Apple has today announced the App Store Small Business Program, which will lower the App Store revenue cut for small developers to 15 per cent, down from the previous 30 per cent.
The initiative will launch on January 1st 2021, small and individual developers who earned up to $1 million in revenue (across all of their apps) in the previous calendar year will be eligible for the reduced 15 per cent commission on the App Store. Those who have earned over $1 million will continue to pay the 30 per cent cut.
Developers new to the App Store will be eligible for the 15 per cent cut, but if/when they go over the $1 million mark, the standard 30 per cent rate will apply for the rest of the calendar year, and cannot qualify for the reduced rate until the next calendar year.
More details on the initiative will be available in December.
“Small businesses are the backbone of our global economy and the beating heart of innovation and opportunity in communities around the world. 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,” said Tim Cook, Apple’s CEO.
“The App Store has been an engine of economic growth like none other, creating millions of new jobs and a pathway to entrepreneurship accessible to anyone with a great idea. Our new program carries that progress forward — helping developers fund their small businesses, take risks on new ideas, expand their teams, and continue to make apps that enrich people’s lives.”
Apple’s 30 per cent cut has been in the news a lot recently – as part of an ongoing legal battle between the company and Epic Games. Epic Games CEO Tim Sweeney has long been critical of the commission, and Epic Games implemented direct payments in Fortnite to circumvent it, causing Apple to remove the game from the App Store.