App Developer Fees for Apple, Google, and Microsoft Are a Hot Issue

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Jun. 25 2021, Published 12:15 p.m. ET

Competition in the app store world is back thanks to one major company, Microsoft, bowing out of app developer fees for in-app purchases and downloads. The Coalition for App Fairness and its dogma have influenced the market, which paved the way for a more equitable space for people to profit off their creations.

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What are the app developer fees at each of the major app stores? Let's look at Apple App Store, Google Play, and Microsoft Windows Apps.

Microsoft eliminates most developer fees, throws a wrench in other app stores' plans

As Microsoft announced a major upgrade in its operating system (it's releasing Windows 11, a full seven years after Windows 10 was first announced), it added another tidbit about how it plans to change things.

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To incentivize app developers to choose Windows Apps over other options, Microsoft is eliminating developer fees. This means that most app creators will be able to retain 100 percent of their revenues.

However, it's only one step forward for holistic app fairness. The fee elimination doesn't apply to games. Video game developers will get to keep 88 percent of revenues by August 1. Previously, Microsoft was keeping a 30 percent commission, but the company is dropping it down as a response to hotly contested app store drama.

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Apple maintains a high developer fee rate in its app store

For all apps, games or otherwise, Apple keeps 30 percent of the sales from developers. Until Microsoft's big move, this was the industry standard for some time. That's why so many app developers have banded together to fight the norm in antitrust lawsuits.

Despite the fact that Apple hasn't changed its protocol, it has adjusted how it's handling app safety and transparency within the store. Over the course of 2020, Apple rejected 1 million new apps and 1 million app upgrades. This increase in oversight (and overhead) could mean that Apple won't want to give up its valuable fees, even though it could mean ostracizing app creators and users who might inadvertently pay more on the app store for the same product.

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Google continues to charge a large commission, too

Apple isn't the only target in the app developer fee debate. Until March, Google continued to adhere to the status quo of 30 percent. Now, apps are now only charged 15 percent for the first $1 million in revenue per year that they make through Google Play. Once a developer exceeds the threshold, the fee increases to 30 percent.

Will Microsoft's latest move force Apple and Google to comply with developer demands?

The 30 percent app store industry standard for developer fees might have surpassed its golden age. Google has already changed its rules to favor startups and small operations. Now, Microsoft is switching things up for non-game app creators. Apple will likely have to follow suit, but there's no way the evolution in the app store fairness is stopping there.

New FTC chair Lina Khan is ready to reconfigure how big tech works in a very big way, and Apple, Google, and Microsoft aren't immune.

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