While discussing at Consilience 2023, a conference for online gaming organizations held on April 24, Indian gaming organizations strongly condemned the 30% commission charged by the Google Play Store for in-application purchases.

Who said what:

It deprives Indian developers of revenue to invest in game development: While a 30% commission could work in big markets like the US, in India it is important to guarantee game developers get more revenue to reinvest in game development, as Sai Srinivas, Co-Founder and CEO of Mobile Premier League (MPL), pointed out. “Let’s evaluate the unit economics: if a developer charges 100 rupees, 30 rupees go to the Play Store or App Store, and 70 rupees go to the developer. From those 70 rupees, they have to pay for hosting, user acquisition, and other expenses. “My view is that we should provide Indian game developers with more revenue to invest in game development and build more games,” Sai Srinivas elaborated.

It is extortion: “The 30% jagirdari tax is extortion, and I believe in India we should not allow anybody to do this, especially when you’re not an Indian company,” Manish Agarwal, Co-Founder of IndiGG, commented. He likewise noticed that Google’s commission on top of the Goods and Services Tax (GST) is a tremendous cost for customers, and in a nation like India, the emphasis ought to be on lessening friction in spending among buyers.

We need government intervention and more third-party app stores: Krafton India CEO Sean Hyunil Sohn called for government intervention and supported the development of third-party app stores to compete with the Play Store.

Rates need to be reevaluated as the industry has evolved: “When app stores and play stores were launched, the 30% fee was revolutionary compared to the 70% charged by OEMs or Telcos for game developers.” At that time, it was a very good idea, but as the industry and business models have evolved, there needs to be a relook at the rates,” Anuj Tandon, CEO of Gaming, JetSynthesys, remarked.

Why does this matter: Gaming organizations are the most influenced by Google’s commissions since they, as a rule, fall under the highest bracket (30% commission) as a result of their high-revenue numbers. Because of this reason, Epic Games prosecuted both Apple and Google in the US in August 2020, the first high-profile fight between app developers and app stores.

Play Store billing is in a mess in India currently: Recently, Indian developers, including gaming apps, utilized third-party billing systems like Razorpay or PayU to process in-app purchases made by users. Developers, by and large, pay the payment processor a commission of under 5% on these purchases. In any case, Google presently expects developers to use Google’s billing system and pay the organization between 15 and 30% commission (depending on the revenue of the app) or use a third-party billing system and pay Google between 14 and 26% commission.

Indian startups, with the help of the Alliance of Digital India Foundation (ADIF), have filed a complaint with the Competition Commission of India (CCI), claiming that Google isn’t in compliance with the CCI’s antitrust order given last October due to the exorbitant commission charged by Google in any event when developers use third-party billing systems. ADIF’s grievance is presently awaiting additional analysis. Independently, ADIF has likewise challenged Google in the Delhi High Court, requesting a suspension of the new billing policy. The court has yet to give any order on this.

Credit: Medianama