Google defends Play Store’s notorious commission

Recently disclosed documents featuring Google’s confidential deal with Netflix, unveiled market monopolization strategies by the search engine giant, as it offered the streaming platform a private pitch to keep using Android-based subscriptions with a lower cut than Apple’s App Store, a media report revealed on Friday.

Numerous state attorneys filed an antitrust lawsuit against Google and its Play Store’s commission, mirroring the Epic vs. Apple monopoly battle. 

A recent complaint surfaced on Friday by MLex senior correspondent Michael Action, submitted by lawyers representing consumers. The complaint revealed how the search engine is indulging in-app store anti-competitive and monopolistic behavior.

MLex is an independent media establishment that delivers private market insight, analysis, and interpretation on regulatory risks.

In the past, subscription-based platforms, such as Spotify, Tinder, and Netflix, struggled to find the appropriate methods to manage Google Play Billing without the 30 percent commission imposed by the Big Tech giant. 

“Similarly, Netflix, Spotify, and Tinder, some of the nation’s largest and most popular subscription services, have repeatedly sought to bypass Google Play Billing. In particular, Netflix wanted an alternative payment system,” the document stated. 

“Apparently to ameliorate this displeasure, Google offered to take a significantly reduced revenue share percentage to Netflix. Not all developers, however, have met with Netflix’s success, even though many have sought to use their payment systems,” the document added. 

In March, Google succumbed to regulatory demands by announcing that it will limit its Play Store’s commission will be cut from 30 percent to 15 percent, covering all global android developers.

This week, the social network released a clarification post on its android developers’ blog, voicing that the company is on a path to hear what its developers have to say to enhance Google Play features.

Throughout the post, Google specified that Play Store applications must rely on Google’s billing system while granting them a year to change. 

“We’ve always required developers who distribute their apps on Play to use Google Play’s billing system if they offer in-app purchases of digital goods, and pay a service fee from a percentage of the purchase. This policy is only applicable to less than 3 percent of developers with apps on Google Play,” the post unveiled. 

“We only collect a service fee if the developer charges users to download their app or they sell in-app digital terms, and we that is fair. Not only does this approach allow us to continuously reinvest in the platform, but this business model also aligns our success directly with the success of developers,” it added. 

However, in Netflix’s case, lawyers impeach Google for giving Netflix a “significantly reduced revenue share,” with a maleficent intention of overtaking the streaming platform’s plans to implement substitute payment methods and systems. 

By doing so, Google would be directly monopolizing the market for its benefit, by imposing harsh policies to maintain its position at the top of the pyramid. 

On Saturday, an unsealed court document revealed that in 2019 Google’s parent company Alphabet Inc. generated $11.2 billion in revenue, purely from its cellular app retail.

Attorneys from 37 U.S. states and districts filed a lawsuit against Google concerning suspected antitrust breaches, demonstrating how in 2019, the establishment accumulated $8.5 billion in gross revenue and $7 billion in working revenue, with a working margin over 62 percent. 

These large sums are attributable to an expediential apps’ sale, in-app buy purchase, and retail adverts. From its part, Google is trying to assert a strong base for itself by stating that its Play app teams’ income comes from a multitude of providers, alongside accounts resulting in the shop’s blazing income.

While the tech giant’s 30 percent commission will forever remain a questionable measure to gain financial support via Google’s Play Store, the volume of lawsuits accumulates as it exposes the search giant to harsher scrutiny due to its terms and policies with developers.

It is still unclear who will be the sole beneficiary of the legal proclaims as each side is standing its ground.