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Apple reportedly looking to reduce 30% revenue cut for music, video and news apps with subscriptions

Screen Shot 2015-06-05 at 1.58.08 PM

A new report by the Financial Times suggests that Apple is looking to change the 70/30 revenue share for certain types of App Store apps. The report claims that Apple wants to change the way revenue is distributed between developers and Apple for music, video and news apps.

The report is a bit circumspect as the timing of the change does not seem to be related to any particular incident, although potentially Apple is forced into cutting the share due to potential anticompetitive complaints with Apple Music, to be announced next week.

Developers hoping to make more money as a result of this change should not get their hopes up; the report specifically targets apps with subscriptions (like news apps or music subscriptions). It does not suggest that Apple will be reducing the 70/30 split universally.

Apple has been historically steadfast in its current arrangement with developers so a change in the terms is a big deal. Newspaper publications especially have complained about the ‘onerous’ 30% revenue share Apple enforces but these arguments have fallen on deaf ears, until now if the report is true.

Spotify has made anti-competive complaints regarding Apple’s upcoming music service, arguing that Apple’s 30% fee puts up barriers to entry for third-party competitors. Although purely speculative at this point, this may be the driving reason for changing the revenue share.

The report does not specify when Apple will announce these changes and indicates that it is still very tentative. It is possible Apple could unveil the changes at its WWDC developer conference next week.

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Comments

  1. This is good news

  2. mikhailt - 9 years ago

    They have to be careful because if they lower the ratio for subscriptions, every app and game will take advantage of it.

    I already don’t like the trend of using IAP for unlocking features that should be a part of the app/game and the upward trend of 100$ or more worth of stupid shit for games.

    Apple needs to limit the IAP to 50$ or less for games, with an option to outward buy the whole games at once. In exchange, developers get a bigger slice to 75 or 80% of the share.

  3. Interactive Arts - 9 years ago

    I believe Apple should also reduce their 30% margin on interactive iBooks as an incentive to improve the current levels of available textbooks for use in Education. It could be on the agenda considering Apples supposed commitment to the development of Educational Technologies and the possibility that we will see movement in this area at WWDC, with iBook Textbooks being brought to iPhone. I certainly hope so.

  4. davidt4n - 9 years ago

    The 70% for developer can be up based on the rating of their apps from users. What I mean is based on the quality of the apps to the consumer. This can help reduce crashes and bugs etc. One stone kills two birds by having higher quality apps in App Store while users are happy too.

    • mikhailt - 9 years ago

      No, this is a bad idea.

      What you’ll see is developers paying users or adding some kind of incentives to users who rate 5 stars while not doing anything to fix the problem.

      This won’t help with the quality levels. The developers shouldn’t focus on the ratings in the first place and Apple definitely should de-focus the ratings as much as possible for any incentives given to developers.

      This should be done in the background since Apple can process the crash reports now and leverage that somehow.

Author

Avatar for Benjamin Mayo Benjamin Mayo

Benjamin develops iOS apps professionally and covers Apple news and rumors for 9to5Mac. Listen to Benjamin, every week, on the Happy Hour podcast. Check out his personal blog. Message Benjamin over email or Twitter.