Spotify isn’t<\/a> the only one that negotiated with Google for special treatment. Netflix did, too. <\/p>\n<\/div>\n In 2017, Google offered Netflix a special discounted rate of 10 percent of its in-app payments on Android \u2014 meaning Netflix could keep 90 percent of the money \u2014 according to documents and testimony in the Epic v. Google trial<\/a>. <\/p>\n<\/div>\n The future of Google\u2019s app store <\/em>is at stake<\/em><\/a> in a lawsuit by\u00a0<\/em>Fortnite\u00a0publisher Epic Games. Epic sued Google in 2020 after a fight over in-app purchase fees, claiming the Android operating system\u2019s Google Play Store constituted an unlawful monopoly \u2014 while Google says its demands would damage Android\u2019s ability to offer a secure user experience and compete with Apple\u2019s iOS.<\/em><\/p>\n<\/div>\n Today, you can\u2019t<\/a> subscribe to Netflix from inside the Netflix app on Android, but that wasn\u2019t always the case. Netflix previously paid Google 15 percent to do that, Netflix VP of business development Paul Perryman said in a 2022 video deposition that aired in the courtroom on Thursday. <\/p>\n<\/div>\n Once upon a time, when Netflix could offer its own method of payment, it paid closer to three percent, he said. Google eventually cut that off. But before Google just up and took alternative payment mechanisms away, it tried to offer Netflix the special 10 percent deal to switch to Google Play Billing (GPB) voluntarily\u2014 rather than risk Netflix taking all of that revenue away. <\/p>\n<\/div>\n Google offered to make Netflix a \u201cplatform development partner\u201d under a program it called \u201cLRAP++\u201d, according to a Netflix internal document shown in court today. (I believe I overheard that LRAP stands for Living Room Accelerator Program.)<\/p>\n<\/div>\n \u201cNetflix is the only one this is being offered to at this point,\u201d the document continued. <\/p>\n<\/div>\n The deal: \u201cBring revshare to 10% on the condition that Netflix have a full commitment to GPB globally.\u201d Perryman confirmed under oath that Google actually offered that deal to Netflix in September 2017.<\/p>\n<\/div>\n \u201cNetflix is the only one this is being offered to at this point\u201d<\/p>\n<\/div>\n<\/div>\n Netflix didn\u2019t take the deal, he said. Netflix no longer pays Google anything for distribution via Google Play, pointing people<\/a> who download the app to subscribe and pay in a mobile browser instead. <\/p>\n<\/div>\n That\u2019s partly because Netflix forecast it might lose money even at 10 percent.<\/p>\n<\/div>\n \u201cAssuming all Android in-app signups came through GPB, Netflix would lose ~$250M USD on 1 year of signups, even when accounting for the incremental uplift,\u201d reads a line in another Netflix internal document. (Netflix compared signing up in a browser vs. in-app Google Play payments, it adds, while assuming a subscriber would stick around for 36 months.)<\/p>\n<\/div>\n \u201cWe don\u2019t see a scenario where Google\u2019s payment system would outperform, or even match our own,\u201d Netflix argued.<\/p>\n<\/div>\n Google\u2019s attorney didn\u2019t contest any of this in the video deposition we saw. Instead, Google spent its time confirming that Netflix is available on practically every video-playing device under the sun \u2014 effectively pointing out, without saying explicitly, that an app at the scale of Netflix can afford to bypass the store and rely on a browser signup. Google didn\u2019t immediately respond to a request for comment.<\/p>\n<\/div>\n While Netflix didn\u2019t take Google\u2019s sweetheart deal, it did take one from Apple back in the day. Netflix had a \u201cunique arrangement\u201d with Apple<\/a> to share only 15 percent of its revenue on iOS, half of Apple\u2019s standard rate, according to an email unearthed during the Epic v. Apple trial.<\/p>\n<\/div>\n We don\u2019t know how much Spotify pays Google for its special deal. In the end<\/a>, the numbers weren\u2019t publicly revealed during trial.<\/p>\n<\/div>\n<\/div>\nFollow along with updates here<\/a>.<\/h5>\n<\/div>\n<\/div>\n<\/div>\n