Google unfairly drives up app prices, VT AG suit says

Vermont Attorney General T.J. Donovan and the attorneys general of 35 states and the District of Columbia have filed a lawsuit against Google alleging “exclusionary” conduct relating to the Google Play Store for Android mobile devices and Google Play Billing. This antitrust lawsuit is the newest legal action against the tech giant, claiming illegal, anticompetitive, and unfair business practices.

“Google has harmed consumers by inflating the price of apps through its anticompetitive practices,” Attorney General Donovan said.

The States accuse Google of using its market dominance to unfairly restrict competition with the Google Play Store, harming consumers by limiting choice and driving up app prices. The case centers on Google’s “exclusionary” conduct, meaning Google illegally excluded other competitors from the marketplace. This exclusionary conduct substantially shuts out competing app distribution channels. Google requires app developers to use Google Play Billing as a middleman and pay a commission of up to 30% when selling on the Google Play Store. Google had earlier promised app developers and device manufacturers that it would keep Android “open source,” allowing developers to create compatible apps and distribute them without unnecessary restrictions. The lawsuit says Google did not keep that promise.

In addition to establishing its Android OS with mobile device manufacturers and network operators and its Play Store as the dominant app store, based on false representations, the Complaint also alleges that Google:

  • Uses technical barriers that prevent third-party app developers from distributing apps outside the Google Play Store;
  • Has not allowed Android to be “open source” for many years, effectively cutting off potential competition
  • Required contracts that forced Google’s proprietary apps to be “pre-loaded” on essentially all devices designed to run on the Android OS;
  • “Buys off” its potential competition in the market for app distribution;
  • Forces app developers and app users alike to use Google’s payment processing service, Google Play Billing, to process payments for in-app purchases of content consumed within the app. Joining Attorney General Donovan in the lawsuit include the attorneys general of Alaska, Arkansas, Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Idaho, Indiana, Iowa, Kentucky, Maryland, Massachusetts, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Oklahoma, Oregon, Rhode Island, South Dakota, Tennessee, Utah, Virginia, Washington, and West Virginia.

A copy of the complaint may be found here.

Categories: Business

2 replies »

  1. Big tech, the oil, steel and railroads of today, and Zuckerberg, Bezos, Gates, and Dorsey are every bit the power mad, unappreciative exploiters of American freedoms that Rockefeller, Vanderbilt,  Carnegie, and J.P. Morgan were. On the other hand we owe them so much. On the other, I just wish that the power that the money conveys to them did not instill such corruption.

  2. This is but a ploy by Donovan to bring part of the settlement money into Vermont coffers. Low hanging fruit, you might say. He will be able to campaign on this action, ignoring the censorship issues Google and it’s owners force on their customers.

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