(Bloomberg) — Alphabet Inc. must lift restrictions that prevent developers from setting up rival marketplaces that compete with its Google Play Store, a judge ruled, upending the search giant’s dominance in the lucrative Android app market.
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A federal judge in San Francisco on Monday handed a big victory to Epic Games Inc. in its long-running antitrust challenge to the technology giant’s app store, which brought in $14.66 billion in sales in 2020. The ruling, which sent Alphabet’s shares down more than 2%, comes after the maker of the popular video game Fortnite convinced a jury that Google abused its power in the Android app market with its Google Play store policies.
Epic had argued that Google Play rules and fees stifled competition and blocked app marketplaces launched by developers. The judge’s decision is likely to accelerate the weakening of app store controls held by tech giants Google and Apple Inc. that have been under fire from regulators and lawmakers around the world.
US District Judge James Donato issued an injunction that takes effect Nov. 1 which bars Google from paying developers to exclusively use its app store or prohibit them from telling customers about how to directly download apps for the next three years. Google also cannot force developers to use its billing features during that time.
The company must also let rival app stores have access to its catalog for the next three years in a bid to help them develop.
Donato said that Google can take “reasonable measures” to ensure the security of its platform, and ordered the parties to recommend three people for a committee to review the technical aspects of those requirements. Developers who find that Google’s security measures are too stringent can challenge them, with the tech giant responsible for proving they are necessary.
Representatives of Alphabet and Epic didn’t immediately respond to requests for comment.
In August, Google lost an antitrust case in which the US Justice Department accused the the company of illegally monopolizing online search and advertising markets.
–With assistance from Rachel Graf.
(Updates with details from court order)
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