Zinger Key Points
- Google offered Fortnite maker Epic Games a $147 million deal to launch the game on Play Store.
- Google says this deal was offered to make sure games stayed on the Play Store.
- Fortnite escaping the Play Store could have led to a “contagion”, according to the Android maker.
The ongoing Google antitrust lawsuit has revealed that the Android maker offered a whopping $147 million deal to Epic Games to secure the debut of Fortnite on the Play Store.
This move aimed to prevent the potential loss of substantial in-app purchase fees via Fortnite's in-game V-Bucks.
What Happened: Alphabet Inc.’s GOOG GOOGL Google proposed a three-year ‘incremental funding’ deal to Epic Games to launch their popular game Fortnite on the Play Store, reported The Verge. The offer, however, was rebuffed by Epic Games.
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Purnima Kochikar, Google's VP of Play partnerships, confirmed in court that the deal was meant to curb a possible "contagion" of popular apps bypassing Android's official store, thus posing a threat to Google’s in-app purchase fees.
Despite this, Epic launched Fortnite directly on its website in 2018, bypassing the Play Store. It only submitted to the Play Store in 2020 due to "scary, repetitive security pop-ups" pushing away their gamers.
In an antitrust lawsuit filed by Epic, it was alleged that Google had panicked following their initial decision, fearing a "contagion risk" from other game developers.
This fear was substantiated by court documents estimating a potential revenue loss of billions of dollars if top game developers defected from the Play Store to avoid paying up to 30% in commission to Google.
Epic also alleged that Google offered a $18 million deal to rival Riot Games, owned by Tencent Holdings Ltd. TCEHY.
The deal, dubbed ‘Project Hug', also included the now-Microsoft Corp.-owned MSFT Activision Blizzard, which reportedly received incentives worth $360 million to keep its games on the Play Store.
Why It Matters: Google’s stance is that its concerns were purely about losing games on the Play Store.
"We just wanted developers to choose Play," Kochikar said.
On the other hand, Epic argues that Google feared competition for Android app distribution and maintained its Play Store as an unlawful monopoly. The outcome of this antitrust suit could have a major impact on the future of app distribution and in-app purchases.
Image Credits – Shutterstock
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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.
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