Inevitably Apple is positioning this as a piece of philanthropy so generous it brings a tear to the eye.
"Small businesses are the backbone of our global economy and the beating heart of innovation and opportunity in communities around the world". It comes via a new developer program called the App Store Small Business Program that Apple says will "benefit the vast majority of developers who sell digital goods and services on the store". But the discount will only apply to developers with app store revenue up to $1 million annually - a threshold that excludes the makers of some of the most popular apps downloaded on iPhones, iPads and other Apple devices. For example, a developer who joins the program in 2021 and exceeds $1 million in earnings mid-year will need to pay out 30 percent commission going forward for the rest of the year.
The discount, which will come into effect in 2021, is created to help struggling companies and independent developers grow their apps during the pandemic, Apple said.More news: FDA OKs First Totally At-Home COVID-19 Diagnostic Test
Apple and the developer of the blockbuster game Fortnite, Epic Games, are fighting over whether the California-based company's tight control of its App Store, and its 30 percent cut of revenue, counts as monopolistic behaviour. Developers can qualify for the programme and a reduced, 15% commission if they earned up to $1 million in proceeds during the previous calendar year.
Details about the new programme will be provided in early December.
In 2019 alone, Apple said that the App Store facilitated $519 billion (roughly Rs. 38,49,500 crores) in commerce worldwide, with over 85 percent of that total accruing to third-party developers and businesses of all sizes.
If at any point this developer crosses the $1 million mark in earnings, then they will automatically be switched to the standard 30% fee.More news: The inflation rate in Great Britain rises to 0.7%.
Apple previewed the App Store changes to a handful of developers, who commented in a separate Apple press release.
Given that a large number of developers could potentially qualify for the new reduced commissions, Apple's bottom line within its growing Services business may be impacted.
In a statement, Match Group said Apple's rules still forced developers to use its payment system even when Apple competes against those developers. Running a small business will continue to be risky, but Apple's substantial reduction of its commissions will certainly help reduce the risks.More news: Apple testing foldable iPhone, 2022 launch possible