Walled Gardens

A San Francisco jury decided Google was running an illegal monopoly to recover huge fees from app developers. It marked a victory for Epic Games. Though a huge relief, Google’s and Apple’s walled gardens still stand.

Epic was ousted from Google Play Store and Apple’s App Store for attempting to bypass the payment systems (avoiding a cut of 30 per cent commission from transaction that go through the payment system). Epic lost its case against Apple but won the case against Google. It is heralded as a turning point in the mobile app economy.

The walled gardens of iOS and Android are built on strong foundations. Of course, there is a dent on the wall. The fees charged for in-app purchases has been a bone of contention since long. At present, almost $200 billion a year are collected for both these companies. It is treated as a fair compensation for the security these stores provide. However, developers take a different view.

Google discourages efforts of the developers to launch mobile distribution efforts of their own. It has launched Project Hug luring top game developers with financial incentives. It actively steers them away from agitating for better terms. Sweetheart deals are offered asking for a smaller percentage of commission on in-app transactions. Google ties up with hand-set makers such as Samsung so as to prioritize Google’s store over any other.

Apple, by contrast, treats every developer equally on its store. There is no need to exert pressure on handset maker because it manufactures its own handsets. Thus, Google’s behaviour is particularly egregious. And as the judge put it ‘success is not illegal.’ Apple was asked to abandon its ‘anti-steering’ rules.

Apple and Google are called walled gardens as they are pleasant and well-maintained. However, more choice is good for consumers.

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