Google, on Tuesday, announced its decision to temporarily restore all previously suspended Indian apps on the Play Store, contingent on developers adhering to the platform's policies. This decision follows a meeting between Google executives, Union IT Minister Ashwini Vaishnaw, and a collective of Indian founders—the first joint meeting since the apps were suspended last Friday.
Following the discussions, the minister acknowledged Google's contributions to building India's digital ecosystem. The Ministry of Electronics and Information Technology expressed its commitment to collaborating with all stakeholders to formulate a lasting solution in the upcoming months.
The tech giant, in a statement, said, "Google maintains its right to implement and enforce its business model as was established in various courts. We will invoice our full applicable services fees in the interim, and extend payment timelines for these companies."
Why were the apps delisted?
Google had removed numerous apps from the Play Store due to their failure to adhere to the in-app payment policy. This policy requires a service fee for transactions not processed through Google's payment system.
Some of the delisted apps included Shaadi.com, Bharat Matrimony, Info Edge’s Naukri and 99acres, audio storytelling apps Kuku FM and Stage, Alt Balaji’s Altt and dating service QuackQuack.
Escalating the three-year disagreement, Google stated that these companies consistently failed to adhere to its billing policies. The tech giant asserted that despite benefiting from the platform, these companies evaded paying fees.
The Alphabet-owned company, mentioned that these select group of developers in India had over three years to get ready and conform to the Play Store's payments policy but chose not to do so. Google also highlighted that these companies still adhere to the payment policies of other app stores.
Google's statement on Friday comes in the wake of the Madras High Court dismissing petitions from numerous Indian tech firms challenging Google's updated user choice billing system in January.
In a blog post, Google stated that the company has consistently upheld compliance with local laws and neither any court nor regulator has contested Google Play's entitlement to charge for its value and services, over the years.
The statement read, “On 9 February, the Supreme Court also refused to interfere with our right to do so. While some of the developers that were refused interim protection have started fairly participating in our business model and ecosystem, others choose to find ways to not do so.”
What is Google's billing policy?
For the purpose of using the distribution offered by the Google Play Store, any app publisher engaged in selling services, digital content, or goods to users is required to adhere to the app marketplace's billing system for processing transactions. This policy is applicable to startups offering services such as education, gaming, dating, matrimonial, and similar categories. However, if the app involves the sale of physical goods, operates as an ecommerce platform, or functions as a bill payment or banking app, it is exempt from the mandatory use of Google Billing.
For each transaction conducted on the app downloaded through the Play Store, the merchant is obligated to pay a fee ranging from 15% to 30% to Google. Google, in its blog post, clarified that it employs a tiered payment programme, enabling smaller players to pay a considerably lower percentage than the standard 15%.
Google introduced this system in 2021, wherein publishers pay 15% on the first $1 million in yearly sales, and after that, it is increased to 30%. For subscription products, there is a fixed 15% charge, no matter how much the publisher earns.
What are the delisted companies demanding?
As these apps were reinstated on the Google Play Store, albeit without their in-app payment functionalities, the founders of these apps argued that Google is leveraging its "monopoly" in the app publishing industry to compel startups into paying excessively high fees for their services.
Lal Chand Bisu, co-founder and CEO of Kuku FM, said that Google, once a business ally, has transformed into the most challenging partner to work with, asserting that the Android giant now wields complete control over the Indian startup ecosystem.
"We are now faced with no option but to accept their terms. This will destroy our business and make Kuku FM unfordable for the majority of the country, but when have a monopoly cared about anything beyond itself,” he said in a post on X.
Sanjeev Bikhchandani, founder of Info Edge, posted on X, that the response from India to this move must be "strategic". He said, "What India needs is an App Store / Play Store that is a part of Digital Public Infrastructure - like UPI and ONDC."
In light of this the Payments Council of India, representing major payment companies in the country also stated its point. The body told ET that the government should pass a law to prevent entities like Google from imposing excessively high fees on app developers.