Distributive policy

Why did Google stop its billing policy in India? What does this mean for you?

Google logo. Image Courtesy: Google

Google has discontinued the application of its Play Store billing system for in-app transactions in India.

It comes after India’s Competition Commission (CCI) fined the company Rs 936.44 crore – its second major ruling against the company in recent days – for abusing its dominant position to force application developers to use its integrated payment system. .

What happened?

The company said it was suspending enforcement of the developer requirement while considering its legal options following the TCC ruling.

The company wrote on its FAQ page: “Following the recent ICC ruling, we are suspending enforcement of the requirement for developers to use Google Play’s billing system for the purchase of digital goods and services. for user transactions in India while we review our legal options and ensure we can continue to invest in Android and Play.”

He added that the requirement to use Google Play’s billing system continues to apply to in-app purchases of digital content for users outside India.

Why did this happen?

In its decision, the regulator said that making access to the Play Store for app developers dependent on the mandatory use of GPBS (Google Play’s billing system) for paid apps and in-app purchases constitutes an imposition of an unfair condition to app developers.

CCI also ordered Google not to prevent app developers from using third-party billing/payment processing services to purchase apps.

The commission further stated that the mandatory imposition of this billing system “disrupts the incentives for innovation and the ability of payment processors as well as application developers to undertake technical development and innovate.”

This comes against the backdrop of Indian developers and start-ups planning to step up their lobbying efforts against fees charged by Google for selling apps and services through the Play Store, in line with Mint.

Nearly 97% of India’s 600 million smartphones run on Google’s Android mobile operating system, and startups have banded together in the past to say the payment policy is hurting their businesses, according to Reuters.

Explained why Google stopped its billing policy in India What does this mean for you

Google Play Store. Picture: Tech2

According Indian Express, Paytm’s Vijay Shekhar Sharma and BharatMatrimony’s Murugavel Janakiraman have in the past reported these concerns to the IT Department.

“This decision helps protect our income. We hope Google will implement this permanently as it is not good for Indian digital start-ups – it amounts to a digital tax for us,” said Janakiraman, CEO of BharatMatrimony Group, which runs various apps that help people to find life partners. Reuters.

Globally, Google and Apple have come under fire for charging fees in their mobile app stores that are unnecessarily high and costing developers billions of dollars a year. Both reduced fees in many circumstances and said they were necessary to fund a safe and secure mobile ecosystem.

Google previously set October 31 as the deadline for Indian developers to integrate apps into its Google Play billing system, which collects a commission ranging from 15% to 30% for each sale.

This is the third time Google has had to push back the compliance date in India after backlash from start-ups, developers and regulators in India – it previously pushed back the start date to March 2022 and October 2022, according at Indian Express.

According yahoo, Google, for its part, has started allowing alternative payment systems in India, South Korea, Australia and Japan on a pilot basis, charging lower fees.

According Hindustan timeSouth Korea has ordered Google to provide Play Store developers with the option of alternative payment systems.

The country then passed a law prohibiting app platforms from monopolizing payment methods.

The move forced tech giants, including Google, to expand the options available to developers to accept payments for app downloads, services, subscriptions and in-app purchases.

What does this mean for consumers?

Not a lot.

But the developers are another story.

The Google Play Store serves as the main distribution channel for app developers in the Android mobile ecosystem, allowing its owners to capitalize on the apps brought to market.

Indian app developers are not required to use Google’s payment system to conduct all customer transactions.

The ICC had in November 2020 ordered an investigation into the issue of mandatory use of the Google Play Store payment system for paid apps and in-app purchases, according to the report.

The commission at the time said that on its face such a policy was unfair because it “restricts the ability of app developers to select a payment processing system of their choice.”

Google is expected to challenge CCI’s decision in court.

With contributions from agencies

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