Google is today sharing more details about the charges that will accompany its plan to comply with Europe’s new Digital Markets Act (DMA), the new regulation aimed at increasing competition in the app store ecosystem. While Google yesterday outlined ways in which it was already complying with DMA — allowing, for example, sideloading of apps — it had yet to share details about what fees would apply to developers, noting that more details would be announced this week .
That time is now, as it turns out.
Today, Google announced that two charges will apply to it Program of external offers, was also announced yesterday. This new program allows Play Store developers to drive their users to the EEA outside of their app, including by promoting offers.
With these charges, Google is following the lead of Apple, which reduced App Store fees in the EU to comply with the DMA, but implemented a new core technology fee that required developers to pay €0.50 for each first annual install per year over 1 million threshold for apps distributed outside the App Store. Apple justified the fee by explaining that the services it provides to developers extend beyond payment processing and include the work it does to support app creation and discovery, building APIs, frameworks and tools to support developers’ app creation work , anti-fraud and more.
Google follows a similar tactic, saying today that “Google Play service fee It was never just a payment processing fee — it reflects the value provided by Android and Play and supports our continued investment in Android and Google Play, enabling users and developers to experience the features people rely on,” says a blog post.
He says there will now be two fees that come with Foreign Offer program transactions:
- One initial acquisition fee, which is 10% for in-app purchases or 5% for two-year subscriptions. Google says this fee represents the value Play provided in facilitating initial user acquisition through the Play Store.
- One continuing service fee, which is 17% for in-app purchases or 7% for subscriptions. This reflects the “broader value that Play provides to users and developers, including ongoing services such as parental controls, security scanning, fraud prevention and continuous app updates,” Google writes.
It is worth noting that a developer can opt out of ongoing services and associated fees, if the user agrees, after two years. Users who originally installed the app believe they will have services like parental control, security scanning, fraud prevention, and continuous app updates, so the opt-out requires user consent. Although Google allows the developer to terminate this charge, these ongoing services will no longer apply either. However, developers will still be responsible for reporting transactions involving users who continue to receive Play Store services.
Image Credits: Google
Google also today shared more examples of what this fee structure would look like in practice, and answered a number of general questions developers might have — like whether the program is opt-in or opt-out (it’s only the former), if it applies to games and apps (yes), if developers can opt-in to only some of their apps (yes), and other integration technicalities. He said developers would have to sign up for the program as a business, not as a person. The company also noted that developers can continue to use Google Play’s billing system while also participating in the external bidding program.
Separately from the External Offers program, Google also this week launched two other programs that allow alternative billing systems for in-app purchases. And that’s it expands this week to all developers whose apps reach EEA users.
