Google Slashes Play Store Fees for Developers Making Less Than $1 Million
Epic’s feud with Google and Apple is dragging on in the courts, but now both app store operators have made substantial changes to the way they share revenue with indie developers. Google has followed Apple’s lead in announcing a new, lower revenue split for all earnings under $1 million per year. Instead of paying 30 percent of every sale, developers in this category only pay 15 percent.
Google will make this change official this coming July, and it applies to all developers. Yes, even Epic if it cleans up its act and comes back to the Play Store. However, the lower rate only applies to the first million dollars the dev takes in each year. After that, the rate goes back up to 30 percent. Google says about 99 percent of all Android app developers will see all their payments to Google drop by half once this goes into effect.
This move follows a similar change in Apple’s App Store late last year. Although, Apple’s lower sales cut is much more narrowly applied. In Apple Land, developers who make less than $1 million per year get the lower 15 percent fee, but that benefit goes away the first time you make more than $1 million per year. The clock doesn’t reset on January 1st as it does with Google.
It was inevitable that Google would make this change after Apple announced its version of lower fees. Smaller developers have been complaining for years that the 30 percent fees are too high. Back in 2018, both Apple and Google dropped the fees on certain subscription content, but the latest moves are much more substantial.
It’s a self-serving gambit: the far majority of developers will get this new 15% rate and thus be less inclined to fight, but the far majority of *revenue* is in apps with the 30% rate. So Google and Apple can continue to inflate prices and fleece consumers with their app taxes.
— Tim Sweeney (@TimSweeneyEpic) March 16, 2021
Epic CEO Tim Sweeny came out swinging when Apple announced its App Store changes last year, saying this was an attempt to peel away Epic’s support among indie devs. Following Google’s move today, Sweeny decried the companies “aligning their monopolistic policies in near lock-step.” Sweeny’s position makes sense for someone who’s running a huge developer. Epic would blow right through both Apple’s and Google’s $1 million barriers and be stuck with the same 30 percent cut it has been railing against.
The mobile ecosystem is almost entirely dominated by Apple and Google, so Epic will have to fight this war on two fronts if it hopes to win. In the meantime, you still can’t get Fortnite on the iPhone. On Google’s side, you can install from third-party sources. Epic has reportedly toyed with the idea of launching its own Android app store, but it’s currently focusing its efforts on suing its way back into Google Play and the App Store.