S.Korea wants to curb Google and the dominance of the Apple Commission

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SEOUL, Aug 24 (Reuters) – South Korea is likely to deter Google and Apple from requiring software developers to use their payment systems economy.

Parliament’s Legislative and Judiciary Committee is expected to approve on Tuesday the amendment to the Telecommunications Industry Act, known as the “Anti-Google Act”, aimed at app store operators with dominant positions.

If the bill gets the committee’s approval, it will be put to the final vote on Wednesday. The legislature in South Korea has been pushing the question of the commission structure since the middle of last year.

Google and Apple Inc (AAPL.O) of Alphabet Inc (BrilleL.O) were not immediately available for comment.

Both companies have come under fire worldwide for requiring software developers who use their app stores to use proprietary in-app payment systems that charge commissions of up to 30% on in-app purchases.

“For game apps, Google has forced app developers to use its own payment system … and wants to extend its policy to other apps like music or Webtoon,” said Kwon Se-hwa, general manager of the Korea Internet Corporations Association, a nonprofit Group representing Korean IT companies.

“When the new bill becomes law, developers will have the option to use other independent payment systems,” said Kwon.

The European Union proposed the Digital Markets Act last year, which targets app store commissions. The rules are supposed to affect large companies, but some European lawmakers are advocating tightening to specifically target American tech giants, Reuters reported in June. Continue reading

Earlier this month, a non-partisan trio of senators in the United States tabled a bill that would curb app stores of companies they believe have too much market control, including Apple and Google. Continue reading

In South Korea, the home market of Android phone maker Samsung Electronics Co Ltd (005930.KS), the Google Play Store had sales of nearly 6 trillion won ($ 5.29 billion), according to a government report released last year.

Earlier this year, Google announced that it would cut the service fee that developers are charged on its app store from 30% to 15% on the first million dollars they make in a year. Apple has taken similar steps. Continue reading

For Apple, commissions from in-app purchases are an important part of its $ 53.8 billion service business and a huge expense for some app developers.

In May, an antitrust lawsuit brought against Apple by the maker of the popular game “Fortnite” revealed that the game maker had paid Apple $ 100 million in commissions over two years. Continue reading

Reporting by Heekyong Yang in Seoul, Additional reporting by Stephen Nellis in San Francisco Editing by Shri Navratnam

Our standards: The Thomson Reuters Trust Principles.


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