On Wednesday, Google announced that its Google Play’s payments policy is in accordance with the Indian watchdog’s order, and it is proceeding with its plans to enforce the policy in the South Asian market. This comes after several developers raised concerns and sought to suspend Google’s in-app billing fee system, alleging non-compliance with the watchdog’s directive.
In a blog post, Google stated, “In 2020, we clarified the requirements of our Payments policy, and developers in India have had ample time to make the necessary adjustments to their apps. We are respectfully adhering to the CCI’s (Competition Commission of India) October 2022 order. In compliance with that order, we have expanded user choice billing to all developers in India and updated our policy, which came into effect on April 26, 2023.”
According to Google, the service fee it collects from developers enables the company to invest significantly in the growth of India’s app ecosystem. The company emphasized that its fees, which amount to 15% or less for most developers, are the lowest among major app stores. Additionally, Google mentioned a 4% reduction in the fee for developers who implement an alternative billing system, stating that it fairly reflects the underutilization of Google Play’s billing system.
Google estimated that fewer than 60 out of over 200,000 Indian developers on Google Play currently pay a service fee higher than 15%.
In the Indian market, which is a crucial overseas market for Google with a substantial investment of over $10 billion, developers will have three options for billing. They can choose to use Google Play’s billing system, implement an alternative billing system alongside Google Play’s, or opt for a consumption-only basis without paying a service fee. Google has stated that it will start notifying developers about this change, as the deadline for implementation expired last month.
In October, the Competition Commission of India imposed a fine of $113 million on Google and mandated that the company provide developers in the country with the choice to use third-party billing systems. However, a group representing Indian developers has argued that Google’s new system still imposes a “high service fee” of 11% or more on those who do not use its payment system.
Google noted, “Most developers globally have already chosen one of these options. In India, now that the deadline has passed, we are informing developers in the country who have not yet implemented one of these options that we will be taking necessary steps to ensure our policy is applied fairly. We continue to comply with local laws and cooperate with local proceedings, as applicable.”
The recent update from Google follows a request by Match, the owner of Tinder, and the Alliance of Digital India Foundation, a group representing Indian startups, to an Indian court to suspend Google’s new in-app billing fee system until the Competition Commission of India evaluates whether Google is complying with its earlier directive.
According to Reuters, last week, the Competition Commission of India confirmed that it had initiated an inquiry into the matter.