Monopoly Alert! Google Forcing App Developers to Use Google Wallet

According to Reuters, Google has been “pressuring applications and mobile game developers to use its costlier in-house payment service, Google Wallet.”

“Google is using its powerful position in the mobile apps market to promote an in-house offering.” Google, leveraging its dominance in one market to crush competition in another? Sounds familiar.

How do developers feel? One social games developer commented, “‘If we had a choice, the freedom to choose which billing service, then that’s even better. But if we have to follow the rules, we will,’ she added. ‘I want to maintain a very good relationship with Google.'”

What happens when developers opt to continue to use other, potentially less-expensive payment methods such as PayPal? Developers’ apps are “suspended” from the Android Market.

What does this mean for you? The higher prices for Google Wallet charges have to come from somewhere. When companies (ahem, Google) use their dominance to force partners into paying monopoly prices, developers can choose to absorb those costs (often at the detriment of future innovation) or pass those costs on to consumers like you.

So why is Google doing this? CEO of Appsperse, a cross-promotion network for app discovery said this “makes users more valuable.” Because remember, when it comes to Google, you’re not the consumer, you’re the product.