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Google said 99% of app developers’ fees would be cut in half.
Denis Charlet / AFP through Getty Images
Alphabet
said early Tuesday that it is slowing down its charges on app developers who use the Google Play store, months later
Apple
they cited a similar move amid criticism of such high costs.
Shares of Alphabet (ticker: GOOGL) rose 1.5%, at $ 2,084.40, in recent trading.
In a blog post Tuesday, Alphabet said it was reducing the fee it collects to 15% from 30% on the first $ 1 million app makers bank from their app store. Alphabet decided to cut its taxes, which will take effect on July 1, amid a regulatory review by the U.S. Department of Justice and several state-led efforts.
Apple (AAPL) made a similar change last year, reducing its rate to 15% – also from 30% – but limited the change to developers reporting annual sales of less than $ 1 million. Apple is being investigated by the U.S. Federal Trade Commission and other regulators for breaches of trust that may be associated with its app store.
Google said in the blog post that the fees of 99% of app developers would be cut in half. It was not immediately clear what effect the change would have on the company’s third-quarter sales and beyond.
Alphabet includes Play store revenue in its “Other” revenue segment, which also plunges into hardware and non-mobile products such as YouTube Premium subscriptions and YouTube TV. The entire sector reported 2020 revenue of $ 21.71 billion.
App store fees were criticized up last year after Epic Games, the
Tencent Holding
(0700.Hong Kong) – maker of Fortnite, has launched a public campaign against Apple and Google over the charges associated with the app store. Apple pushed Fortnite off the store, and Epic filed a suit against trust in the case.
Shares of Alphabet have improved 95% in the past year, as is the
S&P 500
received 69%.
Write to Max A. Cherney at [email protected]