Experts say Google Play opening up in the US will have minimal impact

Earlier this week, US courts mandated that Google must – for a three-year period – open up its Play app store to allow more competition.

This ruling follows the trial opposing Epic and Google late last year, where the jury voted in favour of the Fortnite firm. The changes Google has now been told to make include:

• Allowing third-party app stores to be distributed via Google Play
• Sharing Google Play's full catalogue of apps with these stores (unless app developers opt out)
• No longer forcing developers to use Google Play Billing (for which Google gets a 30% fee on all transactions, even for apps distributed through the Play Store)
• Allowing developers to direct users to alternative stores and payment systems

Google is appealing against the judge's decision, but this is a lengthy process and the ruling comes into effect on November 1, 2024 (although Google will have eight months to put all the changes into place).

"Android users have access to multiple app stores already, but Google Play still dominates"

Piers Harding-Rolls, Ampere Analysis

Epic is already hailing this as a victory, particularly now it finally has its own mobile store. But experts tell GamesIndustry.biz that opening up Google Play in the US may not have as much impact as people think.

"I'm not expecting these changes to have a dramatic impact on the dynamics of the mobile games market in the US," says Piers Harding-Rolls, head of games research at Ampere Analysis.

"Firstly, in terms of the overall market, the US mobile games market is dominated by spending on iOS, with Android taking a minor share. Games companies won't stop bringing their games to Apple devices even if the app store rules are not as favourable as Android potentially, and consumers won't, in general, choose Android phones just to get access to Epic Games Store on mobile.

"Secondly, Android consumer preferences and behaviour are unlikely to change significantly from what is done today. Android users have access to multiple app stores already, but Google Play still dominates. These rulings will make it more seamless to discover and access games from other app stores, but there are still fees and charges that Google will be allowed to make for Google Play-based policing which could undermine the ‘free market' impact."

Newzoo analysts tell us that while this ruling may be the "tip of an iceberg of slow, sweeping changes to the mobile market," it's important to not overestimate its effect. While opening up Google Play is potentially a financial positive for developers – especially now the 30% cut won't be mandatory and studios will be free to steer users to direct and alternative payment methods – there are still considerable challenges that will remain unaltered.

"[These changes] are unlikely to significantly impact discoverability," the analysts tell us. "Although these changes level the playing field at a systemic store level, they do not point towards a clear winner. [Judge] Donato's aim is to break apart a perceived monopoly, not to appeal specifically to game developers."

The team of Newzoo analysts who replied to our questions adds that larger developers and publishers are likely to benefit the most, as they will have more resources when it comes to running their own stores and payment systems, or marketing alternative options to players.

Meanwhile, MobileGamer.biz editor Neil Long also expects the ruling will have minimal impact in the short-term – primarily because Google is appealing, and will likely throw up barriers where it can – but believe there is potential in the mid-term.

"Over the course of the next three years, it could be a big change," he says. "Obviously Epic has its mobile Games Store, and Xbox is working on its 'gamer-first' App Store, although it has gone a bit quiet on that front. Both companies have the game catalogue and marketing budgets to help make players switch over.

"Over time, the high spending, super engaged Android players will be enticed over to using alternatives with cheaper in-game currency and other incentives, but most high value players are on iOS – and that is as locked down as ever."

"Heavyweights like Epic and Xbox [need to] seize the moment now and really make a big splashy effort to get people onto their stores regularly. Mobile is not a space for subtlety"

Neil Long, MobileGamer.biz

While the ruling will make it easier to distribute alternative app stores, with users able to install them from Google Play as well as sideload them, Newzoo analysts warn that another barrier remains: changing people's behaviour to get them to interact with, and purchase from, these stores.

"A parallel example is Epic Games' difficulty in moving PC players away from Steam to the Epic Games Store," the company tells us. "Despite offering exclusive titles and free games, many users remain loyal to Steam. Similarly, mobile users may resist shifting away from familiar app stores, making it difficult for developers to attract and retain users on new platforms."

Newzoo adds that, while three years is enough time to make some changes to the mobile market, it may not be long enough for the average games developer to see significant benefits.

Harding-Rolls predicts that most developers will hold fire on altering how they operate on Android in the US, if only until Google has put the necessary processes to do so. As mentioned, the ruling applies from November 1, 2024 but Google still has eight months to ensure it complies.

"Obviously Epic has been planning for expansion of its mobile app store for a number of years and I think it will be working to get ready for a more integrated launch after those eight months have passed," Harding-Rolls adds.

The ruling only applies to the US, but with both Google and Apple's mobile ecosystems under scrutiny from governments and regulators around the world, it's possible this will set a precedent that could be followed elsewhere. Long certainly expects it to be considered during the Department of Justice's upcoming investigation into Apple's anti-competitive behaviour. That said, he's unsure that further intervention will actually be a good thing.

"Different nations and regions adopting different measures will ultimately just benefit Apple and Google," he explains. "The more complex all this becomes, the more developers and players will just stick with what they know."

However, Long maintains that there is a long-term opportunity for alternative app stores and if major companies can establish a foothold, it should diminish the dominance of the mobile platform holders.

"Those heavyweights like Epic and Xbox [need to] seize the moment now and really make a big splashy effort to get people onto their stores regularly," he says. "Mobile is not a space for subtlety – the benefits need to be very clear and these new stores need to be really easy to use.

"But that's all with the caveat that Google, like Apple, will do everything it can within the new proposals to slow down the adoption of these stores and alternative payment systems."