Apple to reduce App Store fees for small businesses with under $1 million in revenues

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Amid increased regulatory scrutiny over how it runs its App Store, Apple today announced it will reduce the App Store commissions for smaller businesses. Under the new guidelines of the “App Store Small Business Program,” as it’s called, developers earning up to $1 million per year will only have to pay a 15% commission on in-app purchases, rather than the standard 30% commission.
The new program will launch on Jan. 1, 2021, and will be based on the business’s revenues in the previous calendar year — meaning 2020. This $1 million threshold will be based on how much existing developers made across all their applications on a post-commission basis, Apple notes. That means the businesses could actually earn up to $1.3 million in gross revenues. The reduced fee will also apply to new developers launching their apps for the first time.
If, during the course of the year, the developer’s apps surpass the $1 million threshold, they’ll be moved to the standard commission rate, generally 30%, for the remainder of the year. They’ll also then enter the following year at that standard rate, as well. Depending on the developers’ business, however, the “standard” rate may not always be 30%. For developers running an auto-renewing subscription business, for …

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