Google Has Agreed To A £260 Million Settlement: Who’s Eligible For Compensation?

It’s payday for a group of UK-based app developers who are part of a class-action lawsuit that has been brought against Google via its parent company, Alphabet. Indeed, the tech giant has agreed to pay £260 million in order to settle the lawsuit that claims that Google abused its powers and dominant position in the Android application distribution market by limiting competition.

The lawsuit alleges that Google did this by charging excessive commissions, sometimes up to 30%, on sales made through the Play Store.

The Crux of the Lawsuit

Of course, the commission itself isn’t the problem; but the fact that it’s being charged at a whopping 30% is. The allegations are that because the market isn’t properly competitive, app developers have very few options available to them when it comes to selling their applications on a platform.

Thus, at the risk of oversimplifying the situation, the assertion is that their options are to either go ahead with Google and the Play Store, accepting any and all conditions and prices they impose, or opt for one of the few alternatives on the market. The problem with the latter is that the alternatives are, supposedly, not really worth considering and do not really compete with the Google Play store.

But, that in itself is not a fact. While many people may not rate these alternatives particularly highly – some of which include 2APK Mirror, the Samsung Galaxy Store, the Amazon App Store and more – they are still competitors. Thus, one may argue that the notion that users had no alternative options isn’t true. However, that’s not the only problem being raised.

The lawsuit itself asserts that Google’s control of Android app distribution gave it significant market power, allowing it to limit alternative app stores and payment systems while charging developers commissions that critics said were unfairly high. The claim originally sought more than £1 billion in damages.

What Does the Settlement Actually Mean?

The lawsuit and settlement make for flashy headlines, but the ways in which it’s all broken down in a practical sense, nevermind how it actually comes into effect, are far more complicated than a straightforward cheque.

As we know, the settlement was reached at £260 million, but it’s important to break this down and understand where that money actually goes. According to settlement documents and reporting by Reuters, £160 million of the total has been earmarked for compensation distribution to the UK app developers who are part of the class-action lawsuit. The remaining £100 million will cover things like legal fees and litigation costs.

Importantly, the fact that Google has agreed to the settlement does not mean that they, and Alphabet, have acknowledged wrongdoing or admitted to the accusations in the lawsuit. The agreement simply means that they have agreed to pay the settlement amount.

Reuters has confirmed that the UK Competition Appeal Tribunal has now officially approved the settlement, meaning that the case is, finally and officially settled.

Who Benefits from the £260 Million Google Settlement?

Reports suggest that there are actually many, many developers who stand to be eligible to collect from the settlement – as in, several thousand. Payouts are expected to range from a few hundred points to some pretty significant sums for bigger businesses.

This is, undeniably, a huge a win for startups and SMEs who, under most ordinary circumstances, would’ve struggled to defeat, so to speak, a giant like Google. After all, a lawsuit like this requires significant resources and funding in order to get off the ground, never mind be successful. Thus, this class-action lawsuit is a useful demonstration of how collective action can be (and is being) used to take on major companies who, in the past, have been seen as pretty much untouchable.