Phil Schiller Once Suggested Apple Reduce Their App Store Fees

Apple’s current fee for its App Store is 30% of whatever the developers make from the sale of their apps or sales made through in-app purchases. This is an area of contention in the lawsuit against Epic, where Epic and other app developers and companies feel that the 30% that Apple takes is too much.

However, it seems that a decade ago, Apple exec Phil Schiller actually floated the idea of cutting the App Store fee. This is according to court documents which showed a conversation between Schiller and Apple services head, Eddy Cue, where Schiller asked if he thought that Apple’s 70/30 will “last forever”. While Schiller expressed his support for the current model, he did say that he didn’t necessarily believe it would remain “unchanged forever”.

So much so that he later suggested that Apple could reduce their fees when the App Store hits $1 billion in profit per year. According to Schiller, as long as the profit amounted to $1 billion, Apple could reduce the cut they get down from 30% to 20-25%. The exec was quoted as saying, “I know that this is controversial, I just tee it up as another way to look at the size of the business, what we want to achieve, and how we stay competitive.”

That being said, Schiller was right in that the current fee structure won’t remain unchanged. Last year, the company introduced a new structure where Apple would only take 15% from smaller developers whose revenue was under $1 million. They also reduced commissions from subscriptions where in the second-year, they would only take 15%.

Tyler Lee
Categories: Apple, Cellphones, General
Tags: Apps, epic, iOS, Legal