Google to extend third party billing to developers in India, other nations

A reasonable service fee will continue to apply to support investments in Android and google Play

Google on Friday announced that a third-party ‘in-application (app)’ billing system pilot will be extended to India and four other markets - Australia, Indonesia, Japan, and the European Economic Area - allowing non-gaming developers to offer users the choice of an alternative billing mechanism, alongside Google Play.

All non-gaming developers globally can sign up to participate in the pilot and offer this choice to their mobile and tablet users in these markets. Users will continue to have the choice to use Play’s billing system. A reasonable service fee will continue to apply in order to support investments in Android and Play, according to Google. However, the specifics of what the reasonable service fee will be have not been disclosed.

In March, Google said it would allow Spotify to use its own payment system in its Android app as part of the new pilot programme. Following passage of a new law in South Korea last year, Google said it would allow developers to introduce third- party payment systems, alongside its own in that market.

Non-gaming developers in India now have the option of providing third-party billing systems to users. Developers in India have long been demanding Google Play allow third-party billing options.

In a statement, a spokesperson for Google said, “Android has always been a uniquely open operating system, and we continue to evolve our platform and increase the choices available to developers and users, while maintaining our ability to invest in the ecosystem. With this next phase of Google Play’s user-choice billing pilot, all non-gaming developers can offer an additional billing choice, alongside Play’s billing system to their users in Australia, Japan, India, Indonesia, and the European Economic Area. We will be sharing more in the coming months as we continue to build and iterate with our pilot partners.”

The announcement comes at a time when Google faces scrutiny for its appstore payment structure by the Competition Commission of India. Globally, Google and Apple have been facing regulatory heat due to their appstore practices. With this move, Google claims its Play is the first and only major appstore to pilot user-choice billing. No major appstore, whether on mobile, desktop, or gaming console, has taken similar steps towards providing greater payment choices and opportunities to developers, users, and the entire internet ecosystem.

Abhishek Malhotra, managing partner, TMT Law Practice, said this is a partial win for the app-developing ecosystem with regards to anti-competitive practice. “This will come as a boost to the small-to-mid-sized developers, who can now bring about more in-app ‘paid’ features to the fore. This is certainly a victory for app developers who have been raising anti-competitive concerns against google in view of its previous practices of disallowing third party apps for payments and necessitating the routing of such payments via Google playstore.”

Over the past two years, Google Play has steered away from a one-size-fits-all pricing formula. Today, 99 per cent of developers qualify for a service fee of 15 per cent or less.

Google has already reduced commissions to 15 per cent, from 30 per cent, for the first $1 million of revenue developers earn using the Play billing system each year, following a similar move by Apple. The company said that due to this pricing model shift, 99 per cent of developers qualify for a service fee of 15 per cent or less on its appstore.