Newsletter
In a recent court case, netizens got to find out details on a possible Google and Netflix deal. The court case in question is between Epic and Google, where the latter is accused of an illegal monopoly on its app store. Part of those called for testimonies during this case is Netflix, and its statement and backing documents reveal a deal between itself and the tech giant.
This deal in question didn’t see the sunlight as Netflix didn’t agree to the conditions of the deal for certain reasons. One such reason is that while the deal might have been juicy, it will lead to the streaming service provider losing money in the long run. In the deal, Google was offering Netflix the ‘opportunity’ to pay just 10% of subscription revenues on the app while keeping the remaining 90%.
The streaming company moving away from this deal led to a ton of changes that eventually affected the end users. Currently, the method of payment for the streaming provider’s services is not as comfortable as it can be for users. Here are details on the Google and Netflix deal that led to the change in payment plans on the platform.
Despite Google’s enticing offer, Netflix still walked away from its deal
Back in 2017, Google gave Netflix a deal that some might view as being juicy. The tech giant’s offer was that the movie and series streaming service provider pay only 10% of its in-app payments. These payments come from the Android users of the platform that are on various monthly subscription plans.
At the time this offer was made, Netflix was still relying on Google’s in-app payment plan. This means that the tech giant had a cut in all payments that are made via the app. At this time, Netflix was paying over 15% to make use of in-app payment, which wasn’t favourable for the company.
With the deal for the streaming service provider to pay just 10% to Google, it seemed as though it was better. However, after close analysis, Netflix came to realize that even with this deal they’ll end up paying more. The effect of taking this deal will become evident to the streaming service provider over time.
Google, on their part, made this offer just to entice Netflix to continue using its payment channel. By doing this, they would be able to continue benefiting from the app’s presence on the platform. After rejecting this deal, Netflix then switched payment for its services from its Android app to the web.
By doing this, the company saves all its revenue and doesn’t get to share any with Google. Additionally, the streaming service provider says that its new payment method on Android devices outperforms what Google offers. Surprisingly, Netflix isn’t the only developer on the Play Store that Google has approached with this deal.