South Korea will put a brake on Google, the domain of Apple’s commission

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SEOUL, Aug 24 (Reuters) – South Korea is likely to ban Google and Apple Inc. (AAPL.O) from Alphabet Inc. (GOOGL.O) from charging commissions to software developers for in-app purchases. the first limit of this economy could hurt the revenue streams of the tech giants.

Parliament’s legislative and judicial committee is expected to approve an amendment to the Telecommunications Business Act, dubbed the “anti-Google law,” that bans app store operators with dominant market positions from forcing certain payment systems. .

If the bill gets the committee’s approval, it will be put to a final vote on Wednesday. South Korean lawmakers began raising the question of the structure of the technology giants’ commissions since mid-last year.

Apple and Google have faced global criticism because they require software developers who use their app stores to use private in-app payment systems that charge up to 30% on purchases from the app. application.

Last year, the European Union proposed the Digital Markets Act, with the aim of making application commissions. The rules are designed to affect big business, but some European lawmakers are in favor of tightening them to specifically target U.S. tech giants, Reuters reported in June.

Earlier this month in the United States, a bipartisan trio of senators introduced a bill that would curb app stores from companies that are said to exercise too much market control, including Apple and Google.

In South Korea, the local market of Android phone maker Samsung Electronics Co. Ltd. (005930.KS), Google Play Store earned revenue of about 6 trillion won ($ 5.99 billion) in 2019, according to a government report published last year.

Earlier this year, Google said it will reduce the service fee it charges developers in its app store from 30% to 15% of the first $ 1 million they earn in revenue in a year. Apple has made similar moves.

For Apple, too, in-app purchase fees are a key part of its $ 53.8 billion service business and a significant expense for some app developers.

In May, an antitrust lawsuit filed by the maker of the popular game “Fortnite” against Apple revealed that the game maker paid $ 100 million in commissions to Apple for two years.

Heekyong Yang Report in Seoul, Additional Report by Stephen Nellis in San Francisco Shri Navaratnam Edition

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