South Korean regulator speeds up analysis of Google’s proposal to raise commissions

The Fair Trade Commission (KFTC), Korea’s top antitrust regulator, is expediting its analysis of Google’s new strategy and its effect. The latter plans to lift the commission for sales to 30 percent in October next year via its app store.

KFTC is investigating game developers from South Korea, online music streaming media and operators of network platforms that have launched application services through the Google Play Store. It is anticipated that once Google begins to charge 30 percent commission, local application developers’ revenues will decline and service costs will increase.

Yoo Byung-joon, a professor at Seoul National University’s Business School, predicts that after Google’s raised commissions, revenues of software developers will decrease by 2.11 trillion won (approximately US$1.9 billion). Musicians will earn less money from streaming music platforms, and more will still need to be distributed to Google for the expense of songwriters and musicians who pay for the use of streaming music services from subscribers.

KFTC will submit a summary report to Google early next year, involving claims that it pressured South Korean gaming companies to launch games only on the Google App Store. A further investigative report was submitted by the Department in mid-December, accusing Google of stopping local businesses from adding games to the operating services of their rivals.