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Epic Games Wins Landmark Anticompetitive Lawsuit Against Google With Unanimous Verdict
Epic Games Wins Landmark Anticompetitive Lawsuit Against Google With Unanimous Verdict
May 28, 2024 3:57 AM

This is not investment advice. The author has no position in any of the stocks mentioned. Wccftech.com has a disclosure and ethics policy.

Tech giant Google's legal troubles are starting to mount, with 2023 coming to a close as it lost a lawsuit filed against it by Epic Games for monopolizing the Android application ecosystem. Google's Google Play is the dominant application for downloading software on Android gadgets. Epic's lawsuit claimed that the firm illegally monopolized not only the Android app ecosystem but also payment methods on the software platform. In response, Google claimed that it is competing with Apple for users and has been forced to reduce its prices to prevent customer churn - behavior that goes against a monopoly, according to the software company.

Epic's CEO Tim Sweeney shared the decision on his X page, with the ruling providing his company respite after a court rejected similar claims against Apple in 2021.

Google Is A Monopoly When It Comes To Android App Distribution & Payments Rules Jury Unanimously

The ruling is a crucial one for Google as it battles a separate lawsuit that might be perhaps the most important case in its history. The Justice Department has sued Google and alleged that its agreement with Apple to make the Google search engine the default product across Apple's smartphones, laptops and tablets is illegal.

Google's search engine is the primary reason that it has become one of the biggest technology companies in the world, and its agreements with Apple and others ensure that a steady stream of users continue to use the product and drive advertising revenue.

For the Epic Games trial, the judge asked jurors to answer seven questions in the verdict form. These asked them to determine if Epic had proven the existence of an antitrust market, whether Google gained monopolistic power by acting in anti-competitive practices, what product markets were affected by Google's actions, was Epic harmed by Google's actions and if Google stifled trade by entering into anticompetitive agreements.

In a mark of how strong their decisions were, the jurors answered in the affirmative to all seven questions posed by the judge unanimously.

Epic Boss Tim Sweeney

The fact that Epic won its suit against Google but lost the one against Apple shows the difference between Apple's and Google's business practices. A key advantage that Apple enjoys over its Android rival is that it makes and sells its own smartphones and locks the iOS ecosystem to only its hardware. This allows it to bundle whatever products it wants on the devices. On the flip side, Google has to maintain its software advantage on gadgets made by others, such as Samsung and to do so, the firm makes payments.

A key part of the Epic vs Google lawsuit was Google's Project Hug. This involved payments to Samsung and software developers to ensure that they do not use or create alternatives to its software. Some ways through which Google benefited from these strategies include reaching a deal with Samsung to ensure only the Play Store and Samsung's own store were installed on Samsung's smartphones by default and the confidence that software developers would use the Play Store to sell their products instead of developing their competing products.

Through these moves, Epic had argued that Google was able to charge exorbitantly high fees to video game developers, and the near ubiquity of the Play Store also meant that developers had few other options than to use it for their products. While the jury has ruled in Epic's favor, whether Google will be forced to award any financial compensation is unclear.

Victory over Google! After 4 weeks of detailed court testimony, the California jury found against the Google Play monopoly on all counts. The Court’s work on remedies will start in January. Thanks for everyone’s support and faith! Free Fortnite! https://t.co/ITm4YBHCus

— Tim Sweeney (@TimSweeneyEpic) December 12, 2023

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