Indonesia has fined Google $12.6 million for Monopolistic Practices

The Indonesian antitrust authority, KPPU, has imposed a fine of 202.5 billion rupiahs (equivalent to $12.6 million) on Google for monopolistic practices related to the Google Play Store payment system. The decision, announced on Wednesday, stems from an investigation into the tech company's market dominance and the mandatory use of the Google Play Billing (GPB) system for in-app purchases.

Indonesia ordered Google to cease forcing its billing

The Indonesian Financial Services Authority ordered Google to cease requiring the use of its billing system and allow all developers to participate in the User Choice Billing (UCB) program. In addition, the company must grant developers a minimum discount of 5% on service fees for one year after the resolution takes effect.

The investigation began in 2022 and analyzed Google's dominance in Indonesia's digital payments ecosystem. The agency found that the GPB billing system charged up to 30% of fees, significantly higher than other payment systems. This limitation of options reduced the use of applications, transactions, and developers' revenues.

Google Play Store, the only app store pre-installed on all Android devices in Indonesia, controls more than 50% of the app store market. As for the search engine market, Google has a 95.16% share, leaving competitors such as Bing, Yahoo!, DuckDuckGo and Yandex with less than 5%, according to Statista data from January 2024.

Google will appeal 

Google announced its intention to appeal the decision. Danielle Cohen, a company spokeswoman, expressed her disagreement in a statement, underlining the company's commitment to developing a competitive app ecosystem. She emphasized that the platform offers global reach, security, and alternative payment options through the User Choice Billing program. She also mentioned initiatives to support Indonesian developers, such as Indie Games Accelerator and Play Academy.

“Our current models foster a healthy and competitive app ecosystem in Indonesia, offering a secure platform, global reach, and options such as User Choice Billing, which allows alternatives to the Google Play billing system. We will continue to collaborate with the KPPU and other stakeholders during the appeal process,” said Cohen.

This case is part of the growing antitrust scrutiny of Google at the global level. Authorities in countries such as India, South Korea, France, and the United States have sanctioned the company for abusing its market power. According to Nikkei Asia, the European Union and Japan are also investigating its practices, and the Japanese antitrust regulator is expected to order changes in its operations.

As Google prepares its appeal, this case highlights the growing regulatory attention on tech giants and their influence on global markets.