An app developer, keen to launch his new app on the app store has to consider the app store commission charges. The charges that the giant app stores like Google play and Apple app store levy, are a share of the net profits of the app. So there is a pressing need for the app developers to compare the app charges across other app stores.
An app developer who understands well the calculation of the app store charges and is able to configure their ASO strategy succeeds in the app launch. The charges that the Google play and Apple app stores deduct from the app’s income is the app store commission. In simple terms, these app stores act as a medium between the target audience and the app. It helps your app to gain more visibility.
Many of the app stores allow your app to be listed on their page for free. The app store charges apply to apps with paid subscriptions and in-app purchases. The app store commission is charged for the app distribution service rendered by the app store and this commission earned by the app stores becomes their major revenue inflow.
Let us in this blog look at the various aspects of the play store fees for the two giants, the Apple app store and Google play store. Many elements determine the apple app store fees and the google play store revenue. Let us study each and their implications on the net revenue of the app.
Factors considered to calculate the app store commission
A significant percentage of income for the Google Play Store and Apple App Store comes from charging a commission for the app distribution service. Though the standard commission rate is fixed at 30%, each app store follows a different structure. The app store commission is charged for the paid apps in the google play store and apple app store on every:
1) in-app purchase; however, the charges do not apply on any of the purchases of physical goods in the app or if using an ad as an app marketing strategy.
2) Subscriptions charges are applicable for apps that charge the user for the monthly app subscriptions or for an upgrade.
3) Paid apps charge a subscription cost, and the app store commission fees apply for these apps.
What are the app store charges of Google play and Apple App?
Apple App Store
Apple app store has a user base of more than a billion customers in more than 170 countries. It gives access of apps via iPhone, Mac, Apple Watch, iPad, and Apple TV without hosting fees.
The apple app store charges $99/annually for the Apple developer program and $299 for the app’s enterprise version. This charge is a share of the app’s revenue. These charges are applied when in-app purchases are linked to app functionality upgrades or unlocking app features. So the in-app purchase by the user ultimately becomes the revenue for the apple app store.
The app’s net revenue plays a vital role in understanding the commission amount that app store takes from the app. The apple app store charges are believed to be too high. Till November 2020 it was standard 30% commission charged on the price of the paid apps in apple app store. Depending on the app’s net revenue, the below two commission % are applied, which are;
30% commission is charged – If the app’s net revenue is $ 1 million or more.
15% commission is charged – if the app’s net revenue is less than $1 million. Or when the app is newly launched in the app store or after one year of the subscription-based service.
Around 98% of apps are estimated to fall under the 15% commission fee category.
Google play store
Google charges a 30% share of the app revenue. Like the apple app store, google also decreases the app store subscription to 15% after the first 12 months. Google also charges a one-time registration fee of $25 for the app developer account.
There is a legal binding in Google’s guidelines that insists that developers use the google play in-app billing payment method. It is the sole payment system for in-app purchases and downloads. So one has to analyze well the financial implications while using Google play store optimization services.
So if you are keen on launching your new app in the app stores redesign the app store optimization model. Moreover, analyze how the app store commission and other charges impact the net revenue. So that you can make the best out of the app distributions services provided by these app stores. List your app in the app store today. Enhance the visibility and drive more downloads.