Apple’s move to cut App Store commissions in half for small developers is a start, but it mostly misses the real point

Tim Cook WWDC 2020

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On Wednesday, Apple announced a new program that lets smaller iOS developers apply to have the commission they pay on App Store transactions reduced from 30% to 15%. The change applies to developers who generate less than $1 million in total revenue in a year beginning January 1, 2021. In a statement, Apple said the reason for launching the program is to “support small and individual developers and spur innovation for the next chapter of apps.” 

There’s actually a lot to unpack here considering that, according to Sensor Tower, the change could affect as many as 98% of iOS developers. At the same time, those developers represent only 5% of total App Store transactions. As The New York Times points out, the move will have little effect on Apple’s profit margin, amounting to less than 2.5% of App Store revenue. 

Still, I don’t think the numbers are necessarily the best way to evaluate this change. 

I think it’s fair to say that Apple, in addition to finding a way to support small developers, has also found what it thinks is a way to relieve some of the pressure it’s faced over how it manages the App Store. And it’s faced plenty of pressure on that front from both developers and Congress.

It’s hard to argue this isn’t a welcome move, especially for the vast majority of developers who fall under that $1 million threshold. Except there are developers making that argument. Some large developers are crying foul over this change, claiming it’s simply a ploy to create division among developers. The argument seems to be that small developers should have to keep paying a higher commission so that the larger guys can try to claim some kind of high ground in their fight against Apple. 

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Epic and Spotify, for example, are cofounders of the Coalition for App Fairness, a group formed to advocate for Apple to change its App Store policies. The group released a statement that says:

Developers want a level playing field from Apple, NOT a symbolic gesture. Apple’s announcement today is a calculated move and and ignores fundamental flaws with the App Store, specifically:

— Coalition for App Fairness (@appfairness) November 18, 2020

I would argue that’s reading the worst possible motivation into what Apple’s doing. I would also ask who the group means when it says “developers want,” because I suspect that most of the developers who just found out they can keep more of the money generated by their app are less interested in “a level playing field” and more interested in paying a lower commission. 

By the way, it’s never going to be a level playing field because there’s a vast difference between me building an app and publishing it to the App Store and, well, Netflix. There’s no mechanism capable of leveling that field.

It’s also important to understand …read more

Source:: Businessinsider – Tech


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