On Monday, Epic Games, the developer of Fortnite, achieved a significant victory in its antitrust challenge against tech giant Google. A judge in California, USA, issued a permanent injunction forcing Google to provide alternatives to the Google Play Store for downloading apps on Android phones. Google will also be prohibited from paying companies fees or sharing revenue in exchange for not competing with Google's app store. This means that Google's dominant position in the lucrative Android app market could be disrupted.

Affected by the above news, the stock price of Google's parent company, Alphabet, fell by more than 2.4%, dragging down the US stock market significantly in the afternoon, and the US stock market gave up the gains after the strong non-farm employment data on Friday.

The above ruling by San Francisco Judge James Donato is the most significant result of the antitrust lawsuit filed by Epic Games against Google in 2020. Epic Games accused Google of anti-competitive practices, including paying hardware companies and Android phone manufacturers to prevent them from developing competitive app stores.

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The latest ruling by the US judge is expected to give developers a larger market share, as both Google and Apple's app stores typically take a 15%-30% cut from the total sales of high-revenue apps. The new restrictions on Google Play may allow developers to bypass Google's rules or fees, thereby earning more revenue.

According to the ruling document, starting from November, for three years, Google will not be allowed to:

Pay companies to exclusively or preferentially release apps on Google Play.

Pay companies to prevent them from competing with Google Play.

Pay companies to pre-install Google Play on new devices.

Require app developers to use Google Play's payment system, or prohibit app developers from informing users that they have cheaper online goods on their websites (Google Play charges 15%-30% for in-app purchases from large app developers).Google must also allow competing Android app stores access to the Google Play app catalog.

Google is required to provide third-party Android app stores within its Google Play app store.

According to the documents, Epic Games and Google will also form a three-person committee to review technical issues related to Google's compliance.

Games such as Fortnite, owned by Epic Games, profit from in-app purchases of character costumes and other so-called "skins." In 2020, Epic Games updated the iOS and Android versions of Fortnite to allow users to pay for in-app currency directly to them at a discounted price, thereby bypassing Apple's App Store and Google Play Store payments and avoiding a 30% commission charge.

At that time, Apple removed the game from the App Store for violating its rules, and Google took similar measures, but Android users could still download it through third-party stores. After Fortnite was removed, Epic Games immediately sued Apple and Google, mainly on the grounds that the 30% commission they charge in app stores is "too high."

Epic Games won the lawsuit against Google at the end of last year, and Monday's documents detailed the changes Google must make. Epic Games mostly lost in a very similar case against Apple. Google's trial was decided by a jury. Apple's trial was decided by a judge.

During the trial of the Google case, Epic Games focused on whether Google had locked the app store market through deals with mobile phone manufacturers and whether it had scared users away from using Android's sideloading feature with security warnings, which allows Android users to install apps from the web.

Tim Sweeney, CEO of Epic Games, said,

This means that all app developers, store manufacturers, operators, and manufacturers have three years to build a vibrant and competitive Android ecosystem that is too large for Google to stop.

Sweeney previously stated that Google's corporate culture contributed to Epic's victory because Google employees often documented their business actions in emails or communications, which were exposed during the trial.Google once urged Donato to reject the reform proposals put forward by Epic Games, claiming that these reform proposals are costly, overly restrictive, and may harm consumer privacy and security. The judge essentially dismissed these arguments at a hearing in August. Donato told Google's legal team, "After being found to have a monopoly, you will eventually pay the price to restore the world to normal."

Google has recently stated that it will request the court to suspend the pending changes and will appeal the court's decision.

According to Sensor Tower data, consumers spent $124 billion on apps in 2023.

Analysis suggests that the judge's latest ruling may accelerate the weakening of tech giants Google and Apple's control over app stores, which have been criticized by global regulatory agencies and lawmakers.

In another antitrust case in Washington, U.S. District Judge Amit Mehta ruled in favor of the U.S. Department of Justice on August 5, stating that Google illegally monopolized web search and spent billions of dollars to become the default search engine on the internet.