Google Play drops all subscription commissions to 15% from day one
Following a program that Google started in March 2021, the company is now lowering commissions on all Google Play app subscriptions to 15% from the first day of service instead of after a year.
Google's previous commission on subscriptions was the same as Apple's -- 30% for the first year, and 15% thereafter. Google says that 99% of all subscription app developers qualify for the lower 15% commission.
Additionally, it is cutting costs for participants in the Play Media Experience Program. App developers in that program, largely e-book vendors and streaming music services like Spotify, will have fees cut to as low as 10%.
"Our current service fee drops from 30% to 15% after 12 months of a recurring subscription,
VP of Product Management Sameer Samat said. "But we've heard that customer churn makes it challenging for subscription businesses to benefit from that reduced rate. So, we're simplifying things to ensure they can."
In March, three months after Apple's announcement about cutting developer fees, Google announced that standard 30% commission paid for app purchases in the Google Play Store would get cut to 15%. The change, which started on July 1, applied to the first $1 million in revenue generated using the Play store's payment mechanism each year.
After the developer passes the $1 million in revenue milestone for the year, the fee will return to its usual 30% level. Once the year is up, the fee will again reduce down to 15%, until the developer again passes $1 million in app sales and in-app purchases.
Apple's program for app purchase lower fees is similar, but slightly more restrictive. Under Apple's App Store Small Business Program, if a developer passes $1 million, but they become ineligible to take part the following year. If their revenue then falls below $1 million for that following year, they can reapply for the discounted rate the year after that.
Google's version for app purchases operates on the first $1 million in revenue per year, and will automatically restart the following year, regardless of the revenue level of the previous year.
"With this change, 99% of developers globally that sell digital goods and services with Play will see a 50% reduction in fees," said at the time. "These are funds that can help developers scale up at a critical phase of their growth by hiring more engineers, adding to their marketing staff, increasing server capacity, and more."
The decision to make the fee reduction applicable to all developers regardless of size is said to be due to a continued need to pay for scaling. "Scaling an app doesn't stop once a partner has reached $1M in revenue -- we've heard from our partners making $2M, $5M, and even $10M a year that their services are still on a path to self-sustaining orbit," states Samat.
Read on AppleInsider
Google's previous commission on subscriptions was the same as Apple's -- 30% for the first year, and 15% thereafter. Google says that 99% of all subscription app developers qualify for the lower 15% commission.
Additionally, it is cutting costs for participants in the Play Media Experience Program. App developers in that program, largely e-book vendors and streaming music services like Spotify, will have fees cut to as low as 10%.
"Our current service fee drops from 30% to 15% after 12 months of a recurring subscription,
VP of Product Management Sameer Samat said. "But we've heard that customer churn makes it challenging for subscription businesses to benefit from that reduced rate. So, we're simplifying things to ensure they can."
In March, three months after Apple's announcement about cutting developer fees, Google announced that standard 30% commission paid for app purchases in the Google Play Store would get cut to 15%. The change, which started on July 1, applied to the first $1 million in revenue generated using the Play store's payment mechanism each year.
After the developer passes the $1 million in revenue milestone for the year, the fee will return to its usual 30% level. Once the year is up, the fee will again reduce down to 15%, until the developer again passes $1 million in app sales and in-app purchases.
Apple's program for app purchase lower fees is similar, but slightly more restrictive. Under Apple's App Store Small Business Program, if a developer passes $1 million, but they become ineligible to take part the following year. If their revenue then falls below $1 million for that following year, they can reapply for the discounted rate the year after that.
Google's version for app purchases operates on the first $1 million in revenue per year, and will automatically restart the following year, regardless of the revenue level of the previous year.
"With this change, 99% of developers globally that sell digital goods and services with Play will see a 50% reduction in fees," said at the time. "These are funds that can help developers scale up at a critical phase of their growth by hiring more engineers, adding to their marketing staff, increasing server capacity, and more."
The decision to make the fee reduction applicable to all developers regardless of size is said to be due to a continued need to pay for scaling. "Scaling an app doesn't stop once a partner has reached $1M in revenue -- we've heard from our partners making $2M, $5M, and even $10M a year that their services are still on a path to self-sustaining orbit," states Samat.
Read on AppleInsider
Comments
Here's another idea: Apple should consider dropping the commission even further to 5%. So the App Store is basically a loss leader to sell hardware. It will lead to more apps in the App Store, will end all the gripes and lawsuits from developers about high rates, and basically kneecap other app stores from gaining a foothold.
Quite the opposite, and for the reasons you have given.
'kneecapping' other stores would send alarm bells ringing in all jurisdictions.
Keep Apple premium at 30% if they want us.
FU** YOU. Before Apple, you would have been paying 70-90% “commission” with $10,000+ budget to start if you even wanna make $1!! AND if you were lucky!! No store had the obligation to carry your software. Now all you need is a $1,000 Mac and $99/year and you get access to over 1 Billion users. Back in 2005 we were excited if we got accepted into a local store with 1,000 weekly customers with NO SEARCH ENGINE!!!
Apple owes you NOTHING.
Want more revenue? MAKE BETTER SOFTWARE.
But you're right as far as EU antitrust. If Apple was seen as doing something to hurt competitors, the EU would step in.
I remember around 2005 I helped release a music CD and we literally had to print the album covers, laminate them and cut them exactly to size to put in the cases. We were at Kinko’s all night only to have to sell them personally to strangers after concerts we paid to organize.
Hearing some App developer complain that he’s only getting 70% while never having to leave home or do any front-end work is irritating.
Although Apple is the one who have the final word in the App Store, it would be fair to consider what developers think. The iPhone became popular for the excellent job Apple did with iOS. But the same cannot be said of the Apple Apps Store. You don't see Apple apps or services leading in their own app store. The store success depends on the hard work of developers, large and small. For that reason, I think Apple should at least hear them.
And I'm not a developer, but a customer who see and benefits from the hard work Apple AND developers do to improve the iOS ecosystem.
Yes, Apple should move on from having bad apps, in each category there are only maybe ten really good apps, aside from games or utilities, also the bigger companies Google, Microsoft, Adobe, Facebook camping out and offering near free software hasn’t been good to the small to mid tier developers who offer some of the best programs.
Also Apple cutting the price of Pages, Keynote, and Numbers to free hurt the smaller developers, Apple should have continued offer those programs at a placeholder price.
Apple does not need to close the store but they do need to put the AppStore on a diet and get rid of the crap, finding good programs isn’t easy like it used to be. And the same applies to the music store.