Google Play Halves Its Cut Of Devs’ First $1.3 Million

Google Play Halves Its Cut Of Devs’ First $1.3 Million
Tokyo Game Show attendees wait outside the Google Play booth in 2018. (Photo: Tomohiro Ohsumi, Getty Images)
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Google Play developers will see service fees on their first $US1 ($1.3) million every year reduced from 30% to 15% starting on July 1, Google vice president of product management Sameer Samat announced today.

“Helping developers build sustainable businesses is a core part of Google Play’s mission,” Samat wrote on the Android Developers blog. “We work with partners every day to understand the challenges they face and help them bring their innovative ideas to life. Getting a new app off the ground and into orbit is not easy! We’re always looking for new ways to give them an added boost.”

According to Samat, the change will benefit 99% of Google Play developers.

This move is similar to a policy instituted by Apple late last year, through which the corporation cut App Store service fees in half for devs making less than $US1 ($1.3) million a year. Unlike with Google, however, Apple bumps those fees back up if an app’s revenue exceeds the million-dollar mark.

Epic Games CEO Tim Sweeney, whose company is still engaged in legal battles with both Google and Apple over in-app purchasing restrictions and revenue cuts on Google Play and the App Store, criticised the move on Twitter.

“It’s scary for the tech industry to see Google and Apple aligning their monopolistic policies in near lock-step,” Sweeney wrote earlier today. “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 a self-serving gambit: the far majority of developers will get this new 15% rate and thus be less inclined to fight, but the far majority of revenue is in apps with the 30% rate,” Sweeney added in a follow-up tweet. “So Google and Apple can continue to inflate prices and fleece consumers with their app taxes.”

(h/t The Verge)

Comments

    • Yes, although the extra cut only applies in the following financial year, it’s not backdated.

      Worth noting that this is a recent policy to avoid political criticism about 30% being manifestly excessive profit gouging, and the vast majority of income comes from developers making more than $1m (think Candy Crush or whatever the latest big thing is). It’s really just an attempt to blunt the argument that Epic sticking up for the little guy, and the cut can be revisited at any time for any reason.

      • Did Apple change/update their proposal?

        I’ve really not been following it extensively, but my impression of Apple’s proposal initially was that the cut was based on previous financial year and that it couldn’t be revisited at all until the next financial year.

        Which meant if you were lucky (or unlucky as the case might be) to get a sales boost towards the end of a year that put you just over the $1m, then your entire next year was at the higher cut to Apple even if your sales never came close to $1m for that year.

        • I should clarify that my use of the phrase “extra cut” is intended to refer to Apple taking an extra cut out of developer turnover, that is, taking another 15% on top of their base 15%.

          Your description is not inconsistent with what I was intended to say, however I can see where the confusion might have come from.

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