Apple App Store rollback may be a shot at Epic Games
After watching Apple do knock-down bloody battle with Epic Games for much of 2020, one has to wonder if the American tech giant has suddenly blinked. Or at least is sending a passive-aggressive screw you through an Apple App Store rollback on commissions.
The company that Steve Jobs built has announced that it’s scaling back the cut it takes on App Store purchases. Instead of skimming 30 percent off items from the store, it will only take 15 percent for developers earning less than than $1 million per year.
The announcement is part of what’s billed as the App Store Small Business Program. That will be launched on January 1, 2021.
In a press release, Apple said the program will benefit the “vast majority” of “small and independent” developers who sell digital goods and services through the store. The caveat is that they have to have earned less than $1 million in 2020.
Small business a backbone
“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 Apple CEO Tim Cook said in the release.
“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.”
There is of course a substory here. Apple has been locked in a bitter fight with Epic Games, the developer responsible for Fortnite. The popular battle royale game is available through the App Store.
Fortnite had moved to have game-related purchases made from its publisher, Epic Games, rather than the Apple App Store.
Apple eventually retaliated by removing the popular game from the App Store. And then Epic kicked things up a notch by suing on the grounds that Apple’s commission rules are anticompetitive. That court battle is ongoing.
In any event, guess who won’t be benefitting from Apple’s rollback in January. Take a big step forward Epic.
App Store details coming in December
Complete details about the App Store Small Business Program will be released in December.
In the meantime, the Apple press release includes the following basic guidelines:
- Existing developers who made up to $1 million in 2020 for all of their apps, as well as developers new to the App Store, can qualify for the program and the reduced commission.
- If a participating developer surpasses the $1 million threshold, the standard commission rate will apply for the remainder of the year.
- If a developer’s business falls below the $1 million threshold in a future calendar year, they can requalify for the 15 percent commission the year after.