American multinational technology company, Google has disclosed plan to slash its fees to 12% from 15%, and also allow developers of non-gaming apps on the Google play store to provide alternative billing systems as it moves to comply with the new EU Tech rules.
The company through its slash in fee, disclosed that such will only apply to European consumers, while the freedom to use another payment system will eventually be expanded to gaming apps as well.
Recall that earlier this year, European lawmakers agreed on new rules which will curb the dominance of big tech companies. These rules were created by the EU citing the fact that major tech firms have for long used their market dominance to squeeze out competition.
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The EU Digital Markets Act (DMA), required that tech giants such as Facebook, Apple, and Google will be forced to open their services and platforms to other businesses.
What the EU seeks to achieve is to create a fair market, as big tech platforms have been proven to prevent businesses and consumers from the benefit of competitive digital markets.
Under the proposed Digital Markets Act (DMA), American multinational company that specializes in consumer electronics and software, Apple, will be forced to open up its app store to third-party payment options, instead of users being forced to use Apple’s payment system.
This Digital Market Act (DMA) will force Apple to loosen its grip on the iPhone, where users can be allowed to uninstall the company’s safari web browser as well as other company-imposed apps that users cannot delete.
Google on the other hand will be mandated to offer people who use smartphones that run on the company’s Android operating system, alternatives to its search engine, the Google maps app, or its Chrome browser.
The EU rules will be subtle for this year as their implementation will come into full force next year, requiring tech giants to allow app developers to use rival payment platforms for app sales.
The EU has disclosed that any tech giant that violates this rule, risk fine of 10% of their global turnover. Apple and Google have been disclosed as tech giants that will be the most affected.
Also, there has been strong criticism about fees charged by Apple and Google as critics disclosed that their mobile app stores are needlessly high which costs developers billions of dollars yearly.
Both companies have been described as exercising monopoly power. Despite complying with the EU rules, Google has cited a few challenges concerning the rule.
The company disclosed that while it supports the new rule, they are worried that some of these rules could reduce innovation and the choice available to Europeans.
Although, not everyone is positive that these new EU laws will effectively diminish the dominance of these big tech companies, as critics argue that some of these tech giants will not mind violating these rules because they can easily afford the fines for DMA violations.