After facing harsh criticism from the developer community and its high-profile legal battle with the popular battle royal game Fortnite’s developer Epic Games, tech giant Apple has now revealed a new developer program which halves the existing 30 percent Apple App Store commission to just 15 percent for pre-qualified developers.
With the new program, which is expected to be in effect from January 1, 2021, Apple will reduce its standard 30 percent commission for paid app revenue and in-app purchases to 15 percent for small businesses that earn up to $1 million in revenue.
The new initiative will allow small developers and aspiring entrepreneurs to invest more in the growth of their businesses in the App Store ecosystem.
In a statement to the media, Apple’s CEO Tim Cook stated that “We’re launching this program to help small business owners write the next chapter of creativity and prosperity on the App Store, and to build the kind of quality apps our customers love.”
“The App Store has been an engine of economic growth like none other, creating millions of new jobs and a pathway to entrepreneurship accessible to anyone with a great idea. Our new program carries that progress forward — helping developers fund their small businesses, take risks on new ideas, expand their teams, and continue to make apps that enrich people’s lives,” the Apple CEO added.
The program and the reduced commission will be available to new developers along with all developers who have not touched the threshold of $1 million.
Apple will charge only the reduced 15 percent commission until the participating developer surpasses $1 million during the year with only the additional revenue, in excess of the threshold being charged at the standard rate of 30 percent.
Meanwhile, if a developer’s business falls below the $1 million threshold in a future calendar year, they can requalify for the 15 percent commission the year after. iPhone maker will continue to charge its standard commission for apps selling digital goods and services and making more than $1 million in proceeds.