Apple Halves App Store Commission Rates For Smaller Developers

Dominic Whitlock 18th November 202020th November 2020

Apple has made the decision to cut its commission rates for smaller businesses, following pressure from an organisation that was co-founded by Match Group.

The ‘Coalition for App Fairness (CAF)’ was created in September, and challenges Apple and Google to change the way they operate their respective app stores. It’s campaigning for an even playing field in the app industry and wants developers to have more control over their products.

Now, Apple has said developers that brought in less than $1 million in the past year will only have to pay a 15% commission rate, compared to the previous 30%. An official statement says that the change was made because of the widespread difficulties of 2020.

While the update won’t benefit Match Group, it’s estimated that approximately 98% of the companies that run an iOS app will be affected.

Tim Cook, CEO of Apple, told the New York Times: “We’re launching this program to help small-business owners write the next chapter of creativity and prosperity on the App Store, and to build the kind of quality apps our customers love.

“[The smaller commission will help] developers fund their small businesses, take risks on new ideas, expand their teams, and continue to make apps that enrich people’s lives.”

A week after the CAF formed, Apple announced it was completely eradicating the fees until the end of year, for businesses that have been forced to change to online-only events by the COVID-19 pandemic.

However, not every company is happy about this latest news. Epic Games, one of Apple’s harshest critics, accused the technology giant of trying to create a divide between campaigning developers and not making changes that directly benefit consumers.

CEO Tim Sweeney also said to the New York Times: ““Apple is hoping to remove enough critics that they can get away with their blockade on competition and 30% tax on most in-app purchases.”