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Contrary to popular belief, out of 21,000 Indian apps or app developers living in the Apple Store, only 0.08% or 17 pay 30% commission to their company. A majority (87%) of store developers don’t pay fees, according to an Apple executive who resigned before Congress’ standing committee on finance investigated “anti-competitive practices by big tech companies.”
This information was included in a commission report issued in late December.
Google told the commission that only 3% of Indian developers paid for the service on the Play Store. The remaining 97% distribute apps on the Play Store and get free access to all developer tools and services. Google has been targeted by the Competition Commission of India (CCI) and was recently fined for allegedly abusing its dominant position in Play Store policies.
Google told committee members that the people who pay the fees are those who charge users for apps or provide digital content for in-app purchases, and users make the purchases. The deposition comes against a backdrop of growing global concern over Apple’s and Google’s app stores. Some countries are moving to introduce laws to break their dominance and encourage competition, allowing software developers to access iPhones and Android phones without going through their respective app stores. is.
The US and Europe are finalizing laws that allow the “sideloading” of apps. This allows app developers to load their applications without using the Apple or Google app stores. Even in India, the CCI has ordered Google to allow sideloading.
A global frustration is that two tech giants that charge up to 30% in fees from software developers and force them to use only their own payment gateways are generating huge service revenues.
Apple’s deposition claims that the perception that all apps pay commissions is false. The principle of charging fees is clearly defined. Fees apply only to apps that sell digital goods and services, not physical goods or services.
According to experts, this simply means that most popular apps like Amazon, Flipkart, Zomato, Swiggy, Ola, Uber and Policybazaar are not eligible to pay the standard 30% commission.
Large players such as major OTT platforms, Indian gaming giants and music streaming companies are eligible to pay as their services are being consumed digitally. But again, the 30% commission only applies to apps with more than $1 million in “post-commission earnings”.
Startups and small businesses can take advantage of the Apple Store Small Business Program. Under this program, a developer only has to pay 15% if he made less than $1 million in revenue in the previous calendar year. This represents the majority of developers.
If a developer makes more than $1 million, they will have to pay 30%, but if their earnings fall below that in the next calendar year, they will pay a 15% commission. Google is also streamlining service fees in India. Now his 99% of developers are covered by his 15% or less service fee.
In July 2021, the service fee will be reduced to 15% on the first $1M of annual developer revenue.
Later that year, in October, Google changed the subscription pricing model from 30% to 15%, and further reduced to 10% for certain vertical apps under the Play Media Experiences program.
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