Google cuts Play Store dev fees to 15% for all subscriptions

Google announced that they are dropping the 30% flat service fee for in-app purchases or app sales to 15% starting January 1, 2022. 

The tech giant previously offered this discount after 12 months of a recurring subscription, but with this announcement, they are now making everyone eligible from day one to receive this discount from day one.

This applies to all application developers who offer a paid app or sell in-app digital goods and services.

Google says this corresponds to roughly 3% of registered developers, as the rest distribute free apps that follow indirect monetization methods. 

Also, based on the earning amounts and the previous service fee model, 99% of those subject to charges qualified for a 15% fee already. 

The new service fee model dictates the following: 

• The service fee is 15% for the first $1 million of earnings each year when enrolled and 30% subsequently, which gives smaller developers more help as they scale their business.
• The fee for all subscriptions revenue is 15%, reflecting developer investment in keeping subscribers for the long run.
• Developers in certain programs, like the Play Media Experience Program, may be eligible for a reduced fee based on high content costs.

In addition to the apps on the Play Store, Google has also announced fee reductions for e-books and music streaming services on the platform, taking its cut down to 10% under certain eligibility conditions. 

Ongoing investigations

Google’s announcement says that the business model change results from listening to developers and consumers and trying to better cater to their needs. 

With Google targeted by a barrage of anti-trust law violation probes launched across the globe, contract breach claims from developers, and an ever-tightening clamp of scrutiny around its business models, this reduced fee may be seen as an olive branch to developers.

While this is a positive development for Android app creators, it remains to see if developers pass on these savings to consumers.