167 – Breaking News & Latest Updates 2026
Skip to main content

Sean Hollister

Sean Hollister

Senior Editor

Senior Editor

    More From Sean Hollister

    Sean Hollister
    Sean Hollister
    Epic is repeatedly attacking Gennai’s credibility.

    Epic attorney Lauren Moskowitz is asking a rapid-fire series of questions about the things Gennai does not know — because apparently, his approach to an old deposition was to say he didn’t know things over and over again, and she’s taking full advantage.

    So he’s seemingly being forced to admit he doesn’t know various facts and figures and processes now — like how often Google Play is preinstalled on phones or the quantity of apps on Play versus the Amazon Appstore.

    She also tried to suggest he ignored the 3.4-star rating for the Move to iOS app he demoed, choosing to focus on its 100 million downloads instead of its 180,000 reviews, and points out he skipped steps in his demo.

    “You skipped messages for example?”

    “I did, yes,” he admits.

    Sean Hollister
    Sean Hollister
    “As a technical matter, nothing in this document which I’m going to admit is anything you can rely on as a fact. however, that will magically change when Ms. Moskowitz asks the question.”

    Judge Donato gets another laugh (he says it’s just how the rules of evidence work in this particular instance).

    Here’s what’s at the top of that document, written by Gennai:

    For a variety of reasons, the long-standing growth and (potentially) fundamental business model of Google Play is under pressure in 2019. This is being driven by a confluence of factors, including:

    The size and margins of the market are making it attractive for new entrants, either drafting on existing distribution (OEMs) or competing on rev-share rates (Epic)

    A meme is emerging related to the “app store tax”, unfairly comparing the app store revenue share to basic payment processing and putting pressure on Play’s 30%. Larger developers who have more standalone capabilities (and other differentiated content) are leveraging this discontent to attempt to negotiate differentiated rates or go-it-alone.

    These problems are very real and playing out in the market in 2019. Epic/Fortnite, Galaxy Store, conversations with large developers at GDC, etc...

    Combined, these two risks could have major effects on Google Play’s business in the near term...

    We propose to solve these challenges through a combination of tactics that are required in conjunction:

    Firstly, competing on price (rev-share) is prone to be a race to the bottom and is not necessary across the board (only to the most strategic partners where loss of the titles would disproportionately affect the business). We are interested in solving for this in a way that accomplishes two goals simultaneously: (1) lowers the effective rev-share of Play while maintaining the prevailing rate, and (2) returning this value in a way that accrues value back to Google. This is Hug.

    Secondly, the defense of Google Play as the preeminent Android app distribution store can be focused around major points of distribution, particularly in aligning Android’s largest OEMs around Play as an app distribution source. There is also a user privacy / security benefit of doing this. This is Samsung (and maybe Huawei).

    Finally, the prevailing 30% rev-share rate may not be sustainable over time, and it’s in our interests to innovate in that regard before the decision is taken away from us. There are options that are likely Googley, good for the ecosystem, and allow us to continue to derive the right level of value from our investment. This is the business model project.

    Why did he write the “competing on price (rev-share) is prone to be a race to the bottom” bit, asks Google’s lawyer.

    “If that that were to become known, other developers would come to us to do the same, and... negotiate it down, and that would play out badly for us,” said Gennai.

    Correction: I originally missed a bunch of text in the middle of the document; it has now been added.

    Sean Hollister
    Sean Hollister
    “It has over 100 million installs; it’s a very popular application.”

    Gennai on the “Move to iOS” app — we just watched a taped demonstration of data transfer from an Android phone to an iPhone that took less than three minutes.

    Google’s point seems to be that switching between Android and iOS is not that difficult, and I largely agree, but not because of what was just shown. This demo doesn’t show lots of other switching costs beyond initial setup (including carrier-gated things like making visual voicemail work properly), and I would argue it’s harder to go from iPhone to Android than the other way around.

    Sean Hollister
    Sean Hollister
    Google explains why some developers were able to get away with paying less on Play.

    “Developers were working with us in partnership and they were offered a 15 percent revenue share as part of that,” says Google’s Paul Gennai, referring to Google’s Living Room Accelerator Program (LRAP) and parallel ADAP program for audio apps.

    What about subscription devs who were paying 0 percent back in the day?

    There was a component of our billing policy at the time that was likely confusing and could be misinterpreted; there were developers selling goods and digital subscriptions at the time that were not using Google Play Billing.

    “We knew we were going to have to come around and correct that problem,” he adds.

    This does not explain Spotify’s current 0 percent rate, or its special offer to Netflix, or other deals we’ve seen in court, though.

    But it is a defense for another point Epic has made about how Google was not enforcing Play Store Billing evenly.

    Sean Hollister
    Sean Hollister
    Google: “when they succeed, we succeed.”

    Google’s Paul Gennai seems to be here to demonstrate that Google isn’t just pocketing its Play Store service fee — it’s investing in the Google Play store because it knows it needs to compete with Apple. It’s important when consumers “choose which phone they’re going to buy,” he says.

    “Why did Google choose to invest in the Play Developer Console the way you described?” asks Google’s attorney Jonathan Kravis.

    “Our business model was aligned with the business model of developers, when they succeed, we succeed,” was the core of his answer.

    Now, Google’s showing that Google didn’t just copy Apple App Store features — Google introduced promo codes and pre-registration for apps first, he claims, and quickly followed Apple with apps for kids and a subscription game library. The reason: “We wanted to stay competitive to Apple’s App Store.”

    Sean Hollister
    Sean Hollister
    Epic v. Google day 14 starts with Google’s Paul Gennai.

    He’s a VP of product management at Google who left Australia (and Australian telecom biz Telstra) to join the firm in 2008, he says.

    In 2010, he joined the Android team as a product manager reporting to Jamie Rosenberg, whom we’ve already heard from in court. He worked on Android strategy — and was intimately involved in Play Store decisions, it seems.

    Follow along here:

    Sean Hollister
    Sean Hollister
    Epic v. Google day 14 — here are the questions each party wants the jury to decide.

    I’ve been wondering for many days — what will the members of the jury actually be allowed to decide? They’re not going to define the relevant product market all on their own, right?

    I can now give you a slightly better idea — last night, Epic and Google submitted dueling proposed jury verdict forms (pdf). As you’ll see right away, Epic is trying to avoid defining the market, while Google is asking jurors if Epic proved that an “Android app distribution market” and an “Android in-app billing services market” exist to begin with.

    It can’t be both ways: only one final judge-edited verdict form will reach the jury.

    Sean Hollister
    Sean Hollister
    The forbidden popcorn button.

    Technology Connections is a phenomenal YouTube channel, and I have no qualms letting Alec’s latest video take the place of our regularly scheduled Button of the Month for December — it’s very good.

    I got a tad too busy with daily live courtroom reporting and some gaming handhelds to write or edit this month’s column, but I promise it’ll be back in January! Hint: think blue.

    Sean Hollister
    Sean Hollister
    Epic v. Google day 13 is over — a few last things.

    We’ve nearly spent a fortnight in Fortnite court.

    Here’s how we ended the day: Judge Donato told Epic that he doesn’t believe any of Google’s conduct reaches the standard of being “per se anticompetitive.”

    “I’m perfectly fine with rule of reason but I’ve having trouble saying they’re so egregious on their face,” he said.

    Epic lead attorney Bornstein says he’s only seeking per se for the Project Hug agreements with Riot, Activision, and Supercell, and the judge says he’s willing to hear more but isn’t inclined to take this away from the jury. He thinks we’ll be deciding everything under the rule of reason standard instead, partly because of a Circuit Court decision (presumably referring to where Epic v. Apple went on appeal.)

    Judge Donato also wanted to know where Epic thought we’d land on the relevant product market, and Bornstein said he’s handling it differently than in Apple because of Google’s very different structure of business relationships. The judge wound up saying, “I don’t think aftermarket concepts are in play here.”

    I am not a lawyer or even a legal reporter, so I’m not going to translate any of this for you on the spot. It’s not worth getting it wrong.