Google Play fee lawsuit grows to 21 million consumers

Consumers claim Google inflates Android app prices by often taking a 30 per cent cut of sales

Billions of dollars in revenue generated by Google Play is at risk. AP

Google now faces more than 21 million customers, instead of just a handful, in a lawsuit alleging its app store collects exorbitant fees.

A federal judge exponentially increased the Alphabet unit’s damages exposure by granting class-action status on Monday in a suit alleging that Google Play has abused its power over the sale and distribution of Android mobile applications.

The consumer dispute is part of a sprawling antitrust fight that also includes complaints filed by attorneys general of almost three dozen states, Epic Games, Match Group and a group of small app developers.

The actions threaten the billions of dollars in revenue generated by Google Play, according to Bloomberg Intelligence analyst Jennifer Rie.

“We’re evaluating the ruling and, after that, we’ll assess our options,” a Google representative said.

The class features Google Play users since August 2016 in 17 US states and territories not represented in the suit filed in July last year by state attorneys general, Karma Giulianelli, a lawyer representing consumers, told an August hearing.

Almost 70 million consumers are covered by the states’ suit, she said.

The consumers claim Google inflates Android app prices by taking, with some exceptions, a 30 per cent cut of sales on Google Play. But for Google’s anti-competitive conduct, the company would “offer discounts, more subsidies in the form of rewards” to bring users to its marketplace, Ms Giulianelli said at the hearing.

Google lawyer Justin Raphael argued against letting the case proceed as a class action, saying there are too many differences among app transactions to group users together. Apps have a varied price and cost structure, Mr Raphael said at the hearing.