How app developers could benefit from changes to Apple’s own store
Dan Burkhart, chief executive of Recurly, a subscription management and billing platform that works with more than 2,000 companies, said many app developers with whom he communicates regularly were buzzing with excitement on Friday afternoon. Large companies with “established momentum and notoriety” are likely to benefit from being able to direct their loyal customers elsewhere, he said.
Match Group, makers of dating apps Tinder and Hinge, is on track to pay Apple and Google — which control a similar app store for phones running their Android software — more than $500 million in commissions this year, The company’s biggest expense, said Match’s head of finance, Gary Swidler. He said the company was already looking at ways to use Friday’s decision to cut that bill, including by lowering fees for subscriptions paid on one of its websites.
One analyst estimated the change could save the match $80 million annually, but Mr Swidler said there were too many questions to make such a forecast.
“Depending on what the take rate will be, it will help us from a bottom-up perspective, and it will allow us to invest more in our business, and also allow us to pass on the benefits to consumers,” he said. .
Michael Love, the founder and chief executive of a Chinese dictionary app called Pleco, said the prospect of avoiding the commission — he pays 15 percent to Apple — was good news. Even better? Chances are it may interact directly with customers in ways that circumvent App Store rules, such as sending promotional emails, issuing refunds, and viewing old orders.
“I’m excited for the possibilities of payments without getting in Apple’s way,” he said.
Mr Love, 39, said he could not make many deals with other dictionary publishers because they didn’t want to pay commissions to both Apple and him and lose a lot of money.
Now, by avoiding Apple fees and working directly with publishers, it can potentially transform its business and become a “boutique e-book retailer,” Mr. Love said. He said this could increase his revenue from about $500,000 a year to $5 million or $10 million.
“It makes it possible for the little guys to compete,” he said.
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