Gov’t Watchdogs Eye Apple, Google’s Commission Structure

It’s difficult for South Korea’s major app developers to openly criticize the commissions charged by Apple and Google since they are dominant platforms. (Yonhap)

SEOUL, Aug. 19 (Korea Bizwire) — A sign of conflict is surfacing again over the commissions charged by Apple and Google in their respective app stores, which have an unrivaled presence in the app market.

After charging a 30 percent commission for gaming content, Google plans to shift its commission policy towards charging commissions on all in-app payments just as Apple does with its app developers.

According to industry sources, Google recently briefed a local app developer on its new commission policy.

Many app developers are now sharing the view that if Google expands the scope of its commission levy to encompass all genres of apps, developers may have no option but to raise their prices and eventually suffer losses.

Naver Webtoon’s cookies, for example, which are now available at a price of 100 won on PCs and Android devices, are offered at a higher price of 120 won on the Apple App Store due to a higher commission burden.

It’s difficult for South Korea’s major app developers to openly criticize the commissions charged by Apple and Google since they are dominant platforms.

Against this backdrop, the government and politicians are mulling over measures to push the two tech giants towards taking correction action with respect to their commission policies.

Government authorities such as the Ministry of Science and ICT and the Korea Communications Commission are reviewing the feasibility of the commission rules of Apple and Google.

A local company is now gathering victims to file a complaint against the commission rules of Apple and Google with the Fair Trade Commission.

Some analysts, however, have pointed out that such moves lack a sense of reality particularly given the situation where the app marketplaces of Apple and Google are tax-free in Korea due to the fact that they have no physical operation here.

Kevin Lee (kevinlee@koreabizwire.com)