Google has paused its rule requiring use of its own PlayStore system for in-app payments. Developers can use third-party services and avoid Google's 30% tax.
Just over a week ago, Google was fined approximately $113 million in India for forcing its in-house billing system on developers making Android apps. While the fine was hefty in and of itself, the laundry list orders issued by the Competition Commission of India were the real concern for Google.
Why does it matter? Google – and Apple, too – have a strict set of rules for payments in mobile apps. Every app listed on the Play Store is required to integrate Google’s own payment pipeline in their apps for the purchase of in-app items or the payment for subscriptions. In doing so, Google is guaranteed a 30% cut of all transactions.
India is the world’s second-largest smartphone market, and Android commands a massive 95% market share in the country. For comparison, the stakes are much lower in the U.S., where Android’s market share is below the 50% mark, according to a Statista analysis. The CCI’s expansive orders will effectively render Google’s smartphone monopoly toothless.
Troubles ahead for Google and Apple Earlier this year, the European Parliament passed the Digital Markets Act, which proposes a sweeping set of changes for ecosystem gatekeepers like Google and Apple. One of the most notable proposals is forcing Google and Apple to allow third-party payments in apps distributed via the Play Store and App Store, respectively.
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