Applications are used for entertainment, infotainment, socializing, finding life partners, getting food, and medicine. Our dependency on mobile platforms has risen exponentially. Therefore, if you want to build your application to support your eCommerce or offline business, it is an understandable and intelligent move. However, there have been a few policy changes that you should know about when developing your application. In this blog, we will discuss a new policy that calls for the reduction of fees that google charges the developers.
The new policy
Google recently announced that it would charge 15% of the $1 million the developer makes on the app. The fees will be a one-time fee, and Google will only take it once the developer makes $1 million. However, Google takes the fees from any in-app purchases also. Google takes the payment at the time of the purchase of the product/service. Google will enforce the policy from July 1, 2021, onwards. The move will help reduce the prices of goods and services by 50% and favor both the consumer and the company. Before July 1, google took a 30% cut from any in-app purchase.
Why did google charge the fees?
The product management’s vice president defended the fee. He claimed that the fees enable them to distribute the marketing resources to any developer who wishes to launch it. The technology giant provides various marketing tools such as analytics, AdSense, search console, etc. Also, you should know how this change will impact the android application development services you choose.
Since the giant tool cut only from 3% of applications that sell products or services such as gems in games or meditation services, Google’s logic justified the benefit of the rest of the apps. However, they eventually took the developer’s inputs and made the necessary policy changes.
How does google take its cut?
Apps that charge for services and virtual products have to register via the play billing system. The company has to process every payment via the play store billing. Google takes it cut and directs the rest of the money back to the company.
How to take advantage of the new policy
If you plan to take advantage of the scheme for your existing mobile platform, then hire android application development services before March 31, 2022, to integrate the purchase of your virtual products with a play billing system before March 31, 2022. Only then does one qualify for the discount.
If the sudden banning of Chinese mobile platforms gave you the golden idea to start your application, then this policy will help in raising your revenue. Indian developers have also actively developed social media platforms to protect the privacy of Indian citizens.
How this affects new companies and their app?
If you want to venture into the app market, now is a good time to do it. With the reduced fees, your revenue and profit margins will be higher. Small companies and startups who are low on seed money will save up this money and channel it to better development by hiring the top mobile app development company in Jaipur and building applications with fewer problems.
Why did Google decide to change?
There has not been an official reason for the change. However, there is speculation that it was apple’s move that prompted the change. Apple came out with its policy to support small businesses. The reduction applied to iOS developers who earn below one million USD annually directly from the app store. But if they make more than one million USD, then 30% will be charged.
Apple’s fee structure is complicated. Google has a simple system. They offer a 50% reduction of fee on the first one million USD. However, they do charge a lower price on each in-app purchase. It helps small freelancers and startups save money and channels to develop their mobile platform better and reinvest it.
How this change impact your choice of a developer?
As discussed above, the money you save can be channeled to hire the top mobile app development company in Jaipur. The most important aspect of an application is its development and the user interface. With more money for development, one can hire a team of experts, developers who have worked specifically in their niche and add better features that may have been outside the budget.
Is everyone happy with Google’s decision?
There have also been speculations that the giant went for the policy change due to the controversy around it revolving around taking down the popular game Fortnite. Many critics state that the do=uopoly that google and apple have over applications gives them the free will to manipulate the market on their whims. If it weren’t for the pressures from small companies and developers, then the two dominant companies would not have made a move.
The bottom line is that this is good news for small businesses and startups. Most startups are web and application-based. Their revenues come from in-app purchases. By reducing the fee, they have higher chances of succeeding. Moreover, the move is a calculated move; it benefits all the mobile platforms that choose to sell or not. If you are thinking of launching your application, then you have the chance to reduce your developmental costs and channel them into better avenues.