Bandcamp in fight with Google that could mean high fees, payment delays

Bandcamp’s new owner Epic Games is seeking a court injunction to stop Google from charging much higher fees for transactions that happen via Bandcamp’s popular Android app.

Epic is also locked in a similar fee battle with Apple related to its gaming platform.

How big a problem is this?

Last year  Android accounted for about 46% of the mobile market, with iOS accounting for 53.66 percent of the market. At stake are the size and timing of payments to 500,000 independent artists and 11,000 independent labels who rely on the support millions of music fans that buy music and merch via Bandcamp.

Like many other platforms Bandcamp including Spotify has been using its own payment system that circumvents Google Play Billing.

Now Google is closing the loophole.

“Google is now modifying its rules to require Bandcamp (and other apps like it) to exclusively use Google Play Billing for payments for digital goods and services, and pay a revenue share to Google,” wrote Bandcamp co-founder and CEO Etahn Diamond over the weekend.

“If Google’s policy changes stand, beginning on June 1st,” said Diamond, “we would have to either pass Google’s fees on to consumers (making Android a less attractive platform for music fans), pass fees on to artists (which we would never do), permanently run our Android business at a loss, or turn off digital sales in the Android app.”

In addition to higher fees, Diamond says that Bandcamp will also no longer be able to pay artists within its usual 24-48 hours after each sale since Google pays out “15 to 45 days after.”

Spotify took the same deal that Bandcamp and Epic are now rejecting.

Google warned back in 2020 that a new app payment policy was coming, and for some that could mean total fees of 15 – 30%. But both sides aknowledge that Google offered Bandcamp a lower service fee of 10% through its Play’s Media Experience Program,

Spotify, who had also beem circumventing Google Play Billing, took the 10% deal and publically thanked Google for being a good partner.

It’s about more than lower fees.

Bandcamp is also facing a broader problem.

Google’s paynent system is just for digital goods and does not include merch, vinyl and the other physical goods that Bandcamp helps artists sell. This digital-only restriction also calls into question the viability of Epic’s grand plan to build out a marketplace that does for gaming what Bandsintown has done for independent music.

Under the current system. Bandcamp and Epic would need to use one checkout system for digital goods and another for physical. That’s not an experience that most consumers would tolerate.

Google responds: ‘Our fees are lower the Bandcamp’

For it’s part, Google says that Bandcamp and Epic have many options and the 10% fee they are charging is ‘far less’ than the (15%) fee that Bandcamp charges.

“This is yet another meritless claim by Epic, which is now using its newly acquired app Bandcamp to continue its effort to avoid paying for the value that Google Play provides. We’ve been transparent about Play’s Payment policy for more than 18 months and, as Epic knows, Bandcamp is eligible for a service fee of just 10% through Play’s Media Experience Program—far less than the fees they charge on their own platforms. Despite their claims, Android’s openness means that Bandcamp has multiple ways of distributing their app to Android users, including through other app stores, directly to users via their website or as a consumption-only app as they do on iOS.”

Expect more developments between now and the June 1st deadline.

Bruce Houghton is Founder and Editor of Hypebot and MusicThinkTank and serves as a Senior Advisor to Bandsintown which acquired both publications in 2019. He is the Founder and President of the Skyline Artists Agency and a professor for the Berklee College Of Music.