Following the Competition Commission of India’s order last month prohibiting Google from requiring a 15% commission on in-app purchases for apps downloaded from Google Play, the company announced that it would not — for the moment — be enforcing this policy in India. This makes India the only country in the world where in-app purchases for digital goods can be made without paying Google anything by way of commission.
A Google spokesperson told Entrackr that the company had no comment to offer beyond the update to its developer help documentation website, where the extension was announced.
Indian developers had already benefited from an interim exception to this rule, with the deadline for enforcement extended all the way to October 31, 2022. That extension was offered in view of “unique circumstances with the payments landscape in India,” Google said; prominent Indian developers and companies had pushed back against the rule, such as Paytm founder Vijay Shekhar Sharma.
The CCI order has now essentially pushed that deadline indefinitely, as Google explores legal options to combat the prohibition on requiring Google Play billing.
Even in the European Economic Area and South Korea, two jurisdictions where Google has been compelled to allow alternate billing mechanisms, Google requires app developers to pay a reduced commission on in-app purchases.
“When a consumer uses an alternative billing system, the service fee the developer pays will be reduced by 3%,” Estelle Werth, Google’s director for EU Government Affairs & Public Policy, said in a blog post. A similar reduction of 4% applies in South Korea. This could mean that Google was able to extract concessions from the EU and the Korean government to continue to let it receive at least some commission on in-app purchases in those markets.
But that is the difference between a consultative legislative process and an adversarial antitrust investigation. On top of this prohibition, Google was fined Rs 936.44 crore by the CCI, on top of a similar fine in a different competition case. The firm was just days previously fined Rs 1337.76 crore for abusing its dominance by requiring phone makers to pre-install a suite of Google apps if they wanted access to the Play Store.
“Indian developers have benefited from the technology, security, consumer protections, and unrivaled choice and flexibility that Android and Google Play provide,” Google told Entrackr in a statement regarding these orders. “And by keeping costs low, our model has powered India’s digital transformation and expanded access for hundreds of millions of Indians. We remain committed to our users and developers and are reviewing the decision to evaluate next steps.”
