Google to Android developers: use our Wallet or get out

It’s no mystery that Google is eagerly trying to monetize on its huge Android userbase numbers, a mobile platform that in these years exploded in numbers of phones sold but didn’t see as much as a profit for Google itself. Now, the company has forced app developers to use its own Wallet payment service, while collecting a slice of any app’s payment with higher margins than the competitors.

The scoop comes from Reuters, which was able to confirm the rumors from the Android apps community by looking at a confidential email sent to developers some months ago. In the email Google urged developers to adapt their apps to use Wallet, or in 30 days they would have been “suspended” from the Android Market, which has since been rebranded as the Google Play Store.

Google explained that the move would have brought higher “conversion rates” per app – i.e. the chance that a customer will go through with a purchase – thanks to reduced confusion at the moment of choosing the preferred payment channel.

Before Wallet became available for Android, app developers were granted the chance to use their preferred payment service – be it Paypal, Zong or others – but that grant was apparently limiting the revenue stream that Google could potentially extract from the platform.

By forcing developers to use Wallet, the search giant is trying to emulate the Apple success story with the iTunes store purchases: here developers were obliged to use the Apple payment service from the start, so the revenues kept flowing to Cupertino while users were happily purchasing stuff with just a single touch on the screen. And compared to Apple, Paypal and others, now Google is even demanding higher cuts for transactions – 30% for any app, game, music or video purchase on Play.

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