30% is "a market fee, not a monopoly fee," says Google | Epic vs Google
Google defends share of all transactions, as Epic reveals its game store is still not profitable
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The Epic vs Google trial has begun, with both sides making their opening statements on Monday, and Google quick to defend its 30% cut of all transactions for apps distributed via its Play store.
According to The Verge, Google attorney Glenn Pomerantz described the 30% share as "a market fee, not a monopoly fee."
"The service fee you see here is exactly the same fee that Epic pays in the Nintendo store, the Xbox store, the Steam store," he said in a San Francisco court yesterday. "All these stores charge a mega developer like Epic the same 30% fee."
Pomerantz also argued that Google Play and the Android ecosystem provide developers with more value than payment processing services like PayPal or Stripe.
Later in the day, head of the Epic Games Store Steve Allison – the trial's first witness – disputed that 30% is the standard.
He told the court that Valve chose a 30% fee for Steam simply because that was what was charged at physical retail when the marketplace launched.
To emphasise the possibility of other revenue shares, he noted that he himself helped Telltale Games build its own digital store that operated with a 95/5 revenue share. He also claimed to be the person that suggested Epic let developers keep 80% or more of their revenue when the EGS launched.
Allison added that Epic's introduction of the 88/12 split prompted Steam, the Windows Store, and Discord all to revise their revenue shares.
In the wake of the EGS launch, Valve introduced revenue tiers, with developers only paying 25% after their game made $10 million in revenue, and 20% if their game made $50 million. Discord, meanwhile, cut its share to 10% and Microsoft later matched Epic's 88/12 split.
When asked if 70/30 is still the standard in the PC space, he said: "No."
The impact of the 30% fee was also discussed when Down Dog CEO Benjamin Simon appeared as the second witness of the day. He noted that he charges customers $60 per year or $10 per month for his yoga app on Google Play, as opposed to $40 per year, $8 per month on his website.
Simon claimed Google forced him to remove an in-app button that directed people to pay via his website, which resulted in 28% fewer users paying for his app via either channel.
"At first we just had to remove the button [...] [but] they later made us remove some links from our website because we had some links in our app to a FAQ page," he said.
During his time on the stand, Allison also reported that the Epic Games Store is still not profitable – a fact that emerged during Epic's case against Apple in 2021. Back then, a document shared in court showed that the Fortnite firm predicts its games store will finally reach profitability in 2024.
The antitrust trial centres around Epic's claims that Google's practices, such as the 30% fee and anti-steering policies that prevent developers from directing users to payment channels that avoid said fee, are anti-competitive.
The lawsuit was filed after Google pulled Fortnite from the Play store when Epic added a hotfix that enabled direct payments. Google is countersuing for breach of contract.
GamesIndustry.biz will continue to bring you the highlights and biggest revelations from this case, which you can follow via the 'Epic vs Google' tag below.
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