A secret deal from Google lets Spotify bypass Android’s App Store fees entirely -Gudstory

Music streaming service Spotify has struck a unique and highly generous deal with Google for Android-based payments, according to new testimony. epic vs google tests. On the stand, Google’s head of global partnerships Don Harrison confirmed that Spotify paid 0 percent commission when users chose to purchase a subscription through Spotify’s own system. If users chose Google as their payment processor, Spotify gave 4 percent—which is dramatically less than Google’s more typical 15 percent fee.

Google fought to keep Spotify numbers private during its antitrust battle with Epic, saying they could harm negotiations with other app developers who want more generous rates. Google’s User Choice Billing program, launching in 2022, is typically described as taking a cut of about 4 percent from Google’s Play Store commission if developers use their own payment system, Google’s $15. The percentage subscription service fee is reduced to more than 11 percent. This often leaves developers with little or no money as they have to cover the cost of payment processing themselves. And in court, Google has focused on benefits like greater flexibility rather than cost savings.

But Harrison says Spotify’s “phenomenal” popularity was enough to justify a “bespoke” deal. “If we don’t have Play services and Spotify working properly in the main services, people won’t buy Android phones,” Harrison testified. As part of the deal, both parties also agreed to commit $50 million each to a “success fund”.

Google acknowledged Harrison’s testimony in a statement The verge. “A small number of developers investing more directly in Android and Play may have separate service fees as part of a broader partnership that involves substantial financial investment and product integration in different form factors,” says spokesman Dan Jackson. Are.” “These major investment partnerships allow us to bring more users to Android and Play by continuously improving the experience for all users and creating new opportunities for all developers.”

Spotify has often complained about in-app purchase fees in the past. In mid-2023, it completely dropped support for Apple’s App Store billing system to avoid paying the 30 percent commission, and it was one of the highest-profile early members of the Coalition for App Fairness, A group that included Epic and supported Fortnite Publisher’s antitrust lawsuit against Apple and Google. But while Epic continues its legal battle against both parties, Spotify has apparently found an easier and much cheaper way to get out of the Google fight.