In this blog post, our VP Mobile Payments Paolo Rizzardini comments on the recent changes to Google Play terms and conditions regarding in-app billing.
Google has recently announced new terms and conditions for their Play store, and the news made a lot of noise in the mobile industry. Developers are wondering if they’ll need to completely rework their apps to fulfill new requirements, while third party service providers feel that Mountain View is trying to cut them out of the Google Play business.
But is it really as bad as most people seem to think?
Google has been clear about the goal of this update:
We believe these changes will help ensure all users and developers can maintain confidence in the standard of apps available on Google Play. Our aim is to foster a high standard of app behavior, so you will be able to take advantage of Google Play as a successful platform to distribute your apps and continue to grow your business.
In other words, their goal is to provide the end user with the best possible app quality UX. It’s definitely a goal everyone in the mobile industry can subscribe to, and a goal worth the extra work, especially given the opportunities Google Play offers.
The real change in payments happened a year and a half ago
The most important changes are those regarding app updates (which must go through the provided Google Play mechanism only, even for Facebook), advertising policy (now the end user is more protected from pesky apps through device settings, notifications, bookmarks etc.), gambling policy (now covering many more cases) and, apparently, the in-app purchase policy.
Why apparently for in-app purchases?
The real change in payments occurred a year and a half ago when Google “invited” developers not to choose payment channels other than their own. The change that happened a few days ago is not adding much to this, it is more cosmetic than substantial.
First of all, the T&C are quite restrictive as far as gaming is concerned, but they openly state some exceptions:
Where payment is primarily for physical goods or services (e.g. buying movie tickets, or buying a publication where the price also includes a hard copy subscription); or where payment is for digital content or goods that may be consumed outside of the application itself (e.g. buying songs that can be played on other music players).
I am pretty sure that each one of us can find tons of examples for these exceptions, and not only in the physical goods world.
Second, it states that developers “must” use the Google Play billing system, not that they cannot use another one. This means that wherever Google Play billing is available the developer shall use Google Play (again, it is not clear whether exclusively, or other payment channels are permitted), but what about countries or networks where Google’s billing system is not offering the ideal user experience? Since Google’s main goal is to provide the end user with top quality service, a developer using a payment solution that can provide a higher conversion rate (i.e. transform users into buyers, which is the way to evaluate a billing method) can be considered as doing something wrong? Definitely not.
Third, by comparing the changes to in app purchases to the changes to i.e. the advertisement policy, the former are much lighter than the latter. Even if Google has all the power to be as strict as possible, they have left a huge space open to interpretation, as if they were giving advice rather than setting rules.
Other payment solutions can bring the quality Google wants
The reality is that Google knows pretty well that going against the developers on an important topic like monetisation would easily backfire. They know how many different ways and channels developers have available for publishing and distributing their applications, from independent app-stores, device manufacturers’ or mobile operators’ stores, to local publishers, websites, and even blogs. Usually, those channels have much more relaxed payment regulations, and the companies providing billing have an interest in helping developers get the highest possible benefit from all those additional channels. Why put up a fight instead of working together to build a common success?
It is natural for Mountain View to promote and facilitate as much as possible the adoption of their solution in their own app-store, but they cannot completely limit the adoption of different solutions if those solutions provide developers and end users with the quality Google is cleverly aiming at.
So, what’s next?
The answer to that is not simple, but Google will probably stay true to their own cooperative and end-user-centric spirit by defining precise guidelines, an evaluation/acceptance program, and a business model that will allow third party companies like Infobip to be a part of the chain and enhance the value of the Google Play offer to the end user. In the app monetisation segment, the high level service of third party companies brings a real added value, and this way the entire mobile ecosystem is guaranteed to get an additional boost to the benefit of all participants.