Google's 2025 Tentative Settlement Over Play Store Fees Sparks Interest
Google has reached a tentative settlement in a major U.S. class action lawsuit alleging overcharging through its Play Store, potentially avoiding a costly trial.
In a significant development, Alphabet's Google (GOOGL) has tentatively settled a class action lawsuit accusing the company of monopolistic practices that led to overcharging customers via its U.S. Play Store.
Key Highlights
- Google faces allegations of abusing monopoly power to inflate prices on its U.S. Play Store.
- The proposed settlement, pending approval, could help Google sidestep a lengthy trial.
- Meanwhile, Epic Games and Match Group remain committed to their ongoing lawsuit against Google, with a trial slated for November.
The lawsuit, representing approximately 21 million consumers and backed by over 30 U.S. states, claims that Google's dominant market position forced consumers to pay higher prices than they would in a more competitive environment. Plaintiffs argue that without Google's influence, app pricing would have been more competitive and consumer choice greater.
Details of the settlement amount remain undisclosed but are expected to be revealed during an October 12 hearing. Approval of this settlement would allow Google to avoid the uncertainties of a trial.
Epic Games CEO Tim Sweeney publicly stated that Epic is not part of the settlement and plans to continue its legal challenge alongside Match Group, which owns Tinder. Sweeney highlighted that Google imposes a 30% fee on in-app transactions, significantly higher than the typical 3% fees seen in competitive payment markets.
"If Google ends its payments monopoly without imposing a 'Google Tax' on third-party transactions, we are open to settling and supporting Google's new direction," Sweeney said. However, he emphasized that Epic will continue fighting if the settlement is merely a financial payoff to plaintiffs.
Back in 2021, state attorneys general accused Google of stifling competition by forcing developers to use its Play Store to reach users, reinforcing the antitrust concerns.
Following the news, Alphabet's shares dipped slightly by less than 1% in early trading on Wednesday but have surged over 52% year-to-date, reflecting strong market confidence.
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