Google Play will now allow Spotify to bill US users for subscriptions directly in the app.
A Significant Improvement in Google Play User Billing
On Thursday, Google announced that Spotify and Bumble can bill their US users for subscriptions inside their respective apps. Google Play takes a certain percentage of digital sales in apps through billing platforms.
However, allowing companies to bill their users directly in an app will let them reduce the fees. Even though apps can bill their users directly, they still have to pay Google a certain percentage of the app sales. Spotify, for instance, will continue to accept payment for subscriptions made through Google Pay billing.
The support document stated that if a consumer wants to use an alternative billing system, the fee will be reduced by 4%, instead of 15%.
This is a significant move by Google. And it is also a concession from a major mobile app store to enable third-party billing in Google Play. This is an indication that Spotify and Google have made a deal to tackle the issue regarding fees.
Apple has not conceded yet and does not allow all apps to allow third-party billing systems.
The decision of Google to let these apps use alternative billing systems is not the kind of move that app makers want. What they really want is to remove the fee that Google takes. But this is still a significant improvement.
User Choice billing was announced in March. At that time, Google called it a pilot.
Currently, it allows non-gaming apps that follow the user interface guidelines on how to implement the billing. Spotify is one of the testers.
The experience, however, could still change. This is still the early days of the test. Bumble joined Google to test the new billing system. It’s planning to roll out the options to many users in certain countries in the coming months.
Unlike Apple, Google allows side loading. It means that users can install apps from other sources. They are not limited to Google Play.
Now, with this new policy, will Apple make the same move?
Anti-Competitive Behavior
Spotify accuses Apple of its anti-competitive behavior that’s been hurting every developer. The music-streaming giant said that the iPhone maker continues to stand in its way and other developers’ abilities to provide consumers with a seamless experience. Restrictions of Apple are not only hurting creators but also consumers.
Recently, Spotify launched Audiobooks in the US. But Apple rejected the service. According to Spotify, Apple changes its rules arbitrability. As a result, it makes them difficult to interpret.
Apple forces its developers to use its in-house payments system when it comes to handing in-app purchases. The company is getting a huge cut of revenue because it is pricy to maintain App Store. Apple offers perks such as fraud protection, theft protection, etc.
However, many people know that giving developers a way to bypass the fee is not sustainable for Apple.
