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Apple to reduce App Store commission but debate rages

What's New in Publishing 23 Nov 2020 10:45

OPINION

Apple recently announced plans to cut App Store commission rates for smaller businesses and developers. If firms earn less than $1million a year from paid app revenue and in-app purchases, then Apple’s commission rate will fall from 30% to 15%. If a developer passes the million-dollar threshold then they are immediately bumped into the 30% category for the rest of the year.

Apple’s CEO, Tim Cook, said he hoped that the reduced commission would help “developers fund their small businesses, take risks on new ideas, expand their teams, and continue to make apps that enrich people’s lives.”

This sounds like good news all round but as with anything to do with the tech behemoth, it has sparked conflict and conversation.

Majority will qualify for discount

Apple predict the majority of developers will qualify for the discount but have declined to say how much revenue they will lose as a result of the change. The answer according to analytics company Sensor Tower is ‘not much’. They estimate that 98 percent of developers will be eligible for the cut, but those developers generated just five percent of the App Store’s total revenue last year.

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AppleSensor TowerApp StoreYUDU
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