Google to lower in-app commission rate for developers

Seoul: Tech giant Google will lower its planned commission rate for app developers, following complaints from software makers over steep fees.

Google said it will levy a 15 per cent rate on in-app purchases to all developers for annual sales up to $1 million and take a 30 per cent commission from revenues over the $1 million mark.

The new policy will take effect in July.

A company official said 99 per cent of developers log less than $1 million annual revenue on the Play store, reports Yonhap news agency.

Google earlier announced a plan to introduce the 30 per cent commission to all in-app digital goods purchases in South Korea while making it mandatory to use its own payment system for app purchases on its platform, starting January 2021.

The new billing policy caused fierce opposition from tech firms and politicians and the company later delayed its implementation to September.

Last year lawmakers proposed bills that would ban app market operators from imposing certain payment methods in mobile content transactions.

The tech giant has said that the service fee is crucial to reinvest in its platform.

"We will do our best so that South Korean developers can provide their products and services to over 1 billion users from some 300 countries around the world and achieve success in the global market," a Google official said.

Sales from apps on Google's Play store last year were estimated at over 5 trillion won ($4.4 billion), according to a government report that reviewed 246 companies that accounted for over 75 per cent of the country's mobile app sales during September and October last year.