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(UPDATED) Google Inc. has warned developers of mobile games and applications that using any other payment method besides Google Wallet will get their games kicked off of Google Play, the recently renamed Android Market, according to a report by Reuters, That means developers who currently use in-app billing methods like those from PayPal or Boku, methods with lower costs to developers than Google Wallet, would be effectively banished from Android phones.
In an email from August obtained by Reuters, Google gave one developer 30 days to comply or have an app suspended from Android Market.
Google did not respond to Reuters, but Hugo Troche, chief executive of Appsperse, a network for app discovery, defended Google's actions.
"Although this move by Google might seem high-handed, it reduces the friction for purchases inside Android apps and therefore makes users more valuable," Troche told Reuters.
For their part, developers quoted in the story seem to understand Google's motives, even if they do seem a bit miffed at the lack of choice and higher costs.
"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," Si Shen, founder and chief exec at gaming network Papaya told Reuters. "I want to maintain a very good relationship with Google. We are very collaborative. It's very important to the business."
Another developer defended Google, claiming the company is emulating rival Apple's strategy of making the Apple App Store experience simple and consistent in terms of payments.
"This is one of the things that has helped Apple succeed," Charles Hudson of Bionic Panda Games said to Reuters. "Every single developer is using the Apple payment system. Google sees the benefits that provides for the Apple platform and wants to create a similar system."
UPDATE: A report by the BBC late Friday said Google has denied any changes to its policies regarding payment methods developers can use. From the BBC post:
"Google told the BBC its app distribution agreement had always made developers use Google Wallet. But the internet search giant refused to say if it has started enforcing its payment rules more rigorously."
For more stories like this, visit the In-App Payments research center.