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Google slashes service fees in app store after similar move by Apple

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Sundar Pichai (Google) testifies in a hearing before Congress, on March 25, 2021.

CNBC

GoogleAfter a similar move, Apple announced Thursday that they will lower the service fees for its App Store. AppleAs both companies have to comply with regulators and legislators, they will need to make their stores mobile-friendly for developers.

Google released a statement saying that subscription fees for the Google Play Store will decrease from 30% down to 15% on day 1. Developers must take 30% off subscriptions to Google in the first twelve months, before the 15% commission is reduced to 15.

Google claimed that 99% of developers will be eligible for the reduced service fee.

Also, Apple announced on Thursday it is introducing a program that will allow music streaming and e-books to be purchased through its app store. The fees can range from 0 to 10%. Apple does not make any exceptions to these types of apps, and it doesn’t charge developers a 10% surcharge in its app store.

Apple, which is more well-known for its app store than Google has cut its pay from 30% down to 15% over two years. This includes news apps, apps with less than $1million per annum, as well as apps that are free of charge. Apple’s subscription fees are still 30%, so Google may have a better app store for apps that require a subscription.

Apple and Google were both sued for their practices in the app store. This July: state attorneys general announced an antitrust lawsuitGoogle is being sued for allegedly abusing its Android Play Store power and threatening app developers. Epic Games, Fortnite creator brought a large lawsuit against Google as well as Apple. It was about their app store fees.

Legislators have introduced a number of bills to force Apple or Google to make more significant changes in their apps store policies. These are the facts Open App Markets ActThe bipartisan legislation – s. e. – would make it mandatory for companies to permit developers to use alternative payment systems in order to help them get out of default fees.

This would prevent app developers from directly communicating with their customers about legitimate business offers or penalizing them for using pricing terms that are different elsewhere.

A bipartisan bill was also introduced, the American Innovation and Choice Online ActThis would prevent platforms’ use of their gatekeeper power against businesses or users, which includes app makers that depend on them, as well as from discriminating against those who use their services for distribution, like on mobile phones.

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