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Epic Games Says Google Paid Phone and Game Makers to Avoid $1-Billion App Store Hit | Technology News



(Reuters) – “Fortnite” developer Epic Games on Thursday unsealed details about contracts it alleges Alphabet Inc’s Google signed with phone makers and other top video game companies to avoid losing $1.1 billion in annual app store profit.

Epic in 2018 launched “Fortnite” through its website and a partnership with handset maker Samsung Electronics Co, bypassing Google’s Play Store, which charges developers fees of up to 30% of their sales.

Google feared other companies copying Epic and blocked that possibility by erecting unlawful hurdles, Epic alleged in an antitrust lawsuit filed against Google last year.

Among new details a judge ordered be unredacted, Google in 2019 estimated up to $6 billion in Play revenue and $1.1 billion in profit would be at risk in 2022 alone if Epic’s approach spread and alternative stores found success, according to the lawsuit.

But Google avoided the feared hit.

Premier partners received 12% of Google’s search revenues from their phones, compared with 8% traditionally, according to the filing. Some partners, including LG Electronics Inc and Lenovo Group’s Motorola, also received 3% to 6% of Google “Play spend.”

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

(Reporting by Paresh Dave; Editing by Dan Grebler)

Copyright 2021 Thomson Reuters.

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