Phil Schiller, Apple’s [stckqut]AAPL[/stckqut] senior vice president of worldwide marketing, said that Apple would soon alter its revenue-sharing model for apps. While the well-known 70 / 30 split will remain, developers who are able to maintain a subscription with a customer longer than a year will see Apple’s cut drop down to 15 percent. The option to sell subscriptions will also be available to all developers instead of just a few kinds of apps.
If the new subscription model becomes widely adopted, it will represent a fundamental shift in the economics of the App Store. Developers will be incentivized to sell their apps for a recurring fee instead of a one-time cost. It could change the way consumers pay for certain apps, but it also presents a massive opportunity for developers, many of whom feel the app economy has become moribund in recent years. And as iPhone sales growth slows, a move to app subscriptions is another way for Apple to wring more profits from its existing user base.
Apple is also going to start showing search ads for apps in its iOS App Store search results for the first time, something the company had previously resisted.
Source: APP STORE 2.0 | The Verge