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Google Play Store to Face New, Organized Competition

By James Brumley - Updated Feb 7, 2020 at 9:11AM

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Chinese tech companies are banding together to push back against Alphabet's app powerhouse.

Google Play, the platform from which Alphabet (GOOGL -1.81%)(GOOG -1.62%) division Google sells apps and other digital content, hasn't faced any true threat to its distant-second-place position within an app market led by iPhone maker Apple (AAPL 0.00%). But that could be changing soon. Reuters reported on Thursday that Chinese technology companies Xiaomi (1810 1.89%), Huawei Technologies, Oppo, and Vivo are teaming up to tackle their most accessible rival on the app store front.

Graphic of smartphone with app icons.

Image source: Getty Images.

The consortium is calling itself the Global Developer Service Alliance (GDSA), and unites four organizations that each bring a unique attribute to the table. Xiaomi, for example, has developed a strong following in India. The four members of the alliance do well enough in China, where Google Play is banned. By working together, though, the group hopes to displace Google Play by targeting markets like India, Indonesia, and Russia first. There's nothing prohibiting the GDSA from taking aim at Google Play closer to home, however, though politics could potentially become a factor. Huawei's access to Alphabet's intellectual property was cut off last year as part of a sweeping ban on sales of certain technology to Chinese companies.

It remains unclear if the alliance intends to develop one single app sales platform, or only plans to assist one another with their individual efforts, or both.

While Alphabet doesn't offer a great number of details regarding its business, estimates from tech industry market research outfit Sensor Tower peg Google Play's 2019 revenue at $29.3 billion. The bulk of that is shared with app developers, however, leaving on the order of $8 billion worth of sales for Alphabet's flagship business unit last year.

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Stocks Mentioned

Alphabet Inc. Stock Quote
Alphabet Inc.
$2,316.67 (-1.81%) $-42.83
Alphabet Inc. Stock Quote
Alphabet Inc.
$2,332.45 (-1.62%) $-38.31
Apple Inc. Stock Quote
Apple Inc.
$141.66 (0.00%) $0.00
Xiaomi Corporation Stock Quote
Xiaomi Corporation
$14.00 (1.89%) $0.26

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