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Google charges developers 30% commission for sales made through its Play Store. (Reuters )
Google charges developers 30% commission for sales made through its Play Store. (Reuters )

Apple’s fee cut shifts spotlight to Google

  • Apple says it will drop its fee from 30% to 15% from January, for developers who make less than $1 million annually and those who are new to the App Store

Apple’s decision to halve the commission it charges from some developers for sales made through its App Store has put the spotlight on Google. The company, which has been facing criticism for charging high margins in its app store, is yet to emulate Apple.

Both Apple and Google have been facing backlash from developers over their app store policies, with payments and commissions being the biggest concern. Indian developers, in particular, have targeted Google and have moved the Competition Commission of India.

Apple said on Wednesday that it will drop its fee from 30% to 15% from January, for developers who make less than $1 million annually and those who are new to the App Store. Google also charges developers 30% commission for sales made through its Play Store. Both companies have made it mandatory to use their own payment methods when selling content and services through their platforms.

Apple sets a precedent for other app store makers.

“Although it is not really creating any major impact on the ground, it is at least an indication that both Google and Apple are beginning to sense that this could be a potential area for conflict in the future as companies grow," said Rameesh Kailasam, chief executive officer of IndiaTech.org, a startup lobby group.

“Apple needed some olive branches in its ongoing war with developers, especially with regulators breathing down its neck. It is no major revenue hit for Apple, as the bulk of its app store revenue would come from larger developers, while it does make it a friendlier platform for smaller ones," said tech policy consultant Prasanto K. Roy.

If Google follows in Apple’s footsteps, it could help many smaller developers in India, where Android phones make up more than 90% of the smartphone market.

The technology giant did not comment on its plans, but a spokesperson said that consumer spends in Google Play on apps and games created by Indian developers have doubled year-to-date. Indian developers saw more than 80% growth in consumer spends from users outside India year-to-date, the spokesperson said.

“It is hard enough for developers to monetize apps and games in India. Having 15% extra money will go a long way for small app and game developers, especially in India, because here we all are developing for Android first," said Oliver Jones, co-founder, Bombay Play, an award-winning Bengaluru-based game development firm.

Jones was surprised that it was Apple and not Google that made the first move. “When Google started Play Store, they modelled it after Apple’s store. They would look terrible if they don’t reduce the fees now. They may even try to beat it," he said.


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