Google settles class action lawsuit with $90 million fund
Funds to be divided among US developers who earned $2 million or less in annual revenue through Google Play from 2016 to 2021
As part of a class-action lawsuit settlement, Google has agreed to pay $90 million to small US developers.
As reported by Reuters, the original lawsuit was filed in a federal court in San Francisco, with developers arguing that Google was using agreements with smartphone makers to "close the app ecosystem" and make sure devs would use Google Play -- and its 30% fee on transactions.
In a blog post from VP of government affairs and public policy Wilson White about the settlement, Google said that it's "establishing a $90 million fund to support US developers who earned $2 million or less in annual revenue through Google Play during each year from 2016-2021."
If the court approves the terms of the settlement, "developers that qualify will be notified and allowed to receive a distribution from the fund," White continued.
Going forward, Google will publish annual transparency reports which will cover how users interact with the Google Play store, with White adding that the company will also be revising its Developer Distribution Agreement "to make it clear that developers can continue to use contact information obtained in-app to communicate with users out-of-app, including about subscription offers or lower-cost offerings on a rival app store or the developer's website."
The case was similar to a class action lawsuit filed against Apple in 2019, with developers at the time hoping to end the company's "abusive monopoly." The iPhone giant ended up allowing developers to promote alternative payments outside of their apps, and launched a $100 million fund to support studios in 2021.
Law firm Hagen Berman handled both the Apple and Google cases on behalf of developers, and said that around 48,000 app developers would be eligible to apply for the $90 million Google fund, with a minimum payout of $250.
"We think this pair of settlements sends a strong message to Big Tech: the law is watching, and even the most powerful companies in the world are accountable when they stifle competition," the firm said in a statement.
Back in 2021, Google lowered its cut from the Google Play storefront to 15% on the first $1 million of annual revenue, and later introduced a tiered system meaning that eligible developers only get a 10% fee.