Tech

Apple is slashing its App Store payment fees in half for smaller developers, to 15% from 30%

Tim Cook
Apple CEO Tim Cook. Karl Mondon/Digital First Media/The Mercury News via Getty Images
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Apple just made a surprise move as it feuds with app developers.

Apple on Wednesday morning announced it was changing its App Store policies to halve the commission it takes from in-app payments for smaller developers.

The cut, to 15% from 30%, will apply to developers whose apps generated up to $1 million over the past year.

"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," Apple CEO Tim Cook said in a press statement.

The cut is scheduled to take effect January 1.

The commission has sparked a bitter fight between Apple and developers over its rules on in-app purchases, which have attracted antitrust scrutiny in both the US and Europe.

The rules require developers to use Apple's payment system for in-app purchases, such as a Spotify Premium subscription. Apple then takes a 30% cut of every transaction.

Major developers including Spotify, the Tinder owner Match Group, and Epic Games have fought with Apple over its in-app payments rules.

They accuse Apple of abusing its strict control over which apps can function on iOS devices, arguing that it is especially anticompetitive if Apple then decides to launch competing products, such as its music-streaming service, Apple Music.

In September, developers formed a group called the Coalition for App Fairness to try to force Apple to get rid of the charge. Apple's announcement is unlikely to placate larger developers, which don't qualify for the price reduction.

The announcement also doesn't represent a huge financial hit for Apple. Per analytics provided to The New York Times by Sensor Tower, while the change will affect 98% of companies that pay a commission to Apple, their revenue combined totaled only 5% of App Store revenue generated last year.

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