Update 1 (10/05/2020 @ 01:59 AM ET): Google has extended the deadline for Play Billing implementation in India to 31st March 2022. Scroll to the bottom for more information. The article as published on September 28, 2020, is preserved below.

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:


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.