Google will reduce its Play Commission globally for developers selling in-app digital goods and services on its marquee store, the company following Similar move by rival Apple At the end of last year.
The Android-maker said on Tuesday that since July 1, it is slashing service fees for Google Play by 15% – down to 30% – the first $ 1 million revenue developers earn each year using the Play billing system. The company said that every dollar generated through Google Play would cut 30% on developers beyond $ 1 million a year.
Citing its own estimates, Google stated that 99% of developers selling goods and services with Play will see a 50% reduction in fees, and that 97% of apps globally do not sell digital goods or Do not pay any service fees.
Google’s new approach is slightly different from Apple, which said last year that it would collect 15% instead of 30% of App Store sales from companies that did not produce more than $ 1 million in revenue through the company’s platform We do. If a developer has more than $ 1 million in revenue on the Apple platform, this drop does not apply to the iOS app.
“We’ve heard from our partners $ 2 million, $ 5 million and even $ 10 million a year that their services are still on a path to self-sufficient class,” Sameer Samat, VP of Android and Google Play Has written in a blog post.
“That’s why we’re reducing how much of the first $ 1 million of total revenue is earned each year available to every Play developer who uses the Play billing system, regardless of size. We believe this is an appropriate approach that aligns with Google’s broader mission to help all developers succeed. “
This step comes a few months after the change in the Google billing system fee Troubled many startups in India. More than 150 startups were banded together last year by Google, stating that it would cut in-app purchases by 30% over a range of categories created by Android apps.
After the backlash, Google delayed implementing the Play Store payment rule in India From April 2022 Several firms in the country had reached out in recent months to better understand their concerns, people familiar with the matter told TechCrunch.
Vijay Shekhar Sharma, founder and chief executive of mobile payment provider Paytm, India Most valuable startup, Dismissed Google’s move today as a “PR stunt”.
In an interview with TechCrunch, Sharma said that firms like him would still have to pay Google a very high fee. Today’s announcement by Google, he said, adds to the question of whether Google plans to address concerns raised by serious Internet firms.
He said the biggest concern today is the inability to use a third-party payment service for billing. “They’re basically saying that as soon as you build a business bigger than $ 1 million – which is much less frequent – you’re going to pay a 30% fee, which gets 44% after taxes,” he said. said.
The 30% sales cut and the inability to use a third-party billing system are points of contention between many developers and app store operators – Apple and Google and prosecuted by Fortnite-Maker Epic Games Against iPhone Manufacturer Last Year. Epic CEO Tim Sweeney alleged that Apple’s move to reduce app store fees for smaller developers was orchestrated to sow division among app makers.
Sharma said he hoped Google would address other concerns, especially because in a country like India “we have no other operating system, or distribution platform. They effectively control the destiny of every app developer in the country . “
According to research firm Counterpoint, 99% of Android is in the smartphone market in India. Sharma said, “First India was powered by Android, then we became dependent on Android, and now it is controlled by Android.”
Google’s Samat said, “We look forward to seeing more businesses on Android reach new heights, and discuss further with the Indian developer community to find new ways to support them technically and financially as they Build their business. “
“Once the developers verify some basic information to help us understand any related accounts we have and ensure that we apply 15% properly, this rebate is automatically renewed each year Will go, ”he wrote.