Google’s defeat in its antitrust battle with Epic Games was more than just a victory for the Fortnite maker; it was a major upset to the business model that has long governed the mobile app ecosystem.
For years, platforms like Google and Apple have hosted app stores and taken a cut of developer revenues. But following the recent ruling, the future of this model remains uncertain. The question on everyone’s minds is: what does this actually mean for app developers?
The San Francisco jury found Google guilty of “willfully acquiring or maintaining monopoly power by engaging in anticompetitive conduct.” However, the final decision on Google’s penalty rests with the judge. This means that both parties will have the opportunity to present their arguments and shape the outcome later this month.
Until then, it’s unlikely that Google will make any major changes to its Google Play Store. Doing so before the judge’s decision could only add complications if further action is required.
In other words, for the next few weeks or months, the Play Store will continue to operate as usual. Developers will still need to pay their commissions, and consumers may see the added cost of doing business being passed onto them.
Google’s agreements with companies like Spotify and Match will also remain in place. However, it’s unclear if Judge James Donato will force Google to unwind these deals or limit their ability to make similar agreements in the future.
The main focus of the ruling is not specific changes to the Play Store, but rather the legality of the app store business model itself.
As Paul Swanson, a partner at a law firm that specializes in antitrust cases, explains: “This ruling will affect Google, Apple, and other companies that have enjoyed a ‘walled garden’ business model for years.” This means that these companies may need to reconsider how they do business in order to comply with antitrust laws.
But the impact of this ruling may extend beyond just the tech giants. Swanson believes that it could also impact other marketplaces where a company has created its own platform and can dictate the rules, such as the app stores’ 30% commission.
While no other app makers have yet come forward with lawsuits, it’s possible that the ruling could inspire similar action. Rick VanMeter, Executive Director of the Coalition for App Fairness, argues that this decision highlights the need for more competition in the app economy.
However, this ruling is just one of many dominoes that need to fall in order to truly dismantle the current app store business model. Legislative action in other markets, such as Europe’s Digital Market Act and the U.K.’s Digital Markets, Competition and Consumers Bill, will also play a significant role in shaping the future of app stores.
In the end, this ruling may prompt Apple to re-examine its own business model as well. As VanMeter reminds us, “Just because it’s your business model, doesn’t mean it’s legal or right.” Only time will tell how this ruling will impact the app ecosystem and the companies that rely on it.
