Google has confirmed plans to lower the commission it takes from app developers selling goods or services via Google Play. The fee will be halved worldwide from 1 July to 15 percent for the first USD 1 million of revenue earned per year. The company said about 99 percent of developers fall into this category. For app developers making more than USD 1 million in revenue per year, the reduced fee will apply to the first million, and then the standard rate of 30 percent.
The news sees the company take a slightly different approach to Apple. The rival also introduced a reduced rate of 15 percent for smaller developers this year, but this applies only to companies with total income of less than USD 1 million.
The two dominant app platforms have come under pressure for the blanket commission, which is levied regardless of the type of app, company or sales. App publishers who refuse the commission may be shut out from distribution on the app stores, limiting their access to iOS and Android users.
Google said that the service fee is crucial for reinvestments into its platform. The company has been working to standardise application of the fee around the world and also on big apps that may have alternative distribution channels. However, it has faced resistance in countries such as India and Korea, where the commission did not previously apply on many in-app purchases, and from big publishers such as Spotify and Netflix which don't want to share subscription fees with the app stores.
Google previously announced plans to introduce the 30 percent commission on all in-app digital goods purchases while making it mandatory to use its own payment system for app purchases on its platform, starting January 2021. The company then delayed implementation to September after the billing policy came under fire from tech companies and politicians.
