Seoul: Google Play Store fees could increase by more than $136 million in South Korea due to new billing policy that expands its service commission to all in-app digital content purchases, a lawmaker said on Tuesday.
Last September, Google decided to make all app developers on its Play Store use its billing system, which takes a 30 per cent commission on digital content purchases, starting in October this year.
The new policy would lead to an increase in Play Store fees for local developers by as much as 156.8 billion won ($136 million), Park Sung-Joong, a lawmaker of the opposition People Power Party, said, citing a report by the Ministry of Science and ICT.
Sales from apps on Google’s Play Store last year were estimated at over 5 trillion won, according to the ministry report that reviewed 246 companies that accounted for over 75 per cent of the country’s mobile app sales during September and October last year.
Fees on applications that would be newly impacted by the billing policy reached 287.4 billion won last year, reports Yonhap news agency.
Among the surveyed companies, 35 per cent said they would accept Google’s billing policy changes, while 29.9 per cent said they would raise fees for users, and 27.1 per cent said they would use other app stores.
Google’s move has met fierce opposition from local developers and lawmakers who argue that consumers will end up paying for the additional fees.
Last year, lawmakers proposed bills that would ban app market operators from imposing certain payment methods in mobile content transactions to limit Google’s move.
Google has said its policy update will not impact the majority of local developers and that the service fee is used to reinvest in its platform.