Epic Wins: Jury Labels Google Play an Illegal Monopoly

Legal Challenge to the App Store Duopoly

The long-standing duopoly of the app store market, long dominated by tech giants Google and Apple, is now at serious risk of disruption due to a groundbreaking legal decision.

The outcome of a recent antitrust lawsuit may force these corporations to relax their stringent control over their respective app stores. Epic Games, known for the wildly successful video game Fortnite, won a significant legal victory against Google, with the verdict branding Google’s Play Store as an illegal monopoly.

Jury Verdict and Its Potential Impact

The jury convicted Google of monopolistic practices in the app distribution and payment systems for Android, exploiting exorbitant fees—sometimes as high as 30%—from developers and forging agreements to stifle competition. The court will soon decide if Google must permit other means of app payment and distribution outside its Play Store’s realm.

Epic Games hailed the decision as a win for both app developers and consumers, underscoring the urgency for regulations to address the stronghold that Apple and Google have on the mobile market. Google, meanwhile, stands by their business model and plans to appeal, asserting their commitment to safeguard their Android ecosystem.

The Stakes for Google’s Revenue

Epic Games’ legal win presents a significant challenge to Google’s profitable revenue stream from its app store. If the jury’s verdict holds, app developers might gain more autonomy over the distribution and earnings of their apps.

This outcome is particularly significant in light of Epic’s previous defeat in a similar antitrust case against Apple the year before. While Apple was not deemed a monopolist, the court did order the company to allow alternative in-app payment options.

Google’s Wider Antitrust Woes

As Google reels from this legal blow, it also faces further antitrust suits, including a prominent case by the Department of Justice regarding Google’s control over the search market. This has heightened alarms at Barclays.

Analyst Paul Franke previously warned that these ongoing antitrust issues might not be the end of troubles for Google/Alphabet’s hopeful investors. He suggests that there could be a temporary lull in the company’s stock performance as investors brace for what he foresees as unfavorable legal outcomes.