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South Korea passes law to force Apple and Google to allow third-party app payment systems

Currently, Apple and Google have rules in place to force developers to use their own first-party App Store and Play Store payment systems. This is something that developers have been protesting recently, sparking further scrutiny from regulators and anti-trust organisations. Now, South Korea has passed a bill to address this very problem. 

In South Korea, a new bill has passed to prevent platform holders, like Apple and Google, from locking developers into their own payment systems. This means developers should be allowed to implement their own payment systems of choice, which in turn could mean fairer revenue splits for sales made within apps.

Currently, both Apple and Google take a 30 percent cut of App Store and Play Store transactions made using their own first-party payment systems. This is something that has been repeatedly challenged and has become the core focus of a lawsuit brought on by Epic Games.

As reported by The Verge, Apple and Google are not pleased with South Korea’s new Telecommunications Business Act. On Google’s end, the company says that its revenue split “helps keep Android free” and allows the company to give developers “the tools and global platform to access billions of consumers”. Meanwhile, Apple says that the move “will put users who purchase digital goods from other sources at risk of fraud”, and undermines Apple’s privacy protections.

As noted by The Wall Street Journal, South Korea’s new bill could be referenced by regulators in other countries. Currently, there are investigations into Apple and Google’s mobile app store practices in several regions, including the EU, UK and US.

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KitGuru Says: Apple and Google are unlikely to back down from their positions straight away, but if more countries adopt similar rules in the future, they’ll have no choice but to make some big changes to their app store ecosystems and business model. 

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