Google’s improvements to Google Play: A preliminary review

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As has been widely reported in the press, Google has decided to adopt a more aggressive approach to the enforcement of the obligation imposed on app developers offering in-app purchases of digital goods on Google Play to use Google’s proprietary payment solution “Google Play In-App Billing” and pay the associated 30% commission.

At the same time, Google issued yesterday a blog post titled “Listening to Developer Feedback to Improve Google Play“, which detailed its new policies with respect to Google Play. This blog post was accompanied by an FAQs about Google Play Billing and referred to the new Payment Policies that will apply from 20 January 2021.

These are very important developments for the millions of app developers that rely on Google Play to distribute their apps. These developments come at an interesting time, where Google has been sued by Epic Games in the U.S. and the European Commission is investing Apple’s App Store’s practices in the EU. Google and Facebook are also facing greater pressure from major app developers, which have set up the Coalition for App Fairness and set a series of principles that should govern app stores. While Google claims its new policies are informed by developer feedback, there is no question that they come at a time where app stores are under greater scrutiny by regulators and pressure from app developers.

In my view, Google’s clarification of its policies is a clever move most likely designed to prevent regulatory action by contrasting its policies to the more restrictive approach of Apple (as discussed in this paper) and suggesting it will help facilitate competition from other app stores on Android devices. Now, as always, the devil will be in the details and while Google is making steps in the right direction I am skeptical about the real impact of some of the policies adopted by Google.

To help readers better understand the likely impact (or lack thereof) of Google’s policies, I have interspersed my comments in bold into the Google blog post published yesterday.

The latest Android and Google Play news for app and game developers.

Listening to Developer Feedback to Improve Google Play

28 September 2020

Posted by Sameer Samat, Vice President, Product Management

Developers are our partners and by pairing their creativity and innovation with our platforms and tools, together we create delightful experiences for billions of people around the world. Listening carefully to their feedback is an important part of how we continue to make Android better with each release and improve how mobile app stores work. In an April 2019 blog post we shared some updates we made to Android APIs and Play Policies based on developer feedback. And today, we wanted to share some additional insights we’ve gained from developer feedback [DG: Listening to developer feedback is nice, but – as noted above – there is no question that the new Google Play policies are also informed by the Apple investigation of the European Commission and the Epic Games lawsuit in the U.S.] and how we’re taking that input to improve Google Play and Android. Some of the key themes we’ve heard include:

– Supporting developers’ ability to choose how they distribute their apps through multiple app stores on different platforms (mobile, PC, and console), each with their own business model competing in a healthy marketplace;

– Clarifying our policies regarding who needs to use Google Play’s billing system and who does not;

– Ensuring equal treatment for all apps, including first-party and third-party apps, on our platforms;

– Allowing developers to connect and communicate directly with their customers;

– Enabling innovation and ensuring our policies embrace new technologies that can help drive the consumer experience forward.

We’d like to share our perspective on each of these points.

Choice of stores

We believe that developers should have a choice in how they distribute their apps and that stores should compete for the consumer’s and the developer’s business. Choice has always been a core tenet of Android, and it’s why consumers have always had control over which apps they use, be it their keyboard, messaging app, phone dialer, or app store.

Android has always allowed people to get apps from multiple app stores. [DG: That is correct and a difference with the App Store which is the only means of distributing apps on iOS devices. Note however that the other app stores available on Android have very small market shares.] In fact, most Android devices ship with at least two app stores preinstalled, and consumers are able to install additional app stores. [DG: Correct, but these other app stores are unattractive because they have few apps compared to Google Play and this has made it difficult for them to grow.] Each store is able to decide its own business model and consumer features. This openness means that even if a developer and Google do not agree on business terms the developer can still distribute on the Android platform. [DG: Perhaps, but query whether this is an attractive alternative for app developers given that the vast majority of Android users use Google Play.] This is why Fortnite, for example, is available directly from Epic’s store or from other app stores including Samsung’s Galaxy App store.

That said, some developers have given us feedback on how we can make the user experience for installing another app store on their device even better. In response to that feedback, we will be making changes in Android 12 (next year’s Android release) to make it even easier for people to use other app stores on their devices while being careful not to compromise the safety measures Android has in place. [DG: Nice move, but curious to see whether this will work out in practice and whether it will make alternative app stores more than fringe players.] We are designing all this now and look forward to sharing more in the future!

Clarity on billing policies

As we mentioned, each Android app store is able to decide its own business model and consumer features. For Google Play, users expect a safe, secure and seamless experience, and developers come to Play for powerful tools and services that help them build and grow their businesses. Our developer policies are designed to help us deliver on these expectations and Google Play’s billing system is a cornerstone of our ongoing commitment. Consumers get the benefit of a trusted system that allows them to safely, securely, and seamlessly buy from developers worldwide. Google protects consumers’ payment info with multiple layers of security, using one of the world’s most advanced security infrastructures. For developers, Google Play’s billing system provides an easy way for billions of Android users to transact with them using their local, preferred method of payment. [DG: Apple makes the same argument to defend the mandatory use of IAP for apps selling digital goods and services on the App Store, but it is hardly credible. Other payment solutions (think of e.g., PayPal, Adyen or Stripe) can also offer a safe, secure and seamless experience.]

We’ve always required developers who distribute their apps on Play to use Google Play’s billing system if they offer in-app purchases of digital goods, and pay a service fee from a percentage of the purchase. To be clear, this policy is only applicable to less than 3% of developers with apps on Google Play. [DG: Interesting number! In the case of the App Store, only 16% of the apps must use IAP and pay the 30% commission. The difference is likely due to the fact that so far Google enforced the obligation to use GPB less strictly.] We only collect a service fee if the developer charges users to download their app or they sell in-app digital items, and we think that is fair. [DG: Hard to see how having 3% of the apps pay a 30% commission while 97% pay nothing is fair. As I explain in a recent co-authored paper, this approach to pricing on behalf of a dominant firm may be in breach of EU competition law.] Not only does this approach allow us to continuously reinvest in the platform, this business model aligns our success directly with the success of developers. [DG: It is hard to see how this helps those who have to use GBP and pay the 30% commission.]

But we have heard feedback that our policy language could be more clear regarding which types of transactions require the use of Google Play’s billing system, and that the current language was causing confusion. We want to be sure our policies are clear and up to date so they can be applied consistently and fairly to all developers, and so we have clarified the language in our Payments Policy to be more explicit that all developers selling digital goods in their apps are required to use Google Play’s billing system. [DG: In the Q&As, Google notes that “All apps distributed on Google Play that are offering in-app purchases of digital goods need to use Google Play’s billing system.” Thus, the criterion used to distinguish apps that have to use GPB and those that don’t is whether the app is offering “digital goods”. This criterion is analogous to the criterion used by the App, which refers to apps offering “digital goods and services”, a criterion which in my view is arbitrary and has led to a large amount of confusion. Now, what Google does with its new Payment Policies is to offer some examples of apps that need to use GPB and those that don’t. Although these examples are helpful, time will tell whether they will avoid the type of disputes that have marred the App Store. This being said, if you look at these examples, it is sometimes hard to understand why some apps have to use IAP e.g., subscription services (such as fitness, game, dating, education, music, video, and other content subscription services), while others don’t (e.g. payment is for physical goods or services, e.g., a Lyft ride). Why would you tax 30% on apps providing education services, while allowing ride-hailing apps to pay nothing …?]

Again, this isn’t new. This has always been the intention of this long standing policy and this clarification will not affect the vast majority of developers with apps on Google Play. Less than 3% of developers with apps on Play sold digital goods over the last 12 months, and of this 3%, the vast majority (nearly 97%) already use Google Play’s billing. But for those who already have an app on Google Play that requires technical work to integrate our billing system, we do not want to unduly disrupt their roadmaps and are giving a year (until September 30, 2021) to complete any needed updates. And of course we will require Google’s apps that do not already use Google Play’s billing system to make the necessary updates as well.

Equal treatment

Our policies apply equally to all apps distributed on Google Play, including Google’s own apps. We use the same standards to decide which apps to promote on Google Play, whether they’re third-party apps or our own apps. In fact, we regularly promote apps by Google’s competitors in our Editors Choice picks when they provide a great user experience. Similarly, our algorithms rank third-party apps and games using the same criteria as for ranking Google’s own apps. [DG: A bit hard to trust Google on this one given its past behaviour.]

Communicating with customers

Developers have told us it is very important to be able to speak directly with their customers without significant restrictions. As app developers ourselves, we agree wholeheartedly and our policies have always allowed this.

That said, developers have asked whether they can communicate with their customers directly about pricing, offers, and alternative ways to pay beyond their app via email or other channels. To clarify, Google Play does not have any limitations here on this kind of communication outside of a developer’s app. [DG: Thus, Google is less restrictive than Apple in that Apple prevents any type of communication (including outside the app, when the contact details have been obtained from account registration within the app) by app developers to steer app users to their website. Query, however, whether communication outside the apps is an effective way to communicate for app developers, especially small apps without a brand name (which in many cases will not have a website either).] For example, they might have an offering on another Android app store or through their website at a lower cost than on Google Play.

We understand the importance of maintaining the customer relationship. As such, we have also always allowed developers to issue refunds to their customers and provide other customer support directly. [DG: That is another difference with the App Store, but query how this works in practice. Also note that the main complaint of app developers is that when app stores mandate the use of their own payment system (such as IAP and GPB), they do not have access to key user data that are needed to improve their services.]

Enabling innovation

Developers are coming up with cool things all the time. Using their feedback, we are always trying to adjust our approach to ensure that we continue to help enable new forms of innovation. For example, recent innovations in game streaming have generated new game experiences that are available on Google Play, including Microsoft’s recent launch of Xbox cloud gaming in the Xbox Game Pass Android app.

Keep the feedback coming

We really appreciate all the feedback we have received from our developer community and believe the Android ecosystem has never been a more exciting place to be. [Let’s see how things pan out.]

It is exciting to see developers such as Duolingo, Truecaller, Hyperconnect,, and Viber be so successful and grow their business on Android and reach a diverse audience. These kinds of services delight consumers and we are thrilled to have built a platform that can support them.

We’ve also published some additional frequently asked developer questions here.

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