Disney may reportedly be suing Google in India, here’s why

Walt Disney has approached a court in India in an ongoing legal challenge against Google‘s in-app billing system, according to a report by news agency Reuters. Google’s in-app billing system has been under scrutiny for some time now and last year, the tech giant was fined Rs 936 crore for abusing its dominance in the market.

In May, the Competition Commission of India (CCI) started an inquiry into Google after some companies alleged the service fee that the company charges for in-app payments breaches an earlier antitrust directive.

These companies, which include Tinder-owner Match Group and a few other Indian startups, sought an investigation into Google’s new User Choice Billing (UCB) system alleging that it was anti-competitive.

Google had previously said that the service fee supports investments in the Google Play app store and the Android mobile operating system, ensuring it distributes it for free and covers developer tools and analytic services.

Google’s in-app billing system
In October last year, the antitrust watchdog said Google must allow the use of third-party billing and stop forcing developers to use its in-app payment system. For that, the company charges a commission of up to 30%.

The company later began offering UCB to allow alternative payments alongside Google’s own that enabled users to purchase in-app digital content. However, in May, some companies complained the new system still imposes a high “service fee” of 11% to 26%.

Google had argued its service fees only apply when a developer sells digital goods or services in their app and “only 3% of developers in India sell digital goods or services and therefore would need to pay a service fee.”

“For the vast majority of developers, our fees are 15% or less — the lowest rates of any major app store — due to the range of pricing programs Google Play offers. To further put this in context, we estimate less than 60 of the over 200,000 Indian developers on Google Play currently could pay a service fee of above 15%. And this fee is further reduced by 4% if a user pays through an alternative billing system to fairly reflect that Google Play’s billing system has not been used,” the company said in a blog post.

Furthermore, Google also defended the commission saying that Google Play enables developers in India to provide a safe and secure experience to their users, help them reach 2.5 billion monthly active users in 190 markets, and help improve their apps, among others.

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Walt Disney has approached a court in India in an ongoing legal challenge against Google‘s in-app billing system, according to a report by news agency Reuters. Google’s in-app billing system has been under scrutiny for some time now and last year, the tech giant was fined Rs 936 crore for abusing its dominance in the market.

In May, the Competition Commission of India (CCI) started an inquiry into Google after some companies alleged the service fee that the company charges for in-app payments breaches an earlier antitrust directive.

These companies, which include Tinder-owner Match Group and a few other Indian startups, sought an investigation into Google’s new User Choice Billing (UCB) system alleging that it was anti-competitive.

Google had previously said that the service fee supports investments in the Google Play app store and the Android mobile operating system, ensuring it distributes it for free and covers developer tools and analytic services.

Google’s in-app billing system
In October last year, the antitrust watchdog said Google must allow the use of third-party billing and stop forcing developers to use its in-app payment system. For that, the company charges a commission of up to 30%.

The company later began offering UCB to allow alternative payments alongside Google’s own that enabled users to purchase in-app digital content. However, in May, some companies complained the new system still imposes a high “service fee” of 11% to 26%.

Google had argued its service fees only apply when a developer sells digital goods or services in their app and “only 3% of developers in India sell digital goods or services and therefore would need to pay a service fee.”

“For the vast majority of developers, our fees are 15% or less — the lowest rates of any major app store — due to the range of pricing programs Google Play offers. To further put this in context, we estimate less than 60 of the over 200,000 Indian developers on Google Play currently could pay a service fee of above 15%. And this fee is further reduced by 4% if a user pays through an alternative billing system to fairly reflect that Google Play’s billing system has not been used,” the company said in a blog post.

Furthermore, Google also defended the commission saying that Google Play enables developers in India to provide a safe and secure experience to their users, help them reach 2.5 billion monthly active users in 190 markets, and help improve their apps, among others.

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end of article