Play Store service fees lowest among major app stores, says Google

Google estimates that out of more than 200,000 Indian developers on Google Play, less than 60 could pay a service fee of above 15 per cent

Google India on Wednesday released a blogpost expressing its commitment in supporting the country’s growing app ecosystem over the past decade through its investments in Android and Google Play. The company said it charges the lowest service fees among the major app stores. According to the company, only 3 per cent of developers in India sell digital goods or services and therefore would need to pay a service fee. And for the vast majority of developers, service fees are 15 per cent or less — due to the range of pricing programs Google Play offers. Google estimates less than 60 of the over 200,000 Indian developers on Google Play currently could pay a service fee of above 15 per cent. According to the company, this fee is further reduced by 4 per cent if a user pays through an alternative billing system.

Elaborating on the investments part, the company said it ensures a safe and secure experience for users by employing an expansive malware scanning system, which analyses billions of apps daily. Besides, it allows developers to leverage powerful data and analytics dashboards in the Play Console to understand their audience and identify growth opportunities. Additionally, it allows developers to experiment, beta test new features, optimise store listings and analyse app performance to continuously improve their offerings. Google said its Play platform enables convenient and secure monetisation of apps and in-app content in over 180 global markets, providing access to local payment options like UPI and recharge codes, along with monetisation tools. The company added that these investments have helped Indian developers create jobs, reach a global audience of 2.5 billion monthly active users across 190 markets and grow financially.

To fund these investments, Google said it applies a service fee when developers on Google Play sell in-app digital goods or services, which aligns their success with that of the platform. It added that the investments have helped Indian developers create jobs, reach global audiences, and grow financially.

Google has three types of service fees for developers to enrol in. A 15 per cent service fee tier in which developers are charged 15 per cent for the first $1 million revenue earned by the developer and 30 per cent for earnings surpassing the $1 million revenue mark. This is applied to the annual revenue earned by the developer. Then there is a subscription tier in which 15 per cent is charged to automatically renew products that the developer has purchased and subscribed to regardless of the revenue earned by the developer each year. Lastly, there is other transactions type in which developers have to meet certain eligibility criteria to qualify for service fee. They may be part of a specific program such as the Play Media Experience Program. According to the blog post most of India’s developers fall under the 15 per cent service fee mark.

ADIF and CCI order

Google’s post explaining its billing decisions comes after the Alliance of Digital India Foundation (ADIF) had accused the tech giant for disobeying orders by Competition Commission of India (CCI) and forcing app developers to use their billing system, the Google Play Billing System (GBPS), for in-app purchases and subscriptions in March 2023.

In October 2022, CCI had fined the company $112 million in what it considered to be Google’s abuse of their market position and pushing developers to use its in-app payment system.

Following the CCI’s directions, Google began providing a third-party billing option in India April 2023 onwards.