South Korea last week delivered a googly to global IT behemoth Google which has made the world sit up and take notice. The question on everyone’s lips is whether Seoul has laid out a template for countries the world over in their efforts to negotiate social media’s creeping encroachment of national sovereignty. By becoming the first country to regulate Google’s in-app commission policy which could break the app store duopoly of Google and Apple ~ the South Korean parliament last week approved the contentious, so-called ‘anti-Google Bill’ which aims to provide a level playing-field by curbing global IT titans ~ it has set the cat among the pigeons. The Bill amends the Telecommunications Business Act to stop the US-based tech major from requiring local app developers to use its payment system for in-app sales and takes effect immediately upon promulgation.
The legislation was pushed through by President Moon Jae-in’s liberal Democratic Party, which holds a parliamentary majority, as its lawmakers took exception to Google’s new in-app commission policy, announced last year, calling it an example of a large platform operator abusing its market dominance. The Korea Herald reported that the passage of the Bill has proven divisive, pitting local app developers and IT companies who see the need to regulate global tech giants against conservative politicians who fear a trade dispute with the USA. And it’s not only local but also global app developers and IT companies that have welcomed the Korean legislation, arguing that it is a significant step in the fight for a fair app ecosystem as it puts an end to mandatory IAP which will allow innovation, consumer choice, and competition to thrive. Match Group, an American internet and technology company headquartered in Dallas, Texas, issued a statement calling on national legislative bodies across the world to adopt “similar measures to protect their citizens and businesses from monopolistic gatekeepers that are restricting the internet”. Google and Apple together control 90 per cent of the global app store market. The former runs its Play Store on Android, while the latter operates its App Store on iOS. Google and Apple have faced criticism in countries around the globe because they require software developers to use their billing systems, requiring payment of commissions of up to 30 per cent on all in-app purchases. Last year, Google came in for widespread criticism when it announced it would expand this payment system in October 2021, making it applicable to almost all digital content instead of just the gaming segment. Soon after, the European Union proposed the Digital Markets Act, aimed at curbing the commissions forced by US tech titans. Earlier this month, legislation was introduced in America to curb app store companies that hold too much market control, apparently targeting Google and Apple. India must respond to these global cues.