Apple announced the App Store Small Business Program on November 18, 2020, which will reduce App Store commissions for small businesses with annual revenues of no more than $1 million to 15%.
What about the App Store Small Business Program?
The App Store Small Business Program may accelerate innovation and help small businesses and independent developers drive their business forward through the next generation of breakthrough applications in the App Store. The new App Store small business plan will benefit the vast majority of developers who sell digital goods and services on the store, thereby reducing their commissions for paid apps and in-app purchases. If a developer received no more than $1 million in revenue in the previous calendar year, they are eligible to participate in the program and receive a 15% commission reduction.
The App Store Small Business Program will be launched on January 1, 2021. It is at an important time, as small and independent developers continue to be committed to innovation and flourish in an unprecedented period of global economic challenges. As businesses adapt to the virtual world during the pandemic, applications have taken on new importance, and many small businesses have launched or vigorously developed their digital businesses to continue to attract their customers and communities. The plan reduces commissions, which means that small developers and aspiring entrepreneurs will have more resources to invest and grow their businesses in the App Store ecosystem.
Small businesses are the backbone of our global economy and the beating heart of innovation and opportunity in the global community. We are launching this program to help small business owners write a new chapter of creativity and prosperity on the App Store, and build quality applications that customers love. "Apple CEO Tim Cook said. "The App Store, like other industries, is an engine of economic growth, creating millions of new jobs and providing a path to entrepreneurship for anyone with a good idea. Our new plan takes this progress forward-helping developers fund small businesses, take risks on new ideas, expand team size, and continue to develop applications that enrich people's lives. "
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Although comprehensive details will be released in early December, the main points of the program’s participation criteria are simple and concise:
Existing developers will earn $1 million in revenue for all their applications in 2020, and new developers in the App Store are eligible for the program and reduce commissions.
If participating developers exceed the $1 million threshold, the standard commission rate will apply for the rest of the year.
If the developer’s business falls below the $1 million threshold in the next calendar year, they can regain the 15% commission qualification in the second year.
For applications that sell digital goods and services and earn more than $1 million in revenue (defined as the revenue of developers after they are put into production), the standard commission rate of the App Store is 30%. Earlier this year, an independent study conducted by Analysis Group found that Apple's commission structure has become the mainstream of application distribution and gaming platforms.
Small business owners will continue to benefit from Apple’s unparalleled suite of developer tools-including developing applications, programming languages, secure payment interfaces, and more than 250,000 basic software building blocks called APIs. Apple is committed to providing developers with tools to turn their smartest ideas into applications that change the world. Tools such as HealthKit enable engineers to securely access user health data, ARKit enables developers to explore new areas of augmented reality, and Core ML uses the speed and intelligence of machine learning to help developers build with just a few lines of code powerful functions.
From the beginning, winning the trust of users and developers has been an important goal of the App Store. This is why each of the 1.8 million apps in the App Store undergoes a review process that developers and their customers can rely on-a process that ensures that each app is reliable, performs as expected, and is not objectionable The content and adhere to the highest standards of protecting user privacy and security.
Developers of all sizes are building successful businesses while also benefiting from the global reach of the App Store, including the use of more than 40 languages in 175 countries/regions, the use of more than 180 local payment methods and 45 acceptances The currency of the world’s 1.5 billion Apple device users. In 2019 alone, the App Store ecosystem facilitated $519 billion in global business transactions-more than 85% of total revenue came from third-party developers and businesses of all sizes. The new App Store small business plan will build on this progress, generate more digital commerce and application innovation, support new jobs, and help small independent developers continue to bring excellent software to Apple users.
App Store was founded in 2008 and is the safest and most active application market in the world. It currently provides 1.8 million applications and is visited by one billion people every week. It can help creators, dreamers and learners of all ages and backgrounds get the tools and information needed to build a better future and a better world.
What may App Store Small Business Program Befits the Developers?
Every week, 1 billion visitors visit the App Store to browse and use 1.8 million apps in the store, including indie games, online classrooms, and apps written for kids. Many of these applications are created by independent developers driven by a single idea. Usually, these developers will maintain full-time jobs and eventually fund their ideas until their development becomes a reality.
Since the App Store was launched, small businesses have been its driving force. These companies are now more than ever at the core of the communities they serve, helping people stay healthy, connect and learn. Today, Apple launched the "App Store Small Business Program", which is a new commission structure designed to support small and individual developers and promote the innovation of apps in the next chapter.
"This is a huge opportunity for the spirit of indie gaming to become a true mobile device," said Philipp Stollenmayer, an independent developer of the App Store. Stollenmayer's latest game "Bloom Song" won the Apple Design Award in June 2020. It attracted the appeal of the iPhone as a new gaming platform, a gaming platform that is in its infancy and requires its own standards. When his first game "What the Frog" was launched on the App Store in 2013 and won the German Multimedia Award (mb21), he knew he had already gained something.
Stollenmayer said: "I saw a world full of possibilities, how easy it is to find something there." "I had the opportunity to shape the way mobile games work and how they differ from consoles. In mobile games, you Use the phone in a more personalized way. I put it in the game and make it playable, which is more valuable than trying to create a world that doesn’t work on a small screen."
With the new App Store commission structure, small and individual developers earning no more than $1 million in a calendar year are eligible to reduce their commission rate by 15%-half of the standard commission for the App Store. The money saved means that small businesses and developers will have more money to invest in their businesses, expand their workforce, and develop new and innovative features for application users worldwide.
In addition to the game world, the team behind MySwimPro is also excited about the possibility of their company developing and expanding application products with lower risk, thanks to the new App Store plan that will bring additional revenue.
"Me and Adam, and everyone on our team-we all swim with a certain ability," said Ksebati, who is also the CEO of MySwimPro. "We try to build a community around the people who use the app, because swimming is one of the things you can do at any age, anywhere in the world. Therefore, we are users of our own products in many ways."
After spending five years developing an application that started as a side project, Ksebati and Oxner have developed MySwimPro into a successful company with 12 team members around the world, and they are excited for the next chapter. Oxner said: "The new App Store plan will be a huge help to our purchase income in the App Store. We hope to use more revenue to improve the application." "We look forward to further improving the dryland exercise and application. To help swimmers who may be temporarily unable to enter the pool."
Samantha John, the co-founder of Hopscotch, was the first coding language designed for the iPad. He saw the new App Store program as an opportunity for kids to use Hopscotch for free to do more. John said: "This actually makes us take the risks we want to take, but we are very afraid to do it." "Especially around our subscriptions...I think this is a good strategy for making money, but it also limits App audience. We have always wanted to come back and let people do more things for free. Hope we go further and we will have more loyal subscribers joining."
John said: "The main driving principle of hopscotch is that we really want to respect the creativity, creativity and artistic talents of children." "Actually, this is how we look at these children and the way we are coders, so this is the key to how we think about Hopscotch: How do we ensure that children can do work that is meaningful and important to them?"
After the second-generation iPad was launched, John was interested in the possibility of a more child-friendly programming method for developers. "The things about the iPad and the touch screen, and the things you can hold in your hand, feel more personal and more interesting."
Since its launch in 2013, Hopscotch now has 200,000 monthly active users. After seeing how children can create and share their own games and creation tools in the app, John believes that the loyal users of Hopscotch are the best content creators. After the App Store small business plan goes into effect in January 2021, John hopes to introduce more features to the app for free.