BETA
This is a BETA experience. You may opt-out by clicking here

More From Forbes

Edit Story

Apple Changes Course To Protect App Store Revenue

Following
This article is more than 6 years old.

Following online anger at Apple’s decision to cut the commission paid out on apps by nearly two-thirds (Apple Loop, April 28ththe Cupertino-based company has posted an update which states that the cut from seven percent to 2.5 percent will now only apply to ‘app content’ purchases (both in-store and in-app). Everything else, including apps, will remain at the higher level:

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%.

Apple is pitching this as a clarification to the previous statement but as noted Cupertino commentator John Gruber highlights, it feels less like a rewording of an unclear point and more like a reversal of a previous position:

This is more than a “clarification”. The original announcement made it clear that paid apps were being cut too:

"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.

This policy change is good news though.

Ewan Spence

With the changing nature of online advertising, the income from affiliate sales can make up a significant proportion of the income for publishers. Thanks to Apple’s continued online popularity with the geekerati, an army of websites cover news, review apps, and preview the hardware in the Apple ecosystem. Referring readers back to the Apple store and the associated affiliate incomes from app sales is a key part of the self-sustaining economy that has built up around Cupertino.

The small financial saving that could be made by cutting back on affiliate payments for apps has to be balanced against the greater good of feeding the Apple machine. Whether the mistake was one of omission or one of over-zealous bean counting, the decision to retain the higher fee is one that should be welcomed by everyone.

Now read how the App Store allows Apple to act as the guardian of Silicon Valley…

Follow me on Twitter or LinkedInCheck out my website