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Google will reimburse developers $90 million to settle a lawsuit over Play Store earnings

Google said Thursday it will pay $90 million to settle a lawsuit with U.S. developers that accused Google of abusing its power of app distribution and charging an unfair fee of 30% for app purchases and in-app purchases made through the Play Store.
The company noted that U.S. developers who made less than $2 million each year between 2016 and 2021 through Google Play Store earnings will be eligible for compensation.
“A vast majority of US developers who earned revenue through Google Play will be eligible to receive money from this fund if they choose. If the Court approves the settlement, developers that qualify will be notified and allowed to receive a distribution from the fund,” the search giant noted in a blog post.
Hagens Berman Sobol Shapiro LLP, the legal firm that represented the plaintiffs, said that developers were entitled to a minimum compensation of $250 — with some settlements going above $200,000. The firm noted that more than 48,000 U.S. developers are eligible for payment by Google.
The plaintiffs originally filed the case against Google in 2020 in California alleging that the company gained a monopoly in the Android app distribution space “through a series of anticompetitive contracts, strategic abuses of its dominance in other Android software applications, deficits in consumer knowledge and information, and the cultivation and exploitation of device users’ fear of malware.” The case document also harped upon the fact that Google had a default 30% Play Store tax for developers on the sale of apps or in-app purchases.
To handle the criticism on the 30% Play Store tax, in 2021, Google slashed its cut to 15% on the first $1 million earned by a developer each year. Later, it reduced Play Store fees to 15% for subscription-based apps and as low as 10% for media apps in select categories like e-books or music distribution. According to an estimate by damages expert, Dr. Michael Williams, this fee reduction could save developers more than $109 million in service fees until 2025.
The Mountain View-based company said that apart from the $90 million payment fund, it is revising its Developer Distribution Agreement document to make it clear that developers can contact users through out-of-app means like promotional emails — similar to a change Apple made last year — if they have obtained that information in the app. The firm said it’ll introduce a new section in the Play Store named “Indie Apps Corner” to highlight apps made by small startups and independent developers, too. What’s more, the firm will publish annual Google Play transparency reports with details like app removals and account terminations.
Currently, Google and Apple force developers to use their own payment systems for in-app purchases on apps distributed through their own app stores. However, that might change due to many lawsuits and legislation against these companies in different geographies. Last year, Google agreed to let developers in South Korea use third-party payment options — after the country passed a new law over digital payment systems while reducing its service fees by 4%.
Over the last few months, Google has made different agreements with Spotify and Match Group over using alternative payment systems for their apps. When announcing a deal with the former, the search giant said that “we will be exploring user choice billing in other select countries.”

Google will reimburse developers $90 million to settle a lawsuit over Play Store earnings

TikTok tops 2 billion downloads

TikTok, the widely popular video sharing app developed by one of the world’s most valued startups (ByteDance), continues to grow rapidly despite suspicion from the U.S. as more people look for ways to keep themselves entertained amid the coronavirus pandemic.
The global app and its Chinese version, called Douyin, have amassed over 2 billion downloads on Google Play Store and Apple’s App Store, mobile insight firm Sensor Tower said Wednesday.
TikTok is the first app after Facebook’s marquee app, WhatsApp, Instagram and Messenger to break past the 2 billion downloads figure since January 1 of 2014, a Sensor Tower official told TechCrunch. (Sensor Tower began its app analysis on that date.)
A number of apps from Google, the developer of Android, including Gmail and YouTube, have amassed over 5 billion downloads, but they ship pre-installed on most Android smartphones and tables.
TikTok’s 2 billion download milestone, a key metric to assess an app’s growth, comes five months after it surpassed 1.5 billion downloads.

In the quarter that ended on March 31, TikTok was downloaded 315 million times — the highest number of downloads for any app in a quarter and — surpassing its previous best of 205.7 million downloads in Q4 2018. Facebook’s WhatsApp, the second most popular app by volume of downloads, amassed nearly 250 million downloads in Q1 this year, Sensor Tower told TechCrunch.
As the app gains popularity, it is also clocking more revenue. Users have spent about $456.7 million on TikTok to date, up from $175 million five months ago. Much of this spending — about 72.3% — has happened in China. Users in the United States have spent about $86.5 million on the app, making the nation the second most important market for TikTok from the revenue standpoint.
Craig Chapple, a strategist at Sensor Tower, said that not all the downloads are as organic as TikTok, which launched outside of China in 2017 and has engaged in a “large user acquisition campaign.” But he attributed some of the surge in downloads to the COVID-19 outbreak that has driven more people than ever to look for new apps.
India, TikTok’s largest international market, accounts for 30.3% of the app’s downloads, according to Sensor Tower. The app has been downloaded 611 million times in the world’s second largest internet market.
From a platform’s standpoint, 75.5% of all of TikTok’s downloads have occurred through Google Play Store. But the vast majority of spending has come from users on Apple’s ecosystem ($435.3 million of $456 million).
TikTok’s parent firm ByteDance, which was valued at $75 billion two years ago, counts Bank of China, Bank of America, Barclays Bank, Citigroup, Goldman Sachs, JP Morgan Chase, UBS, SoftBank Group, General Atlantic, and Sequoia Capital China among some of its investors.

TikTok tops 2 billion downloads