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Google headquarters logo. (Photo = Yonhap News) |
[Alpha Biz= Kim Jisun] More than 60 South Korean game companies are set to file a class action lawsuit against Google and Apple, accusing the tech giants of abusing their dominant market position to impose excessive fees.
According to a Kukmin Ilbo report on Wednesday, law firm Wither People announced that it would soon file a damages class action lawsuit in collaboration with U.S. law firm Hausfeld. The lawsuit targets Google and Apple’s in-app payment policies and monopolistic practices.
Lee Young-gi, an attorney at Wither People, stated, “Even after closing the initial round with around 60 companies, more firms are expressing their intention to join. We are currently gathering data for damage assessments ahead of expert evaluations in the U.S.”
Hausfeld previously represented 48,000 U.S. app developers in a similar Google in-app payment case in 2023, resulting in a settlement.
The joint Korean-American legal team plans to pursue a pre-litigation settlement process (class mediation) before formally filing the lawsuit. U.S. courts have previously ruled that Google and Apple must compensate companies for the difference between their standard commission rates (4–6%) and the excessive fees charged.
In-app payments refer to purchases made within mobile apps via platforms like Google Play Store and Apple App Store. These platforms charge developers a commission of up to 30% on transactions.
South Korea’s gaming industry is the fourth-largest globally, with an annual revenue of approximately 22 trillion won. However, developers claim they suffer due to the 30% commission rates—three to five times higher than standard fees. In contrast, fees in the U.S. and Japan have dropped to around 20% following the introduction of third-party payment systems, while Europe’s Digital Markets Act (DMA) reduced fees to as low as 17%. In South Korea, the rates remain at a global high of around 30%.
The two law firms estimate that excessive commission fees on South Korea’s annual mobile game app spending of 8.3 trillion won result in damages of approximately 2 trillion won per year. The estimated damages over the four-year period from 2020 to 2023 amount to roughly 9 trillion won.
Despite suffering from high fees, many small and medium-sized game developers are hesitant to join the lawsuit, fearing potential retaliation from Google and Apple, which together dominate over 90% of the domestic app market.
AlphaBIZ Kim Jisun(stockmk2020@alphabiz.co.kr)
