South Korea set to prohibit Google and Apple from mandating software developers to use their payment systems, thus denying them from taking commissions on in-app purchases. The first major economy to impose such restrictions on the tech titans.
On Tuesday, the parliament’s legislative and judiciary committee is anticipated to pass an amendment to the Telecommunications Business Act, dubbed the “Anti-Google bill, ” targeting app store providers with dominating market positions.
If the committee approves the bill, it will submit to a final vote on Wednesday. Since mid-last year, South Korean lawmakers have pressed the subject of the commission structure. Google (NASDAQ: GOOGL) Inc and Apple Inc (NASDAQ: AAPL) did not immediately respond to requests for comment.
Both businesses have been chastised worldwide for requiring software developers who use their app stores to use proprietary in-app payment systems that collect commissions of up to 30% on in-app sales. Google has been pressuring app developers to use its payment system for gaming applications. It wants to expand this approach to other apps like music or webtoon, said Kwon Se-Hwa, the Korea Internet Corporations Association general manager. This nonprofit group represents Korean IT enterprises.
If the new bill becomes law, developers will have the option of using alternative, independent payment systems, Kwon explained.
Digital Markets Act
Last year, the European Union introduced the Digital Markets Act, which targeted app store commissions. The laws intended to harm giant corporations, but some European politicians want to tighten them to target American technology behemoths explicitly.
Earlier this month, in the United States, a bipartisan trio of senators filed a bill that would rein in app stores run by firms with too much market domination, such as Apple and Google. According to a government study published last year, Google Play Store earned about 6 trillion won ($5.29 billion) in revenue in South Korea, the home market of Android phone maker Samsung Electronics (OTC: SSNLF) Co Ltd.
Commissions from in-app purchases are a significant portion of Apple’s $53.8 billion services business and a considerable burden for some app developers.
Google bans 8 ‘deceptive’ crypto apps
Google (NASDAQ: GOOGL) has removed eight reportedly fraudulent mobile apps from its Play Store, which were duping cryptocurrency enthusiasts by demanding fees for a bogus cloud mining service.
Fraudulent mobile applications have become a popular means of misleading naive users with a high success rate. Trend Micro’s most recent investigation uncovered eight Android applications that were abusing cryptocurrency consumers by demanding a monthly charge under the guise of running a legitimate cloud mining business.