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The battle for the money of IT giants, how Apple and Google will pay out billions of dollars

Hello.

The amount of news related to the claims of officials against Apple and Google for taking a percentage of

the cost of applications and services on its platform,going wild. Officials hide behind developers who are unhappy with the fact that they are in principle taking money, as well as users who suffer from "dishonest practices." In my opinion, too often Google and Apple have been equated in such matters, as if the companies are the same and no different. Let me remind you that the practice of both companies regarding the percentage of sales is the same - 30% of the cost of an application or service. For small developers, concessions have recently appeared, but they still have to pay their percentage.

The difference lies not in the numbers, but in the fact that Googleallows you to use third-party app stores on Android, there are dozens of them, but none can come close in popularity to the Play Store. And therefore, developers are guided by it, but there is an opportunity not to be present in this store - you can choose an alternative store or even sell your application directly, allowing the user to install it on a smartphone from an APK file. That is, no one is forcing developers to use the Play Store, this is their conscious choice due to the size of the store. And in this Google differs from Apple, the latter simply does not have the ability to install applications from anywhere other than the App Store.

American IT giants are a tasty morsel forextortions of various kinds, especially considering that in many countries of the world there are simply no local competitors. This allows you to pass laws or regulate the market in such a way that taxes arise that affect the same Google or Apple, but do not affect local businesses. The task is to cut money from large companies, to get them into the budget. It is clear that in the end, any fine will be paid from the pockets of buyers, all costs will be passed on to them, but at the moment we can say that officials can celebrate local victories and open champagne.

A good example of such attacks isGreat Britain, lawsuits against both Apple and Google have appeared in the country, they are very typical of our time. The British law firm Hausfeld & Co LLP, represented by Dr. Kent, filed a lawsuit in court, the goal is to compensate users in the UK for payments for applications. That is, formally, the overpayment that people made because of Apple's policy. The corporation tried to dismiss the class action lawsuit, but was unable to do so. The volume of the potential claim, calculated by Dr. Kent, amounted to 1.5 billion pounds. The victims are 19.6 million iPhone and iPad users. Any Apple user who has purchased apps since October 1, 2015 may be eligible for a payout if it is proven in court that Apple charged additional fees. Such cases do not go quickly, it can last for several years. But in the end, Apple's chances are quite low, so later the company will clearly try to reduce the damage and pay some kind of compensation to the victims.

This is clearly seen in the case of lawsuits in othercountries where a corporation negotiates payouts when it realizes it could lose large sums. Remember the butterfly keyboard on Apple laptops?

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The butterfly mechanism has become a curse, keyboardscrashed all over the world. Thousands of publications, hundreds of thousands of broken keyboards and Apple's stoic silence, the corporation did not recognize the problem for many years, but then it did. Class action lawsuits against the company have been filed in various countries around the world.

One of these lawsuits ended in the United States, in whichrepresented by users in several states - California, Florida, Illinois, Michigan, New Jersey, Washington. Anyone who bought an Apple laptop with a butterfly design and then changed the keyboard can get a refund. If the replacement was multiple, then $ 395, a single replacement - $ 125, replacing a single key - $ 50. The total amount of payments, including payment to the law firm, amounted to $50 million, of which $15 million went to the lawyers who prepared the lawsuit. Apple denied knowing about the marriage (ridiculous!), but pre-trial agreed to payments. In other countries, claims against the company are still pending before the courts.

Mobile-review.com And again about "butterflies". Apple recognized the defect in the 3rd generation, but what should users do?

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There should be no doubt that lawyersare suing corporations in pursuit of their own interests and using the current agenda, which dramatically worsens the climate for large IT companies. And if problems with the “butterfly” keyboard are quite real and brought inconvenience to users, then with the purchase of content, not everything is so simple for all platforms.

For example, in the same Britain, following a lawsuit againstApple appeared similar against Google, in it the claims are exactly the same - the applications were unreasonably expensive, they should have cost less. And if Apple can still somehow argue about the absence of alternative app stores, the possibility of downloading them from other sources, then Google has no such problems. And the likelihood that Google will fight off such class action lawsuits is much higher. The amount of the claim is only 920 million pounds, a little did not get to a billion. The court documents contain an interesting figure - in 2019, Google earned $11.2 billion from its app store. This is income in all countries of the world.

To understand the problem of the current moment,suffice it to give one figure, only in the European Union the volume of fines against Google in the past few years has exceeded 8 billion euros. And these are the cases where fines have been imposed, dozens of cases are still in court, the amounts of payments in them are comparable.

The trigger for the attack on Apple and Google was a lawsuit from Epic Games, the creator of Fortnite, they opposed Apple.

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During the court hearings, manycurious details about the Apple commission and how justified it is, at first glance, it has no basis. But at Apple, they fight to the death to defend their right to charge a commission of any size. For the company, this is a guarantee of survival, otherwise its income will collapse.

A wave of criticism of Apple and Google unfolded in 2020a year later, companies were forced to cut commissions for developers, for example, Google reduced it from 30% to 15% for those who receive up to a million dollars a year. Also, the commission has been reduced for several categories of subscriptions and applications. In theory, this leads to the fact that application developers can earn more, in practice, some companies proportionally reduce the cost for the buyer.

At the end of June, Google decided to negotiate withAmerican developers who have filed a lawsuit against the company will be paid up to $90 million, a special fund has been organized for this amount. Up to 48,000 developers can qualify for a payout, the amount will be from $ 250, the upper bar in some cases - up to $ 200 thousand. The main thing is that the developer’s income for the year does not exceed $ 2 million, the period under consideration is from 2016 to 2021.

It did not set itself the goal of considering all claims againstthese companies, it is worth mentioning the linking of payments on the iOS platform to Apple Pay and the fact that this is a de facto use of a monopoly position. Such lawsuits are being considered in many countries of the world, including in Russia, the FAS found Apple guilty of non-competitive practices. The only problem with the Russian market is that Apple is no longer present in our country, and we can say that even when a fine appears, and it is negotiable and can exceed a billion rubles, there will be nothing to pay it. Even more fun here is that the more such fines hang on Apple and Google, the more obstacles will be for their return to our market.

The global economic crisis makes peoplecompanies and states look for new sources of income, and in this aspect, we can safely say that the costs of IT giants for lawyers will increase significantly. The reason is that the volume of backdated claims against them for their practices will only grow. And this means that they will suffer losses from paying fines, trying to settle lawsuits privately, agreeing to pay smaller amounts. But the fact that the giants will be plucked and forced to pay is already a fact.

For us, this means a simple thing.Sooner or later, the costs of lawyers, as well as fines, will be transferred to the cost of products, and in addition to the usual inflation, this factor will spur price increases. So it’s worth getting ready for the fact that in 3-4 years many familiar products will cost indecently expensive. And we can’t avoid this, the flywheel is already running. Therefore, I would not rejoice that Apple or Google were obliged to pay billions - in the end, we will pay for them out of our own pocket.

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