Google is delaying planned changes to its in-app payment rules in India by six months, backing down after some of the country’s largest developers and startups threatened to band against the U.S. search giant.
Alphabet Inc.’s Google said in a blog post on Monday it will give developers until March 2022 to integrate with its Google Play billing services, compared with an earlier deadline of September 2021 announced last week. That declaration irked local app developers who saw it as a move to exert control over the country’s startup ecosystem. Paytm, India’s most valuable startup, unveiled Monday an Android Mini App Store that will give local developers free distribution of their apps and offer payment options at a 0% fee.
Paytm founder Vijay Shekhar Sharma was among the most vociferous in opposing Google’s payment rules at a meeting held by dozens of startup executives last week. The 56 founders gathered to challenge the Mountain View, California-based company -whose Android mobile operating system has over nine-tenths of India’s market share – after it announced that it will require all developers to adopt its billing system and accompanying 30% cut of transactions. It will also start charging newer categories of online services like education and online dating the same fee.
Read more: India Startups Join Effort to Break Google, Facebook Dominance
“We are setting up listening sessions with leading Indian startups to understand their concerns more deeply,” Google wrote on its blog. “And we’re also extending the time for developers in India to integrate with the Play billing system, to ensure they have enough time to implement the UPI for subscription payment option that will be made available on Google Play.”
Less than 3% of developers with apps on the Play store sold digital goods over the last 12 months and about 97% of those developers already use Google Play’s billing system, according to the company.Paytm is launching its Mini App Store with the aim of driving a self-sufficient India and retain consumer spending within the country, the startup said in a statement Monday. Pioneered by Tencent Holdings Ltd.’s WeChat, mini apps are custom-built, low-cost software for basic mobile phones that offer users an app-like experience without the need to download full versions. Domino’s Pizza, Decathlon, ride hailing service Ola and online pharmacy Netmeds are some of the brands already available on the beta version of Mini App Store, which had 12 million visits from beta testers in September.
The backlash in India marks growing global opposition to the 30% fee-structure imposed by Google and rival Apple Inc., which has come into focus this year after Fortnite-maker Epic Games Inc. filed a lawsuit in the U.S. against the two companies’ app store rules.
For more articles like this, please visit us at bloomberg.com