[Exclusive] Kakao VS Google War... Google Payments Disabled When Installing KakaoTalk Distributed Directly by Kakao

[Asia Economy Reporters Kang Nahum and Lee Seungjin] As Kakao defies Google's policy mandating in-app payments and begins directly distributing the installation file for the latest version of the KakaoTalk application (app), it has been revealed that installing KakaoTalk using this file disables the use of Google in-app payments.

◆No Google Payments When Installed via APK=According to industry sources on the 6th, Kakao posted a notice on the 1st targeting users of KakaoTalk version 9.8.6 for Android, stating, "Android users who download the latest version of KakaoTalk via Daum search will temporarily be unable to use in-app payments."

Kakao also included a web payment outlink, stating, "Purchases are always possible at the KakaoTalk Emoticon Shop, and prices are available at a 20% discount compared to Google in-app payments."

This notice does not appear in earlier versions of KakaoTalk (v9.8.0).

Previously, Kakao requested Google to review the KakaoTalk update, but on the 30th of last month, Google rejected the review of the latest version of the KakaoTalk app.

Google's rejection of the KakaoTalk app review is a retaliatory measure against Kakao for defying Google's mandatory in-app payment policy and maintaining a 'web payment' outlink that allows some paid content (KakaoTalk emoticons) to be purchased at a lower price.

With updates via Google Play no longer possible, Kakao is temporarily distributing the Android version app installation file (APK) for KakaoTalk directly. When searching for KakaoTalk on Kakao's portal 'Daum,' Android smartphone users are guided on how to download the latest version of KakaoTalk.

A Kakao representative explained, "When upgrading via APK file installation, since it does not go through the app market, in-app payments are also disabled. Users who wish to purchase subscription services including emoticons can do so via web payment."

◆Unexpected Price Competition=As users of KakaoTalk version 9.8.6 are forced to purchase emoticons only through web payments, Google launched a counterattack by offering a 2,000 KRW discount on paid content via Google in-app payments (limited to one purchase over 2,000 KRW).

In earlier versions of KakaoTalk where in-app payments are still available, users can purchase a 2,500 KRW emoticon for 500 KRW. This means emoticons can be bought at a much cheaper price than through KakaoTalk web payments.

While it cannot be definitively stated that Google’s discount campaign is specifically targeting KakaoTalk, the industry views it as an effective way to compel users who have not yet updated to maintain the older version of KakaoTalk.

An industry insider said, "KakaoTalk emoticons are sold in the range of 2,000 to 2,500 KRW, so Google's 2,000 KRW discount is very drastic," adding, "Given the discount pricing, it is reasonable to suspect that Google is conscious of Kakao."