Japan banning Apple and Google app stores from using their payment systems

To boost competition in the market for app payments, the Japanese government recently revealed its plans to enforce new regulations on tech giants Google and Apple. These rules will require these companies to allow developers to use different payment systems instead of just their own.

Eliminating monopoly

According to a report from a government panel, Google and Apple should let smartphone users securely install apps from sources other than their platforms, like the App Store and Google Play Store. These proposed measures aim to create a more diverse and competitive app ecosystem in Japan.

In addition to these measures, the government aims to introduce more regulations to make it easier for users to remove pre-installed apps from their iPhones and Android devices. This move aims to give users greater control and flexibility over the software on their devices.

Source: Japan Cabinet

The government panel’s report comes after a thorough investigation by the Japan Fair Trade Commission, which highlighted Apple and Google’s lack of competitive pressure in Japan’s mobile operating system and app distribution market. These findings catalyze a more proactive approach to implementing new rules.

Is it a backlash?

Both Apple and Google have faced regulatory scrutiny worldwide due to concerns about competition, leading to changes in their business practices. 

For example, Apple faced a €50 million fine from the Dutch Consumers and Markets Authority (ACM) and subsequently allowed Dutch dating apps to offer alternative payment options.

To comply with the EU’s Digital Markets Act, it is expected that Apple will introduce the ability for European users to install apps directly. However, this feature was not initially included in the beta version of iOS 17.

Google understood something

Google launched its User Choice Billing program in Japan in September, which allows Android developers to offer alternative payment methods alongside Google’s own system. This program, which reduces the controversial in-app purchase fee by 4%, was later expanded to the United States, South Africa, and Brazil in November.

“Android has always been a uniquely open operating system, and we continue to evolve our platform and increase the choices available to developers and users while maintaining our ability to invest in the ecosystem.”

“With this next phase of Google Play’s user choice billing pilot, all non-gaming developers can offer an additional billing choice alongside Play’s billing system for their users in Australia, Japan, India, Indonesia, and the European Economic Area. We will share more in the coming months as we continue building and iterating with our pilot partners,” said Google.

Concluding thoughts

Japan serves the purpose of fair dealing, open choice, trust, and transparency. They have also considered user convenience, privacy, and security while making this decision. It is always crucial for businesses to comply with regional laws and regulations to be competitive and to keep their goodwill.