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Google will allow alternative payment systems for Play Store in more countries

·3-min read

Google announced today it's expanding the user choice billing program for Play Store — which lets users choose alternative payment systems for in-app purchases — to India, Australia, Indonesia, Japan and the European Economic Area. The company is calling all non-gaming developers globally to apply for this program, and if they qualify, they can use third-party payment systems in the above-mentioned regions.

The search giant introduced a similar policy for non-gaming developers and users in the EEA region in July. The new guidelines are an extension of that. The company gave a 3% discount on fees for developers using third-party billing in the EEA region. With the new announcement, Google is offering a 4% discount on fees to developers. The company said it will reveal more details about that in the coming weeks and months.

This information is critical for a lot of developers as the percentage cut Google takes will determine if they want to go through the hassle of switching payment processors.

The company said that more than 99% of developers on the Play Store qualify for 15% or lower fees — but the top 1% of developers generate quite a lot of revenue on the Play Store. Google takes a 15% cut from the first $1 million from any developer annually. It then charges 30% after developers' first million-dollar earnings for the year. Some developers who qualify for the Google Play Media Experience program — which includes apps offering books, audio, and video — pay as low as 10% fees.

While this new expansion includes some of the largest Android markets like India and Indonesia, it ignores the U.S. market, where lawmakers are exploring rules that aim to curb Apple and Google's monopoly over app stores. In July, the firm agreed to a $90 million settlement with U.S.-based developers over the issue of Play Store fees.

“Android has always been a uniquely open operating system, and we continue to evolve our platform and increase the choices available to developers and users, while maintaining our ability to invest in the ecosystem. We will be sharing more in the coming months as we continue to build and iterate with our pilot partners," a Google spokesperson said in a statement.

The firm first piloted this program with Spotify in March and said it will slowly make third-party billing available in all markets where Spotify Premium is available. Later in May, Google also struck a deal with Match Group over its apps offering alternative payment options for in-app purchases.

Google already offers a third-party payment system on the Play Store for users based in South Korea after the country passed a law that forbade companies from mandating a payment system for in-app purchases. However, the firm offers a 4% discount on developer fees in South Korea.

Like Spotify's third-party billing pilot, Google will work with developers to make this option available to users gradually — there's no official timeline for this yet. So users might not see multiple payment options right away. Once it's available, users will see different payment systems directly in the app and they can decide which one to use depending on the charges and features offered by them. If they choose to use an alternative payment system, they will have to contact the provider regarding payment issues, refunds and cancelations.

Google introduced mandatory Google Play billing globally from June 1, but given the new announcement, developers will be able to use other payment processors in their apps for approved regions.

The Mountain View-based giant's move to introduce third-party billing to multiple regions will put pressure on Apple to take similar steps. The iPhone maker currently offers alternative billing to dating apps in the Netherlands, reader apps in Japan and all apps in South Korea after being forced by local regulators.

Updated the story with clarification from Google about discounts offered to devs under the new announcement.