Google authorizes the use of third-party payment services in Europe on the Play Store

On July 19, 2022 in a blog post, Google announced that it would be making several significant changes to its Play Store app marketplace within the European Economic Area. Among these new features, the Mountain View company will allow applications to use any in-app payment method. A condition, that the developers transmit all transactions on their service to Google, so that it can recover its commission.

Developers will continue to pay commission to Google

The new payment policy put in place by Google will concern all applications present on the Play Store in Europe, with the exception of games. While players should continue to pay through Google’s payments service for now, they will be able to take advantage of third-party payments later. This change is accompanied by the reduction of the commission on in-app purchases, from 15 to 12%. Thus, on each microtransaction, Google takes part of the amount up to 12%.

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To find out if application developers will decide to choose alternative billing systems, Google has invited them to fill out a declaration form from August 1st. Using this document, they will notify the tech giant of the amount of all transactions paid from the third-party billing system(s) they choose, on a monthly basis. This is how Google can later recover its 12% commission.

Several application developers have been campaigning for several years for Google to authorize the use of third-party payment methods. Spotify or Match Group, the parent company of Tinder, sued Google for this reason, considering that it was playing on its dominant position to force companies to use its in-app payment service.

Google gets ahead of the implementation of the EU’s Digital Market Act

These changes made by Google are specific to the European Union, Norway, Iceland and Liechtenstein, members of the European Economic Area. These new directives are linked to the Digital Market Act (DMA), the text of which was validated by the European Parliament at the beginning of July. It must now be approved by the European Council so that it can enter into force.

The upcoming arrival of the Digital Maket Act and the Digital Services Act will inexorably lead to profound changes for the technological giants and the operation of application stores such as the Play Store or the App Store. Even if these texts are to come into force only by 2023, the Mountain View firm has preferred to take the lead and comply now.

Google explains that ” As part of our efforts to comply with these new standards, we are announcing a new program to support alternative payments for users in the European Economic Area “.

If Google preferred to take the lead in Europe, it has long been beaten in other countries to try to keep its in-app payments service. In South Korea, where a law requires the opening of the Play Store payment system, Google is fighting to limit the scope of application of this new legislation.

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