The company stressed that it would still charge service fees, but would cut that cost by four percent to help offset costs from running a separate billing system. E-book and music streaming app developers would pay Google a six percent cut instead of the previous 10 percent, for instance, while most creators will pay 11 percent instead of 15 percent. Some very popular developers won’t see much change at all, though, dropping from 30 percent to 26 percent. More implementation details are coming in the “weeks and months” ahead.
Google is complying with South Korea’s regulation mandating third-party payment support, but not in the way you may anticipate. According to the Wall Street Journal, Google will accept alternate payment options for Play Store apps in South Korea. When you check out using a compatible app, you’ll be given the option of billing methods for the transaction. This, however, will not allow developers to avoid Google’s payments.
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Senior public policy director Wilson White argued that Google still needed to take a cut to “continue to invest” in Android and the Play Store. The fees help keep those platforms free, White said. They also fund the advancement of Android, developer tools and security.
Whether or not Korean regulators will accept Google’s approach isn’t clear. The new law doesn’t bar Google from taking a slice of in-app purchases, but the small drop in fees might not be enough to offset the costs of third-party systems. The law was meant to open up app stores and foster competition — that won’t happen if it’s too cost-prohibitive to use third-party payments. While this might stop Google from suing developers who offer alternatives, it may still discourage those developers from considering alternatives in the first place.
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