Google clarifies In-App Billing requirements, says using third-party app stores will be easier in Android 12
Last week, we learned that Google was preparing to update its Play Store guidelines with new language that clarifies the requirements around the use of the Google Play In-app Billing service for in-app purchases. The report suggested that Google wanted to crack down on apps that offered in-app payments without using Google’s payment service, which is how Google gets 30% of revenue from Play Store purchases. Today, Google made these changes official.
Clarity on use of Google Play In-App Billing
Before today, Google required all apps distributed on the Play Store that sell digital goods consumed entirely within the app (such as skins in a mobile game) to use Google Play’s billing system. This has been a long-standing policy of Google Play, but the company says that they have “heard feedback that [their] policy language could be more clear regarding which types of transactions require the use of Google Play’s billing system.” As such, the company has updated the language on its Payments Policy page to be more explicit about the requirement for all digital goods to be sold through Google Play’s billing system. (For what it’s worth, I did a diff between the old payments policy page and the updated page using the Wayback Machine, and it definitely looks like only the language and not the actual policies were updated.)
Google says that “less than 3% of developers with apps on Play sold digital goods over the last 12 months” and that “of this 3%, the vast majority (nearly 97%) already use Google Play’s billing.” It’s important to put these numbers into context, though. There are nearly 3,000,000 apps on the Play Store; the vast majority of these apps are free and thus have no need for Google Play’s billing system. Regardless, for those existing apps that will be affected by this change, Google is giving until September 30, 2021, to implement their billing system. Any new apps submitted to the Play Store after January 20, 2021, however, will need to be in compliance with the updated guidelines. Lastly, for those apps that transitioned from offering physical goods to digital goods (because of the challenges from the COVID-19 pandemic), Google says “these businesses will not need to comply with [their] payments policy” for the next 12 months.
Other aspects of Google’s Play Store guidelines have not changed. For example, developers are still not allowed to inform customers about better pricing, offers, and alternative ways to pay within the app itself. However, they are allowed to communicate with customers directly through other channels, such as via email. In addition, Google says their policies “apply equally to all apps distributed on Google Play”, including their own, and that their algorithms “rank third-party apps and games using the same criteria as for ranking Google’s own apps.” Google, of course, isn’t transparent about their proprietary search and ranking algorithms, so these statements were likely made in response to heightened scrutiny from the press and regulators.
Using Third-Party Apps is Easier on Android 12
When Epic Games filed its lawsuit against Google (and Apple), the company challenged what they believed to be scare tactics employed by Google to reduce the willingness of people to use third-party app stores. For example, Epic complained that the permissions that users have to grant contained dissuasive language, and that the inability to then silently install and update apps placed third-party app stores at an inherent disadvantage. Lastly, Epic also alleged that Google went out of its way to block the Epic Games Store from being preloaded on phones from OnePlus and LG.
In today’s blog post, Google reiterates that consumers have always had the choice of getting apps from multiple app stores, but that each app store “is able to decide its own business model and consumer features.” As an example, Google directly cites how Fortnite is still available for Android users that download the Epic Games Store or have access to Samsung’s Galaxy App store. However, the company will be “making changes in Android 12…to make it even easier for people to use other app stores on their devices while being careful not to compromise the safety measures Android has in place.” Google hasn’t shared exactly what changes they’re making to Android, but we’re guessing it’ll involve a new set of permissions and APIs.
FAQ about Google Play billing
In addition to the main blog post detailing the updated policy language, Google also published a FAQ about the use of Google Play’s billing. Here are the questions and answers that Google prepared:
Google Play Billing FAQ
- Q: Can I distribute my app via other Android app stores or through my website?
- A: Yes, you can distribute your app however you like! As an open ecosystem, most Android devices come preinstalled with more than one store – and users can install others. Android provides developers the freedom and flexibility to distribute apps through other Android app stores, directly via websites, or device preloads, all without using Google Play’s billing system.
- Q: What apps need to use Google Play’s billing system?
- A: All apps distributed on Google Play that are offering in-app purchases of digital goods need to use Google Play’s billing system. Our payments policy has always required this. Less than 3% of developers with apps on Play sold digital goods over the last 12 months, and of this 3%, the vast majority (nearly 97%) already use Google Play’s billing. For those few developers that need to update their apps, they will have until September 30, 2021 to make those changes. New apps submitted after January 20, 2021 will need to be in compliance.
- Q: Many businesses have needed to move their previously physical services online (e.g. digital live events). Will these apps need to use Google Play’s billing?
- A: We recognize that the global pandemic has resulted in many businesses having to navigate the challenges of moving their physical business to digital and engaging audiences customers in a new way, for example, moving in-person experiences and classes online. For the next 12 months, these businesses will not need to comply with our payments policy, and we will continue to reassess the situation over the next year. For developers undergoing these changes, we’re eager to hear from you and work with you to help you reach new users and grow your online businesses, while enabling a consistent and safe user experience online.
- Q: Do Google’s apps have to follow this policy too?
- A: Yes. Google Play’s developer policies – including the requirement that apps use Google Play’s billing system for in-app purchases of digital goods – apply to all apps on Play, including Google’s own apps.
- Q: Can I communicate with my users about alternate ways to pay?
- A: Yes. Outside of your app you are free to communicate with them about alternative purchase options. You can use email marketing and other channels outside of the app to provide subscription offers and even special pricing.
- Q: Can I communicate with my users about promotions on other platforms?
- A: Of course. We’re an app developer too, and we know how important it is not to restrict your ability to communicate with your users. You can email them or otherwise communicate outside of the app information about your offerings, even if they are different on Google Play than in other places.
- Q: Can I have different app features, prices and experience depending on the platform?
- A: Yes. It is your service and business, it is up to you. We do not require parity across platforms. You can create different versions of your app to support different platforms, features and pricing models.
- Q: Can I offer a consumption-only (reader) app on Play?
- A: Yes. Google Play allows any app to be consumption-only, even if it is part of a paid service. For example, a user could login when the app opens and the user could access content paid for somewhere else.
- Q: Does your billing policy change depending on what category my app is in?
- A: No. Business or consumer apps, and verticals like music or email are all treated the same on Google Play.
- Q: Can I offer my customers refunds directly?
- A: Yes. We understand the importance of maintaining the relationship with your customers. You can continue to issue refunds to your customers and other customer support directly.
- Q: Will Google Play allow cloud gaming apps?
- A: Yes. Cloud game streaming apps that comply with Play’s policies from any developer are welcome on Google Play.
Update: Google defers Play Billing deadline to March 31, 2022 for India
Google had mentioned a deadline of September 30, 2021, for implementation of Google Play Billing in existing apps. Google is extending this deadline for India to March 31, 2022, in light of the recent feedback it had received from developers in India. This should also give developers who implement the India-specific UPI for subscription payment options (that will be made available on Google Play) enough time for the implementation.
As Economic Times reports, Google says the idea behind giving a lengthy period of time before the policy comes into effect is to make sure that businesses are not unduly stressed. However, Google is not yet discussing a change in its global business model per se. The statements, clarifications and extensions come in light of criticism leveled at Google for its app store dominance, and with more than 50 tech entrepreneurs in India joining hands to petition the Indian government for support to create an overarching Indian digital app ecosystem as a counter-measure.