Google’s rapid response to Match Group’s U.S. antitrust complaint talks about User Choice Billing–but what is truly needed is Developer Choice – FOSS Patents

Yesterday (Monday), dating app provider Match Group (known for Tinder and other services) filed an antitrust complaint in the Northern District of California against a policy change by Google that would now require Match Group to use Google’s in-app payment system, after a decade during which Android dating apps enjoyed the freedom to rely on their own billing, avoiding Google’s app tax. Match Group previously complained with Dutch competition authority Autoriteit Consument & Markt (ACM, Authority for Consumers & Markets), which is now also investigating Google (while already going into another round with Apple). I strongly doubt that Apple is out of compliance in the Netherlands, and actually think Match Group’s own conduct warrants an investigation.

Match Group’s U.S. complaint raises some of the same issues as Epic Games already did almost two years ago, with Match Group’s complaint coming across as more emotional and vitriolic. There will be a case management hearing before Judge James Donato in the Northern District of California on Thursday. I was thoroughly disappointed to see Judge Donato order a “stay” of Epic’s motion for a preliminary injunction, given that the issue is urgent (Bandcamp, a music marketplace recently acquired by Epic, might be kicked out of the Google Play Store on June 1), but there would still be time before June 1, especially for a temporary restraining order. Just like Match Group’s dating apps, Bandcamp would be affected by a policy change that Google incredibly mischaracterizes as a mere clarification of its rules.

Google was quick to respond publicly to Match Group’s complaint, which makes sense given that Match Group’s acerbic complaint was clearly directed not only at the district court but also at the court of public opinion, including politicians and competition authorities. Wilson White, Google’s Vice President of Government Affairs & Public Policy, published a detailed and emotional blog post, Setting the Record Straight on Match Group’s Cynical Campaign Against Google Play. I guess that one aspect of Match Group’s complaint that really hurts Google way beyond the context of Android in-app payments is the pressure the monopolist tried to exert on Match Group ahead of the latter’s testimony before a Senate Subcommittee in April 2021. Some senators were outraged at the time, and now that incident is part of the story of a private antitrust lawsuit and quite possibly the subject of depositions. Depending on what comes out, Google could even get into serious trouble with the United States Senate.

Google’s blog post contains some of the same red herrings as always, such as arguing (in other words) that with Android itself being free, Google’s Android business model depends on its app tax, and pointing to alternative Android app stores and sideloading, though Epic and the three dozen state attorneys-general suing Google over its Android app distribution policies have already shown–partly by virtue of pretrial discovery–to what extreme lengths Google goes in order to disadvantage those alternatives.

Two of Google’s bullet points focus on “user choice billing”–and all I’m going to do in the remainder of this post is to show why Google’s claims in those paragraphs are somewhere between grossly misleading and utterly nonsensical:

  • “Match Group isn’t interested in true user choice billing. While Match Group claims to support user choice, it has yet to offer its users that option in South Korea, where user choice billing is now available on Google Play. Likewise, they inaccurately allege that users “sometimes” pick Match Group’s billing 3 to 1 over Google Play. But many of their apps only offer Match Group’s billing. In the cases where Google Play is theoretically a user choice, it isn’t presented as a fair choice and is hidden in small text at the very bottom of the app.”

  • “We’re the only major app store piloting true user choice billing. We recently announced a pilot to invite developers to help us test and iterate on user choice billing in other markets outside South Korea. We started with Spotify as our first partner as they have made substantial investments in the platform and have deep product integrations across all of Android’s form factors. We are actively looking to add more partners in the coming months and developers can express interest.”

There are details here that don’t make sense. The claim that Google Play is “the only major app store piloting true user choice billing” ignores that Microsoft already announced in June 2021, at the unveiling of Windows 11, that developers would be free to implement their own billing system. But the worst part is Google’s criticism of Match Group not offering “user choice billing” in South Korea. In that country, the legislature requires Google to allow alternative payment systems, but the law wasn’t waterproof, so Google charges developers a commission that renders the use of alternative billing systems unattractive for developers as well as users. That’s the same issue as with the enforcement of the Dutch ACM’s antitrust ruling against Apple.

“User choice billing” is a fallacy. Users have always had a choice of payment systems: different credit cards, PayPal, or buying Google Play gift cards.

Courts, lawmakers, and regulators shouldn’t get confused by that smokescreen.

The problem isn’t that users need a choice among billing systems. If a user wants to pay with a Visa card, the user will pay with a Visa card whether it’s Google Play or, say, Match Group’s own billing system.

What the worlds really needs–and what will ultimately also benefit consumers–is Developer Choice.

Developers must have a choice, including the choice of not using Google’s billing system at all. Developers must be able to offer end users lower prices, and what enables them to do that is the freedom not to use billing systems like Google’s or Apple’s that effectively impose a tax (as Elon Musk has repeatedly pointed out).

If developers decline to use Google’s billing system, the question is what Google should be allowed to charge them for using the Android platform. But so-called user choice billing doesn’t solve the real issue.

Developer Choice goes beyond billing systems. It also involves a level playing field for third-party app stores. But even if one focuses narrowly on billing, the question simply isn’t “user choice”–much less if it’s a kind of choice (such as between Visa and Amex, or Paypal and gift cards) that users have always had.

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