Google is lowering commissions on all subscription-based businesses on the Google Play Store, the company announced today. Previously, the company had followed Apple’s move by reducing commissions from 30% to 15% on the first $1 million of developer earnings. Now, it will lower the fees specifically for app makers who generate revenue through recurring subscriptions. Instead of charging them 30% in the first year, which lowers to 15% in year two and beyond, Google says developers will only be charged 15% from day one.

The company says 99% of developers will qualify for a service fee of 15% or less, as Google is also further reducing fees for specific vertical apps in the Play Media Experience Program. These will be lowered to as much as 10%, it says.

The Play Media Experience Program encompasses apps like e-books and on-demand streaming music services, where the content costs account for the majority of sales. These are also businesses that, in some cases, compete directly with Google — as YouTube Music does with Spotify, for example.

The program was launched earlier this year to encourage book, video, and audio developers to build for Android, and had offered service fees as low as 15%.

“Digital subscriptions have become one of the fastest growing models for developers but we know that subscription businesses face specific challenges in customer acquisition and retention,” said Google’s Sameer Samat, Vice President, Product Management, in an announcement. “We’ve worked with our partners in dating, fitness, education and other sectors to understand the nuances of their businesses. Our current service fee drops from 30% to 15% after 12 months of a recurring subscription. But we’ve heard that customer churn makes it challenging for subscription businesses to benefit from that reduced rate. So, we’re simplifying things to ensure they can,” he said.

The new fees will kick in starting on Jan. 1, 2022, Google said.


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