Tech

The lawsuit alleges that the Google Play Store revenue sharing policy is simply copying Apple

Why is it important: The Google Play Store may not be as lucrative as the Apple App Store, but the two app distribution platforms work the same when it comes to generating revenue from developers. This has left Google in a fever with antitrust regulators, so it’s only a matter of time before it has to change its Play Store policy to avoid new legal issues.

Last month, Google filed its fourth antitrust lawsuit in recent years, in which 36 attorneys general and one district attorney accused the company of anti-competitive behavior against the Play Store. In particular, the search giant has been accused of making it difficult for developers to distribute their apps through alternative app stores, as well as signing contracts with phone manufacturers and carriers that prevent them from creating their own competing app stores.

According to court documents that were unsealed The Play Store generated $ 11.2 billion in revenue this week in 2019, of which $ 8.5 billion was in revenue. While this is not quite on par with Apple’s App Store profit margins, the ROI is 62 percent, which is quite an advantage compared to the 80 percent margin achieved by the latest app distribution platform.

This suggests that, like Apple, Google can afford to charge developers much less fees while still making a profit from hosting its apps and filtering out malware. The company currently accounts for up to 30% of app revenue, but internal communication suggests that this figure simply reflects what Apple did with its App Store. The lawsuit even cites internal data that shows the Google Play Store could pay off with a revenue share of just six percent.

Perhaps more disturbingly, Google has offered to “significantly cut” Netflix’s Play Store revenue after the latter company voiced its “dissatisfaction” with the standard fee. Netflix, Tinder, Spotify – and most famous – Epic – have it all tried to bypassing the Google Play Store billing system in recent years, but the search giant it wouldn’t be for fear of losing more than $ 1.1 billion in annual revenue. This behavior also looks like an exact replica of what Apple has done with the likes of Amazon and Netflix.

Google Representative said The Verge that “all developers are subject to the same policies as all other developers, including the payment policy. We have long had programs that support developers with increased resources and investments. These programs are a sign of healthy competition between operating systems. and app stores and benefit developers. “

However, these programs are very similar to those of Apple. For example, the one that was introduced in March cut Play Store commissions in half for developers who haven’t made more than $ 1 million in lifetime sales yet. Apple launched a similar program last year for developers who publish their apps to the App Store and earn less than $ 1 million a year.

Apple recently decided to change its App Store policies to allow developers to advertise alternative payment options to users using their contact information, which is admittedly just a small step in the right direction, but Google hasn’t done it yet. If anything, the pressure of the four antitrust lawsuits could finally push the search giant to re-copy Apple.


Source link

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button