One of the most mediatic details of the lawsuits of Epic Games against the Apple Store and Google Play Store, went through the current practice of the industry, with the so-called “developer tax” and its high margin of 30% for platforms. However, after being the focus of much criticism, and with a lawsuit still pending against Epic Games, Google finally seems to have given its arm to twist.
While this 70/30 split between store or platform owners and developers seems to continue to work in other areas such as video games, with examples such as Steam, where the vast majority of games are sold in double digits, the already low margins of the mobile app market never fully agreed with this practice.
So, as Google has shared, with a start date from January next year, the service fee as well as that of any sale made through the Google Play Store it will be half, going from 30% to 15%, with developers now entering 85% of their sales. Interestingly, the own Google already offered this same percentage, but exclusively for those developers who have been at least 12 months old under a recurring subscription. This change follows another big move last April when it cut the revenue cut to 15% for the first $ 1 million of a developer’s revenue.
On the other hand, Google is also adjusting some of the figures for e-book publishers and music-on-demand streaming services, which could be reduced up to 10%, again under a small but, only available to those developers participating in their Google Play Media Experience program.
And is that companies like Google and Apple are trying to boost their subscription model as a more viable and sustainable strategy compared to one-time payments for applications, in Google’s case, taking advantage of the media impact of changing its subscription fees by reducing its tax on developers.