Apple to cut commission on apps, but not for Fortnite and Spotify
Apple, in the midst of a standoff with big names such as Epic Games (Fortnite) on the subject, will reduce the commission it takes on the income generated by developers, but only on the smallest of them. The bitten apple brand will drop to 15% from 30% previously its levy, but only as long as developer revenues remain below $ 1 million. The Cupertino, California-based company says it wants to help small businesses develop their online presence in the face of “Global economic challenge” caused by the pandemic.
But this decision also comes after several major application editors have joined the crusade launched this summer by the video game studio Epic Games against a “tax” deemed too high. From January 1, 2021, the commission may be reduced from 30% to 15% on sales of applications as well as purchases of digital goods and services within them for developers who have not exceeded one million dollars in revenue (after commission) during the previous year, Apple has detailed in a blog post.
The biggest apps generate most of the revenue
According to the group, a “vast majority” of developers are concerned among the 28 million registered on its platform which distributes 1.8 million applications. But the group did not detail the share of its income that would be affected. However, according to experts, the largest applications generate most of the revenue. The reduced commission will not be limited to the duration of the health crisis and is part of a long-term vision of the evolution of the App Store, Apple explained during a press briefing with journalists.
” Our new program will help developers finance their small businesses, inspire them to take risks with new ideas, grow their teams and continue to build apps that enrich people’s lives ”, commented Apple CEO Tim Cook, quoted in the blog post. However, the commission will rise to 30% as soon as the threshold of one million dollars (or its equivalent in another currency) is exceeded.
Apple has explained on numerous occasions that this commission is used to ensure the proper functioning of the App Store and the safety of users. The maker of the iPhone banned the game-phenomenon Fortnite from its platform this summer, following an attempt by its publisher Epic Games to bypass commissions it deemed “tyrannical”. The two Californian groups are heading towards a trial which could take place in July 2021. Epic Games has since been joined in its crusade by a dozen companies, including Deezer and Spotify.