Google to allow third-party payment systems in South Korea
Governments around the world are scrutinizing how Google and Apple do business, thanks to outcry from developers both big and small. The arguments against Google and Apple are generally the same: They hold a monopoly on app distribution and payment options on their respective platforms, charge supra competitive fees to developers, and unfairly restrict alternative app markets and payment options. Google reduced its developer fees to 15%, likely thanks to global mounting pressure, and we knew that the South Korean government was hell-bent on forcing Google (and Apple) to accept alternative payment options. Now, Google has announced that it will allow third-party payment systems in South Korea.
As reported by Reuters, Google has announced that it will comply with South Korea’s new law, most of which went into effect in mid-September. The law was passed in late August, and it banned big app store operators such as Google and Apple from forcing developers to use their payment systems. Its aim was to give developers a choice to use their own payment systems, preventing Apple and Google from charging commissions on every single in-app purchase.
“We respect the decision of the National Assembly, and we are sharing some changes to respond to this new law, including giving developers that sell in-app digital goods and services the option to add an alternative in-app billing system alongside Google Play’s billing system for their users in South Korea,” Google said in a statement. Google’s 15% service fee will decrease to 11% when users choose an alternative billing system, in recognition of developers incurring costs when using their own billing system. It also confirmed that alternative billing systems may not offer the same level of protection or payment options that Google Play’s billing system does.
The company intends on rolling out the ability for developers to use third-party payment systems this year, though it will only apply in South Korea.
“We were able to confirm Google’s determination to comply with the law, and I hope (Google) will implement this policy change in a way to reflect the legislative purpose of the revised law,” said KCC Chairman Han Sang-hyuk.
Apple has already said that it is in compliance with the new law and does not need to change its app store policy. The KCC said in response that it would ask the South Korean division of Apple for a new policy allowing greater autonomy in payment methods. If the company failed to comply, the KCC would consider a fact-finding investigation as a precursor to potential fines or other disciplinary action.