Google’s Favorable Treatment
It was discovered during ongoing court actions between Google and Epic Games that they gave preferential treatment of transaction commissions to Spotify. Don Harrison, Google’s President of Global Partnerships, revealed during the hearings that, contrary to the standard commission rates that can reach up to 15% on transaction amounts, Spotify paid:
Charge no commission for in-app subscriptions made through its own streaming service platform.
4% commission for transactional charges made through Play store.
Unraveling Google’s Plans
This testimony disrupts Google’s plans, as the company had fought to keep the percentage applied to Spotify private during the Epic proceedings to avoid straining relationships with developers who have paid (and continue to pay) higher commissions:
They are charged an additional 11% of the entire deal as a commission when they use a third party platform.
Google retains 15 percent of revenue if it handles the transaction.
Covering operating costs of the platform using a “discount” of 4% is not practical. In most instances, however, Google forces developers into using its payment system. Court hearing Harrison defended themselves by saying that a little bit of the “favoring toward Spotify” is because it’s an extremely popular thing and if it doesn’t work right then users might just stop buying their android smartphones altogether thus negatively affecting sales
Google’s Response
Google’s spokesperson, Dan Jackson, confirmed Harrison’s testimony to theverge.com:
In regard to this, it could be that there are some developers who are more involved in Android developer than others, and these could be subjected to different service fees. This is part of wider cooperation that include significant financial investments or service integration among other products. The investments support increasing the number of Android”
Nevertheless, there is still no clue on who apart from Spotify will be regarded as “a selected number of developers”.
