Epic Games’ Google Lawsuit Extends Down Under, Amid Tech Giant’s App Store Dominance

Epic Games’ Google Lawsuit Extends Down Under, Amid Tech Giant’s App Store Dominance
This illustration picture shows a person logging into Epic Games' Fortnite on their smartphone in Los Angeles on August 14, 2020. (Chris Delmas/AFP via Getty Images)
Daniel Y. Teng

Epic Games has extended its legal battle with Google to Australia, pursuing the tech giant over anti-competitive practices, after the developer’s hit game ‘Fortnite’ was removed from the store last year. Epic Games has previously sued both Google and Apple over alleged anti-competitive practices in the United States and Europe.

It comes as the Australian regulator continues an ongoing investigation into the app marketplace, which is dominated by Google Play Store and Apple’s App Store.

The current dispute between Epic and Google centres on Google Play, the central marketplace for Google-owned Android phone users to purchase and download apps and games.

Typically, Google charges a 30 percent commission to game developers each time a user purchases an app, similar to Apple. However, with more apps now incorporating subscription models, companies are now paying the tech giants each time a customer purchases an update.

Epic Games attempted to bypass this system, encouraging users to purchase apps through Fortnite’s own in-app payment processor.  The company claimed this allowed consumers to save money because Epic did not need to inflate the price to accommodate the commission.

In response, Google removed Fortnite from its store, affecting over 470,000 players in Australia.

In the latest lawsuit, Epic Games argued that the move to eliminate Fortnite from the platform took away any “meaningful competition” in the market and harmed app developers and consumers.

“It restricts competition and innovation and precludes app developers and consumers from having a choice for app distribution and in-app payment processing on Android devices,” the statement of claim (pdf) read.

“Google’s conduct inflates the price for apps and in-app content for millions of Android device users in Australia,” it continued.

In November, Epic Games filed a similar claim against Apple.

Meanwhile, the Australian Competition and Consumer Commission (ACCC) is investigating competition and transparency issues surrounding the burgeoning online app marketplace.

“We want to know more about the market for mobile apps in Australia, including how transparent and effective the market is, for consumers as well as those operating in the market,” ACCC Deputy Chair Delia Rickard said in a statement.

“We will also focus on the extent of competition between the major online app stores and how they compete for app sales with other app providers,” she added.

“For app developers and suppliers, gaining a spot in one of the major app stores can result in significant sales, while failing to gain access can be a major setback. We are keen to provide greater transparency on how this process works.”

Daniel Y. Teng is based in Brisbane, Australia. He focuses on national affairs including federal politics, COVID-19 response, and Australia-China relations. Got a tip? Contact him at [email protected].
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