Developers are reviewing South Korea’s strategy to prohibit Apple and Google from automatically assessing high commissions on in-app purchases, according to a Monday (Aug. 30) Financial Times report.
In South Korea, developers paid more than $1.7 billion to app store operators in 2020, according to the report. That lost revenue could have a ripple effect if the ban on commissions is duplicated in other countries.
Originally, the South Korean parliament’s legislation and judiciary committee was expected to approve an amendment to the Telecommunications Business Act – dubbed the “Anti-Google law” – last week, as PYMNTS reported. The action, which has been delayed until further notice, according to Tech Crunch, would halt Apple and Google from requiring software developers to use their payment systems.
The tech giants have been criticized in numerous countries for their rule requiring developers to use proprietary in-app payments systems which charge commissions up to 30 percent for in-app purchases, according to PYMNTS.
Earlier this month, three U.S. senators introduced legislation that would set rules governing app stores and allow developers to use third-party payment services and stores. If enacted, the bill would establish the Open Markets App Act, which would be used to combat Big Tech monopolies. The proposed law would set enforceable rules protecting competition and strengthening consumer protections.
Epic Games, Spotify and Tile are engaged in legal battles with Apple and Google. Last year, Epic Games said Apple’s removal of Fortnite over Epic’s use of an alternative payment system was “yet another example of Apple flexing its enormous power in order to impose unreasonable restraints.”
In Korea, the Google Play Store accounts for more than 80 percent of the app market, according to Financial Times. In addition, Google made approximately $1.3 billion in South Korean app store revenues in 2020.