Google to pay $90 million to settle app developers

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Google to pay $90 million to settle app developers

In this Sept 24th, 2019 file photo, a Google sign is shown on the company's campus in Mountain View, California. JEFF CHU AP WASHINGTON Alphabet Inc's Google has agreed to pay $90 million for a legal fight with app developers over the money they earned by creating apps for Android phones and enticing users to make in-app purchases, according to a court filing.

The app developers, in a lawsuit filed in federal court in San Francisco, accused Google of using agreements with smartphone makers, technical barriers and revenue sharing agreements to effectively close the app ecosystem and shunt most payments through its Google Play billing system with a default service fee of 30 percent.

Google will put $90 million in a fund to support app developers who made $2 million or less in annual revenue from 2016 -- 2021, as part of the proposed settlement.

A majority of US developers who earned revenue through Google Play will be eligible to receive money from this fund if they choose, according to a blog post by Google.

Google will charge developers a 15 percent commission on their first million in revenue from the Google Play Store each year. It started doing this in 2021.

The proposed settlement must be approved by the court.

There were likely 48,000 app developers who were eligible to apply for the $90 million fund, and the minimum payout is $250, according to Hagens Berman Sobol Shapiro LLP, who represented the plaintiffs.

Apple Inc. agreed last year to loosen App Store restrictions on small developers, striking a deal in class action. It agreed to pay $100 million.

In Washington, Congress is considering legislation that would require Apple and Google to allow sideloading, or the practice of downloading apps without an app store. It already allows sideloading, according to Google. It would prevent them from requiring that app providers use Google and Apple's payment systems.