Spotify’s Google Play Store Deal
Adi Robertson and Sean Hollister (Hacker News):
Music streaming service Spotify struck a seemingly unique and highly generous deal with Google for Android-based payments, according to new testimony in the Epic v. Google trial. On the stand, Google head of global partnerships Don Harrison confirmed Spotify paid a 0 percent commission when users chose to buy subscriptions through Spotify’s own system. If the users picked Google as their payment processor, Spotify handed over 4 percent — dramatically less than Google’s more common 15 percent fee.
Google fought to keep the Spotify numbers private during its antitrust fight with Epic, saying they could damage negotiations with other app developers who might want more generous rates. Google’s User Choice Billing program, launched in 2022, is typically described as shaving about 4 percent off Google’s Play Store commission if developers use their own payment system, bringing down Google’s 15 percent subscription service fee to more like 11 percent. That often ends up saving developers little or no money since they must foot the cost of payment processing themselves.
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Google would not name other developers that have gotten the company to agree to more generous rates. During the trial, we learned that Google offered Netflix a special discounted rate of just 10 percent, but Netflix refused. Netflix no longer offers an in-app purchase option on Android and no longer pays Google anything to distribute its app as a result.
Previously:
- Apple Asked Amazon to Block Rival Ads
- Cue Testimony in US v. Google
- Apple Resisting Further Changes to Anti-Steering Rules
- Special App Store Behavior for Disney+ Subscriptions
- App Store External Purchase Fee: 27%
- Seeking Special App Store Deals
- Amazon Prime Video Now Allows In-App Rentals and Purchases
Update (2023-12-19): John Gruber:
Not only does Spotify on Android default to using its own in-app purchasing system — giving not a penny to Google in fees, apparently — but I couldn’t even find a way to choose to pay using the Play Store system. Google has granted Spotify a complete exemption to any sort of payment fee, and Spotify simply uses its own in-app payment processing.
On iOS, needless to say, Spotify has no such exemption. I just checked, and all Spotify does on iOS is list the features of each Premium account tier, with a message under each tier that reads “You can’t upgrade to Premium in the app. We know, it’s not ideal.” They don’t even list the prices or tell you where to go to sign up.
[…]
It beggars belief that Spotify would pull its app from the Play Store. What makes more sense is that Google wanted to get Spotify — an EU-based company — off their backs as vocal critics of their app store policies, so they offered them this sweetheart deal to shut them up.
