Google admits Spotify pays no Play Store fees because of a secret deal
A Google executive said during testimony in the Epic vs. Google trial that a deal with Spotify allowed the audio company to bypass Play Store fees, as reported The edge.
Don Harrison, head of partnership at Google, said Spotify pays no fees when it processes its own payments and only pays a measly 4% fee when Google processes them, the publication notes. He also said the two companies have committed to investing $50 million each in a “success fund.”
The details surfaced today after Google asked the court to preserve details of its agreement with Spotify sealed earlier in the month.
Google usually takes a 15% off subscription apps. These fees could be reduced to 11% through programs such as user choice billing, which allows developers must use their own or third-party payment solutions.
“A small number of developers who invest more directly in Android and Play may have different service fees as part of a broader partnership that includes substantial financial investments and product integrations across different form factors. “These key investment partnerships allow us to attract more users to Android and Play by continually improving the experience for all users and creating new opportunities for all developers,” the Google spokesperson said , Dan Jackson, in a press release.
Google has also tried to strike similar Play Store deals with big companies. Earlier this month, The edge reported that the search giant offered Netflix a deal in 2017 to pay only 10% fees on the Play Store for subscriptions. Netflix does not currently allow users to purchase subscriptions through the Android app.
Last month, the Mountain View-based company reached a settlement with the Match Group to allow the dating app giant to use third-party billing solutions on the Play Store. Bumble, Match Group’s rival, was part of User Choice Billing Program pilot started in November 2022.
Epic, however, rejected Google’s offers to adopt user-choice billing and went to trial earlier this month. The trial has discovered many details about the internal workings of the Google Play Store. For example, in 2021 the company offered $197 million for Epic to bring Fortnite to the Play Store, but the gaming company refused the deal. Separately, Google has attempted to strike multimillion-dollar deals with other game makers such as Activision Blizzard and Tencent’s Riot Games.
