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Match Group withdraws restraining order against Google ahead of trial

Match Group withdraws restraining order against Google ahead of trial

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Match Group, the parent company of Tinder, Match, and OkCupid, has reached a temporary agreement with Google, after it sued Google for allegedly restricting its billing policies on the Google Play Store. As part of the agreement, Match Group has withdrawn its request for a temporary restraining order against Google, the company said in a media statement.

In exchange, Google made several concessions as per Match Group's demands, which primarily centre on providing Match Group users with alternatives to Google Play Billing. For instance, Google will not reject or remove Match Group apps from the Google Play store because they provide alternative payment options, and will approve app updates that offer payment alternatives.

Google will also work on fixing the "deficiencies" as cited by Match Group, which include inferior customer service, limited offerings and data privacy. Match Group said in a statement that it will "in good faith", then test Google's system on its apps that currently do not offer Google Play Billing, alongside its current payment systems. Additionally, the agreement will see Match Group put up US$40 million into an escrow account, instead of paying Google directly for billing transactions that occur on Android outside of Google's payment system.

Nonetheless, Match Group said it maintains that the fees Google is demanding for payments outside of Google Play Billing are illegal under federal and state law. However, due to Google's "complete monopoly control over the Android app distribution ecosystem", Match Group has agreed to hold funds in escrow and maintain the status quo of Match Group apps in the Google Play Store, until the Court hears and adjudicates the claims filed against Google on 9 May. According to Match Group, both parties are able to terminate this temporary agreement, in which case, Match Group can reinstate its request for a restraining order. The date for the trial is currently set for April 2023.

According to the claims filed by Match Group on 9 May, as previously seen by MARKETING-INTERACTIVE, Google "illegally monopolised the market" for distributing apps on Android devices with its Play Store. Match Group added that Google "lured app developers to its platform" with assurances that the latter could offer users a choice over how to pay for the services they want. "But once it monopolised the market for Android app distribution with Google Play by riding the coattails of the most popular app developers, Google sought to ban alternative in-app payment processing services so it could take a cut of nearly every in-app transaction on Android," Match Group said. The complaint also accused Google of using bait and switch tactics to exploit app developers.

Two years ago, Google required all apps that sell "digital goods and services" to use Google Play Billing exclusively beginning September 2021. According to Match Group, no alternatives to Google Play Billing were allowed and the consequence of non-compliance was "banishment from Google Play". 

At the same time, when transactions involve the purchase of digital goods or services using Google Play Billing, the complaint alleged that Google would keep as much as 30% for itself. While Google labelled this a "fee", Match Group called it an "extortionate tax" in the complaint, adding that it was nearly 10 times the actual fees other payment processors charge in competitive marketplaces. Match Group also pointed out that the phrase "digital good or service" is "ill-defined and arbitrarily applied" as clothing and food delivery as well as ride-sharing apps do not qualify under this term.

"Google’s policy change eliminated the promised exception that had previously enticed Match Group and other popular apps — such as streaming services — to offer in-app purchases and spend time, effort, and money to develop their own in-app payment systems," the complaint said. According to Match Group, monopolising the Android in-app payment processing market allows Google to impose a 15% to 30% tax on the billions of dollars users spend on "digital goods and services" on Android.

Photo courtesy: 123RF

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