Google admits Spotify pays no Play Store fees because of a secret deal
A Google executive said during a testimony in the Epic vs Google trial that a deal with Spotify allows the audio company to bypass Play Store fees, as reported by The Verge.
Don Harrison, Google’s head of partnership, said that Spotify pays no fees when it processes its own payments and pays a measly 4% fee when Google processes them, the publication noted. He also said that both companies have committed to put $50 million each in a “success fund.”
The details surfaced today after Google requested the court to keep the specifics of its deal with Spotify sealed earlier in the month.
Google typically takes a 15% cut on subscription apps. This fee could be reduced to 11% due to programs like user choice billing, which allows developers to use their own or third-party payment solutions.
“A small number of developers that 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 bring more users to Android and Play by continuously improving the experience for all users and creating new opportunities for all developers,” Google spokesperson Dan Jackson said in a statement.
Google has tried to strike similar Play Store deals with large companies as well. Earlier this month, The Verge reported that the search giant offered Netflix a deal in 2017 to just pay a 10% fee on Play Store for subscriptions. Netflix doesn’t allow users to buy subscriptions through the Android app at the moment.
Last month, the Mountain View-based company reached a settlement with the Match Group to let the dating app giant use third-party billing solutions on the Play Store. Match Group’s rival Bumble was part of the 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 uncovered many details about Google Play Store’s inner workings. For example, in 2021, the company offered $197 million to Epic to bring Fortnite to the Play Store, but the gaming company refused the deal. Separately, Google has tried to strike multimillion-dollar deals with other game makers such as Activision Blizzard and Tencent’s Riot Games.