Apple to lower App Store fees for smaller developers

Apple Inc yesterday said it plans to start a program to lower its App Store commissions for software developers who make US$1 million or less in proceeds each year from the store.

Apple takes a 30 percent cut of most purchases made on the App Store, although the commission drops to 15 percent for subscriptions that remain active for more than a year.

Apple said developers will automatically get the lower 15 percent rate if they seal up to US$1 million in proceeds — defined as the portion of App Store purchases that the developer keeps — in a calendar year.

Apple’s App Store fees and rules have come under fire from both large software firms such as Microsoft Corp as well as numerous startups and smaller companies that allege the fees deprive consumers of choices and push up the price of apps.

Apple has said its rules apply evenly to developers and that the App Store provides an easy way to reach its huge base of users without having to set up payment systems in the 175 countries where it operates.

Apple said the new program will start on January 1, 2021.