As app cuts and percentages remain a constant conversation in the mobile community, it would seem that Google is moving towards a policy that will be more lenient towards starting app developers. Traditionally, Google Play has taken a 30% cut of in-app and downloadable purchases, but its new policy will reduce this cut to 15% through a developer’s first annual sales in a year.
Google Play announced its new policy in an Android developer blog post on March 16, 2021, as reported by CNBC. Starting on July 1, 2021, Google will reduce its cut of app sales to 15% through a developer’s overall first million dollars worth of sales in a year. According to the post, Google’s new policy is built towards incentivizing developers towards studio growth and investment via staff and improved technology.
“With this change, 99% of developers globally that sell digital goods and services with Play will see a 50% reduction in fees,” Google VP Sameer Samat said in the post. “These are funds that can help developers scale up at a critical phase of their growth by hiring more engineers, adding to their marketing staff, increasing server capacity, and more.”
Google’s new policy only applies to the first million dollars worth of app and download purchases for a developer. After that million is reached, the cut will increase back to its standard 30%. Nonetheless, it’s a means to aid the growth of developers and creators in the mobile market and should help small studios in becoming more established.
Google’s new policy also flies in the face of Apple, who has seen no shortage of criticism on the matter of its supposed 30% blanket cut of app sales (unless, of course, you count alleged backroom deals). It’s a contentious topic that factored into Apple going to legal war with Epic Games over anti-trust allegations.
With these things in mind, Google’s efforts to soften its take on smaller and less profitable developers should mean brighter horizons for those hoping to develop in the Android mobile space. It will remain to be seen what kind of effect this has on the mobile app environment as the policy launches in July.
TJ Denzer posted a new article, Google Play to offer 15% cut incentive to app developers on first million in annual sales
Google’s new policy also flies in the face of Apple, who has seen no shortage of criticism on the matter of its supposed 30% blanket cut of app sales (unless, of course, you count alleged backroom deals).
Actually Apple instituted a program with similarities to this one starting in January of this year (though not as easy or generous as Google's).
Apple allows people to apply for and get into a "Small Business Program" where if you make less than $1M a year you get the 15% cut but if you go above that it's 30%.
Google's program here is better - it's apparently automatic and it's just on the first $1M outright. The way Apple's thing works if you go above $1M one year you can't be in it the next but you can be in it the year after that if you fall under $1M.
But what Google's really done here is follow Apple's lead on it and improve the terms, likely also due to address the criticisms of Epic without actually helping Epic at all. One of Epic's arguments is that the 30% is unfair to small businesses, Apple/Google's response is to do something that will help small businesses - which Epic is not.