Google Play to trial alternative billing system in 'app store first'

Google has launched a pilot to provide an alternative billing system on Google Play, with Spotify being the first company to take part.

The tech giant announced yesterday that it will be exploring user choice billing in a select number of countries, following the launch of its additional billing system for users in South Korea.

South Korea passed legislation last year that banned big app store operators from forcing software developers to use their platform’s payment systems. This was the first major bill passed by a major economy against Apple and Google, despite the two companies facing growing criticism for requiring the use of a payment system that charges commissions of up to 30%.

The pilot will allow a small number of participating software developers to offer an additional billing option next to Google Play’s billing system. The company said it’s designed to help it explore ways to offer choice to users, while maintaining its ability to invest in the ecosystem. Google called it a significant milestone and the first on any major app store.

The tech giant is partnering with developers to explore different implementations of user-choice billing, starting with Spotify. The companies will work together to innovate in how consumers make in-app purchases, deliver engaging experiences across multiple devices, and bring more consumers to the Android platform.

Spotify will introduce Google Play’s billing system alongside its current one. Google said this pilot will help it increase its understanding of how user choice billing works for users in different countries and for developers of different sizes and categories.

The music streaming platform said that over the coming months, it will work with Google to build this new experience and roll it out in countries around the world. They will work together to test and learn, and jointly explore product innovations across the Android platform. The launch of the first iteration of the alternative billing system is expected to arrive later this year.

“Spotify is on a years-long journey to ensure app developers have the freedom to innovate and compete on a level playing field,” said Alex Norström, Spotify’s chief Freemium business officer. “We’re excited to be partnering with Google to explore this approach to payment choice and opportunities for developers, users and the entire internet ecosystem. We hope the work we’ll do together blazes a path that will benefit the rest of the industry.”

Spotify has been a critic of app store fees for years. In 2020, for example, it joined an alliance of tech firms, alongside Epic Games, aiming to challenge Apple and its App Store practices. The alliance opposed Apple's “App tax”, which imposed a store commission on creators and consumers ranging between 15% and 30%.