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Google Rejected Play Store Fee Changes Due to Impact on Revenue, Epic Lawsuit Shows
23.12.2023 - 07:09 / tech.hindustantimes.com
Alphabet Inc.'s Google considered changing its app store pricing model to circumvent a regulatory crackdown, but abandoned a proposal to charge a set fee per app after it became clear that could cost the company billions of dollars, according to documents released late Thursday.
Google created Project Everest in 2021 to reconsider the Play Store billing model, according to the documents, which were released as part of an antitrust suit by Epic Games Inc. Google last week lost the suit brought by the maker of Fortnite when a federal jury found the tech giant abused its monopoly power over the app store.
Sparked by mounting pressure from regulators and developers over Google Play's hefty 30% commission, the presentation showed the search giant was concerned about staving off what it saw as potential regulatory overreach.
“We can defend the status quo for a few months,” Google said in the presentation. “Making proposed changes sooner may help support reasonable legislation, position Google as a leader, and prevent more draconian legislation.”
Project Everest explored charging developers piecemeal service fees for putting their apps or games in the Play Store, with additional fees for user downloads, updates and referrals. But the company estimated that model created “potential for significant loss” from $1 billion to $2 billion for apps and $6 billion to $9 billion for games.
Instead, employees recommended allowing app developers to process payments themselves in exchange for paying Google a lower fee. The company estimated the change would reduce the store's annual revenue between $250 million and $1.3 billion, depending on how many users opted for the other payment choice. That solution essentially mirrors the $700 million settlement Google announced last week with a group of state attorneys general from about three dozen states and consumers.
Google's loss to Epic threatens to roil an app store duopoly with Apple Inc. that generates close to $200 billion a year and dictates how billions of consumers use mobile devices. Epic has spent years railing against the Apple and Google's practice of charging commissions of as much as 30% to software developers who typically have few other options. Google's loss is likely to accelerate the weakening of app store rules, which have already come under fire from regulators and lawmakers around the world.
Mobile app developers have long complained that Google's commissions are too high and require them to charge consumers more, a grievance that has led countries like Korea to require the company to open its app stores to other payment systems. New European Union rules set to come into effect in March will also require Google and Apple to open up their stores.
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blog.playstation.com
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theverge.com
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By Jon Porter, a reporter with five years of experience covering consumer tech releases, EU tech policy, online platforms, and mechanical keyboards.
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tech.hindustantimes.com
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droidgamers.com
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blog.playstation.com
23.12.2023 / 04:41
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tech.hindustantimes.com
21.12.2023 / 03:54
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videogameschronicle.com
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gameranx.com
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blog.playstation.com
20.12.2023 / 01:05
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