Google agrees to pay $90 million fund to end legal dispute with app developers

Google has agreed to pay $90 million to end legal dispute with the app developers over the money they made from making apps for Android smartphones and persuading users to make app purchases. As per a lawsuit filed in federal court in San Francisco, the app developers accused Alphabets Inc’s Google that it was closing the app ecosystem and redirected many payments through its Google Pay billing system with a default service fee of 30 per cent using agreements with smartphones manufactures, revenue sharing agreements and technical barriers, reported by Reuters. 

The tech firm stated in a blog post that as a part of the proposed settlement, it would invest $90 million fund to assist the app developers that earned $2 million or less in yearly revenue form 2016-2022. The company in the blog post said, “A vast majority of US developers who earned revenue through Google Play will be eligible to receive money from this fund, if they choose.”

According to Hagens Berman Sobol Shapiro LLP, who represented the plaintiffs, this $90 million fund was eligible to 48,000 app developers and the lowest compensation is $250.

Google also announced that it would charge developers a 15 per cent commission on the first million dollars of sales they make through the Play store annually. The tech firm started doing this in the year 2021. 

Congress in Washington is currently debating on legislation that would compel big tech companies like Google and Apple to permit sideloading, the technique of downloading apps without using an app store as it would prevent the developers to use firms’ payments systems. However, Google says it allows sideloading.