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Apple only losing 3% of App Store revenue after cutting developer fees

App Store
App Store (Image credit: iMore)

What you need to know

  • Apple is only losing about 2.7% of revenue after implementing the Small Business Program for the App Store.
  • The program cut fees to 15% for developers making less than $1 million in revenue.

The App Store Small Business Program, which cut fees for developers making less than $1 million, has not seemed to have much impact on Apple's revenue from the platform.

As reported by CNBC, new data from analytics firm Sensor Tower reveals that Apple would have only missed out on less than 3% of App Store revenue if it implemented the App Store Small Business Program for the entire year of 2020.

  • If the 15% fee schedule on revenue up to $1 million had been in place on Google Play in 2020, Google would have missed out on $587 million, or about 5% of Sensor Tower's estimate of $11.6 billion in Google Play fees for the year.
  • If Apple's program had been in place for 2020, Sensor Tower estimates that it would have missed out on $595 million, or about 2.7% of its estimated $21.7 billion in App Store fees in 2020.

$595 million is a drop in the bucket for Apple's services business, which took in over $54 billion last year.

Apple reported $54.76 billion in services revenue in fiscal 2020, or about 19% of its total sales. App Store fees are only one part of Apple's services business, which includes subscriptions, warranties and other products. An Apple spokesperson didn't immediately respond for comment on the Sensor Tower report.

Both Apple and Google are seeing increased pressure from governments over their app store policies. A bill in Arizona that would force Apple and Google to allow different payment systems in the App Store passed the House last week, and a survey on the bill showed it was very popular among registered voters of both parties.

Joe Wituschek
Contributor

Joe Wituschek is a Contributor at iMore. With over ten years in the technology industry, one of them being at Apple, Joe now covers the company for the website. In addition to covering breaking news, Joe also writes editorials and reviews for a range of products. He fell in love with Apple products when he got an iPod nano for Christmas almost twenty years ago. Despite being considered a "heavy" user, he has always preferred the consumer-focused products like the MacBook Air, iPad mini, and iPhone 13 mini. He will fight to the death to keep a mini iPhone in the lineup. In his free time, Joe enjoys video games, movies, photography, running, and basically everything outdoors.

1 Comment
  • What I find interesting in this is that Google would have missed out on $587 million, and Apple would have missed out on $595 million. Those are pretty comparable numbers considering how much bigger a market Google has in Android. Just goes to show how much more profitable being on iOS is to developers. Maybe consider that before biting the hand that feeds you.