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What just happened? Google announced this week that it's complying with the new South Korean law that says it must allow alternate payment systems for Android apps. The company will also reduce service fees for transactions that use third-party payment, on top of other changes it made last month.
Google notified South Korean Android developers that they could begin adding alternate payment options to their apps. When Android users in South Korea make Google Play Store purchases, they'll have the choice to pay through Google Play or a third-party billing system during checkout. The service fee reductions on third-party billing will compound with the fee reductions Google discussed in an October 21 blog post on its Android developer blog.
Under current rules, the service fee for 99 percent of developers whose apps are on Google Play is now 15 percent or less rather than 30. Ebooks and music streaming services are now eligible for services fees of 10 percent, while the commissions on recurring subscriptions will drop from 30 percent down to 15 on January 1, 2022.
South Korean third-party billing systems will have service fees reduced by four percent across the board. For instance, purchases that would incur a 15-percent fee for the developer through Google Play billing will drop to 11 percent through third-party billing. Likewise, ebooks paid for through alternative systems will only see a six-percent charge.
The new law Google is complying with passed South Korea's national assembly at the end of August. South Korea became the first country in the world to ban app store owners like Apple and Google from forcing developers to route purchases through their billing systems. It even became known as the "Anti-Google Law" in South Korea. Apple has yet to comply.
Google stressed that it thinks its billing system is safer than third-party alternatives, noting features like parental controls or family payment. It pointed out how many people buy Google Play gift cards in South Korea and how those will only go through the store's billing system. It also highlighted things the Play store's fees pay for, like security and developer tools.