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Global App Spending Passed $100 Billion in 2020

This article is published in collaboration with Statista

by Felix Richter

Faced with antitrust allegations and the wrath of (some) app makers, Apple extended an olive branch to its developer community in November by introducing the App Store Small Business Program, which reduces the company’s app store commission from 30 to 15 percent for developers earning less than $1 million a year.

Ever since the App Store was launched in 2008, Apple has taken a 30-percent cut on app sales, in-app purchases of digital content and subscriptions made via iOS apps (the latter dropping to 15 percent after the first year), which has lately drawn the attention of competition watch dogs, especially in cases where Apple competes with third-party app makers (e.g. Apple Music vs. Spotify).

While Apple’s decision to cut its commission in half for small developers looks like a big concession to make, data suggests that developers eligible for the program only account for a small fraction of App Store revenue. The following chart explains why Apple is fighting so hard to protect its slice of the app store pie. According to estimates from app analytics firm SensorTower, App Store revenue amounted to more than $70 billion last year. Assuming most of that total qualifies for Apple’s commission, that amounts to roughly $20 billion in revenue last year alone, which even for Apple is no small change.

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