Google was fined 202.5 billion Rupiahs, equivalent to $12.6 million, by Indonesia’s antitrust agency KPPU on Wednesday for violating antitrust laws related to its payment system services for the Google Play Store.
The KPPU mandated that Google stop requiring the use of Google Play Billing in the Google Play Store. It also called for all developers to have the option to participate in the User Choice Billing (UCB) program and receive a minimum 5% service fee discount for a year after the final decision, according to their statement.
The investigation into Google by the antitrust watchdog was initiated in 2022 for its dominant position in the market, particularly the requirement for Indonesian app developers to use Google Play Billing (GPB). The agency discovered that the Google Pay Billing System charged fees as high as 30%, exceeding other payment systems.
The Google Play Store facilitates payments between developers and users through the GPB System for in-app purchases. Google mandates that all digital product and service purchases in the Google Play Store must go through the Google Play Billing system, restricting other payment options. This limitation led to a decrease in app users, transactions, and revenue, according to the agency.
The agency highlighted that the Google Play Store is the only pre-installed app store on all Android devices, holding a market share of over 50%. In the search engine market, Google dominates with a market share of 95.16% in Indonesia, while other search engines like Bing, Yahoo!, DuckDuckGo, and Yandex account for the rest as of January 2024, as reported by Statista.
Google intends to challenge the ruling.
In an email statement, Google spokesperson Danielle Cohen expressed disagreement with the KPPU’s decision and announced plans to appeal. Cohen emphasized that Google’s current practices support a competitive Indonesian app ecosystem, providing security, global reach, and choice, including user choice billing.
The tech industry is closely monitoring Google’s legal battles involving fines for breaching antitrust laws due to its misuse of market dominance in various countries. Japan’s antitrust regulator is anticipated to find Google in violation of antitrust laws and order the company to cease monopolistic behaviors, according to Nikkei Asia.
