Google Play Store Now Letting Spotify Use Alternative Billing for In-App Purchases

[MacRumors]

Google today announced that popular streaming music service Spotify will be able to bill Android users directly in the Google Play version of Spotify without needing to go through the Google Play billing system.

Spotify is Google's first partner for "User Choice Billing," a feature that allows Android users to make purchases using the payment option they prefer. User Choice Billing is essentially an alternative billing option for in-app purchases, and it comes with a reduced fee.

Spotify will be able to collect payments directly from users, and Google will charge Spotify four percent less than normal. Spotify and other developers who eventually adopt User Choice Billing will still need to give Google a cut of their app sales and purchases, but at the reduced rate. Google normally collects between 15 and 30 percent of in-app purchases, much like Apple.

In a blog post, Spotify said that Google has taken a "bold step to help level the playing field," and that "fair and open platforms" bring "frictionless consumer experiences."

Spotify has been publicly advocating for platform fairness and expanded payment options for years. We believe that fair and open platforms enable better, frictionless consumer experiences that also empower developers to imagine, innovate, and thrive.

Spotify is rolling out an initial test implementation of user choice billing to users in select countries starting this week. Google today also announced a partnership with Bumble, with Bumble adding support in the coming months.

User Choice Billing from Google is an option in 35 countries, including the United States, much of Europe, Australia, Japan, and more, and it is a pilot program that other developers are also able to join.

With User Choice Billing, Google has distinguished the Play Store from the App Store, as Apple does not let apps use alternative billing at this time. There are two exceptions, however, including South Korea and the Netherlands. Regulators in these countries have forced Apple to allow some apps to use third-party payment providers.

In the Netherlands, Apple collects a 27 percent commission instead of a 30 percent commission, and in South Korea, Apple collects a 26 percent commission. Both reduced commissions are similar to what Google has done for its User Choice Billing System. With Google adopting options for alternative billing and continued regulatory pressure, it is possible that Apple will also fold and expand the Dutch and South Korea processes to other countries and app types, but Apple is continuing to fight for in-app purchase to remain the only payment method in the App Store at the current time.

Article Link: Google Play Store Now Letting Spotify Use Alternative Billing for In-App Purchases

 

[Andronicus]

Apple won’t change unless forced. I don’t know who is right though 🤷‍♂️

 

[Naraxus]

Apple will soon offer alternative payment options. Whether by legislation or Apple's own doing (lol) it's coming.

 

[SoldOnApple]

I think maybe Apple should be able to get their cut of subscriptions made on an Apple app, but maybe services like Spotify should be able to encourage their users to login to their accounts in the Safari app or any other browser and sign up there. Then Apple would have an incentive to give new Spotify users a discount on their first month if they sign up using IAP, and Spotify in turn would be motivated to offer an even bigger discount if they pay in a browser instead. Apple should have the change to argue that IAP is more convenient and more secure, and Spotify have the chance to argue they deserve more money.

 

[TheYayAreaLiving 🎗️]

Dang! That's something Apple would never allow into the App store. But they may no longer have a choice anymore in the future.

Also, curious about how secure is the transaction is.

 

[spazzcat]

Apple won’t change unless forced. I don’t know who is right though 🤷‍♂️

I will not sign up if you don't allow me to pay for subs through Apple. It is way too easy to end subscriptions under Apple.

 

[lazyrighteye]

I think maybe Apple should be able to get their cut of subscriptions made on an Apple app, but maybe services like Spotify should be able to encourage their users to login to their accounts in the Safari app or any other browser and sign up there. Then Apple would have an incentive to give new Spotify users a discount on their first month if they sign up using IAP, and Spotify in turn would be motivated to offer an even bigger discount if they pay in a browser instead. Apple should have the change to argue that IAP is more convenient and more secure, and Spotify have the chance to argue they deserve more money.

Agree. I too think there are all sorts of ways Apple can effectively dip a toe in this pond and still manage to monetize the experience. As you mention, aspects like convenience and security are legit features they could (and do) tout - but in this instance as a way to sway users to go with them as opposed to app dev's site. Seems almost inevitable and should prove pretty interesting.

 

[Wildkraut]

We are not there yet, this won't be enough.
EU's Digital Markets Act and Digital Services Act is on the way after Apple and Google. 🤣

 

[GMShadow]

Spotify has been publicly advocating for platform fairness and expanded payment options for years. We believe that fair and open platforms enable better, frictionless consumer experiences that also empower developers to imagine, innovate, and thrive.

Right. Totally nothing to do with your margins. You're practically Mother Teresa!

 

[Kazgarth]

Dang! That's something Apple would never allow into the App store. But they may no longer have a choice anymore in the future.

Also, curious about how secure is the transaction is.

They offer Paypal payments if you are worried about security and easy of refunds/cancellation.

 

[cocky jeremy]

Well, there you go. You have other options now. So either shut up and take what Apple offers or stop making apps for iOS.

 

[cocky jeremy]

Dang! That's something Apple would never allow into the App store. But they may no longer have a choice anymore in the future.

Also, curious about how secure is the transaction is.

It's Android. Security doesn't exist there.

 

[LeadingHeat]

So if Google is allowing the company/app to bill the user directly, that opens a few questions.

- Does Google still have to handle the refunds/disputations/fraud on Spotify’s behalf? Are they held accountable or are they freed from responsibility?

- If they’re still involved then it makes sense, but if they’re not, then how are they getting away with still charging that fee? And how is Spotify totally okay with 4% less?

I feel like if Apple did this, it wouldn’t be enough and there’d be claims of monopoly and bullying like they’re whining about now.

 

[djphat2000]

Can't wait to see all the innovation this price cut will bring!

 

[gpat]

They're definitely doing this only to piss off Apple.

 

[djphat2000]

So if Google is allowing the company/app to bill the user directly, that opens a few questions.

- Does Google still have to handle the refunds/disputations/fraud on Spotify’s behalf? Are they held accountable or are they freed from responsibility?

Not sure. But, I expect they do not have to handle it. Since you purchased it via 3rd party. Rather a 3rd party method of payment. You would have to deal with them for the refund not Google.

- If they’re still involved then it makes sense, but if they’re not, then how are they getting away with still charging that fee? And how is Spotify totally okay with 4% less?

They are free to charge for it (at all) because it's' still coming from the Google Play store. To avoid that, it would have to come from a 3rd party store.

I feel like if Apple did this, it wouldn’t be enough and there’d be claims of monopoly and bullying like they’re whining about now.

There will always be whining. Whatever Apple's version of it (most likely pretty similar to this), it will not be enough to those that state they should have done this a long time ago. Can't win for losing.

 

[Leon Ze Professional]

This certainly weakens Apples argument. They're not going to like this one bit!

 

[LeeW]

Google is just getting ahead of what they know is going to be forced soon enough. Plus it makes Apple look bad.

 

[Scipster]

I'm ok with user choice billing so long as developers are required to include Apple/Google Pay as an option. Nothing beats having all of your subscriptions managed/billed in one place!

 

[mansplains]

Can't wait to see all the innovation this price cut will bring!

Innovations such as acquiring Kinzen for censorship!

 

[genovelle]

So if Google is allowing the company/app to bill the user directly, that opens a few questions.

- Does Google still have to handle the refunds/disputations/fraud on Spotify’s behalf? Are they held accountable or are they freed from responsibility?

- If they’re still involved then it makes sense, but if they’re not, then how are they getting away with still charging that fee? And how is Spotify totally okay with 4% less?

I feel like if Apple did this, it wouldn’t be enough and there’d be claims of monopoly and bullying like they’re whining about now.

If the app lives on their servers using their APIs and App distribution network, encoding it for hundreds of languages etc. Google also has full access to the data already and monetizes each customers data as their primary revenue source. They don’t really care about user experience or potential fraud in the same way Apple does, so they aren’t as concerned about the outcome.

 

[compwiz1202]

A. Will users get any discount?
B. Can we still use Google Play balance to pay?

 

[CarAnalogy]

Wait a minute, they’re still taking 26-27% commission instead of 30%, and Spotify hails this as “leveling the playing field?” That extra 4% really makes all the difference?

This is clearly just posturing. I don’t know what their real motive is, but being Spotify they probably are just happy to have your credit card number because they make it very difficult to cancel.

 

[Kierkegaarden]

Did I read this correctly — Google will charge 4% less than normal? So instead of 30% or 15%, it will be 26% or 11%? I’m assuming Spotify would be in the higher category regardless, so we’re talking 26%. Does anyone think this will make any difference to Spotify? They want ZERO fees — they want to leach off the infrastructure that was built to allow their app to exist in the first place, and they want to pay nothing to support it.

 

[CarAnalogy]

A. Will users get any discount?
B. Can we still use Google Play balance to pay?

A. No
B. Yes