July 7, 2021
Nearly 70% of the U.S. state attorneys general have reportedly joined an antitrust lawsuit filed July 7 against Google and its branded Google Play Store. The suit, which was filed in California federal court, alleges Google is exercising monopoly power with a planned September 30% commission hike on third-party sales of digital goods, i.e. movies and TV shows, in addition to subscription streaming services such as Netflix and Disney+ and Hulu.
Lead states in the suit include Utah, North Carolina, Tennessee, New York, Arizona, Colorado, Iowa and Nebraska — underscoring a trend among conservative states taking on Silicon Valley tech giants such as Facebook, Google and Apple alleging political bias.
But this suit, similar to litigation filed against Apple’s App Store, is calling out the company’s gatekeeper tactics as non-competitive. Google also faces separate litigation from myriad states regarding its search engine and advertising technology.
Most studios, media companies and over-the-top video platforms use Google and Apple to market their apps to consumers. Apple mandates that anyone using a branded iOS device must access third-party apps through its App Store. For Android device users, Google Play Store has become the default search tool, although consumers can access apps via alternative channels such as Amazon and Samsung.
Google last year began informing companies and services that it would begin enforcing their use of its payment system for all transactions, beginning in September. As the deadline approached companies such as Netflix and Spotify cried foul, which led to Google reportedly proposing a 15% commission on the first $1 million in revenue from video, audio and e-book transactions.
While Apple continues to operate in a closed system, Google does not — a reality Wilson White, senior director of government affairs and public policy at Google noted in written testimony submitted April 21 to the U.S. Senate Judiciary Committee.
In his testimony, Wilson argued that use of the Android mobile operating system, which launched in 2008, is free to anyone and has increased third-party competition as a valuable go-to platform for e-commerce, development and marketing.
More importantly, Wilson contends Google operates the Play Store outside of a bubble.
“Distributors can distribute their app via many other Android app stores, directly to OEMs, or through direct downloads on their websites,” he wrote. “And developers are free to contract directly with device makers [i.e. mobile phone, tablet manufacturers] to preload their apps on Android devices.”