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Google to give developers a bigger cut of subscription app revenue

In the past both Google and Apple have taken a large cut of the revenue earned from subscription apps. Now it appears that both companies are preparing to give developers a larger cut of the profit.

Previously, ever time a user paid a fee to subscribe to an app on the Google Play store, 70 per cent of that money would go to google and the remaining 30 per cent would go to the developer. It is rumoured that Google will be flipping these percentages around in such a way that developers with subscription based apps on its store will now receive 85 per cent of the fees paid by users.

Google has apparently been testing this revised revenue split for around a year. No date has been set for when the company will roll out this feature to all of the apps on the Play Store but, with Apple announcing a similar revenue split, it may do so sooner rather than later. The loss in revenue from subscription apps could pay off for Google by earning more exclusive apps and services for its store.

Apple's new revenue split will give developers an 85 per cent cut as well but there is a catch. Its developers will only receive an increased portion of their app's revenue after a user has been subscribed to their app for 12 months. However, Apple has always taken a smaller cut of this revenue and its previous rate earned developers a 75 per cent cut. Google on the other hand is expected to permanently give the creators of apps on the Play Store 85 per cent of subscription revenue.

Another big difference between the App Store and the Play Store is that Google has always allowed developers to control their own billing which lets them keep all of the revenue earned from their apps. Whereas Apple has and will continue to force them to use its billing system to ensure that it receives some revenue from every sale.

While the new subscription revenue split is a big change on Google and Apple's part, the 70-30 per cent split on traditional apps is not likely to be changed any time soon.

Image Credit: N Azlin Sha / Shutterstock

Anthony Spadafora
After living and working in South Korea for seven years, Anthony now resides in Houston, Texas where he writes about a variety of technology topics for ITProPortal.