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Can an app installed from Play Store being dropped support due to changing requirement in Android version?

If a very low percentage of app users still uses a very old Android version, and the developer decides to drop support for this old version, does the Play Store offer an option to refund the payment?

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    Besides, when you've bought the app "back then" for the price less than a portion of popcorn, nobody promised you life-time upgrades (neither for the app, nor for the refill of your popcorn bag). You've bought that version specifically, with the option of being able to use any future versions if there are any, if they are compatible with your then device, and if the dev decides to publish them as updates. Considering the low price and the high amount of work required from the dev, that's only fair. – Izzy Jan 25 '16 at 10:07
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Can an app installed from Play Store being dropped support due to changing requirement in Android version?

App developer (free/paid app) is at complete liberty to support/not support later Android versions, with or without continuing support for earlier versions. You will find many apps not supporting Lollipop or Marshmallow, and on other hand supporting/not supporting earlier versions.

Developers have two choices (nothing is binding), as cited Support Lower Versions of Android as an example, relating to autoback up feature of Marshmallow:

  1. Updating an existing app to support auto backup.

  2. Giving your new app support for lower versions of Android

Google Play Store policy doesn't discuss this, so only inference is that the app will be on Play Store:

  • As long as it complies to Play Store policy
  • As long as developer wishes

developer decides to drop support for this old version, does the Play store offer an option to refund the payment?

No refund is possible. See this answer for details and also read the comments, which relate to your question If a paid app stops working, can I get my money back?

Edit: An important point of compatibility pointed out by Izzy. I have a paid call recorder app bought 4 years ago, which worked fine but is not compatible with current Huawei phone and developer can't fix it since information about chip set (Kirin ) is not made public by OEM. I can't obviously ask for a refund

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There is a term called "Buyer Beware". The same way old phones or old operating systems are stopped being supported, the apps can also share the same fate. Especially when considering the fact that apps evolve much faster than phones or OSes.

Technically when you buy something, a contract is made between two sides that both sides are obligated to abide. If they specifically don't promise such a support, than neither Google Play nor Dev don't have to pay you back.

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