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A bipartisan group of state attorneys general including Iowa’s filed an antitrust suit Wednesday targeting Google's app store, adding to the tech giant's regulatory woes.
Thirty-six states and the District of Columbia brought the lawsuit. It asserts Google maintains a monopoly in the market for distributing apps for the Android operating system, which it owns and develops and is used by most of the world's smartphones. The suit claims Google favors its Play Store over other app stores also available on Android devices and argues that developers have "no reasonable choice" but to distribute their apps through the store.
“Millions of consumers rely on the Google Play Store to discover and download frequently used apps on their smart devices,” said a statement from Iowa Attorney General Tom Miller, who joined in the lawsuit.
“Through the use of restrictive contracts and agreements, Google has used this reliance to thwart competition and create a monopoly in app distribution,” Miller said. “What’s more, Google has knowingly passed higher than average fees along to customers, often costing consumers hundreds if not thousands of dollars they wouldn’t have spent except for Google’s dominant market position.”
App developers have publicly criticized Google's rules for participating in its Play Store, which figures in a lawsuit brought against the company by Fortnite maker Epic Games. For years, the internet giant charged a 30 percent commission for the sale of apps and in-app purchases on the Play Store. Facing mounting pressure, it dropped that to 15 percent at the beginning of July, but only on the first $1 million generated by an app developer.
The state attorneys general argue that commission is "extravagant" and say it is not the result of a competitive market, but rather one where Google has maintained unfair advantages through a mix of technological barriers and special contracts. They say because of this "exclusionary conduct," even other tech giants have been unable to build a competitive Android app store.
The states are asking the judge to prohibit some of the company's long-criticized practices, including its use of contracts that require device makers to give the Play Store premium placement and its requirements that app developers use Google's payments services. Google should be required to stop "imposing needless technological obstacles or inaccurate warnings in the user experience of sideloading Android apps for apps that meet reasonable industry safety standards," the lawsuit requests.
Unlike Apple, Google does allow other companies to sell apps on the Android operating system. But in most countries, the official Play Store is the main place to get apps, and Google has required device makers to preload the Play Store on phones, which competitors say is unfair.
Google did not immediately respond to a request for comment, but the company has argued that its Play Store helps developers and consumers. Wilson White, Google's senior director of government affairs and public policy, testified before a Senate Judiciary antitrust subcommittee in April that developers have alternatives beyond the Play Store and that the fees it charges are in line with others.
Rod Boshart of The Gazette Des Moines Bureau contributed to this report.