Google is slashing its Play Store commission rate from 30% to a maximum of 15%. The tech giant also formalized reforms allowing external payment systems, ending a five-year antitrust battle with Epic Games, developer of "Fortnite."
Sameer Samat, President of Android Ecosystem at Google, announced on Tuesday that in-app payment fees will be reduced from 30% to as low as 15%, with subscription service fees dropping to 10%. An additional 5% fee will apply when using Google's payment system. However, the surcharge will not apply if developers use their own payment systems or direct users to external sites for transactions.
Google described the decision as "providing flexibility in a way that maximizes choice and safety for users."
The new fee structure will roll out starting in June in the United States, European Union, and United Kingdom, followed by Australia in September and South Korea and Japan in December. Google plans to implement the new policy worldwide by September next year. The company will also add a feature allowing users to easily download apps from pre-registered third-party app stores that meet quality and safety standards. However, introducing external app stores in the U.S. market requires court approval.
The new fee structure is expected to significantly improve profit margins for mobile game developers. Industry observers anticipate that reduced commission costs in mobile app marketplace transactions could lead to lower prices for consumers.
The overhaul also concluded the longstanding dispute between Google and Epic Games. Tim Sweeney, CEO of Epic Games, posted on social media platform X: "Google is fully opening Android to support competing app stores and payment methods, offering better terms to all developers. As a result, we have settled all disputes worldwide. Thank you, Google."
Fortnite, which had been removed from the Play Store, is expected to return to the platform globally. Epic Games filed a lawsuit against Google in 2020, arguing that in-app payment fees were excessive. The company is also engaged in a similar dispute with Apple over its iPhone App Store.
