An Epic win jolts Google

Today let’s talk about a high-stakes ruling against Google in a closely watched antitrust case, and consider what it might mean both for the companies involved and the larger digital economy.

Late Monday, the jury deliberating in Epic Games’ lawsuit against Google ruled in favor of the Fortnite developer. It found that Google harmed Epic by creating a monopoly in in-app billing and app distribution within the Android ecosystem, illegally tying the app store and its billing system together. A series of revenue-sharing deals with developers and device manufacturers were also found to harm competition.

Epic’s lawsuit was filed in 2020. Around the same time, the company sued Apple on similar grounds, claiming Apple’s app store monopoly and ban on third-party billing systems was anticompetitive and illegal. But Epic (mostly) lost that case, which was decided by a judge. 

As this new trial unfolded, Sean Hollister wrote at The Verge, “Epic v. Google turned out to be a very different case.” 

He continues:

It hinged on secret revenue sharing deals between Google, smartphone makers, and big game developers, ones that Google execs internally believed were designed to keep rival app stores down. It showed that Google was running scared of Epic specifically. And it was all decided by a jury, unlike the Apple ruling.

Last week Hollister wrote a recap of the trial that, in addition to exploring the many facets of each company’s arguments, serves as a highly entertaining account of Google’s app-store related chicanery over the years: sweetheart deals to favored developers like Spotify and Netflix; successful efforts to prevent third-party app stores from launching; and the lies it told about its app store not being designed as a profit center. (The Play Store’s profit margin in 2021 was estimated during the trial to be 71 percent.)

And Epic managed to prove all that despite operating in an environment where — oops! — much of the relevant evidence was destroyed by Google, thanks to executives’ use of a default setting in Google Chat that deleted their messages automatically after 24 hours. (The judge in the case, James Donato, called this “the most serious and disturbing evidence I have ever seen in my decade on the bench with respect to a party intentionally suppressing