Google Play Drops Commissions To 15% from 30%, Following Apple's Move Last Year 50
Google will lower its Play commissions globally for developers that sell in-app digital goods and services on its marquee store, the company said, following a similar move by rival Apple late last year. From a report: The Android-maker said on Tuesday that starting July 1, it is reducing the service fee for Google Play to 15% -- down from 30% -- for the first $1 million of revenue developers earn using Play billing system each year. The company will levy a 30% cut on every dollar developers generate through Google Play beyond the first $1 million in a year, it said. Citing its own estimates, Google said 99% of developers that sell goods and services with Play will see a 50% reduction in fees, and that 97% of apps globally do not sell digital goods or pay any service fee.
Google's new approach is slightly different from Apple, which last year said it would collect 15% rather than 30% of App Store sales from companies that generate no more than $1 million in revenue through the company's platform. That drop doesn't apply to iOS apps if a developer's revenue on Apple platform exceeds $1 million. "We've heard from our partners making $2 million, $5 million and even $10 million a year that their services are still on a path to self-sustaining orbit," wrote Sameer Samat, VP of Android and Google Play, in a blog post.
Google's new approach is slightly different from Apple, which last year said it would collect 15% rather than 30% of App Store sales from companies that generate no more than $1 million in revenue through the company's platform. That drop doesn't apply to iOS apps if a developer's revenue on Apple platform exceeds $1 million. "We've heard from our partners making $2 million, $5 million and even $10 million a year that their services are still on a path to self-sustaining orbit," wrote Sameer Samat, VP of Android and Google Play, in a blog post.
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In Google's case, it is even worse. They also take a cut of all the in-app advertising, too, since they own all the ad networks.
Re: Monopoly (Score:3, Informative)
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Nonsense, Google abused their market position to also bully vendors into accepting the Google Play ecosystem on their devices. The fact a handful of devices with alternative purposes (i.e. Kindle for reading books from the Kindle store) didn't bend to the pressure isn't a counter-argument to this point because the vast majority of the Android ecosystem was bullied by Google into just being an extension to the Google ecosystem. To date no single company has been able to build a competitive app store for this
Abuse of semii-monopsony (Score:3)
Not blaming you for the lack of clarity, but that might be the excuse for AC posting thusly. Knew he didn't know enough about the topic to want to put his name on it? But he still wanted to abuse that FP slot.
So to clarify:
(1) Not a monopoly. There's another major player in the market and the market isn't even closed, though there are high barriers to entry and "minor" players (such as Samsung and NTT) don't really count.
(2) It's closer to a monopsony with the google (and Apple) abusing their business relat
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Oh yeah. Forgot to recommend a relevant dead tree. Choosing Not to Choose by Cass Sunstein is the current one, though mostly I disagree with him. (And I already chose "No Amazon for me" 20 years ago.)
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Worth mentioning that the law often doesn't care if it's a monopoly or not, the law cares if they are engaging in anti-competitive behavior or not. So Google could be breaking antitrust law even if they are not a monopoly.
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I really doubt that your analysis applies under the "Bork doctrine", because the nature of "harm" has been changed. If the monopolist is not directly overcharging the "customer", then there is no harm and thus no cause for legal action against the "beneficent" corporation. At least that was the theory advanced by Bork and that's the way the antitrust laws have been increasingly interpreted over the years. In a sense, the nature of "customer" has been radically changed since the anti-monopoly and anti-trust
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I really doubt that your analysis applies under the "Bork doctrine", because the nature of "harm" has been changed
I am 100% sure it does, read what I wrote again.
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Already read it twice. Not difficult to understand. Just wrong in a fairly simplistic way. Why do you think saying it again will make it true? I've already said you need more evidence. You've declined to provide any.
Right now it seems obvious you have no court precedents to cite. So how about a simpler form of evidence? What recent example can you cite of a significant antitrust or anti-monopoly legal action? Doesn't have to be a court case. I'll consider any government action above a polite suggestion. You
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So Google could be breaking antitrust law even if they are not a monopoly.
:-) Any examples?
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Good question. An interesting case that might or might not be relevant here is when Apple was convicted of price fixing [theguardian.com].
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Thank you. Yeah, this is the kind of stuff we should hang them for. They are actually interfering with the market. Too bad there are no real penalties. Maybe there should be automatic breakups of any business that controls more than 30% of its market when they engage in these practices, but it has a be a total breakup down to the individuals involved, don't let them own stock for instance. Asset forfeiture might be effective. Take some patents and copyrights from the offending corp. Garnish a percentage of
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Yeah total monopoly at 27% of the cell phone market. https://gs.statcounter.com/ven... [statcounter.com]
Still high. (Score:2)
A normal Brick and Mortar store is expected to add a 15-30% on top of the sales price because of higher expenses, and limited inventory. Lets say a Blue Ray Box Set, if it isn't popular, than that product could be on the self for a long time, in which you will not be able to put other things (that may sell faster) in its spot. Also you need staff it keep it clean and presentable. So for some products the retail store will mark up its price, because it is expensive for them to keep in inventory.
For most o
Re:Still high. (Score:4, Informative)
Yes it's still high. But at least, with Android, you have the freedom to sideload.
You can sideload on iOS (Score:1)
But at least, with Android, you have the freedom to sideload.
You can also sidelaod with iOS, it just requires jailbreaking, or of course iOS development is free if you just want to build apps for it. These days there are pretty limited reasons to sideload.
What apps are people even side loading on Android these days? Seems like most options would be malware at this point.
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It's just about having the freedom to get an application not approved by Google and/or avoid the 30/15% fee.
It's mostly games I think. Fortnite must be the best example.
If Google puts its fees too high, chances are more and more applications will be sold outside of their store. Apple do not have such pressure and it's bad for competition.
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I sideload everything. I don't sign in to Google at all.
Re:Still high. (Score:4, Insightful)
Lower cost in storage != zero cost total cost. While the storage of a digital good is less than a physical product, that does not mean that there are no other costs that change the dynamic. One major difference is a digital store has to be open 24/7 worldwide. Also this could mean a massive infrastructure of backups and redundancies. For example, I would imagine the Google store has to handle a massive amount of purchases Christmas morning that may not be needed other days of the year.
For truly global stores, that also means their infrastructure has to take payment in different countries. That means the system has to handle varying payment systems, taxes, and regulations. Using and maintaining these systems do not cost $0.
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Yeah, it could be 4%. Enough to cover credit card fees and operate the servers. Google would still profit.
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Still, 4% is enough to cover all what you are describing.
As for taxes, last I checked Google was avoiding them as much as possible. They do not charge sale taxes in Canada. So must not be very expensive to manage...
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Still, 4% is enough to cover all what you are describing.
Wow, you do not understand how payment systems works. If you spend $1.00 buying an app with your Visa, Visa charges Google 4% just to get their money. That means Google only gets $0.96. In what world is the 4% that Google never got and was charged "enough to cover their" systems? With $0.96, Google has to pay the developer and pay for all their 24/7 redundant worldwide systems.
As for taxes, last I checked Google was avoiding them as much as possible.
While Google wants to not pay taxes if possible, their tax is not $0. However Google must at the minimum report what they paid devel
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Still, 4% is enough to cover all what you are describing.
Wow, you do not understand how payment systems works. If you spend $1.00 buying an app with your Visa, Visa charges Google 4% just to get their money.
I think it's more like 2-3% but whatever. 1% over hat Visa charges is more than enough for Google to cover its cost and made a reasonable profit. The rest is pure profit.
However Google must at the minimum report what they paid developers so that the developers can be taxed (income not sales) according to their local jurisdictions.
I don't think Google has to do that, but even if they do, it's easy to do it with that 1% margin over the credit card fee. It's basically automated.
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I think it's more like 2-3% but whatever. 1% over hat Visa charges is more than enough for Google to cover its cost and made a reasonable profit. The rest is pure profit.
Bahahaha. Based on what fictional world? You do understand that if you buy an app for $1, at best Google has $0.81 to build/maintain a 24/7 digital store for tens of thousands of apps. If you think you can make a lot of profit, go right ahead and build your own store. After you spend millions to billions in infrastructure, you can collect $0.81 for an app.
I don't think Google has to do that, but even if they do, it's easy to do it with that 1% margin over the credit card fee.
What part of "worldwide" is unclear to you? How are EU regulations different than Singapore? Sure it is "easy" when you do not have to handle them.
It's basically automated.
Bahahah
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Well I sure hope that Google collects less than 81% in fee. I think it is 15-30%. So I don't see where you take your $0.81 from.
You clearly don't understand economies of scale. With the millions they do in sales, operating the servers and storage is marginal.
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And guess how much hosting a 99 cent app yourself would cost. Paypal or a merchant account will take 30 cents off the top just to do the one transaction, so you get 70 cents. Minux another 3-5 cents for the transaction fee, so you're dow
From 900.00 to 1.000.000 (Score:2)
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yeah, would make more sense if the 30% applied only to sales over $1M
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That's how Apple does it, per the summary. Google does 15% for the first million, then 30% for anything else.
I agree though that it doesn't make much sense to apply the 30% to the entire amount because, as your scenario shows, you would lose money. You may make that up in more sales but I'm not going to figure out how many more sales you would need.
No, it's like tax rates (Score:2)
The article (and summary) make clear the first 1,000,000 is skimmed at 15%, and ever other dollar is skimmed at 30%. So, sell 1,000,000 - get $850,000. Sell 2,000,000 - get $1,550,000 (850k + 700k).
Use something else (Score:5, Interesting)
What I hate about all the complainers regarding this topic is that almost all of them use Android. Use a Pinephone or something else and your stomaching of a lack of features now will grow it into a full ecosystem later.
Look at Linux in the 90s. If it were not for a bunch of nerds determined to make it work, despite its inconvenience, it would not be a viable desktop OS today and the top choice for servers.
In the 90s I uses Macs as my primary computers but I had fun tinkering with Linux. Today my work is split between my Macs and my Linux boxes and there are only a few tasks where I favor one over the other. I use an iPhone as my primary phone but I am considering looking at these FOSS alternatives to tinker with. This whole idea that we should force Apple and Google to be open platforms through legislation is just ridiculous. Like with Linux, nerds should build their own platform. After all, that is what makes us nerds.
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Re: Use something else (Score:2)
The past decade has been the year of the Linux desktop. The Raspberry Pi has made millions of kids comfortable with Linux. The whole Linux desktop thing should not be measured in marketshare. It should be measured by whether Linux works as a desktop OS, which it does. Similarly, macOS is a desktop OS despite holding less than ten percent of the market. I know this will anger a certain crowd here, but systemd is largely what made Linux a desktop OS.
As for phones, I am curious to see the state of KDE mobile.
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I'm watching non-technical friends get fed up with new versions of OS X and start strongly considering that the next one will be a Dell with Linux because it runs Steam and all the other stuff they use already.
The momentum is there. The more Windows and Apple make their shit intolerable, the more users Linux will garner.
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This whole idea that we should force Apple and Google to be open platforms through legislation is just ridiculous.
Why? The world would be a better place if they opened up their platforms.
What's wrong with Android? (Score:2)
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For me, Android seems to strike a compromise between Apple's walled garden and the complete freedom of something like Linux running KDE mobile. That compromise is wholly unappealing. I would rather have the phone I depend on to be completely locked down (iPhone) and my tinker toy to be completely detached from Google.
The freedoms Google offers are not worth the price: my data and my phone's security. Android is the Windows of the phone world. Extending this analogy, I also worry that Google will/is bully OE
Re: Use something else (Score:2)
Re: Use something else (Score:2)
Interesting differences (Score:3)
Google's million dollar cutoff is based on $1,000,000 in app revenue. Apple's million dollar cutoff is based on the developer's cut of that. That means that Apple's 15% cutoff is actually higher, continuing up to about 1.18 (1/0.85) million.
Meanwhile, Apple changes over to standard rates (which are not necessarily 30%) as soon as the cutoff is passed for all future sales, but Google claims to exempt the first million in each year. So, if you have recurring sales of 800k, it's better to be in the Google ecosystem. If you expect one good year, it's better to be in the Apple ecosystem. (Of course, you'll be in both)
Realistic scenario (Score:1)
So, if you have recurring sales of 800k, it's better to be in the Google ecosystem. If you expect one good year, it's better to be in the Apple ecosystem. (Of course, you'll be in both)
Lets get real here, very few apps make over 1M every year, any app that does is going to be in both ecosystems anyway. It's not like you should make a choice for which platform to build for initially based on this.