Once live, users will see the two billing options presented side-by-side directly in the Spotify app. Rather, it will take Google’s product and engineering teams time to build the new experience over the coming months. The new system is not immediately available as of this announcement. However, it noted that user choice billing, such as is the case in South Korea, will still involve a service fee regardless of which billing system the user chooses. Google also declined to detail the commission structure involved. But a company spokesperson suggested that the commercial terms met Spotify’s “standards of fairness.” Reached for comment, Spotify declined to say what sort of commission it would be paying Google as a part of this pilot test, noting that the agreement was confidential.
Even in the case of South Korea where Google was required to permit alternative billing systems, it only reduced commissions by 4% for developers that directed users to their own billing systems. Today’s app stores charge commissions ranging from 15%-30%, generally speaking, for apps offering subscriptions and in-app purchases through their platforms. This fight is not just about wanting to have a more direct relationship with customers - it’s largely about money. Spotify, of course, has also been one of the larger developers to push for regulatory changes to app stores’ existing billing systems and structure, having testified before Congress on the matter, joined lobbying groups, and backed app store legislation - including the Open Markets Act, which would require companies like Apple and Google to permit alternatives to existing app stores. Google did not say which other developers it has lined up for future tests, but noted Spotify was a “natural first partner” on the effort given its reach as one of the “world’s largest subscription developers with a global footprint” and its “integrations across a wide range of device form factors.”
Google, however, cautioned the pilot will begin with select markets and build on the experience over time, and which regions would be first has yet to be determined.Īs the debut pilot partner, Spotify will introduce both their own billing system alongside Google Play’s own when the pilot goes live.
Spotify said the pilot will roll out to all markets where Spotify Premium is available, which is 184 total markets worldwide. While Google already offers a similar system in South Korea following the arrival of new legislation requiring it, this will be the first time it will test the system in multiple worldwide markets. Amid increasing global regulations over app stores and their commission structures, Google today announced the launch of a pilot program designed to explore what it calls “user billing choice.” The program will allow a small number of participating developers, starting with Spotify, to offer an additional third-party billing option next to Google Play’s own billing system in their apps.
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