Google Takes Inspiration From Apple, Brings Down In-app Subscription Fee From 30% to 15%
Not many of us know that Google and Apple take some percentage of the money earned by the app owners from in-app subscriptions. This means that whenever you pay for your favourite app subscription such as Spotify, some portion of that amount goes to the app store as a subscription fee.
However, app stores want to incentivise app developers, and that’s why Apple reduced its cut off percentage from 30% to 15%, in June last year. Now, taking the cue from Apple, Google has announced the similar strategy so that developers do not have to look for other ways to get in-app subscriptions from users. The changed percentage will come into effect from January next year.
This was a much-needed move from Google as by charging 30% of subscription revenue, developers start looking for alternative subscription channels outside the app store to skip sacrificing 30% of the amount earned from subscriptions. Apps like Spotify charge extra for in-app subscriptions so that they can pay the 30% cut to the app store. With the reduction of the revenue percentage, apps on short margins can lower down their subscription amount for the users.
Google had been taking a lot of inspiration from Apple lately, and this move is just a part of that inspirational journey. To recall, Apple recently reduced the pricing for 4K movies on Apple TV and as expected Google followed the steps and reduced the pricing for 4K movies on the Play Movies.
From all the noted instances, all we can say is that Google is trying hard to stay in competition with Apple. Of course, by offering a reduction in subscription revenue, Google will help app developers from not looking for alternatives and stick to the Play Store for in-app subscriptions.
Nevertheless, we hope this move also encourages app developers to offer better subscription pricing to the users. Lesser pricing will also lead to increased subscriber base.
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