As part of the next antitrust case against the IT giant Google, which is part of the Alphabet holding; the financial performance of the Google Play app store has been disclosed for the first time.
A number of US states have filed antitrust charges against Google. The claims relate to company policies that govern the Google Play platform. In particular, third-party Android app developers are unhappy with the fact that Google obliges to use its own payment tools when selling subscriptions and content and charges a commission of up to 30% on sales.
According to documents declassified in the framework of antitrust proceedings; in 2019 alone, the Google Play app store received revenue of $ 11.2 billion.
At the same time, gross profit amounted to $ 8.5 billion, and operating profit – approximately $ 7.0 billion. The operating profit margin of the Google Play platform at the end of 2019 exceeded 62%.
Note that these figures take into account the sales of the actual mobile applications, in-app purchases; as well as advertising based on Google Play.
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Lawsuits against Google over Play Store fees
It became known that in the UK filed a class-action lawsuit in the amount of £ 920 million ($ 1.3 billion) against Google, accused of “excessive and illegal” prices in the Google Play Store.
The lawsuit, filed with the UK Competition Court of Appeals, alleges that the tech giant is discouraging competition on the Play Store; and is illegally charging a 30 percent commission on in-store purchases. The lawsuit also states that Google is integrating the Play Store with its other products and services; and requires it to be pre-installed and prominently displayed on your desktop.
This discourages competition from other apps on Android devices as the “vast majority” of shoppers are directed to the Google store to shop. The authors of the lawsuit called the 30 percent commission charged by Google on app purchases as “illegal and unearned fees charged to ordinary people for no reason.”
Commenting on the filing of the lawsuit, a Google spokesman said: “This lawsuit ignores the advantages and choices provided by Android and Google Play, as well as the competitive market in which we operate”.
Also, according to Google, consumers and developers have a choice of competing app stores; while consumers can download other apps or entire app stores, allowing them to do without Google Play altogether.
Earlier this year, the UK filed a similar class action lawsuit against Apple; seeking compensation in the amount of £ 1.5bn ($ 2.1bn).
