The number of emoji subscription purchases on South Korean messaging app KakaoTalk fell by a third over the year, parent company Kakao said on a quarterly earnings call on Thursday, blaming Google’s new in-app payment policy that forces apps to use their own Android builders. billing system.
KakaoTalk’s Emoticons Plus subscription service, which costs about $3.8 per month, allows users to access unlimited emojis. TechCrunch reported in June that South Korean app developers and content providers will see their paid subscriptions and service fees increase due to a recent change to Google’s Play Market that caps the 15-30% commission.
Kakao CEO Whon Namkoong said the negative impact of Google’s new charging policy is “inevitable,” adding that the number of Kakao talk emoji purchases has decreased since Google’s new payment policy was introduced in June this year.
“From a user perspective, due to Google’s new in-app payments policy, the [digital goods] the price barrier has gone up,” Namkoong said. “As a result, if you look [KakoTalk’s] Emoticons Plus [subscription] service, the number of new users has dropped to a third of what we had seen during the year.”
Cocoa plans to work on countermeasures to meet the change, Namkoong said. “We plan to run a promotion for users using Google’s in-app payment, as well as for our subscribers, in order to minimize the impact of in-app payment in the second half of the year,” he said.
The US tech giant introduced changes to its in-app payments system in June this year to charge transactions that overflow from non-game apps and other types of digital goods such as over-the-top (OTT), music streaming, web animation , digital book apps and more. Non-game apps, prior to the change, were allowed to direct consumers to external payment sources via in-app links.
Google said earlier this year blog published that “all developers who sell digital goods and services in their apps are required to use the Google Play billing system” and clarified that apps that use external payment links will be removed from the Google Play Store starting in June to comply with Google’s new payment system.
Kakao runs two businesses: the platform business (Kakao Talk, Kakao Mobility, Kakao Pay) and the content business (Kakao Games, Kakao Webtoons and Melon music streaming). The South Korean Internet company posted second-quarter revenue of $1.3 billion (1.82 trillion WON), up 34.8% year-over-year, and net income of $77.3 million (101 .2 billion WON) for the quarter, down 68%. from a year earlier.