Google today announced new moves to make selling on the Play Store more attractive to developers. Currently, the company charges 30% for all subscription sales, then drops it to 15% after a year. Starting in 2022, developers will now be charged 15% on payments from the first day, while Google also moves to reduce fees for apps registered under the Play Media Experience Program to 10%.
“Digital subscriptions have become one of the fastest-growing models for developers, but we know that subscription businesses face specific challenges in customer acquisition and retention. We’ve worked with our partners in dating, fitness, education and other sectors to understand the nuances of their businesses,” Google’s Sameer Samat, vice president of product management, explained in an announcement. “Our current service fee drops from 30% to 15% after 12 months of a recurring subscription. But we’ve heard that customer churn makes it challenging for subscription businesses to benefit from that reduced rate. So, we’re simplifying things to ensure they can.”
The new fee structure kicks in January 1, 2022, and will benefit 99% of developers, Google says. This means that if you purchase a subscription from the Play Store after that date, Google will only charge the developer 15% of the total payment right from the start. Google will also make a change to apps and services under the Play Media Experience program. These apps were built with support for cross-platform experiences such as Google TV, Android Auto, Google Wear, and Google Cast in exchange for a reduced fee of 15%. Starting January 1, 2022, that fee will drop to as low as 10%,
Google’s new moves come after efforts from developers to challenge the Play Store and Apple App Store’s 30% fees as onerous. The company had made many preemptive moves in this regard, lowering the commission it charged for small businesses (earning under $1 million annually) to 15%. It wasn’t enough to stop some countries like South Korea from ordering it to open up its Play Store to alternate payment mechanisms, but moves like this will go a long way in quelling further dissatisfaction from developers and content providers. Google cites Bumble and Duolingo as examples of partners who have responded positively to this change.
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