Sean Hollister

“When push came to shove, he talked about whether competition is prevented” rather than impaired, says Bernheim.

The upshot of that: Bernheim believes Epic doesn’t need to prove Google actually blocked competition entirely. In his opinion (for Epic), Epic only needs to show there were no good alternatives to Google Play and Google Play Billing. It doesn’t need to show there were no alternatives at all.

For example, says Bernheim, Gentzkow presented a chart titled “Was Fortnite Blocked?” showing that revenue tanked on Google Play after the app was kicked off the store, but didn’t tank for Android phones that got Fortnite a different way.

But “If off-Google Play was a good substitute for Google Play, you’d see when one drops, the other goes up commensurably.” That didn’t happen: demand stayed stable outside of Play, according to the bar graph we just saw. “There’s no indication that any of the people here are substituting to off-Google Play.”

“Because there’s competition, Google can’t extract as much because there’s a smaller share,” he says, showing us a pair of pie charts: one where Google has a $35 slice of a $50 pie and one where Google has a $10 slice of a $100 one.

(The $100 pie is supposed to represent competition in Android; the small pie “impaired” competition.)

He also says Google’s comparison of Android to the old Symbian OS is flawed because phones from rival manufacturers used different versions. “Each had their own versions of Symbian and each was incompatible with the other.”

He says he will point out basic errors in their analyses.

“Google could not achieve its financial goals without Play,” he added. “The work you do in this one room alone was really mission critical.”

And we’re breaking for lunch. See you in 30 or so.

Epic just showed us a document from 2022 titled “GPB as Platform of Choice.”

It asks one key question: once developers and users have more choices for billing systems, “what are we doing to make GPB the platform they *want* to choose?”

It suggests that “for developers, we must show demonstrable & indisputable ROI” and “we must also connect directly with users and give them a compelling case to check out with Play Billing based on trust, convenience & value.”

“In other words, we’ll need to compete,” asks Epic’s attorney.

Correct, says Loew.

The document mentions two Google codenames that have something to do with alternative check-out options: “Halla” and “Everest.” I suspect “Everest” is Google’s “User Choice Billing” based on the context of the document, but I can’t be sure.

We’ll never know what she would have said, I guess!

Today, in court, she seemed amused by her boss’s language.

“But in that case Google still takes 30 percent of Candy Crush’s revenue even though it didn’t help me discover the app, correct?”

Loew says both things are correct. She also agrees with Epic’s attorney that a theoretical competing Android app store could charge lower service fees, offer better discovery, etc., etc.

She points out that Google allows games to be consumption-only apps.

She also says developers can communicate any way they want with their customers outside of the app.

Inside the app, she confirms, Google does not allow developers like Down Dog to communicate other ways to pay — but Google argues that has a benefit for developers and users:

“If users have a purchase intent... we believe we convert quicker if they can do it in the moment without friction.”

And “if we charged the developer afterwards we’d have to invest in an invoicing system and a collection system,” she says.

Google examined lots of payment models, she says, but found them more convoluted.

“This way when a user pays, everyone gets paid.”

Google has to monitor payment laws around the world at federal, state, and local levels — some cities have specific taxes, and Vermont has “a very specific rule for subscriptions,” she says.

“Does Google bill users for these services it provides?” No, says Loew.

Then there’s fraud prevention, too.

Google isn’t yet showing how much it has to spend on these things, and... wouldn’t other giant payment processors that charge less have to do these things, too? But I get it — Play isn’t free to run.