A lot of information about the secret deals that Google has inked with some of the largest tech companies has come to light during the Epic v. Google trial. For example, it paid Samsung $8 billion to make its apps default on Galaxy devices. The latest tidbit is about a juicy deal that Spotify secured with Google, enabling the world's largest music streaming service to avoid Google Play Store fees for subscriptions.
It was confirmed by Google's head of global partnerships Don Harrison during his testimony in the trial that Spotify pays a 0% commission on subscriptions purchased through its own system whereas it also pays a reduced commission if users choose Google as the payment processor.
Spotify got a sweetheart commission rate from Google
This seems to be a rather generous arragement that Google agreed to. It only charges 4% commission to Spotify when users choose Google as the payment processor for subscriptions purchased on Android devices. It's a much lower rate compared to the 15% commission Google commonly charges.
This isn't something that Google wanted to be made public. It did try to keep the Spotify numbers private during this lawsuit as it felt that it would damage negotiations with other developers who may want better rates themselves. However, Harrison went on to say that this sweetheart deal with Spotify was justified given the music streaming service's “unprecedented” popularity, which is why this “bespoke” deal with Spotify made sense.
While Google hasn't revealed what other developers get better commission rates but it did emerge that the company had offered Netflix a special rate of 10%. Netflix refused which is why you no longer have an in-app purchase option on Android.
None of this has any impact on the end user's experience, though, but evidently Google is going to have a tough time going into negotiations with other developers now that all of this information is public.
