- Apple’s App Store Small Business Program has been in place for just over a year.
- It has halved in-app purchase costs from 30% to 15% for developers trading less than $ 1 million a year.
- Independent developers have shared that the program went well for them.
Independent developer Emmanuel Crouvisier quit his startup job on January 1st – coincidentally the 1st year anniversary of Apple’s App Store Small Business program – and he credits the program primarily to enable his career change.
The program has reduced in-app transaction fees from 30% to 15% for developers with app store transactions of less than $ 1 million annually. The developers enrolled in the program told the insider that they were happy to take home higher revenues and were surprised by the simplicity of enrolling in the program.
The fee reduction program, launched on January 1, 2021, has since allowed some developers to quit their full-time jobs to focus on independent app ventures and provide a financial cushion for more than two years into the pandemic.
While developers praise the app, the iPhone maker is currently facing international setbacks for apps requiring users to use their own payment system – and charge as high as 30% for each transaction – but developers in the app say the 15 % Fee proportional is the benefits that Apple offers them.
“We’re not getting the 30% cut we should – the services Apple offers are not worth that much,” said Jeff Johnson, an independent iOS developer.
Johnson was pleased but surprised when Apple announced the program. Things became clearer as court documents revealed that maintaining this low rate for at least three years was part of a class-action settlement after small developers accused Apple of monopolistic behavior for its mandatory payment system.
Apple also agreed to pay $ 100 million into a Settlement-Provisioned Small Developer Assistance Fund, which essentially reimbursed in-app transaction fees to developers who made under $ 1 million a year in each calendar year between 2015 and 2021.
Settlement funds have been distributed, but developers are concerned that the program will only last for the three years stipulated in the agreement.
An Apple spokesman did not say whether the program would last over three years. The spokesman also noted that the program was announced in November 2020, before the settlement was announced in August 2021.
Vidit Bhargava, who was an Apple Worldwide Developer Conference Student Scholar in 2016, hopes this program will continue and note that an additional 15% of revenue for developers will mean the difference between developing their app on the site or full-time.
“It’s a great model to support younger developers,” Bhargava said as he recalled the decision to either take a traditional 9-to-5 job or become a full-time independent app developer. “If you look at the percentage jump, that would have been a clear answer for me [app development] is much more lucrative. “
Crouvisier, who was able to quit his job as an engineering director at a software development company earlier this year, has been developing apps for almost a decade, but his App Card Pointers, which helps people maximize rewards from their credit cards, launched in 2020 was his first successful app.
He started monetizing it at the end of 2020 and was so successful that he started to become strategic as one stays in the App Store Small Business program – if an app exceeds $ 1 million in in-app transactions within a year, it is no longer eligible for the program and all transactions for the rest of the year as well as for the following calendar year are subject to a 30% charge.
He calculated that starting from the program could mean losing $ 150,000 a year.
In August, Apple announced that it would start communicating with developers outside of the apps to inform them about alternative, non-Apple purchasing methods. Crouvisier took advantage of this by sending users discounts by email when paying with Stripe.
Overall, he was pleased with the program as well as with the resources of Apple’s ecosystem. He recommends only a small change for automatic developers to enroll in the program.
“My app helps people save money, so I’m very big at saving money myself,” Crouvisier said with a laugh.
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