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    Google is cutting the service fee it charges developers for selling digital goods and services via its Play app store platform, the company said Tuesday. The fee will drop to 15% until developers hit $1 million in revenue for the year from such sales on the platform. Google follows Apple, which last November made a similar move with its rival app store.

    The change will kick in July 1, Google said, and it’ll apply to every developer regardless of size. The fee will jump to the standard 30% once developers make more than $1 million in sales for a year.Cut through the chatter

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    “With this change, 99% of developers globally that sell digital goods and services with Play will see a 50% reduction in fees,” Sameer Samat, Google’s vice president of product management, said in a blog post.

    Now playing: Watch this: Epic vs. Apple lawsuit heads to trial in 2021

    3:46

    Last summer, Fortnite developer Epic sued Google and Apple for removing Fortnite from their app stores. Epic added a direct payment service to its Fortnite app, which circumvented the app store owners’ payment systems and commissions.

    In a statement emailed to CNET, Epic acknowledged that the reduced fee “may alleviate a small part of the financial burden” but said the change doesn’t address the cause of the problem.

    “Whether it’s 15% or 30%, for apps obtained through the Google Play Store, developers are forced to use Google’s in-app payment services,” an Epic spokesperson wrote. “Android needs to be fully open to competition, with a genuinely level playing field among platform companies, app creators, and service providers. Competition in payment processing and app distribution is the only path to a fair app marketplace.”

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

    logo: Photograph: Issei Kato/Reuters

    © Provided by The Guardian Photograph: Issei Kato/Reuters

    Google will slash the fee it takes from Android app developers in the Google Play store by half following a similar move by Apple last year, as the two companies face legal challenges over the fees.

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

    text, logo: Google says the fee cut will help app developers ‘scale up at a critical phase of their growth’.

    © Photograph: Issei Kato/Reuters Google says the fee cut will help app developers ‘scale up at a critical phase of their growth’.

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

    CONSTELLATION BRANDS, INC.

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

    Related: Fortnite creator Epic Games launches Australian legal action against Google

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

    “Android and Google Play have always listened to our developer partners from around the world and we continue to take their input into account as we build and run the ecosystem,” he said.

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

    Both companies are facing legal action from Epic Games, the creators of Fortnite, after Fortnite was kicked off both the Apple App Store and Google Play Store in August last year because it was bypassing the companies’ in-app payment methods in favour of its own cheaper direct billing that prevented Apple and Google taking a share.

    In response to the announcement, an Epic Games spokeswoman said the reduction might “alleviate a small part of the financial burden developers have been shouldering” but said it did not address the root of the issue.

    “Whether it’s 15% or 30%, for apps obtained through the Google Play Store, developers are forced to use Google’s in-app payment services. Android needs to be fully open to competition, with a genuinely level playing field among platform companies, app creators, and service providers,” she said.

    “Competition in payment processing and app distribution is the only path to a fair app marketplace.”

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

    Google declined to comment on the court case.

    In August, an Apple spokesperson said Epic’s actions in seeking to bypass the in-app purchasing system were expressly about violating App Store guidelines designed to protect customers.

    “Their reckless behaviour made pawns of customers, and we look forward to making this clear to Australian courts,” she said.

    Epic has since launched legal action in the US, the UK and Australia, and has filed an antitrust complaint against Apple in the EU.

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

    Google move to cut Play Store fee could help ‘boutique’ apps, but not big developers

    logo

    © Provided by The Indian Express

    In a move that brings relief to thousands of developers across the world, Google has decided that from July 1 it will take just a 15 per cent cut — down from the present 30 per cent — on the first $1 million revenue earned by apps on Google Play. While the move does not change much for big apps, it does help smaller apps and game developers in a big way.

    “Reduction of commission fees is likely to benefit boutique firms, individual application developers and early stage startups,” Manjunath Bhat, Sr Director Analyst, Gartner, tells Indianexpress.com. “It will have little to no impact on large established application development companies in India.”

    Sameer Samat, VP of Android and Google Play, wrote in a blog post that “99% of developers globally that sell digital goods and services with Play will see a 50% reduction in fees.” Developers with a total revenue over $1 million each year will still need to pay a 30 per cent fee to Google.

    Google’s announcement follows a similar move by Apple last year when the Cupertino company said it will reduce its fee from 30 per cent to 15 per cent from January, for developers who make less than $1 million annually. However, Google’s approach is slightly different. In the case of Apple, the company’s App Store Small Business Program applies to only those developers who earn less than $1 million in annual sales per year from all of their apps – and once they make more than $1 million, they are charged at a standard rate. Google, meanwhile, says the cut applies to the first $1 million regardless of total revenue. “We’ve heard from our partners making $2 million, $5 million and even $10 million a year that their services are still on a path to self-sustaining orbit,” Samat said.

    Both Apple and Google in recent months have come under fire from large firms such as Epic Games and Spotify, as well as from smaller developers, who allege that the current business practises applied by the two tech giants are harming the tech market. In fact, Apple’s legal fight with Fortnite creator Epic Games has put the company under increased scrutiny from regulators. Because both Apple and Google control the most popular App Stores as well as the entire smartphone market and the ecosystem, many developers say they have no options but to follow the rules laid by the two companies and pay the fees.

    “In a country like India, it particularly makes a big difference,” says Rajan Navani, Vice Chairman & Managing Director, JetSynthesys. “I think in a way it helps support the Indian ecosystem, especially the smaller developers.”

    Navani, whose company develops popular mobile games for Android, says a reduction in the Play Store fees will make a bigger impact because the app monetization on Google’s platform is much larger. “If we look at Google’s platform numbers, they are somewhere in the range of 30 to 40 per cent growth in app purchases in India,” he said. “ It’s a good move, because with new developers coming in, more companies will engage with citizens through digital payments,”

    The move is more significant also because Android dominates the smartphone market in India. The change, even though not specific to India, comes a few months after Google faced criticism from high-profile local startups including Paytm over a move to charge a 30 per cent commission for in-app purchases.

    Vijay Shekhar Sharma, founder of Paytm, called Google “judge, jury and executioner” after the Mountain View giant temporarily delisted the popular payments app from the Android app store for a policy violation. Following the backlash, Google had to delay its 30 per cent Play Store cut in India to April 2022.

    “The commission reduction is a step forward in growing this market,” Bhat said. “A lot lies ahead in the journey of platform innovation, democratising access to the platform and monetising platform services in India.”

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