Apple has become a premium brand. Always going for the brand statement, the company has always produced goods that are overpriced but they work. Not to mention, making it one of the most expensive tech companies out there, Apple flawlessly advertises its prices, making users still want Apple goods. The iPhones are pretty badly spec’d but they outperform many devices in the same tier. Now, the company continues this trend of premium on apps from the App Store. This is done so to ensure quality control. This is why the App Store from Apple isn’t cluttered with apps that are plain bad or harmful to the users. The premium is charged to developers who may go ahead and charge it to the end-users in their subscription models. Now though, it seems that Apple is working its way to reduce this premium. According to this tweet from Tom Warren, an article from the Verge covers it in depth.
Big Apple news. Apple is reducing its App Store cut to 15% for most app developers in January. This is a BIG deal for indie app developers that usually have to pay 30% on app revenues and in-app purchases. Details here: https://t.co/S878cPgzdf pic.twitter.com/Livxh3ofxW
— Tom Warren (@tomwarren) November 18, 2020
Now, they are claiming that the company would be reducing the cut in half starting January, next year. This would actually bid well for smaller developers who may have good products to offer but cannot bear the costs. Not to mention, other companies may price their products such as subscription models well too which would do well for the end-users. This would naturally create more traffic on the App Store.
Earlier this year, we saw that Fortnite was deleted from the App Store since they didn’t comply with the company’s policies, taking away from their cut. Other developers have been doing that too and this cost reduction would obviously incentivise them not to do so. It may just improve the quality of work that they provide.
Now, this would be aimed at incentivising the smaller developers only. The company is announcing its program which would be aimed at developers earning less than 1 Million Dollars in total annual revenue. This is Apple’s way of keeping the smaller businesses or developers close and in the loop and honestly, it is a good initiative, if not a perfect one.