Startups mulling over options against Google over additional fees

Google opened its optional billing policy to all developers in India on 24 February. This allows firms selling digital items and subscriptions through the Play Store to integrate billing methods other than Google’s built-in system.

However, startups are being dishonest by accusing the company of overcharging for these payments. Google charges a 15% fee for using its own billing system for any payments on apps that generate less than $1 million in annual revenue. For others, the fee is 30%. Under the new policy, app developers will have to pay 11% and 26%, respectively, if users choose third-party billing.

Startup founders and industry stakeholders met on 27 February to discuss the way forward. Two founders, who were part of the discussions, requested anonymity, saying they were exploring all legal avenues, including filing another complaint with the Competition Commission of India (CCI), going to the courts and approaching the government is included. The startups are accusing Google of discriminatory pricing, which they said stifles market competition. One of the founders said that they plan to file a contempt case with the CCI, claiming that Google’s new policy violates the CCI order.

To be sure, Google updated its Play Store policy in January to comply with another CCI order that found the US tech firm in violation of India’s competition laws. CCI slaps Google with a 936 crore fine last October, and ordered it to allow third-party billing on the Play Store.

Although third-party billing is now available to all developers, since last month, startups feel that Google is still charging high commission on third-party billing.

A Google spokesperson said in a statement, “Google Play’s service fee has never been a fee for payment processing, and even when a user chooses an alternate billing system, developers will continue to pay Google Play and Android derive significant value from.”