Google reduces its 30% Play Store "tax"
Tim Sweeney, Epic CEO, thanks Google for making changes to its in-app payment program.
Google Play Store tax is reduced. | Image by Google
Google announced today in its Android Developers Blog, that in certain countries, it will no longer take a 30% cut of the transactions rung up in the Play Store. Some changes are the result of a settlement Google made with game developer Epic last November. Google could have waited for final approval from the judges overseeing the various cases, but decided to put revisions in place now.
Google makes changes to the Play Store's 30% commission rate
Google Play is giving developers a choice when it comes to billing. They can choose to use their own billing systems in their apps right alongside Google’s billing. They also will be allowed to take users outside their apps to the developers' own website for purchases. Google says, "Our goal is to offer this flexibility in a way that maximizes choice and safety for users."
Developers using Google Play's own billing system will be charged a "market-specific" rate that is distinct from the service fee. That rate will be 5% in the European Economic Area (EEA), U.K., and the U.S.
The in-app purchase (IAP) service fee will be reduced to 20% for new installs (which is being defined as a first-time install from users following the launch of new fees in a region). Those developers who are willing to participate in the new Apps Experience Program and revamped Google Play Games Level Up program will pay a 20% service fee for transactions from existing installs. They will be charged an even lower 15% service fee on transactions from new app installs. The service fee for recurring subscriptions will be 10%.
Google's new Registered App Stores program will make it easier to sideload app stores that are vetted in advance by Google. That is because the stores that decide to join will have already met certain safety and quality benchmarks. App stores choosing not to join will be treated the same and have the same experience as any other sideloaded app on Android. The Registered App Stores program will start outside the U.S. at first. Depending on whether Google can get approval from the courts, the program will be available in the states.
Timeline reveals when the new rules will hit your country
An approximate timeline was released by Google and the company says that it will share some more information about these changes in the coming months. Google says that it needs to make sure that it has the time to build the required technical infrastructure, ensure the developers can experience seamless transitions, and be on the right side of local regulations.
The updated fees are expected to roll out using this staggered schedule:
- By June 30: EEA, the U.K. and the U.S.
- By September 30: Australia.
- By December 31: Korea and Japan.
- By September 30, 2027: The updates will reach the rest of the world.
Google's new plan for Play Store transactions. | Image by Google
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Google also states that its battle with Epic Games ends with this announcement. In a tweet, Epic CEO Tim Sweeney called the new program "a better deal for all developers," and said that Epic settled all of its disputes with Google worldwide. Additionally, Google says, "We believe these changes will make for a stronger Android ecosystem with even more successful developers and higher-quality apps and games available across more form factors for everyone." In other words, if Google is right, everybody wins.
Epic Games CEO Tim Sweeney responds to the news via tweet. | Image by X
The Alphabet subsidiary wrote that it looks forward to continuing to work with the development community to build what it calls "the next generation of digital experiences."
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