Apple Drops App Store Fees to 15% for All Developers Making Under $1 Million From App Store

Apple today announced the launch of a new App Store Small Business Program that will see the Cupertino company lowering its App Store fees for small business owners and independent developers. Starting on January 1, 2021, all developers who earn less than $1 million from the ‌App Store‌ will pay 15 percent in commission to Apple, down from the standard 30 percent.

app store 15 percent feature
The 15 percent commission rate applies to paid app purchases, in-app purchases, and subscription fees, with the lowered rate benefitting most developers on the ‌App Store‌.

"Small businesses are the backbone of our global economy and the beating heart of innovation and opportunity in communities around the world. We're launching this program to help small business owners write the next chapter of creativity and prosperity on the App Store, and to build the kind of quality apps our customers love," said Tim Cook, Apple's CEO. "The App Store has been an engine of economic growth like none other, creating millions of new jobs and a pathway to entrepreneurship accessible to anyone with a great idea. Our new program carries that progress forward -- helping developers fund their small businesses, take risks on new ideas, expand their teams, and continue to make apps that enrich people's lives."

All developers who earned under $1 million in 2020 are able to qualify for the program and the reduced 15 percent commission rate. New developers who join the ‌App Store‌ and create apps in 2021 will also qualify. Going forward, developers who earn up to $1 million in the prior calendar year will be able to participate.

Developers who earn over $1 million will not be eligible, with the $1 million total calculated using post commission earnings that take into account total earnings after Apple's standard 30 percent cut. Developers earning more than the cutoff will continue to pay the standard 30 percent commission rate.

If a developer who participates exceeds $1 million in earnings, commissions will go back up to the 30 percent rate as well. For example, a developer who joins the program in 2021 and exceeds $1 million in earnings mid-year will need to pay out 30 percent commission going forward for the rest of the year. This will also apply in 2022, but if after that revenue falls below the $1 million threshold, the developer will be eligible for the program again in 2023.

As for subscriptions, developers who are eligible for the program will pay a 15 percent commission on subscriptions, even during the first year. Apple already has mixed ‌App Store‌ fees for subscriptions. During the first year a person subscribes, the standard commission rate is 30 percent, but it drops to 15 percent after that. That fee structure remains in place, but Small Business Program participants will pay 15 percent for all subscribers.

According to Apple, the reduced ‌App Store‌ fees are being implemented to help small business owners maintain their businesses and accelerate innovation during uncertain times. The fee drop is being implemented as developers try to work through economic challenges and more and more business are pivoting to digital as people continue to work and learn from home.

The fee changes will be a relief to many developers who have been unhappy with Apple's ‌App Store‌ fees. Apple has faced scrutiny from U.S. antitrust regulators in the United States, and investigations conducted by those regulators have surfaced complaints from developers who believe Apple's fees are too high.

Today's fee cut won't benefit some of the developers that have been the most vocal about Apple's commission rates, such as Epic Games, but it will relieve some of the pressure on the small business owners that need the most help.

There are more than 28 million developers from 227 regions who offer apps through the ‌App Store‌, and 1.8 million apps available worldwide. Apple says that the program will be available to the majority of developers, with those developers all receiving the same access to Apple's developer tools and programs. Apple expects the ‌App Store‌ Small Business Program to generate more digital commerce, support new jobs, and provide more funds for small businesses to invest back into their apps as they work to create innovative software for Apple users.

Popular Stories

Generic iOS 18

iOS 18.1 With Apple Intelligence: New Features, Release Date, and More

Thursday October 10, 2024 8:26 am PDT by
iOS 18.1 will be released to the public in the coming weeks, and the software update introduces the first Apple Intelligence features for the iPhone. Below, we outline when to expect iOS 18.1 to be released. iOS 18.1: Apple Intelligence Features Here are some of the key Apple Intelligence features in the iOS 18.1 beta so far: A few Siri enhancements, including improved understanding...
top stories 12oct2024

Top Stories: iOS 18.1 Release Date, New Macs Incoming, and More

Saturday October 12, 2024 6:00 am PDT by
Things are firming up for a big Halloween week for Apple, with the company's next operating system updates reportedly coming early in the week and hardware launches coming a few days later. Ahead of those hardware launches, we've recently seen what appears to be one of the most significant physical product leaks in years, while some of the new features in Apple's recent software updates have ...
ipad mini 7

Apple Unveils New iPad Mini With A17 Pro Chip and Apple Intelligence

Tuesday October 15, 2024 6:07 am PDT by
Apple today announced a significant upgrade to the iPad mini, now featuring an A17 Pro chip and support for the company's new Apple Intelligence system. The refreshed seventh-generation tablet maintains its compact 8.3-inch design while offering notable performance improvements and new capabilities. Subscribe to the MacRumors YouTube channel for more videos. The A17 Pro chip brings a 30%...
maxresdefault

The MacRumors Show: Apple's Shocking M4 MacBook Pro Leak

Friday October 11, 2024 8:27 am PDT by
On this week's episode of The MacRumors Show, we discuss the unprecedented leak of Apple's M4 MacBook Pro models and the company's rumored move to more staggered hardware and software releases. Subscribe to The MacRumors Show YouTube channel for more videos Multiple leaks surrounding Apple's unannounced 14-inch MacBook Pro with the M4 chip recently surfaced online. The leaks began with unboxin...
Apple Intelligence Feature 2

Apple Seeds Seventh Developer Betas of iOS 18.1 and iPadOS 18.1 With Apple Intelligence [Update: Public Beta Available]

Monday October 14, 2024 10:10 am PDT by
Apple today provided developers with the seventh betas of iOS 18.1 and iPadOS 18.1 to continue testing Apple Intelligence features. The seventh betas come a week after Apple seeded the sixth iOS 18.1 and iPadOS 18.1 betas. The updates can be downloaded from the Settings app on a compatible device by going to General > Software Update. Note that Apple Intelligence features still an iPhone 15...
16 pro

iPhone 17 Pro Models Rumored to Introduce These 5 New Features

Friday October 11, 2024 8:55 am PDT by
While the iPhone 16 series was released just a few weeks ago, there are already many rumored features for the iPhone 17 models, and especially for the Pro models. Below, we recap five key new features rumored for the iPhone 17 Pro and Pro Max so far: 24MP front camera for all iPhone 17 models: All four iPhone 17 models will feature an upgraded 24-megapixel front-facing camera, according...
iPad mini review thumb

iPad Mini 7 Coming Next Month: What to Expect

Tuesday October 8, 2024 6:16 am PDT by
Rumors strongly suggest Apple will release the seventh-generation iPad mini in November, nearly three years after the last refresh. Here's a roundup of what we're expecting from the next version of Apple's small form factor tablet, based on the latest rumors and reports. Design and Display The new iPad mini is likely to retain its compact 8.3-inch display and overall design introduced with...

Top Rated Comments

Coconut Bean Avatar
51 months ago
EPIC!!!!

Or well, not for EPIC. LoL.
Score: 110 Votes (Like | Disagree)
Davehaslanded Avatar
51 months ago
Now let’s see if Epic drop their legal battle, considering they claim they were only doing it for the ‘little people’, and not themselves. I doubt it.
Score: 89 Votes (Like | Disagree)
PickUrPoison Avatar
51 months ago
This is huge, and is targeted at exactly the size of devs that can use it most.
Score: 65 Votes (Like | Disagree)
Macropanda Avatar
51 months ago
This is great. I’m a dev that doesn’t earn even close to that limit so very nice indeed.
Imagine getting near the end of the year and sitting at 990k income. Surely it would be better to pull the app and lose a bit to get the next year at 15%?
Wouldn’t it make sense to make the first 1m 15% and 30% for everything earned over 1m?
Score: 49 Votes (Like | Disagree)
berrymetal Avatar
51 months ago
That is freaking amazing!
Score: 48 Votes (Like | Disagree)
LeeW Avatar
51 months ago
Let's be honest here, Apple is positioning this to fend off the various actions and criticism against them, doing it in a way that it will cost them less. But, having said that, it's a big deal for the smaller developer, so it's a win. But they are not doing it by choice, its a forced action.
Score: 46 Votes (Like | Disagree)