Google Cuts Subscription-Based Mobile App Service Fees

Google Cuts Subscription-Based Mobile App Service Fees

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Article Reference: CNET

Subscription-based mobile apps have been a popular way for developer’s mobile apps to bring in revenue. Google announced Thursday that beginning on January 1st, 2022, all subscription-based mobile apps in the Google Play Store will have their service fees cut in half. This was announced first on Google’s blog for Android developers. Subscription based fees for apps on Google Play Store are usually 30% and then they drop down to 15% after one year of recurring subscriptions. The new service fee will now be cut down from 30% to 15% from the moment the app enters the play store.

Google is making this change because many app developers have expressed “that customer churn makes it challenging for subscription businesses to benefit from that reduced rate. So, we’re simplifying things to ensure they can.” Google Hoping to create a great space for customers and developers alike.

The company faces scrutiny being a big tech company like Apple, who also charges a 15% service fee for subscription-based mobile apps after the first year but has not yet lowered theirs from 30% in the first year. Big tech companies receive a lot of criticism from developers and lawmakers on their restrictive rules. ​​“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,” Sameer Samat, a vice president at Google, said in a blog post.

Google also announced a reduction in service fees for e-books and music streaming services. This is to help make Google Play better for the artist, musician and author development communities. Rates will be reduced from 15% down to 10%.

Interested in learning more about developing subscription-based mobile apps? Reach out to NCN experts here for more information.