1

Montana, group of states, file another antitrust suit against Google

(CN) — A consortium of state attorneys general filed an antitrust lawsuit against Google in federal court on Wednesday, representing the fourth major antitrust lawsuit against the technology company.

The most recent complaint focuses on the company’s Play Store on Android, saying the company has abused its power by favoring its own apps over those of rivals. 

“Google has violated the trust of Android phone customers by limiting consumer choice and raking in outrageous commissions on app developers,” said California Attorney General Rob Bonta in a prepared statement issued Wednesday. “Android customers are effectively stuck using the Google Play Store for apps, where they pay a premium.”

Bonta joined fellow colleagues from 35 other states and the District of Columbia, representing a bipartisan slate of officials from states as diverse as Colorado, Iowa, Nebraska, New York and North Carolina. 

“This anti-competitive behavior also stings consumers by limiting their options,” Bonta said. “A more competitive app marketplace could open innovation, leading to more choice, better payment processing, improved customer service, and enhanced data security.”

The large coalition of states in the suit reflects the increasingly bipartisan nature of the nation’s disenchantment with large technology companies exerting their influence in the public sphere. Figures as politically disparate as Donald Trump and Elizabeth Warren have thrown their weight behind ideas to use the Federal Trade Commission to break up Big Tech and executives from Google, Facebook, Apple and Twitter have summoned to appear before Congress in recent years. 

Google also faces an ongoing lawsuit from the Department of Justice and several states alleging it used exclusionary contracts to ensure the apps it built were the default ones available for consumers on the Android mobile operating system developed by the company. 

Texas and 10 other Republican-led states sued Google in December 2020 for what they claimed were monopolistic practices related to the buy and sell side of online marketing services provided by the company. 

The same suit says Google colluded with Facebook to fix prices for online advertising services. 

The other antitrust lawsuit against Google pertains to the company’s practice of listing its own business-review services on search results to the exclusion of Yelp and Tripadvisor and other similarly situated companies that provide customer reviews. 

In the suit filed Wednesday, plaintiffs say consumers are paying a 30% commission to Google due to its fee structure for outside developers combined with a lack of choice about where to download apps, since Google has attacked competing app stores and many Android-based phones only allow the Play Store. 

“Google has taken steps to close the ecosystem from competition and insert itself as the middleman between app developers and consumers,” the complaint says. “Unbeknownst to most consumers who own a mobile device running Android, every time they purchase an app from the Google Play Store, or purchase digital content or subscriptions within an app, up to 30% of the money they pay goes to Google.”

The Google Play Store has a 90% market share in terms of app distribution on Android phones, according to the complaint. No other service has a market share more than 5%. 

“Instead of simply producing a better app distribution experience, Google uses anti-competitive barriers and mandates to protect its monopoly power and grow its supra competitive revenue from the Google Play Store and Google Play Billing,” the complaint says.

Google has long had policies that require developers to use in-house payment systems instead of independent systems, however, it rarely enforced those rules until recently. The use of an app-store for anticompetitive purposes is a legal argument that is at the heart of Epic Games’ legal battle with Apple. Similar to the claims of the attorneys general, Epic Games said they are forced to use Apple’s app store and its consumers are hurt as a result. 

The Apple v Epic trial commenced in May and the decision from a federal judge is pending.  

 Follow Matthew Renda on Twitter