Google's new deal to allow users third-party subscription

July 01, 2022

Due to a separate deal with the Japanese Fair Trade Commission, Apple now also allows third-party subscription services

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Google has reached a deal with US developers that will allow customers to sign up for services that are not accessible through the company's Play Store — Reuters

Google has reached a deal with US developers that will allow customers to sign up for services that are not accessible through the company's Play Store, marking the latest shift in a smartphone era that it shares with Apple Inc, Bloomberg reported.

Alphabet Inc. also plans to invest $90 million in developers earning $2 million or less per year through the company's app store from 2016 to 2021. Google will keep charging a 15% fee on the first $1 million in annual revenue earned from the Play Store by US developers, according to a statement released Thursday.

The agreement is similar to one reached by Apple last year with small developers who had pushed for changes to the way app stores work. As with the Google settlement, Apple developers were permitted to advertise lower pricing to consumers via email or other means outside of the App Store. Apple has also agreed to support developers with a $100 million pool, which is slightly more than Google is offering.

Due to a separate deal with the Japanese Fair Trade Commission, Apple now allows third-party subscription services to bill clients outside of the App Store, avoiding the tech giant's 15% to 30% fee.

Both companies have come under intense legal and political criticism for the commissions and billing restrictions they impose on paid services in their app stores. Congress is considering legislation to coerce tech companies to change their software business models. Three dozen states sued Google last July, in part because of its app-store policies.

According to Bloomberg, Match Group Inc., which operates dating services such as Tinder, sued Google in May over its Play Store policies, alleging that the search giant was acting as a monopolist with its billing rules. Within weeks, Match announced that Google had changed its policies, prompting the dating site to withdraw its legal bid for a temporary restraining order. Google also announced in March that it would begin testing the ability for some apps to bill users directly rather than through Google.

Google said in the announcement on Thursday that it was revising its policies to allow developers to contact customers outside of the Play Store, such as "about subscription offers or lower-cost offerings on a rival app store or the developer's website."

The Mountain View, California-based company also announced that it would publish annual transparency reports on app store activity, including statistics such as app removals and account terminations.

Apple, headquartered in Cupertino, California, has agreed to publish annual transparency reports on app removals.


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