Friday, December 22, 2023

Alphabet, Google's Parent Company, Settles Lawsuit for 640 Million Euros

User avatar of Henrik Andersen

Henrik Andersen

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Alphabet, Google's Parent Company, Settles Lawsuit for 640 Million Euros

Alphabet, the parent company of Google, has agreed to pay a sum equivalent to 640 million euros to prevent further prosecution regarding alleged abuse of power within its app marketplace, the Google Play Store. The company faced charges from numerous American states and consumer groups for purportedly exploiting its market dominance.

Allegations suggested that Alphabet made it exceedingly difficult for app developers to distribute their apps through platforms other than the Google Play Store. Additionally, consumers who purchased apps through this store were reportedly subjected to inflated prices.

The tech giant mandated that app developers process payments for apps exclusively through the Google Play Store, where Google retained a commission ranging from 15 to 30 percent of the purchase amount. This practice was deemed to artificially inflate app prices, according to the plaintiffs.

By settling the lawsuit, Alphabet forestalls further legal action. This resolution is advantageous for both the Google parent company and the complainants.

Lawsuits of this magnitude demand substantial time and financial resources from all involved parties. Should the lawsuit proceed, Alphabet faced the risk of being found guilty of abusing its market power, potentially incurring a higher penalty than the settlement amount agreed upon.

Google's parent company admits no wrongdoing in settling the lawsuit.

By doing so, the company aims to prevent potential future prosecutions for the alleged abuse of power. Furthermore, Alphabet has committed to revising the policies of the Google Play Store.

Of the hundreds of millions paid by Alphabet, an equivalent of 576 million euros will be allocated to a fund designed to compensate consumers affected by these issues. Approximately 64 million euros will go to the states that had filed complaints against Google.

Earlier this month, a jury ruled that Alphabet held an illegal monopoly concerning its app store, a case brought forth by Epic Games, the creator of the popular game Fortnite.

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