What you need to know
- Google has halved its Google Play fees to 15% for all developers on their first $1 million in revenue.
- It follows a similar move by Apple last year.
- Google's move is actually more generous as it applies to all developers even if they earn more than $1 million.
Update, March 17 (7:39 am ET): Epic Games has released a statement in reponse to the changes.
Google has today announced it is halving the commission rate for developers on the first $1 million in revenue they earn on Google Play.
In an announcement today:
Starting on July 1, 2021 we are reducing the service fee Google Play receives when a developer sells digital goods or services to 15% for the first $1M (USD) of revenue every developer earns each year. With this change, 99% of developers globally that sell digital goods and services with Play will see a 50% reduction in fees. 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 move follows a similar change from Apple last year. From that report:
In huge developer news, Apple has today announced it will reduce its App Store commission rate from 30% to 15% for small businesses who earn up to $1 million a year in revenue.In a press release today the company stated:Apple today announced an industry-leading new developer program to accelerate innovation and help small businesses and independent developers propel their businesses forward with the next generation of groundbreaking apps on the App Store. The new App Store Small Business Program will benefit the vast majority of developers who sell digital goods and services on the store, providing them with a reduced commission on paid apps and in-app purchases. Developers can qualify for the program and a reduced, 15 percent commission if they earned up to $1 million in proceeds during the previous calendar year.
Google's change on paper seems vastly more generous, as it applies to the first $1 million in revenue earned by all developers, regardless if they earn more (around 1% of which do). Apple was criticized for having a seemingly arbitrary $1 million cut-off point. From Google:
This is why we are making this reduced fee on the first $1M of total revenue earned each year available to every Play developer, regardless of size. We believe this is a fair approach that aligns with Google's broader mission to help all developers succeed. We look forward to sharing full details in the coming months.
Epic Games founder Tim Sweeney, who was vocally critical of Apple's move in November, took to Twitter again to criticize Google, describing the move as a self-serving gambit.
It's scary for the tech industry to that see Google and Apple aligning their monopolistic policies in near lock-step. In a free app market, rates would be much lower for all due to competition, and not subject to their divide-and-conquer tactics.It's scary for the tech industry to that see Google and Apple aligning their monopolistic policies in near lock-step. In a free app market, rates would be much lower for all due to competition, and not subject to their divide-and-conquer tactics.— Tim Sweeney (@TimSweeneyEpic) March 16, 2021March 16, 2021
Update, March 17 (7:39 am ET) — Epic Games statement
Following the changes announced by Google, Epic Games gave the following statement to iMore:
"While a reduction in the Google app tax may alleviate a small part of the financial burden developers have been shouldering, this does not address the root of the issue. Whether it's 15% or 30%, for apps obtained through the Google Play Store, developers are forced to use Google's in-app payment services. Android needs to be fully open to competition, with a genuinely level playing field among platform companies, app creators, and service providers. Competition in payment processing and app distribution is the only path to a fair app marketplace."
