New Delhi Google on Tuesday halted enforcement of a policy that mandated Indian app developers to use its proprietary Play billing system, a week after India’s antitrust regulator ruled that the policy stifled competition.
The Play billing policy, which required app developers to use Google’s built-in payment methods, was to come into effect from October 31. However, on October 25, the Competition Commission of India (CCI) ruled that Google cannot force developers to use its payment system.
“Following the recent decision of the CCI, we are reviewing legal options and ensuring that we continue to support Android and Play,” Google said.
If Google had implemented the policy, apps that failed to integrate Google’s billing mechanism for in-app purchases after October 31 could have been suspended or removed from the Play Store, more than 95% in India. Affects their revenue as Android phones account for more smartphone users. ,
Mint reported on October 25 that the CCI’s decision could prompt app developers and marketers to lobby regulators to force Google to cut in-app transaction fees. Experts said it could be difficult for Google to roll back mandatory use of its billing tools, and it could also be a first step towards normalizing the transaction fees that other payment merchants charge.
“Even if Google calls this a temporary move, I see no way for them to comply with the new rules and roll back their previously intended payment policy. As a result, it is not enough to generate revenue. may look to adopt a different approach,” said technology policy analyst Prashanto K Roy.
According to the data filed with the Registrar of Companies (ROC) till FY 2011, Google earned 14.8 crore through payments on Play Store – only 0.2% of its annual revenue in the financial year.
To be sure, Google is in the process of making changes to its policy as well. Last month, it launched a pilot program that allowed app vendors to use third-party billing systems when distributing apps through the Store. However, Google Play Store still offers a 4% discount on the commission rate when a third-party payment mechanism is used—its base rate retains a 15% commission for the first $1 million of revenue and 30% thereafter .
App developers said the suspension of the Play Store billing compliance deadline by Google indicates a positive move.
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