Google Will Refund Millions of Consumers for Overcharging for Apps and In-App Purchases
Multistate Agreement Requires Google to Stop Anticompetitive Behavior and Allow App Developers to Use Other Billing Systems
New York Attorney General Letitia James and a bipartisan coalition of 53 attorneys general today announced a $700 million agreement with Google LLC (Google) for monopolistic conduct in its app store that increased costs for consumers and app developers. Today’s agreement resolves a lawsuit filed by a coalition of attorneys general co-led by Attorney General James that alleged Google unlawfully maintained its monopoly over mobile app distribution and in-app payment processing for Android devices, and used its monopoly power to charge consumers as much as 30 percent for purchasing apps and making in-app purchases. The agreement requires Google to pay restitution to consumers and make changes to how it allows app developers to sell products on Android devices.
“No company, no matter how large or powerful, is allowed to corner a market and use its influence to overcharge consumers and smother competition,” said Attorney General James. “For too long, Google abused its market share to unfairly raise prices and block developers from selling products in other app stores. Under this agreement, New Yorkers and millions of consumers nationwide will get money back after being overcharged for Google’s app store services. I thank my fellow attorneys general for their partnership on this case to deliver real change for millions of consumers nationwide.”
As a result of this agreement, Google will pay $630 million in restitution, minus costs and fees, to consumers who made purchases on the Google Play Store between August 2016 and September 2023 and were harmed by Google’s anticompetitive practices. Google will also pay the states $70 million for their sovereign claims. Eligible consumers will be notified of the settlement and will receive automatic payments through PayPal or Venmo, or they can elect to receive a check or ACH transfer. In addition, Google must make changes to stop its anticompetitive practices that harm consumers and app developers. Under the agreement, Google is required to:
- Give all developers the ability to allow users to pay through in-app billing systems other than Google Play Billing for at least five years.
- Allow developers to offer cheaper prices for their apps and in-app products for consumers who use alternative, non-Google billing systems for at least five years.
- Permit developers to steer consumers toward alternative, non-Google billing systems by advertising cheaper prices within their apps themselves for at least five years.
- Not enter into contracts or enforce provisions that require the Play Store to be the exclusive, pre-loaded app store on a device or home screen for at least five years.
- Allow the installation of third-party apps on Android phones from outside the Google Play Store for at least seven years.
- Revise and reduce the warnings that appear on an Android device if a user attempts to download a third-party app from outside the Google Play Store for at least five years.
- Maintain Android system support for third-party app stores, including allowing automatic updates, for four years.
- Not require developers to launch their app catalogs on the Play Store at the same time as they launch on other app stores for at least four years.
- Submit compliance reports to an independent monitor who will ensure that Google is not continuing its anticompetitive conduct for at least five years.
For much of this case, the attorneys general litigated alongside Epic Games and Match, two major app developers. Match announced a separate settlement earlier this year, while Epic Games took its case to trial. A jury unanimously found that Google’s anticompetitive conduct violated the federal antitrust laws early last week.
Today’s agreement requires Google to stop this anticompetitive behavior.
Attorney General James is also co-leading a bipartisan coalition of 38 attorneys general in a case against Google for its illegal, anticompetitive conduct that has sought to maintain the company’s monopoly power in the general search services and search advertising markets. The coalition of attorneys general and the U.S. Department of Justice took the case to trial in the U.S. District Court for the District of Columbia. New York is also a plaintiff in a third case against Google alleging that the company monopolized the components of the “adtech stack” used to buy and sell digital display ads.
