Over 30 states have banded together in suing Google over unfair fee practices associated with its Play Store. The states allege that Google is operating as a monopoly and that it has created an “ecosystem” that has virtually eliminated competition. Because of this elimination in competition, Google is able to charge hefty fees for developers of apps that are offered in the Play Store.

The lawsuit which is led by Utah, New York, Tennessee, and North Carolina alleges that Google uses tactics that are anti-competitive in an effort to “disincentivize competition in Android app distribution.” The lawsuit explains, “Google has not only targeted potentially competing app stores, but also has ensured that app developers themselves have no reasonable choice but to distribute their apps through the Google Play Store."

In the complaint, states highlight that Google charges up to 30% in commission for purchases made in the app store. In addition to the high commission fee, the complaint outlines that another of Google’s aggressive tactics relates to its Google Play Billing. The states argue that Google continues to profit off of app developers even after a consumer pays for the app in the Play Store. If a consumer makes a purchase within the app, outside of the Play Store, they impose the same hefty 30% commission fee. The lawsuit explains that this practice allows Google to “indefinitely collect supra competitive commissions from consumers who purchase in-app digital content.” States argue that this high fee practice requires app developers to raise their prices on consumers.

Google responded to the suit through a blog post in which Google Senior Director of Public Policy Wilson White explains, "This lawsuit isn't about helping the little guy or protecting consumers. It's about boosting a handful of major app developers who want the benefits of Google Play without paying for it." White goes on to add, "Doing so risks raising costs for small developers, impeding their ability to innovate and compete, and making apps across the Android ecosystem less secure for consumers."

Following an announcement from Apple, Google has announced that starting this month, the tech giant would limit the amount of commission it takes. For the first $1 million developers make every year, Google will cut the commission it takes from 30% to 15%.

In the blog post, Vice President of Product Management, Sameer Samat explains, “With this change, 99% of developers globally that sell digital goods and services with Play will see a 50% reduction in fees. These are funds that can help developers scale up at a critical phase of their growth by hiring more engineers, adding to their marketing staff, increasing server capacity, and more.”

As a result of Apple’s earlier announcement to cut commissions, federal judge Yvonne Gonzales Rogers expressed to Apple CEO Tim Cook that the commission cuts only mask the issue of anti-competitive practices. Rogers explained, "The issue with the $1 million small-business program, at least what I've seen so far: that really wasn't the result of competition. That seemed to be a result of the pressure you were feeling from investigations, from lawsuits, not competition."

The Coalition for App Fairness has displayed its support of the lawsuit brought on against Google by over half of the nation. The coalition’s executive director Meghan DiMuzio shared with NPR, "App stores have been given a free pass to abuse their dominant market position for far too long. Their anti-competitive policies stifle innovation, inhibit consumer freedom, inflate costs, and limit transparent communication between developers and their customers."

This lawsuit is one of several faced by Google alleging violations of antitrust laws. Since 2020, the Justice Department along with state attorneys general have brought four lawsuits against the tech giant alleging that they are creating an environment that weeds out the competition and results in a monopoly of the industry.