South Korea takes strong offense to Google Play’s 30% cut

The Indian story is repeating now in South Korea. The latternation has launched an antitrust investigation into Google over its plans toenforce commission fees for in-app purchases made through its mobileapplication store.

Under the new policy set to take effect in October next year,Google will take a 30 percent commission on all digital purchases by consumers.

South Korean app developers have voiced strong oppositionagainst the move, arguing that it could be in violation of local fair trade andtelecommunications laws, reports Yonhap news agency.

 Joh Sung-wook, chairperson of the Korea Fair TradeCommission (KFTC), told lawmakers during a parliamentary audit that Google'splan is currently being reviewed.

 "I believe that competition isn't working properly inthis industry," she said. "In order to restore competition, we arecurrently investigating for anti-competitive actions."

Also Read: The Indian story is repeating now in South Korea. The latter nation has launched an antitrust investigation into Google over its plans to enforce commission fees for in-app purchases made through its mobile application store.

Google holds a tight grip over local app store sales, with a63.4 percent share of the total last year at $5 billion, according to the KoreaMobile Internet Business Association.

 Han Sang-hyuk, head of the Korea Communications Commission,echoed Joh's concerns, and called for inter-agency cooperation over the issue.

 "We need to monitor the response from other countriesand also create a structure for cooperation between local agencies," Hantold lawmakers in a separate audit.

 The country's telecommunications regulator is conducting aseparate investigation into Google over its in-app payment policy.

 Google has argued that it is committed to an open system byoffering other app stores on its Android platform and that it will comply withlocal laws.

 In response to growing frustration, Google has established asupport fund worth $100 million for local app developers and users.

 Amid growing scrutiny over Google's app store fees, localrival One Store, under the country's top mobile carrier SK Telecom Co., said itwould exempt in-app payment fees by 50 percent for app developers with monthlytransactions of less than 5 million won until the end of next year.

 In India, Google faced criticism from developers after itannounced its policy asking them to integrate with the Play Store billingsystem.

 However, Google said it has extended the time for developersin India who use alternative payment system, to integrate with the Play Storebilling system till March 31, 2022.

 Targeting Google's dominance in the app distribution spacein India, leading digital payments platform Paytm on Thursday said it issetting up a Rs 10 crore fund as equity investments for mini app developers inthe country.

 The move, announced at a mini apps developer conference,comes after Paytm launched an Android Mini App Store earlier this week tosupport local developers.

 Paytm claimed that over 5,000 developers from across thecountry expressed their interest in being a part of the Paytm Mini Appprogramme.

 Several Indian entrepreneurs came out in support of Paytm'sinitiative.

 "Google's tax is like a distributor asking for 30 percent of the sales revenue as a cut. Today, we are all at the mercy of Google.We don't know when they will remove the apps, based on some policy that theydecide," Murugavel Janakiraman, Founder & CEO, Matrimony.com, said ina statement.