Google tests letting apps like Spotify offer own billing
BNN Bloomberg
Alphabet’s Google will begin letting some apps bill users directly as an alternative to paying through Google, a concession amid mounting antitrust concerns with app store fees.
Alphabet Inc.’s Google will begin letting some apps bill users directly as an alternative to paying through Google, a concession amid mounting antitrust concerns with app store fees.
The new system, which Google is framing as an experiment, starts first with streaming giant Spotify Technology SA. If a user chooses to pay Spotify directly instead of using Google’s billing system, Spotify won’t have to give Google its entire 15 per cent fee, according to a person familiar with the matter. A Google spokesperson said the company hasn’t sorted out the financial terms yet.
“This is a significant milestone and the first on any major app store — whether on mobile, desktop, or game consoles,” Sameer Samat, a Google vice president, wrote Wednesday in a blog post. The executive said Google would be sharing more “in the coming months.”
Both Google and Apple Inc. have faced pressure from lawsuits and in Congress for requiring app-makers to use their payments systems. Google takes a 30 per cent commission on most app store purchases and subscriptions, but lowered the fee in recent years to 15 per cent for media providers like Spotify. Spotify is one of several companies that have complained about the inability to use their own billing systems on mobile app stores.
In South Korea, Google was forced to provide an alternative billing system after regulatory action. In that market, Google said it was reducing app-maker’s fees by 4 per cent.
The new update is meant to work across the globe.
