What you should know
- Google allegedly paid $8 billion to Samsung over four years for search engine, voice assistant, and Play Store as default on Samsung’s mobile devices
- Google devised strategies to share app store revenue with Android mobile device manufacturers to ensure products come preinstalled with Google Play on home screens
- Google proposed to pay Samsung $200 million over four years to include Samsung’s Galaxy Store app marketplace within the Google Play store, but later abandoned the plan
- Internal documents indicate that Google saved almost $1 billion over four years by retracting its request for Google Play to be exclusively available on a device’s first screen
Full Story
Google reportedly paid Samsung $8 billion over four years to maintain its position as the default search engine, voice assistant, and app store on Samsung phones. The disclosure comes from testimony in the ongoing case filed by Epic Games against Google, with James Kolotouros, Google’s Vice President for Partnerships, revealing details about the agreements with Android manufacturers. According to Kolotouros, the deals are aimed at ensuring that Google Play is preinstalled on home screens of Android devices.
Epic Games alleges that Google’s app marketplace violates antitrust laws and aims to demonstrate that Google sought to discourage the rise of third-party app stores that could affect Google Play’s operating profit. An internal presentation called “Project Banyan” revealed Google’s strategy to invest in fortifying the Google Play Store against Samsung’s Galaxy App Store.
During the trial, internal documents indicated that Google saved almost $1 billion over four years by abandoning the idea of making Google Play exclusively available on a device’s home screen. Google’s lawyer clarified that there was no agreement to prevent Samsung from placing its Galaxy store on a device’s home screen, emphasizing that these deals were legitimate efforts to maintain healthy competition in the market.
In addition to the $8 billion deal with Samsung, there was also a proposal in 2019 for Google to pay Samsung $200 million over four years to include Samsung’s Galaxy Store app marketplace within the Google Play store. Although this plan was abandoned, three different deals were signed the following year, totaling $8 billion over four years. According to Epic’s estimates, Google’s app store revenue is expected to exceed $12 billion in 2021.
