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Spotify avoids app store charges by making under-the-radar agreement with Google regarding Android

During the second trial of Epic v. Google earlier this month, Epic Games, the creators of Fortnite, accused Google of offering large sums of money to developers to keep their apps on the Play Store. It has been revealed during the trial that Google offered $147 million to Epic Games for the launch of Fortnite on the Play Store. Additionally, it has come to light that Spotify had a unique and generous deal with Google regarding Android-based payments.

Don Harrison, Google’s head of global partnerships, confirmed during the trial that Spotify paid 0 percent commission when users purchased subscriptions through Spotify’s own system. However, if users chose Google as their payment processor, Spotify paid a 4 percent commission, a significant deviation from the standard 15 percent fee.

Google’s User Choice Billing program, initiated in 2022, reduces the Play Store commission by about 4 percent for developers using Google’s payment system, bringing the 15 percent subscription service fee to around 11 percent. Google fought to keep Spotify’s numbers private during its antitrust battle with Epic, arguing that disclosing such details could impact negotiations with other app developers seeking more favorable rates.

Harrison justified the unique deal with Spotify, citing the music streaming service’s “unprecedented” popularity as the reason for the “bespoke” deal. He stated, “If we don’t have Spotify working seamlessly across Play services and core services, people will not buy Android phones.”

Google acknowledged Harrison’s testimony in a statement, with spokesperson Dan Jackson explaining, “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.” Google, however, did not disclose the names of other developers benefiting from the more favorable rates.

It was also revealed during the trial that Google offered Netflix a discounted rate of 10 percent, which the streaming giant declined. In the past, Spotify has voiced its grievances with in-app purchase fees and has recently reiterated its opposition to Apple’s App Store policies, accusing the Cupertino-based company of unfair practices.

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