Decreasing service fees on subscriptions to 15%
android-developers.googleblog.com
Decreasing service fees on subscriptions to 15%
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Re: Decreasing service fees on subscriptions to 15%
#2Should be 0% or otherwise heavily discounted for your first $x in sales. More money in early products today will mean more revenue for google later.
Re: Decreasing service fees on subscriptions to 15%
#3I don't see the point. Spotify's not willing to give up 10% of their Android revenue, they'll still use their own payment. Epic won't give up 15%. South Korea mandated that apps be allowed to have custom payment methods within apps. Why would any big company, whether Netflix, Epic or Spotify, still give Android 10%? It just seems that the "app store pay toll" is getting less and less justifiable; and it seems outrageous that mobile-first startups should give 15% of their revenues to rent-seeking by the #1 biggest company in the world and #5 biggest company in the world.
BTW, this regulatory pushback may really harm Android, because according to Sundar, Google Play constitutes most of Android revenue. With those revenues gone, that's a big chunk of money gone for Google. App Store revenue is also 37% of Apple's profits, so obviously they're fighting tooth and nail, but it's easy to see where things are going. Apple/Google are going to be pretty desperate to prevent a total exodus.
Re: Decreasing service fees on subscriptions to 15%
#4Here are some non-obvious reasons why this is a big deal:
1. Regulatory and technology changes are making advertising a less effective business model. It's both more expensive to acquire users and less profitable to run ads. So each week more companies are switching to one-time IAP or subscriptions as a primary revenue source. This change will further accelerate this transition.
2. A lot of apps sell digital content at a low margin. For example, Spotify and other music apps have to pay record labels for content. You can also consider marketplaces for user generated content that have this issue. Apple and Google's high service fees have prevented a large category of businesses from existing on the app store. Yes, they could try to direct users to pay through the browser, but anti-steering policies made this nearly impossible for companies without an established brand.
Re: Decreasing service fees on subscriptions to 15%
#5>Today, we’re also making changes to the service fee in the Media Experience program, to better accommodate differences in these categories. Ebooks and on-demand music streaming services, where content costs account for the majority of sales, will now be eligible for a service fee as low as 10%.
And I think Google has always been taking 15% on the first million revenue on services. Which wasn't clear in the post.
The 10% changes is welcome. But may be too little too late in terms of legal and regulation.
Re: Decreasing service fees on subscriptions to 15%
#6I don't see the point. Spotify's not willing to give up 10% of their Android revenue, they'll still use their own payment. Epic won't give up 15%. South Korea mandated that apps be allowed to have custom payment methods within apps. Why would any big company, whether Netflix, Epic or Spotify, still give Android 10%? It just seems that the "app store pay toll" is getting less and less justifiable; and it seems outrage…
My view is that it's an effort to avoid regulation. It's easier to justify a fee of 10-15% to regulators than a flat 30% fee.
Re: Decreasing service fees on subscriptions to 15%
#7I don't see the point. Spotify's not willing to give up 10% of their Android revenue, they'll still use their own payment. Epic won't give up 15%. South Korea mandated that apps be allowed to have custom payment methods within apps. Why would any big company, whether Netflix, Epic or Spotify, still give Android 10%? It just seems that the "app store pay toll" is getting less and less justifiable; and it seems outrage…
Agreed, personally I think 3-5% would be fair anything more is rent seeking.
Re: Decreasing service fees on subscriptions to 15%
#8I don't see the point. Spotify's not willing to give up 10% of their Android revenue, they'll still use their own payment. Epic won't give up 15%. South Korea mandated that apps be allowed to have custom payment methods within apps. Why would any big company, whether Netflix, Epic or Spotify, still give Android 10%? It just seems that the "app store pay toll" is getting less and less justifiable; and it seems outrage…
Agreed, personally I think 3-5% would be fair anything more is rent seeking.
Credit card transactions take far less, and they deal in legitimate risk (chargebacks, stolen cards, fraud, etc).
As developers, we don't even need app stores. They're an artifice that got shoved down our throat by trillion dollar mega corporations. A taxation clearinghouse. You can distribute the same program bytes from anywhere, most notably the web.
It's Steve Ballmer's old dream of taxing all software. There's just no point in it. It's massively unfair.
The excruciating review process adds insult to injury. And it makes fixing bugs a slow and stressful nightmare.
If smart phone manufacturers really want to protect customers, the best way to do that is to store signatures of known bad applications and provide solid permissions-based access to system resources.
Screw app stores.
Re: Decreasing service fees on subscriptions to 15%
#9Earlier quoted context omitted.
Agreed, personally I think 3-5% would be fair anything more is rent seeking.
Credit card transactions take far less, and they deal in legitimate risk (chargebacks, stolen cards, fraud, etc). As developers, we don't even need app stores. They're an artifice that got shoved down our throat by trillion dollar mega corporations. A taxation clearinghouse. You can distribute the same program bytes from anywhere, most notably the web. It's Steve Ballmer's old dream of taxing all software. There's ju…
From a user's perspective, the review is absolutely necessary and really needs to be much better on Android. Proactive vetoing of malware from distribution is much better than reactive malware scanning against a signature library.
That doesn't really justify a slice of subscription revenue though.
Re: Decreasing service fees on subscriptions to 15%
#10Earlier quoted context omitted.
Agreed, personally I think 3-5% would be fair anything more is rent seeking.
Credit card transactions take far less, and they deal in legitimate risk (chargebacks, stolen cards, fraud, etc). As developers, we don't even need app stores. They're an artifice that got shoved down our throat by trillion dollar mega corporations. A taxation clearinghouse. You can distribute the same program bytes from anywhere, most notably the web. It's Steve Ballmer's old dream of taxing all software. There's ju…
As a consumer, i want app stores. It's million times better than the default Windows situation downloading random binaries off the Internet. Code signing and malware signature matching are at best bandaids on a waterfall.
Having a centralised place with reviews categories, updates etc. is very valuable.