Mobile Breaking (12/11): jury delivers victory to Tim Epic, finds that Google App Store constitutes an "illegal monopoly"

[Commissar SFLUFAN]

Once again, Tim Epic has gone to court against a mobile platform holder -- the one whose CEO is not named Tim -- over the 30% cut paid to said platform holder for in-app purchases.

 

In today's first day of testimony, the first witness called was Steve Allison, head of the Epic Games Store, who once again confirmed that EGS remains unprofitable.  The Verge's live blog of the proceedings can be found here:

 

Epic v. Google: a battle over Fortnite fees goes to court - The Verge

WWW.THEVERGE.COM

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The antitrust trial has taken years to reach a courtroom.

[Brian]

5 years and still no profit? Lolololololol. The Fortnite cash cow allowed for so many poor decisions. Now that the cow is drying up a bit, all these decisions are floating up like a turd in a punch bowl. 

[crispy4000]

I just don't want the store to ever go away and lose all those free games.

[Keyser_Soze]

If only they weren't in constant legal battles to make more money 🤔

[Commissar SFLUFAN]

Summary of the first day's proceedings:

 

The Epic v. Google trial may come down to simple v. complicated - The Verge

WWW.THEVERGE.COM

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But we’ll see if Epic’s opening holds up.

 

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Could Google actually lose?

 

When I walked into the courtroom on Monday morning, it seemed impossible. If Epic couldn’t prove Apple’s walled iOS garden is a monopoly, how could the comparatively open Google do worse against the windmill-tilting Fortnite developer?

 

But now that both sides have made their opening arguments to a jury, I’m not quite as sure. Because while Google spent most of its first day attempting to explain complicated ins and outs of business, Epic was able to paint a black-and-white picture of good and evil with itself as the clear underdog.

 

Epic lead attorney Gary Bornstein was tasked with making the case that Android functions as an unlawful monopoly. He did so by basically calling Google a bully and a cheat that “bribes” or “blocks” any attempt to compete with Android’s Google Play store. The result? A status quo where the vast, vast majority of Android app installs are from Google Play, with only a tiny sliver attributable to the Galaxy Store that comes preinstalled on every Samsung phone.

 

Bornstein showed jurors charts of Google’s fat app profit margins (70 percent on $12 billion in revenue a year, says Epic) and pointed out several ugly-seeming ways Google has allegedly attempted to keep anyone from taking that money away — like paying game developers not to build their own app stores or standalone app launchers like Epic did with Fortnite. 

 

“Google pays actual and potential competitors not to compete. Literally gives them money and other things of value,” said Bornstein. “It’s like Google saying, ‘Here’s $360 million’ — that’s an actual number you’ll hear about — why don’t you sit this one out and let me win?”

 

The upshot for consumers, Epic’s earlier legal filings have suggested, is that we pay higher prices for apps than we would if there were more competition and / or lower app store and payment processing fees. But while this will probably come up later in the trial, Epic chose to focus more on simply painting Google as the bad guy on day one.

 

 

[TwinIon]

I just don't see how Epic wins this in light of their loss to Apple. Apple strictly prohibits Epic from doing all the things Epic wants to do, and Epic lost on almost every count. Google actually allows Epic to sideload Fortnite or create their own App Store. I won't really disagree that Google leverages their position to prevent any alternative app stores from being successful. Epic's characterization of "bribe or block" is probably relatively accurate. So, as with the Apple lawsuit, I think it would actually be a good thing for Epic to win, but I think it'll be difficult to do so.

[Brian]

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The upshot for consumers, Epic’s earlier legal filings have suggested, is that we pay higher prices for apps than we would if there were more competition and / or lower app store and payment processing fees. 

Lolololol. So disingenuous to paint this as a pro-consumer battle. Epic’s own store proved this is utter BS. 

[Commissar SFLUFAN]

Day 2 has started with Epic's attorneys seemingly doing a fairly good job of planting the seed that Google may have destroyed evidence.

 

Epic v. Google: a battle over Fortnite fees goes to court - The Verge

WWW.THEVERGE.COM

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The antitrust trial has taken years to reach a courtroom.

 

[Commissar SFLUFAN]

Epic v. Google: everything we’re learning live in Fortnite court - The Verge

WWW.THEVERGE.COM

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The antitrust trial has taken years to reach a courtroom.

 

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Epic still makes plenty of money on consoles, right?” asks Kravis.

 

Epic is currently losing money, Sweeney claims — but Kravis says Epic earned $12 billion across Sony, Microsoft and Nintendo platforms.

 

 

[Brian]

Can someone please leak Epic’s financials? Thanks 

[MarSolo]

Now that I’m reading Control Freak by Cliff Blezinski, this case is so eye opening.

[SuperSpreader]

Microsoft can buy Epic 

[Commissar SFLUFAN]

20 things we learned from the Epic v. Google trial - The Verge

WWW.THEVERGE.COM

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Okay, technically it’s a little longer than a fortnight.

 

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I have spent 15 days reporting live from the Epic v. Google trial: an antitrust dispute over whether Google's Android app store is an unfair monopoly. I’ve watched a parade of witnesses go by, including Epic CEO Tim Sweeney and Google CEO Sundar Pichai. We’re now in a weeklong break before both parties return on December 11th to make their closing arguments, after which a jury will decide who’s right. I’ve chronicled every major thrust, parry, and riposte leading up to that in our Verge StoryStream, writing nearly 600 dispatches from the courtroom so far.

 

But who’s got the time to dig through all that, am I right?

 

So here are straightforward versions of the 20 most interesting things we’ve learned — starting with the fact that Epic could win the whole thing.

 

 

[Commissar SFLUFAN]

Tim Epic has prevailed.

 

Epic win: Jury decides Google has illegal monopoly in app store fight - The Verge

WWW.THEVERGE.COM

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Victory Royale.

 

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Three years after Fortnite-maker Epic Games sued Apple and Google for allegedly running illegal app store monopolies, Epic has a win. The jury in Epic v. Google has just delivered its verdict — and it found that Google turned its Google Play app store and Google Play Billing service into an illegal monopoly.

 

After just a few hours of deliberation, the jury unanimously answered yes to every question put before them — that Google has monopoly power in the Android app distribution markets and in-app billing services markets, that Google did anticompetitive things in those markets, and that Epic was injured by that behavior. They decided Google has an illegal tie between its Google Play app store and its Google Play Billing payment services, too, and that its distribution agreement, Project Hug deals with game developers and deals with OEMs were all anticompetitive.

 

 

[AbsolutSurgen]

[Brian]

Google gonna be firing some lawyers tonight 

[Commissar SFLUFAN]

Axios's Stephen Totilo stated the key distinction between this case and the one against Apple which Epic lost:

 

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The Epic-Apple case, decided by a judge, focused on Apple's policies and whether they were anti-competitive

 

This case, decided by a jury and expertly covered by The Verge the past couple of weeks, involved deals Google made or tried to make regarding its app store and competition.

 

 

[Spawn_of_Apathy]

EGS is saved. Yay. 

[Air_Delivery]

This seems like a big deal. Like big enough that I wonder if Apple/Googles stock is gonna take a sigificant hit. 

[TwinIon]

I'm pretty surprised by this outcome, and I agree that this being a Jury made a big difference in the outcome. I think Epic would have had a much better chance with a Jury against Apple. Google being more open is what doomed them with the jury. Google allows a lot more than Apple does, but because they allow so much more they strike all kinds of deals to maintain their advantage, and that doesn't look good. Apple doesn't really strike any deals, they just say no.

 

That said, I still think the biggest reason that Apple won and Google lost is thanks to market definitions. In the Apple case the judge decided that the market was "mobile game transactions." In the Google case, the markets in question were decided to be "Android app distribution" and "Android in-app billing". If Epic had gotten the Apple market defined as "iOS app distribution" and "iOS in-app payment solutions" like they wanted, I think it would have been very hard to argue Apple didn't have a monopoly. The reverse is true for this Google case. If the market was the same "mobile game transactions" that was used in the Apple case, then all of Google's deals now look like they're desperate plays for revenue in a market where they control the market share but not the profit share. Limited only to what is happening on Android, I agree that they're pretty clear monopolists.

 

It'll be very interesting to see what kinds of remedies the judge comes up with. He could limit the kinds of deals that Google is allowed to pursue. He could force Google to allow alternative payment systems on the Play store and/or to allow app stores in the Google Play store. With a lot of those kinds of deals, we actually already have some expectation of what Google could do to get around it thanks to Apple being forced to do the same. Sure, they'll allow you to use your own payment processor, but you still owe Google 27% of all digital transactions.