As part of a new developer program, Apple will reduce the commission rate in the App Store to 15 percent from January 1, 2021. However, this significant reduction does not benefit all developers equally, but is aimed at smaller companies whose income from apps was less than USD 1 million in the previous year.
Apple expects the reduction in commission, called the App Store Small Business Program, to accelerate innovation and help smaller and independent developers and companies that need to strengthen or build their digital presence to their customers within a short period of time during the pandemic to be reached in other ways. According to Apple, the reduced commission benefits the vast majority of developers, but does not name any proportion of the developers actually covered, and also no share of the revenue of these developers in the total revenue of the app store.
Apple is reducing the commission for developers covered by the Small Business Program, both for paid apps and for in-app purchases.
Small businesses are the backbone of our global economy and the beating heart for innovation and opportunity in communities around the world. We are launching this program to help smaller entrepreneurs write the next chapter of creativity and prosperity on the App Store and develop the high quality apps that our customers love. The App Store is an unparalleled engine of economic growth and has created millions of new jobs. He paves the way to entrepreneurship that is accessible to anyone with a great idea. Our new program builds on this dynamic – it helps developers fund their small business, take risks with new ideas, grow their teams, and continue to build apps that enrich people’s lives.
Tim Cook, CEO von Apple
Apple plans to announce comprehensive details about the developer program and the criteria for participation at the beginning of December, but has already roughly outlined them today:
Developers who earned up to $ 1 million in 2020 on all of their apps, as well as developers who are new to the App Store, can qualify for the program and the reduced commission. If a participating developer exceeds the $ 1 million threshold If the developer’s business falls below $ 1 million in a future calendar year, they may re-qualify for the 15 percent commission the following year.
The rest of the developers continue to pay a 30 percent commission
The App Store’s standard 30 percent commission rate will remain in place for apps that sell digital goods and services and generate more than $ 1 million in revenue, defined as a developer’s income after commission. The commission, which is also due on subscriptions concluded, has repeatedly caused displeasure among developers and a discussion about the extent to which Apple’s own apps are being illegally preferred.
In 2019, the App Store generated revenues and sales worth $ 519 billion worldwide – with more than 85 percent going to third-party developers and their companies, according to Apple.