From 7% to 2.5% in one week flat — Welcome to the new Apple Store affiliate rate.
May 8, 2017: Apple has clarified that only in-app purchases are subject to the reduced rare
From Apple's iTunes Affiliate Blog:
We'd like to clarify some changes being made to the Affiliate Program. Commissions for all iOS in-app purchases will be reduced from 7% to 2.5% globally, and all other content types (including music, movies, books, paid iOS apps and TV) will remain at the current 7%. For more information on commission rates, please see our Getting Started Guide.
So, phew, kinda.
Apple just announced via the iTunes Affiliate Newsletter that it's slashing App Store — app and in-app purchase — affiliate revenue from 7% to 2.5% effective May 1, 2017.
Starting on May 1st 2017, commissions for all app and in-app content will be reduced from 7% to 2.5% globally. All other content types (music, movies, books, and TV) will remain at the current 7% commission rate in all markets. We will also continue to pay affiliate commissions on Apple Music memberships so there are many ways to earn commissions with the program.
That's close to a two-thirds drop and with only one week's notice.
Once-upon-a-time App Store affiliate revenue paid for a full-time app editor on iMore. It's dwindled since then, as paid apps gave way to fremium, but this, to quote our business team, is "soul crushing". We'll have to wait and see how it shakes out, but it's possible revenue will drop low enough it wouldn't even keep a full-time editor in instant coffee for the month.
@natisho @reneritchie @MDMDeals No kidding it's going to hit me hard—gonna need to take a hard look at if it's worth it to run @MDMDeals anymore. Suspect I may not be 😕
— Mark D Miller (@MarkDMill) April 24, 2017
Both the depth of the cut and the abruptness of the timeline are startling. A lot of websites, including iMore, have been increasingly turning to affiliate revenue to help shore up declines in ad revenue — and to get away from the more egregious ads.
The same holds true for developers who have long used affiliate adds on their own apps to bolster their income.
With Apple (and Amazon, by the way), slashing that affiliate revenue, it's going to make things even tougher. (Google, the other major online market, doesn't and never has offered affiliate revenue for Google Play.)
So, yeah, this change in affilate commissions pretty much sucks. We don't rely on links alone (thankfully), but we'll be affected by it. pic.twitter.com/85V94DBPqQ
— Federico Viticci (@viticci) April 24, 2017
While Apple initially ran the App Store at slightly above break-even, and used its 30% share of paid apps to support the huge percentage of free apps, App Store revenue has grown steadily over the years and has long since become a huge business in its own right.
If the App Store were struggling, cuts would be easier to understand. But the reverse is true. That's led to the popular, if desperate, theory that Apple is doing this in advance of cutting its own revenue share from 30% down to 15% or 10% at WWDC 2017.
That would explain the change, though not the abruptness.
As much as that sounds like wishful thinking, it would at least reduce the pressure on developers. Though, if that was part of the reasoning, why not wait and announce the two together?
Not really. Affiliates never worked for iPhone/iPad apps because of low prices anyway. https://t.co/zkoylDmqve
— 👾Denys Zhadanov (@DenZhadanov) April 24, 2017
Either way, publications are also businesses and, if they can't financially justify it, they may reduce or eliminate app coverage, which would also hurt developers and customers alike. (At least for those who find app coverage valuable.)
Given how out-of-the-blue this is, a lot is up in the air right now. We'll have to wait and see how it shakes out.
If you're a developer or a pub that depends on App Store affiliate revenue, let me know how the change affects you.
Reader comments
Apple slashes App Store affiliate revenue — for in-app only
I don't like this. I deliberately support sites like iMore and others by using affiliate links. I keep ads off due to malvertizing. I could see reducing the amount as the App Store has been making record sales, but not slashing it like this.
Malvertizing... great word.
If this is a precursor to a cut in the revenue share of App purchases then at least it'll be sort of justified. If not it just comes across as being miserly, especially as Apple have given next to no notice for it. It'll be interesting to see how App coverage is handled on Apple sites from now on. Websites covering Android often have a more balanced view of Google Play apps due to the lack of an affiliate program, whilst many Apple sites seem to push paid apps more thanks to the slice of the revenue they get.
"Websites covering Android often have a more balanced view of Google Play apps due to the lack of an affiliate program"
This behaviour would be more beneficial to the consumer no? With the newly restructured App Store review and direct developer feedback mechanism, maybe Apple wants to direct people to their own app review / feedback forum instead of other outside websites like imore.
Question: How can I catch Rene's attention to this reply to solicit his thoughts on this?
Present! How can I help?
Not that you need my backup, but sites that promote bad paid apps will lose readers. Sites that recommend good apps will stay afloat and buikd customer trust (insert subjectivity disclaimer).
iOS gets games first and best for a reason.
http://gizmodo.com/when-it-comes-to-gaming-the-iphone-will-always-stomp-...
Hi Rene,
Was just wanting your thoughts on Apple possibly planing to steer readers to their own new feedback (support with direct developer feedback) mechanism instead. PS. The reply button stopped working for me - fixed now. PS. Apple may be trying to steer away from affiliate revenue not that other large techs are not doing it either. = bad press.
Two mouth ago, Amazon have cut their affiliate commission too.
This seems a crazy decision by Apple. Sites such as this (and several others) are great promotors of Apple’s products, so why are Apple rewarding them by slashing one of their main income streams? Such sites also have great influence on how the public perceives Apple, so why deliberately antagonise them by gouging them for money that Apple really doesn’t need? And with only one week of notice!
As an independent app developer I think it It is already too difficult for the average user to discover new apps. The App Store doesn’t have anywhere near enough space to promote every decent app, so this is where third party blogs and sites come in. Without them smaller developers such as myself will have far fewer opportunities for our apps to be brought to users’ attention.
It doesn’t matter if Apple reduce their commission from 30% to 0% because this decision will mean that far fewer users hear about the apps, and so far fewer will be sold, which means that everyone will lose out.
The only time Rene criticizes Apple is when it cost him money.
I'm paid either way. So really, it's just the Apple mouse I hate.
Strange move. I wouldn't think referrals would be a huge percentage for Apple and they'd be happy to get them. I hardly ever view the app store without first reading an article that leads me to it. Perhaps it'll make sense after WWDC but as Rene mentions that could have waited. Makes me wonder who'd really want to partner with Apple when they do stuff like this.
Both Rene and commenters pointed out that others like Google and recently Amazon do not pay affiliate revenue, maybe Apple do not want to be zeroed out - to avoid being accused of paying for reviews?
The problem with this article is that it doesn't explain what App Store affiliate revenue is and how it works, to the average person who doesn't know. Rene is usually always good at dumbing down the technical jargon and putting things in layman terms.
Can anyone explain?
Thanks.