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Apple Company’s revenue is expected to be decreased by 5% with Apple store small business program

Apple is one the most powerful companies in the world and it has a large number of customer, besides this, it has ranked as a best-selling smartphone brand in the last quarter of the year 2020 and it has beaten Samsung company with the launch of iPhone 12 model. According to a report Apple Company made $260.17 billion from sale in the year 2019 and customers have spent almost $72 billion on in-app purchases. However, the company earning such a huge amount has also given priority to the small developers who do a lot of work in developing their app and earn a small amount. Therefore, Apple announced a program last year named Apple Store small business program which allowed the small developers to pay less commission for each sale they made from the App Store.

It was a huge opportunity for the small developers and especially the starter because no other company has made such a big offer that this company has made. This could decrease the revenue of the company up to a great extent. A company earning a huge amount from selling apps does not want to lose a portion of its earning but Apple Company has sacrificed its portion of revenue on small developers to secure their place on App store. It was assumed that the company is giving up a significant portion of its income, but according to a report from Sensor Tower (and CNBC), Apple Company’s expected revenue to be decreased by 5% only. This means that this company will remain on the list of companies with the highest revenue earning in a year. Google also announced a similar program as waiving a portion of their income to the small developers. According to a report, developers are required to give 30% of their earnings to the App Store or Google which makes this amount a significant amount each year.

To become eligible for the Apple Company and Google’s program, a developer is earning less than a million-dollar in the previous year. This program helped many small developers to grow even stronger in the market. However, there was no leniency for those developers which earn a lot and they had to give 30% of their sales made on the App Store and Google. 5% reduction is nothing considering the revenue that comes from the App Store, which earns more than a billion-dollar. These companies have waived this portion of their revenues because they know that this 5% would never affect their income per year.

App Store fees are only a part of the revenue which the company makes, Apple Company made around $21.7 billion from App Store fee and if the company waive around $595 million in Apps fees, it would definitely not affect the revenue of the company; however, it would help small developers to stand strong.


Photo: ymgerman via Getty Images

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