Bandcamp’s had a rollercoaster couple of months.
In March, the online music store and direct-to-fan platform got both the music and video games businesses talking when it was acquired by $31.5 billion-valued Epic Games, maker of hit video game Fortnite and Unreal Engine.
Today (Friday May 20), Epic and Google have filed a Joint Stipulation in a Californian court, with the latter company agreeing to not kick Bandcamp off its app store.
Today’s news marks the latest chapter in a long-running legal battle between Epic Games and Google.
Fortnite was removed from both stores for breaching Apple and Google’s policies on in-app payments, after Epic Games implemented its own in-app payment system in order to avoid paying a 30% app-store fee to Apple and Google for in-app purchases.
According to the motion filed by Epic against Google in April, relating to its recently-acquired subsidiary Bandcamp, Google has threatened to remove any apps, including Bandcamp, from its app store on June 1, 2022, if they don’t adopt Google’s payment system for in-app purchases, rather than using their own payment system.
Using Google’s payment system requires app makers to pay the company a fee, and Epic and Bandcamp argue that the change “threatens to irreparably harm Epic and thousands of artists who rely on the Bandcamp app”.
Bandcamp is used by more than 500,000 independent artists and 11, 000 independent labels.
In a blog post published by Bandcamp co-founder and CEO Ethan Diamond today (May 20), he explains that since 2015, Bandcamp has allowed artists to make sales directly to their fans in the Android app using its own billing system to process payments.
This, says Diamond, has been consistent with Google’s own guidelines exempting digital music from incurring a revenue share.
What’s happing now, is that Google is changing that policy, and apps like Bandcamp will have to start using Google Play Billing for in-app purchases exclusively, which, as stated above, will require those app-makers to pay Google a revenue share on those sales.
In Diamond’s blog post, he writes that if “Google’s policy changes stand, beginning on June 1, 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”.
He adds that the policy change would have a negative impact on the time it takes to pay artists.
Bandcamp currently makes payments between 24 to 48 hours after a sale. Diamond claims that using Google’s billing system would see that timescale rise to between 15 and 45 days after a sale.
“With today’s filing, we hope to ensure fans can also continue to buy music and merchandise through the Android app, and that as much of their support as possible reaches the artist as quickly as possible.”
According to a Joint Stipulation filed by Epic and Google today (Friday May 20), which you can read here, the music platform can continue to use its own payment system on Android devices, and Google has agreed not to remove Bandcamp from the Play Store as long as the agreement filed today is in effect.
Bandcamp and Epic have agreed, however, to start placing 10% of all revenue generated from in-app purchases on Android devices into an escrow account until Epic’s case against Google is resolved.
The agreement will remain effective until the date of “a final judgment or other disposition” of Epic’s anti-trust litigation filed against Google in 2020, or sixty days after either Google or Epic notifies the court that they’re terminating the agreement.
If Epic wins a final judgment, Google has agreed to release the funds in the escrow account to Epic. If Google wins, Epic has to pay Google.
Added Diamond in his blog post: “With today’s filing, we hope to ensure fans can also continue to buy music and merchandise through the Android app, and that as much of their support as possible reaches the artist as quickly as possible.”
According to today’s filing: “Google agrees that, for as long as this Agreement remains in effect and effective immediately, it will not remove from, de-list, refuse to list on, or otherwise make unavailable the Bandcamp app on the Google Play Store, nor will Google reject, unreasonably delay, or refuse to distribute updates of the Bandcamp app, on the basis that the Bandcamp app or updates to the app offer in-app purchases of digital goods or services through means other than Google Play’s billing system. For the avoidance of doubt, Google reserves the right to enforce all other provisions of the Google Play Developer Distribution Agreement (DDA) and Google Play Developer Program Policies to the extent such enforcement is consistent with the terms of this Agreement.”
You can read Ethan Diamond’s blog post in full below:
Under an agreement encouraged by the court, Bandcamp will continue to operate using our existing payment system on Android devices. Fans can keep supporting artists on Android as they have, and we’ll continue paying artists the same share of sales (typically within 24-48 hours, as we do today). Bandcamp will place 10% of the revenue generated from digital sales on Android devices in escrow until Epic’s ongoing case against Google is resolved, a cost we will bear. Moving forward, we’ll continue the fight to allow artist-first business models like ours on Android. You can read the court filing here.
Since 2015, artists and labels have used Bandcamp’s Android app to sell music and merchandise directly to their fans, and we have used our own billing system to process payments, consistent with Google’s guidelines which specifically exempted digital music from incurring a revenue share. However, 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. If Google’s policy changes stand, beginning on June 1st, 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. Furthermore, the policy changes would impact our ability to pay artists quickly – instead of receiving payment after 24 to 48 hours, artists may not be paid until 15 to 45 days after a sale.
Bandcamp’s mission is to help spread the healing power of music by building a community where artists thrive through the direct support of their fans, and where fans gather to explore the amazing musical universe that their direct support helps create. That community now consists of over 500,000 independent artists and 11,000 independent labels who rely on the support of the millions of music fans on Bandcamp to fund their next record, buy groceries, or pay their rent, mortgage, or utility bill. We believe it’s imperative for fans to be able to express that critical support on Android, and so to stop Google from implementing these new policies for Bandcamp and other developers, Epic is filing a motion to seek a court injunction allowing Bandcamp to continue operating as we have (you can read our filing here and my declaration here).
We know that many people use Bandcamp’s Android app to listen to their music purchases, and we are committed to making sure that option remains available. With today’s filing, we hope to ensure fans can also continue to buy music and merchandise through the Android app, and that as much of their support as possible reaches the artist as quickly as possible.
Bandcamp co-founder and CEO
Music Business Worldwide