Google announced that it would start allowing all Android app developers to opt for a third-party billing system for Google Play Store purchases in India starting April 26. The company has been accused of reducing the commission for third-party billing systems by only 4%.
Tinder-owner Match Group and Indian startups have asked the country's competition body to investigate Google for alleged non-compliance with an antitrust directive by charging a high service fee for in-app payments. Google will be charging 15-30% if consumers are paying through Google Pay, or 11-26% if paid alternatively, which would take away almost one-third of the revenue and would dent the pockets of OTT platforms severely, noted Alliance of Digital India Foundation (ADIF).
"Google's policy change of a charging service fee even on transactions processed by third-party payment processors ... has detrimental consequences for users and app developers,"
complaint by ADIF said.
Google has previously said the service fee supports investments in Google Play app store and the Android mobile operating system, ensuring it distributes it for free, and covers developer tools and analytic services.
The Competition Commission of India (CCI) in October imposed a $113 million fine on Google and said it must allow the use of third-party billing and stop forcing developers to use its in-app payment system that charges commission of 15%-30%.
Google later decided to start offering User Choice Billing (UCB) for allowing alternative payments alongside Google's when purchasing in-app digital content, but the ADIF said in its filing that this new system imposes a "service fee".
"The app developers will have to pay 1%-3% for alternate payment service providers and 11%-26% to Google, which makes the entire ecosystem unsustainable,"
ADIF said.
Match in its March 21 filing asked the CCI to direct Google not to collect or impose any commission or service fee, including via user choice billing, saying the system was "anti-competitive".
ADIF, which represents Indian startups including digital payments firm Paytm and social media app ShareChat, in its March complaint alleged that Google was using the new service fee system to bypass the antitrust directive that ordered it not to impose any "unfair and disproportionate" conditions.
Source: Reuters
