Google has quietly developed its “User Choice Billing” pilot to let more creators of non-gaming Android apps offer third-party payment choices as alternatives to Google Play.
Developers will notice their service fees of 15 to 30 percent reduced by 4 percent when users choose a new third-party billing alternative, which the developer — not Google — must support in case of customer issues.
As of September 1st, registered creators from the European Economic Area (EEA), India, Japan, Indonesia, and Australia can partake in User Choice Billing, according to this enrollment page.
Google claims that 99 percent of developers using the company’s Play Store billing qualify for the 15 percent service fee rate — but it’s the revenue-generating Spotify of the world who pay Google the contested 30 percent on each in-app purchase.
The User Choice Billing pilot initially launched in March with Spotify as its first partner after Google was forced to offer alternative in-app payments in South Korea. The moves come in direct response to the intense criticism Google and Apple have received globally over the fees they take from the purchases made in their digital stores that locked developers out of third-party in-app payment systems.
There’s no comment on when the schedule will be expanded to game developers or developers based in the US. Google only says, “we expect the pilot details to continue to evolve as we learn more and receive additional feedback.”
Google announced that it would permit applications to use their payment system on the Google Play Store for as protracted as the original and built-in Google Play Store billing plan is included, alongside the other third-party options. Google will initiate a pilot program, and the first app to merge for the test is Spotify.
Google today revealed that it’s “exploring user choice billing” in select nations and with a few participating developers. The first and most well-known company to join is Spotify.
“This pilot will permit a small number of participating developers to submit an additional billing choice next to Google Play’s billing strategy and is planned to help us explore modes to offer this choice to users while preserving our ability to invest in the ecosystem. It is a momentous milestone and the first on any major app store — mobile, desktop, or game consoles.”
Spotify is “one of the most extensive subscription developers with a global footprint,” and the company will work on improving in-app purchases. However, it’s unclear what payment system Spotify will use to sign new subscribers or what perks it will offer users to use its payment solution. The company announced that users would have a choice to pay with Spotify’s payment plan or Google Play Billing when willingly signing up for the benefit. The two alternatives will be shown side-by-side in the app, and each user will have the choice to select whichever they favor.
“Users who’ve downloaded Spotify from the Google Play Store will be given a choice to pay with either Spotify’s pay system or with Google Play Billing. These two options will live in the app for the first time. It will let everyone subscribe and purchase using the payment choice directly in the Spotify app. In addition, Spotify will resume freely communicating with users about our Premium subscription service, boost discounts and promotions, and show listeners on our Free tier the ability to transform to Premium directly in the app.
Over the forthcoming months, Spotify will function with Google’s product and engineering teams to create this new experience, and we’ll roll it out globally. The parties will test and learn, jointly exploring product innovations across the Android platform. We anticipate launching the first iteration of User Choice Billing later this year.
Spotify has publicly advocated for platform fairness and expanded payment options, among other things, because fair and open platforms enable better consumer experiences and allow developers to grow and thrive. When this happens, everyone wins.”
We previously heard South Korea forced Google and Apple to allow third-party payment solutions. While both companies yielded, they contrived to get around the legislation by pushing developers to pay a subscription fee, even if made outside of the built-in payment plan. The cut has been reduced, but creators are still needed to pay. It is a tremendous win for the industry, and how well businesses and consumers receive it stays to be seen.
The fee should still be paid, and any antics to avoid paying the store tax will result in disciplinary action. Epic tried to push the waters by submitting an external payment system to players buying in-game items in Fortnite. Despite being the giant cash cow for mobile gaming, Fortnite was booted off the App Store. An ugly court battle ensued, leading to some surprising revelations regarding Apple and Google’s business procedures. Both companies opposed relinquishing their app store tax, leading to a string of fines and legislation. For instance, in markets like South Korea, Google and Apple have been forced to offer alternative billing systems.
Google is now being assertive, and in a move that can put an industry-wide precedent, the search giant is delivering alternative payment systems for apps listed on the Play Store. The company fittingly anoints its User Choice Billing. Essentially, Google will permit developers to provide a third-party billing system in their apps alongside Google Play’s own payments process. But, of course, it will be up to users to choose the one they want to use.