Dozens of states filed an antitrust lawsuit against Google on Wednesday accusing the tech behemoth of using exclusionary contracts with smartphone application developers to maintain its monopoly power through its app store.
It is the latest antitrust lawsuit filed against the company by U.S. governments and the second in six months by New York Attorney General Letitia James.
James led the coalition of 37 attorneys general in filing the lawsuit in the U.S. District Court for the Northern District of California, San Francisco Division, which is about 40 miles from Google’s headquarters in Mount View, Calif.
“Google has served as the gatekeeper of the Internet for many years, but, more recently, it has also become the gatekeeper of our digital devices — resulting in all of us paying more for the software we use every day,” James said in a statement announcing the suit.
The attorneys general accuse Google of reneging on its 2005 promise when it acquired the Android operating system to keep it open to industry players by inserting itself as a middleman between app developers and consumers through its Google Play Store.
The lawsuit states that Google employs “anticompetitive tactics” in the form of exclusionary contracts with app developers to sell their products through its app store, which maintains a 90% market share of all apps sold on Android phones.
The company also requires app developers that sell their content through the store to do so with its Google Play Billing system, which the attorneys general say gives Google an additional monopoly in the market for Android in-app payment processing for digital products.
“Google’s anticompetitive conduct harms consumers and app developers, both at the point of app distribution and when a consumer later purchases in-app digital products,” the lawsuit states, adding that it also harms app developers as they lose profits “because potential customers may forgo purchases of existing apps in response to the higher prices caused by Google’s conduct.”
The lawsuit was filed after James led a coalition of 38 attorneys general in suing Google in a similar antitrust suit in December.
It also comes as the Internet giant faces an antitrust case filed by the Justice Department and 11 states in October of last.
“We are filing this lawsuit to end Google’s illegal monopoly power and finally give voice to millions of consumers and business owners,” James said Wednesday.
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