Google has been accused of providing billions of won in rebates to four major South Korean game developers — NCSoft, Netmarble, Com2uS, and Pearl Abyss. The tech giant has faced long-standing criticism for requiring app developers, including game companies, to use its in-app payment system, which collects a 30% commission. However, new claims suggest that Google offered reduced commission rates to large game companies by redistributing part of these fees as revenue-sharing or advertising subsidies, effectively lowering their costs. Consumer and civic groups have reported Google and the game companies to the Korea Fair Trade Commission (KFTC), accusing them of unfair practices that disrupted the market.
On Nov. 21, the Citizens’ Coalition for Economic Justice (CCEJ), the Korean Game User Association (KGUA), and the Korean Game Consumer Society (KGCS) announced they had filed a report with the KFTC. The groups accused the four developers of helping Google violate the Monopoly Regulation and Fair Trade Act. They called on the KFTC to impose fines totaling 69.8 billion won and conduct a comprehensive investigation into the gaming industry. KGUA President Lee Chul-woo said, “Providing financial incentives to major developers while allowing them to advertise at lower costs than competitors undermines fair competition.”
Evidence of Google’s financial support for the four companies surfaced last year during a U.S. federal court trial between Epic Games and Google. Internal documents presented at the trial showed that in 2019, Google paid $485 million (589 billion won) to NCSoft and Netmarble as part of revenue-sharing deals. When combined with advertising subsidies, the total value of the alleged transactions rises to $1.04 billion (1.27 trillion won).
Google reportedly made these payments to retain popular games on its Play Store, as some developers threatened to leave due to its steep 30% in-app purchase commission. The financial incentives were allegedly aimed at dissuading them from migrating to rival app markets.
Civic groups argue that Google’s selective payments created an uneven playing field in the South Korean gaming industry. Developers excluded from the arrangements were forced to absorb the full 30% commission, putting them at a competitive disadvantage. “Google likely recognized that smaller developers would not challenge the in-app purchase fees unless major companies like NCSoft led the charge,” said an industry insider.
Critics also claim Google knew its actions were unlawful. In 2023, the KFTC fined Google 42.1 billion won for preventing developers from launching apps on ONE Store, a domestic app marketplace founded in 2016 by South Korea’s three major telecom companies and Naver. Google had reportedly offered benefits such as Play Store promotion and international market support to developers in exchange for avoiding ONE Store. Despite the investigation beginning in 2018, Google is alleged to have continued offering incentives to maintain its control over in-app purchases.
The four game developers denied the allegations, stating, “The Google documents cited as evidence do not clearly confirm revenue-sharing agreements, and we have never received such payments.”
These developments align with an October ruling by a U.S. federal jury, which found Google’s 30% in-app purchase fee policy violated U.S. antitrust laws in markets outside China. Additionally, 44 South Korean game companies are preparing a class-action lawsuit in the U.S. against Google. They plan to demand the tech giant halve its commission and compensate for damages caused by its high fees, with the lawsuit expected to be filed by the end of the year.
