Google’s pilot on third-party payments in Play Store apps is now being expanded to include developers in India. The pilot was announced globally in March with a small group of developers including Spotify in select countries.
On Friday, the company updated its support pages to announce that the move is being expanded to six more regions, including India. This will only apply to “non-gaming” apps on the Play Store.
“With this next phase of the Google Play User Choice Billing Pilot, all non-gaming developers can offer their users in Australia, Japan, India, Indonesia and the European Economic Area an additional billing option with Play’s billing system. “We will share more in the coming months as we continue to build and iterate with our pilot partners,” a Google spokesperson said in the statement.
Allowing third-party payments on the Play Store has been a major point of contention between Google and developers around the world, including in India. The company is facing anti-trust battles in various sectors including the Competition Commission of India (CCI) over the issue. “We have always recommended that the billing system should never be a lock-in model. The customer should be free to choose any provider and open-ended,” said Ramesh Kailasam, president and chief executive of startup industry body IndiaTech.org. The price points available in the market should be transparent.”
To be sure, Google has stated that service charges paid by developers will continue to apply in third-party billing as well. However, each time a consumer uses third-party billing, the service fee for developers will be reduced by 4%. For apps that make less than $1 million a year, Google charges 15% for using its built-in payment platform. For others, the fee is 30%.
“It’s a flawed argument that app marketplaces don’t generate revenue because they charge fees at every level, from listings to the various embedded functionalities that are used throughout the process,” Callasam said. Apple also charges similar fees to developers and has begun allowing third-party billing systems in some regions around the world. “Charging unusually high commissions on in-app payments is already in place,” Callasam said. The price adds to the environment and can kill the startup environment.”
On the other hand, lawyers say allowing third-party billing may not affect Google’s ongoing case in the CCI. In April, the Director General (DG) of CCI submitted its report on Google’s Play Store billing policies, stating that Google is imposing “unfair and discriminatory” terms that violate India’s rules.
Kunal Mehra, partner at law firm DSK Legal, said, “This is a welcome policy change and it appears to be a pilot matter that needs to be implemented seriously by the CCI for a potentially lenient view of the situation.” However, he added, “any investigation still takes into account past conduct, so if the push to Google’s billing system is found to be inappropriate, fines may be imposed regardless of policy changes.” “
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