Big Tech companies are facing a lot of pressure amid scrutiny of their business practices by the antitrust regulators in various countries. Because of this, companies are making some changes to their business structure.
In line with this, Google is once again changing the way it charges fees to the app developers. The search engine giant has announced that all subscription-based app will be eligible for significantly less fess than the usual 30 percent.
As per the new changes, the company has confirmed that the subscription apps will now pay 15 percent fees instead of 30 percent. Further, the technology giant has announced that apps with services like ebooks and on-demand music streaming will be eligible for a fee as low as 10 percent.
The reason stated by Google behind cheaper fees on ebooks and music streaming apps is that “content costs account for the majority of sales” and that the rates “recognize industry economics of media content verticals.” Unlike its previous revision of fees, this new modification to the fee structure isn’t tied to overall revenue.
Earlier this year, in March, the company had cut its share of revenue on upfront or in-app purchases from 30 percent to 15 percent, but it is applicable only to the first $1 million per year that an app developer earns.
With this development, Google could be hoping to change its public image amid mounting regulatory scrutiny over how the company manages its app store and its relationship with third-party developers.
According to the estimates by analytics firm Sensor Tower, the tech giant collected around $11.6 billion in in-app purchases around the world in 2020 on $38.8 billion in spending on the Google Play store.
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