Google recently announced an updated policy regarding its app store fees which would see developers adhere strictly to payments going forward. The Android parent company announced that starting from 2021, all app developers will pay an equal amount on app store fee, which also includes high-profile app developers that have enjoyed the privilege of earning more but paying less in the store.
This move comes as some developers, including Netflix and Spotify, have been getting around paying Google its cut of their revenue by asking users to enter their credit card information into their own apps. Starting next year, developers will be required to use Google’s in-app billing system so Google can take its share from source.
“We’ve always required developers who distribute their apps on Play to use Google Play’s billing system if they offer in-app purchases of digital goods, and pay a service fee from a percentage of the purchase. To be clear, this policy is only applicable to less than 3% of developers with apps on Google Play. We only collect a service fee if the developer charges users to download their app or they sell in-app digital items, and we think that is fair. Not only does this approach allow us to continuously reinvest in the platform, this business model aligns our success directly with the success of developers.”
Google’s existing policy says that developers have to use Google’s billing system if purchases were made within the platform, but was yet to be enforced. It mentioned that 97% of developers selling digital products already were complying with this policy.
“We want to be sure our policies are clear and up to date so they can be applied consistently and fairly to all developers, and we so we have clarified the language in our Payments Policy to be more explicit that all developers selling digital goods in their apps are required to use Google Play’s billing system,” said Sameer Samat who a Vice President of Product Management at Google in a blog post.
The change will see the Play Store follow in the footsteps of Apple’s App Store, which in recent months has been criticized by some of tech’s biggest names for the steep fees it charges developers who want their apps to be available on iPhones and iPads. The tech has argued against scrutiny of its platform pointing out that Google also takes 30% fee from in-app purchases.
Last week, Spotify, Tinder parent company Match Group and “Fortnite” developer Epic Games — which over the summer got itself kicked out of Apple’s and Google’s stores when it violated policies by implementing a new payment system in its popular gaming app announced that they were joining a nonprofit coalition with the goal of pressuring Apple to change its stand on fees.
Google had been turning a blind eye to this behavior until now, saying in a blog post that it wanted to “clarify” its rules, and added that 97 percent of the developers on its app store who sell digital goods abided by the rules.
“But for those who already have an app on Google Play that requires technical work to integrate our billing system, we do not want to unduly disrupt their roadmaps and are giving a year to complete any needed updates,” the company said.
Apple CEO, Tim Cook faced a hearing on antitrust this summer where he had to respond to questions about which apps Apple allowed on its platforms and how it uses its power to subjugate smaller developers. Google CEO, Sundar Pichai testified at a similar hearing, where he responded to questions about the company’s role in advertising, data collection and search but not so much on how Google charges developers for using the Google Play Store.