Startup body slams Google's fee cut, calls for more reforms
2 min read 22 Oct 2021, 12:55 PM ISTStartup body the Alliance of Digital India Foundation has accused the company of trying to ‘deflect and distract’ from what developers have been asking for so far
PremiumGoogle’s decision to slash Play Store fees for developers selling subscription services hasn’t been received as well as the company may have hoped. Startup body the Alliance of Digital India Foundation (ADIF), accused the company of trying to “deflect and distract" from what developers have been asking for so far.
Google has reduced the 30% commission it was charging from developers for using its platform to 15%. The new fees will come into effect from January 2022 and the body also said this move only addresses the issue of high prices charged from app developers, the bigger issue of anti-competitive practices still remains unaddressed.
"What developers are asking for is fairness and not benevolence in the form of “reduced" commission percentages. It has never been about the percentages. Price discovery should be left to the market forces. As long as Google gets to unilaterally dictate prices and people don’t have choices, it's still a lagaan—be it 30, 15 or even 2, the percentages do not matter," Sijo Kuruvilla George, executive director, ADIF said in a statement.
The industry organization had filed a plea with the CCI earlier, asking the antitrust regulator to stop Google from bringing its Play Store fee policies into practice till the CCI’s probe into the company had finished. “Deflect and distract seems to be what's in play here. The portrayal and grandstanding, as a measure that fully acknowledges and addresses the concerns of developers, is misleading and objectionable," Kuruvilla added.
Both Google and Apple have made it mandatory for app developers to use their payment system for selling any content and services through their platforms. A few developers, including Epic Games that tried to bypass the payment system were banned from some of these stores.
The body acknowledged that the reduction in Play Store fees will bring relief to developers who were dependent on Google's billing system and will improve their margins if they fall in the categories that qualify for Google’s relaxation in margins.
According to Google, 99% of developers would qualify for a service fee of 15% or less.
The 30% Play Store commission charged by Google had become a bone of contention between Google and app developers in India and abroad.
This had brought Google on the radar of regulators. The Competition Commission of India (CCI) had launched an investigation against both Google and Apple for alleged anti-competitive practices on their respective app store markets.
In July, an antitrust lawsuit was also filed against Google in the US for similar reasons. Last year, game company Epic Games had brought a lawsuit against both Apple and Google for charging high app store fees that was preventing them from offering their services at reasonable prices to customers.
Apple had recently changed its policies, too, and slashed App Store fees from 30% to 15% for developers who made less than $1 million annually and were new to the App Store. It came into effect from January 2021.
