South Korea becomes world’s first market to force Apple, Google to allow third-party app store payments

South Korea has become the world’s first market to challenge the duopoly of Apple and Google over app store payments by approving a bill that forces them to allow third-party payments in the country. Waiting to be rubber-stamped by President Moon Jae-in, the legislation forces both Apple and Google to change their policies for app marketplaces that currently reject payments systems from third parties.

Apple and Google do not allow third-party payments in their app marketplaces, citing reasons such as ecosystem security and robust support. But both the companies charge the developers publishing apps on Android and iOS a commission of 30 per cent on every transaction for giving the necessary support. Developers have time and again slammed the monopolistic nature of app marketplaces for these platforms, especially on iOS where the App Store is the only way to download and install apps.

The bill, when passed, will put a damper on proprietary billing systems that Apple and Google have managed for their operating systems. This would mean that any third-party developer will be able to push its own payments system and both Google and Apple will have to allow it.

An Apple spokesperson said the bill will “put users who purchase digital goods from other sources at risk of fraud, undermine their privacy protections, make it difficult to manage their purchases and features like ‘Ask to Buy’ and Parental Controls will become less effective.” A Google spokesperson, similarly, said that the commission, it charges, “helps keep Android free, giving developers the tools and global platform to access billions of consumers around the world. We’ll reflect on how to comply with this law while maintaining a model that supports a high-quality operating system and app store, and we will share more in the coming weeks.

Even though it is South Korea that is close to implementing the new law to curtail the extent to which Apple and Google manage payments on their mobile ecosystems, the bill will have global ramifications. Last year, Epic Games launched its own payment system inside Fortnite for both Android and iOS to get around the proprietary billing systems of Google and Apple, respectively. Not only Apple and Google kicked Epic Games’ Fortnite from their app marketplaces, but they also labelled Epic Games’ dare absurd and non-cooperative. Epic moved court against Apple in what could be one of the biggest battles in tech. Epic had support from the likes of Spotify and Tinder, which had previously urged both Apple and Google to use their own payments systems.