Contributed by: kellyseal on Wednesday, November 16 2022 @ 08:09 am
Last modified on Wednesday, November 16 2022 @ 03:41 pm
In response to increasing scrutiny of its Play Store practices, Google has announced it is opening up its platform to third party payment systems in 35 additional countries.
Currently, Google is the only option for an in-app payment provider on its platform in most countries aside from South Korea, which means it can charge commission (as high as 30 percent) to app developers for every single in-app purchase made by their users. Developers began to fight back, and along with help from European regulators who began to crack down on Apple and Google for their App Store and Play Store practices, they are finding success.
This new initiative has opened up platforms in the US, Brazil and South Africa, in addition to those markets which had already required third party payment system options to be available for developers, such as the EU, Japan, Australia and India.
According to Tech Report[*1] , the case against Apple and Google having total control over payments on their platforms have ramped up in recent months, thanks to legislative actions being brought forward. The bipartisan Open Markets Act was introduced in late 2021 in the U.S. Congress, which according to language in the bill, is created to “tear down coercive anticompetitive walls in the app economy.”
The bill would require platforms like Play Store and App Store to not interfere with app developers who opt to use a third party payment service, or “unreasonably prefer or rank its own apps (or those of its business partners) over other apps.”
If passed, it poses a significant threat to revenue streams for these tech giants. This pending legislation, along with increasing pressure from European regulators and the EU Digital Markets Act (which also opens up competition for Google and Apple), has forced these companies to move and take real steps to open up their platforms.
Match Group and Epic Games have sued both companies in regard to allowing third party payment systems for their apps, as they don’t want to keep paying commissions on in-app purchases, and they want more control over the billing process with customers. Google and Apple have claimed that there are security risks to opening up their platforms, but it looks like now they are backing off.
The recent regulations and legislative moves have shined a spotlight on Apple and Google’s control over commissions, platform taxes, and other fees they can charge, since there are currently few other app store platforms that can compete with them. The latest move to open things up is a welcome sign for developers.