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Google to slash app store fees by half for developers’ first US$1m in sales

 

Google will halve fees charged to Android app developers in the Google Play store following a similar move by Apple last year, as both companies face legal challenges over fees.

The company announced the move, which will take effect in July A blog post on Tuesday. Purchases of apps on the Google Play store, or the amount taken from in-app purchases, will be deducted from 30% to 15% for the US $ 1m (A $ 1.3m) that developers earn each year.

This would mean that 99% of developers globally would see a 50% reduction in fees, said Sameer Samat, Google’s vice president of product management.

“These are funds that can help developers in the critical phase of their growth by hiring their engineers, adding their marketing staff, increasing server capacity, and more,” he said.

The fee goes back up to 30% after the first $ 1m, and Samat asked it to apply to all app developers – not just developers making less than $ 1m per year was a “reasonable approach”.

“Android and Google Play have always listened to our developer partners from around the world and we take their input into account to get the ecosystem up and running.”

Apple brought a similar cut in its fees for the Apple App Store in January this year.

Both companies are facing legal action from Epic Games, after the creators of Fortnite, Fortnite were removed from both the Apple App Store and the Google Play Store in August last year, because it was in favor of companies on their own In-app was bypassing payment methods. Cheap direct billing that prevented Apple and Google from participating.

In response to the announcement, an Epic Games spokesman said the shortfall could be “reducing the financial burden a small part of the developers”, but said it did not address the root of the issue.

“Whether it is 15% or 30%, for apps acquired through the Google Play Store, developers are forced to use Google’s in-app payment services. Android needs to be completely open to competition, a truly playground between platform companies, app makers and service providers.

“Competition in payment processing and app delivery is the only way to a proper app marketplace.”

Epic has alleged that Google and Apple have harmed app developers and consumers in Australia, restricting competition and innovation through app distribution on iPhones and Android devices and preventing choice over in-app payments.

Google declined to comment on the court case.

In August, an Apple spokesman said Epic’s action in seeking to bypass the app-in-app purchasing system was clearly about violating App Store guidelines designed to protect customers.

“Their reckless behavior made the pawns of clients, and we look forward to clarifying this to the Australian courts,” she said.

Epic has since initiated legal action in the US, UK and Australia, and has filed a antitrust complaint against Apple in the European Union.

Both cases will be heard in Australian federal court next week, while the US case will be heard in May.

 


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