Epic and Google are preparing for another legal battle. You may remember that Google has severe in-app billing measures coming to the Play Store soon. The new rules require all apps that sell digital goods to use Google Play Billing by March 31, so Google gets a cut of the sales. Any non-compliant apps have been unable to submit updates since March 31, but the actual deadline is June 1, when these apps will be removed from the Play Store. Epic Games bought popular indie music site Bandcamp in March and is already taking Google to court over its new acquisition. Bandcamp doesn’t follow the billing rules, so it should be banned in June. As part of its antitrust case against Google, Epic is filing a preliminary injunction motion to block Bandcamp’s exclusion from the Play Store.
Epic has attacked Google and Apple over their app store rules and what Epic says are excessive fees. In March, there were many questions about why the creator of Fortnite and Unreal Engine would buy an independent music site. A line of comment from Music Business Worldwide founder Tim Ingham seems to have hit the nail on the head with Epic’s strategy. Ingham points out that Epic failed to get Apple to lower its 30 percent cut on the app store, in part because the alternative model that Epic was able to demonstrate in court, the Epic Games Store and its 12 percent fee, was not profitable. Apple’s lawyers argued that Epic’s Games Store’s lack of profitability justified Apple’s 30 percent fees.
gang camp it is However, it is a profitable digital content business. Bandcamp has a searchable content store, and hosts and delivers the content charging artists a 10 to 15 percent commission. Ingham predicted that Epic would keep Bandcamp’s business model as a viable alternative to Apple and Google’s app store fees, and that Epic would use its new acquisition to attack app store owners. It seems that we are seeing the first actions of that plan.
Bandcamp says your business is incompatible with Google Play Billing
Epic’s court filing argues that “Google has a monopoly on Android app distribution and uses its monopoly power to illegally tie its paid product, Google Play Billing, to its app distribution product, Google Play.” Bandcamp is used as an example of the harm this billing system will cause, arguing that Bandcamp’s business model is mostly incompatible with Google Play Billing.
Epic raises several issues with Google’s billing system. First, that Bandcamp’s payment system is “tailor-made to maximize efficiency and minimize costs, allowing artists to be paid within 24-48 hours of a sale.” Google Play takes 15-45 days to pay, and Bandcamp’s fast system is meant to help independent artists pay monthly bills on time.
Second, Epic says that Bandcamp’s ability to give artists 82 percent of revenue would be hurt if Google cuts 30 percent. Epic also notes that Google offered the company an attractive 10 percent commission deal after Epic complained. Google continues to offer large companies special discounts on their Play Store fees. Spotify has another special arrangement that allows it to run its own payment system alongside Google Play. Epic also rejected the 10 percent deal, saying that Bandcamp currently has a 7 percent markup on its 13 percent cut, so it can’t afford it.
One of the more interesting complaints is that Google Play Billing simply doesn’t support the type of store that Bandcamp runs. The first is that Bandcamp is a mix of digital and physical content. That makes sense for a music company: You can buy a digital download, a physical CD or vinyl record, and some band merchandise, like a t-shirt, all in one store. Google Play Billing, which was intended for in-app purchases, is not designed for this and does not support physical sales. Bandcamp would have to support two different payment systems and would have to run two payment systems. Bandcamp’s second compatibility issue is that it’s an open marketplace, with thousands of artists selling products. Google Play supports payment to a single developer entity, not the middle man with thousands of sellers.
On the Bandcamp blog, CEO Ethan Diamond said: “If Google’s policy changes stick, as of June 1, we would have to pass Google fees on to consumers (making Android a less attractive platform for music fans), passing fees on to artists (which we would never do), permanently running our Android business at a loss, or turning off digital sales in the Android app.” Eliminating purchases due to new Google billing rules is the option Amazon and Barnes & Noble took earlier this month. Poor Barnes & Noble is also an Android maker, and now it can’t sell digital books on its own hardware!
Epic’s antitrust case against Google is scheduled for April 2023, while non-compliant apps will be removed from the Play Store within a month. We will be attentive to more news.
Update at 4:18 pm ET: Google sent a statement:
This is yet another meritless claim from Epic, who are now using their newly acquired Bandcamp app to continue their effort to avoid paying for the value that Google Play provides. We’ve been transparent about Play’s payment policy for over 18 months, and as Epic knows, Bandcamp is eligible for only a 10% service fee through the Play Media Experience Program, much less than the fees that They charge on their own platforms. Despite their claims, the openness of Android means that Bandcamp has multiple ways to distribute their app to Android users, including through other app stores, directly to users through their website, or as a Google app. exclusive consumption as they do in iOS.