Google has decided to reduce the commissions on its Google Play Store service. The service has reduced commissions for developers worldwide that sell virtual goods and services on its platform. Apple also made a similar move late last year.
Google announced that from the first of July this year, its decision to reduce its commissions from 30 percent to 15 percent will take effect. The company said that the 15 percent commission will be for the first $1 million of revenue developers earn using the platform each year that it will charge a 30 percent commission on every dollar developer get via the platform after the first $1 million annually.
Google also mentioned that 99 percent of developers that sell their digital products using its Google Play platform will see a 50 percent cut in fees. The tech company also mentioned that about 97 percent of apps worldwide do not sell digital goods or pay any service fee.
Last year Apple did something similar to what Google has just done, but there is still a slight difference. Apple announced that it would charge 15 percent instead of 30 percent of sales from its App Store from companies that generate under $1 million in revenue through Apple Store. Apple’s decision last year did not apply to its iOS apps if a developer’s revenue on App Store exceeds $1 million.
Sameer Samat, the Vice President of Android and Google Play Store in a blogpost revealed that, ‘We’ve heard from our partners making $2 million, $5 million and even $10 million a year that their services are still on a path to self-sustaining orbit’, that ‘this is why we are making this reduced fee on the first $1 million of total revenue earned each year available to every Play developer that uses the Play developer that uses the Play billing system, regardless of size. We believe this is a fair approach that aligns with Google’s broader mission to help all developers succeed’.
Although surrounded by a number of controversies, Google Play’s reduction of commission fees will enable ‘small’ developers be able to both thrive and grow.