Google will pay $90 million to app developers to end their legal dispute

1 Jul 2022 , 08:13 AM

According to a court document, Google, a subsidiary of Alphabet Inc., has agreed to pay $90 million to end a legal dispute with app developers over the money they made from developing apps for Android smartphones and from persuading users to make in-app purchases.

The app developers claimed in a lawsuit filed in federal court in San Francisco that Google was closing the app ecosystem and redirecting most payments through its Google Play billing system with a default service fee of 30% by using agreements with smartphone manufacturers, and technical barriers, and revenue sharing agreements.

Google stated in a blog post that as part of the proposed settlement, it would invest $90 million in a fund to assist app developers that earned
$2 million or less in yearly revenue from 2016 to 2021.

According to Google’s blog post, “the vast majority of U.S. developers who earned money through Google Play will be eligible to receive money from this fund if they wish.”

Additionally, Google stated it would keep charging a 15% commission to developers that earn $1 million or less in annual revenue from the Google Play Store. In 2021, it first started doing this.

The proposed settlement must be accepted by the court.

The $90 million fund was open to 48,000 app creators, and the lowest compensation is $250, according to Hagens Berman Sobol Shapiro LLP, who acted as the plaintiffs’ legal counsel.

By reaching a settlement in a class action, Apple Inc. agreed last year to relax the limits on small developers using the App Store. Additionally, $100 million was agreed upon.

Congress in Washington is debating legislation that would compel Google and Apple to permit sideloading, the technique of installing software devoid of the aid of an app store. Additionally, it would prevent them from compelling app developers to utilize Apple’s and Google’s payment systems.