Epic Games says Google has paid phone and game makers to avoid a million dollars in the app store

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August 19 (Reuters) – Fortnite developer Epic Games on Thursday revealed details of the alleged allegations that Google signed Alphabet Inc (GOOGL.O) with phone makers and other video game companies for avoid losing $ 1.1 billion in annual app store profits.

Epic in 2018 launched “Fortnite” through its website and a partnership with phone maker Samsung Electronics Co. (005930.KS), bypassing the Google Play Store, which charges commissions to developers up to 30 % of your sales.

Google feared other companies copying Epic and blocked that possibility by lifting illegal barriers, according to Epic in an antitrust lawsuit filed against Google last year.

Google said demand remains unfounded and poorly characterizes business conversations. No trial has been scheduled.

Among the new details that a judge ordered not to withdraw, Google estimated in 2019 up to $ 6 billion in Play revenue and $ 1.1 billion in profits that would be at risk in 2022 alone if Epic’s approach spread and alternative stores found success, depending on demand.

But Google avoided the dreaded success.

In 2019, it launched the “Premier Device Program” to pay phone manufacturers to ensure Play Store exclusivity and limit the appeal of collaborations similar to what Epic had come up with Samsung, according to new details released.

Leading partners received 12% of Google search revenue from their phones, compared to 8% traditionally, according to the filing. Some partners, including LG Electronics Inc (066570.KS) and Lenovo Group’s Motorola (0992.HK), also received 3% to 6% of Google’s “Google spending”.

Separately, Google in 2019, as part of an effort called “Project Hug,” approved spending “hundreds of millions of dollars” on more than 20 prominent developers in marketing and other perks to keep them in the Play Store, according to the details. The “vast majority” accepted Google’s offer in December 2020.

According to the lawsuit, Google internally called the new offerings a success in stopping a “contagion” of developers fleeing the Play Store.

Paresh Dave Reports; Edited by Dan Grebler

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