Google said on Wednesday an Indian court’s directive ordering the company to charge a lower 4 percent in-app payment on Disney’s streaming service in the country was a temporary measure until the court proceedings play out.
Disney in India has gone to court in what is the latest and most high-profile challenge to Google’s policy of imposing a “service fee” of 11-26 percent on in-app payments. The service charge was introduced after an antitrust directive ruled against Google’s earlier 15-30 percent fee and forced Google to allow third-party payments.
An Indian court on Tuesday said Google should receive a lower 4 percent fee for in-app purchases from Disney+ Hotstar, and cannot remove Disney’s app from its India app store, in what is a significant challenge to Google’s payments business model.
“The order is interim in nature, and the temporary 4 percent figure is simply a fee that the developer will pay to Google each month while these legal proceedings play out,” Google said in a statement.
Google will need to comply with the court directives until it is overturned or modified.
Disney, which runs the popular Disney+ Hotstar streaming app in India, has challenged Google’s new billing system in a court in India’s Tamil Nadu state. Its lawyers had argued Google was threatening to remove the Hotstar app if it didn’t comply with new payments system.
© Thomson Reuters 2023
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