Google Settles with App Developers for $90 Million

Google has reached an agreement with app developers who sued over unfair Play Store practices, including charging a 30 percent commission on all in-app purchases. Part of the settlement requires Google to pay developers $90 million in lost revenue over the years, including Match Group.

According to Tech Crunch, in addition to the $90 million payout, Google will be revising its Developer Distribution Agreement to allow developers to contact users outside of the app, and to be more transparent with annual reports detailing app removals and account terminations, for example. In addition, Google will add a new “Indie Apps Corner” to its Play Store to highlight apps made by smaller startups and independent developers, who often get overlooked for the big players.

The settlement doesn’t resolve a larger problem of allowing developers to use third party payment systems and cutting Google Play and Apple Stores out of these commissions, which currently is not allowed in either store. Match Group and others have sued both Apple and Google for the right to have their own in-app payment system without forcing users to go through the stores, and for having to pay a percentage of every purchase to the tech giants.

But things are changing slowly. Apple has reached an agreement with Dutch regulators on new terms going forward to allow third party payment systems for dating apps in the Dutch App Store. The Japanese Fair Trade Commission also reached a settlement to force Apple to allow third-party billing systems to go outside of its store, cutting off its commission for those transactions. And in South Korea, Google allowed third party payment systems in their Store after the country passed a new law requiring it.

Last year, Google lowered its fees from 30 percent of all in-app purchases to 15 percent for subscription services and 10 percent for certain media, like ebooks and music, according to Tech Crunch. This was after three states sued the company for its Play Store practices. And Congress is now weighing legislation that would force tech companies like Apple and Google to change their software business models.

The settlement amount isn’t final, however, and more than 48,000 developers would be entitled to some portion of it.

Google announced the settlement had been reached in a blog post, noting that: “A vast majority of US developers who earned revenue through Google Play will be eligible to receive money from this fund if they choose. If the Court approves the settlement, developers that qualify will be notified and allowed to receive a distribution from the fund.”