A huge penalty for Google. The company will pay over $600 million to users of Android smartphones

The huge fine for the American internet giant is the result of a loud and long-running case between Google and Epic Games, the creators of the popular game Fortnite. which accused the giant of violating antitrust regulations.

Google will pay Android users $630 million

How Google reached a settlement in this case with all 50 US states (plus the District of Columbia, Puerto Rico and the US Virgin Islands) back in September this year, but its content remained secret until the resolution of the related lawsuit between Google and Epic Games.

Prosecutors accused Google of forcing users to pay “excessive fees” by limiting the distribution of apps on Android devices and charging “unnecessary fees” for in-app microtransactions. Google did not agree with the allegations, but eventually agreed to sign a settlement.

The first part of the settlement assumes that the owner of the Play store will pay USD 700 million, of which USD 630 million will go to injured Android users. Under the terms of the settlement, each “eligible consumer” will receive a minimum refund of $2 for additional charges incurred between August 16, 2016 and September 30, 2023. However, it is not clear how refunds will be calculated and whether they will also be due to users outside the US.

Google is to pay the remaining $70 million to all US states, and this amount is to cover, among others: penalties and court costs. Additionally, the internet giant agreed to change its policies but make it easier for customers to download apps directly from their developers. The company will also not impede transactions between developers of applications downloaded from Google Play and users, provided that the latter agree to it.

The amount could have been many times higher

While the amount of $700 million seems huge, it is only a fraction of the potential penalty that could await Google if the case ultimately ends in a court judgment. According to the prosecutor general’s estimates, if the case did not end in a settlement, the company would have to pay a penalty of up to $10.5 billion to the American states.

As a reminder, the dispute has been going on since 2020, when Google (like Apple before it) banned the Fortnite app from its store. Its creators decided to bypass the payment systems of the Play and AppStore stores (both companies charge up to 30% commission on transactions, which the developer did not like). As a result, Epic Games sued both Google and Apple for using practices inconsistent with antitrust regulations and taking advantage of the duopoly on the market.