Match Group Inc. sued Google on Monday, alleging the search giant broke antitrust laws with billing rules for the Android app store, the latest salvo in a global brawl involving the mobile-app industry.
the operator of dating apps Tinder and OkCupid, claims in a federal lawsuit that Alphabet Inc.’s
Google exerted monopolistic power over app distribution on its Android smartphone software, restricting the ability of developers to use their own payment systems in their apps.
“Ten years ago, Match Group was Google’s partner. We are now its hostage,” Match said in the lawsuit, filed in the U.S. District Court for the Northern District of California. “Blinded by the possibility of getting an ever-greater cut of the billions of
dollars users spend each year on Android apps, Google set out to monopolize the
market for how users pay for their Android apps.”
Google and Apple Inc.
have forced app developers to use their own payments systems, while taking a cut of in-app purchases, leading to blowback from large companies paying billions to the two tech companies. Google has recently made some concessions on its app store, including allowing Spotify Technology SA
to use its own payments system in its app.
In the filing, Match said it asked Google if it could adopt the new “user billing” feature like Spotify, but Google refused.
“Less than a week before Google’s March 31, 2022, deadline, Google
announced a new ‘pilot program’ (misleadingly) labeled ‘User Choice Billing,’” the lawsuit said. “Under this new ‘pilot program,’ developers may offer a ‘choice’ of billing platforms but with a catch: one of those options must be Google Play Billing and only Google determines who can participate in this new program. So far, the only developer Google selected appears to be Spotify, the popular music streaming service with hundreds of millions of active users. Match asked to participate, but, despite the fact that Match has offered users a choice of payment systems in its Android apps for nearly a decade, Google refused, telling Match that User Choice Billing is only a pilot program at a ‘very early stage’ and that it could not confirm when or whether it would be expanded beyond Spotify.”
Google fired back immediately to the charges.
“This is just a continuation of Match Group’s self-interested campaign to avoid paying for the significant value they receive from the mobile platforms they’ve built their business on,” a Google spokesperson said in a statement to MarketWatch.
“Like any business, we charge for our services, and like any responsible platform, we protect users against fraud and abuse in apps. Match Group is currently attracting regulator concerns over things like deceptive subscription practices, and with this filing they continue to put money ahead of user protection,” the Google spokesperson said, adding that Match Group’s apps are eligible to pay just 15% on Google Play for digital subscriptions, the lowest rate among major app platforms.
Match has been an irritant for Google. The conflagration was sparked with a high-profile rebuke of the search giant during a congressional hearing in April 2021. Jared Sine, Match’s chief legal officer, told Senate members then that Google called Match the night before Sine’s testimony became public to press why his testimony differed from Match’s comments in its latest earnings call.
During the earnings call, Match executives said they believed they were having productive conversations about Google’s 30% fee for in-app payments through its app store. In the testimony, however, Sine complained Google had made “false pretenses of an open platform.”
The lawsuit is the latest legal skirmish between developers and tech giants like Google and Apple, who run the largest digital stores, through which most apps are sold. Epic Games Inc., for example, has sued both Apple and Google for their restrictive app-store rules.
The app-store setup has led developers to accuse Google and Apple of imposing taxes on their sales, as well as prompted them to lobby governments for regulation. South Korea passed a law requiring the tech giants to allow alternate payment systems, and Congress is considering similar proposals.
Apple and Google contend they can’t open their app stores to outside payment systems because that would compromise the privacy and security of consumers.