The Standard Commission
Both Apple and Google take a percentage of every in-app purchase and paid app download processed through their billing systems. The standard commission rate is 30% for both platforms. This means if a user pays $9.99 for a subscription, the developer receives approximately $6.99 and the store keeps approximately $3.00.
This commission covers payment processing, global distribution, fraud prevention, and platform services. Whether the rate is justified continues to be debated by developers, regulators, and the platforms themselves.
Apple App Store Commission
Standard Rate: 30%
All paid apps and in-app purchases are subject to the 30% commission by default.
Year 2+ Subscription Rate: 15%
For auto-renewable subscriptions, Apple reduces the commission to 15% after a subscriber has been continuously subscribed for more than one year. If the subscriber cancels and resubscribes within 60 days, the one-year clock continues. If the gap exceeds 60 days, the clock resets.
Small Business Program: 15%
Developers earning less than $1 million in annual proceeds (not gross revenue) qualify for the App Store Small Business Program, which reduces all commissions to 15%. The calculation includes all proceeds from all apps under the developer account and any associated accounts.
Key Details
- Commission applies to digital goods and services only
- Reader apps (Netflix, Spotify) can link to external sign-up pages under the External Link Entitlement
- Physical goods and services are exempt (Uber, DoorDash, Amazon physical)
- Apple collects and remits sales tax/VAT in most jurisdictions
Google Play Commission
Standard Rate: 30%
Same as Apple: 30% on all paid apps and in-app purchases.
Subscription Rate: 15%
Google applies a flat 15% commission on all subscription revenue from day one. Unlike Apple, there is no requirement to wait for the second year. This has been in effect since January 2022 and makes Google significantly cheaper for subscription-based apps.
Small Business Program: 15%
Developers earning less than $1 million in annual revenue qualify for 15% on all transaction types (not just subscriptions). The threshold is based on total Play Store earnings.
Media Experience Program: 10%
Eligible media apps (ebooks, audio) can qualify for a further reduced 10% commission rate through Google's Media Experience Program.
Key Details
- Google allows third-party billing in some regions and for some app types (user choice billing)
- When using user choice billing, the commission is reduced by 4% (26% standard or 11% for subscriptions)
- Commission applies to digital goods only
- Google collects and remits tax in most jurisdictions
EU Digital Markets Act (DMA) Impact
The European Union's Digital Markets Act, enforced since March 2024, has forced both Apple and Google to offer alternative distribution and payment options in the EU.
Apple's EU Changes
- Developers can use alternative payment processors with a reduced commission (27% standard, 12% for small business)
- Apps can be distributed through alternative app stores
- A Core Technology Fee (CTF) of 0.50 EUR per first annual install above 1 million applies
- Most small developers are unaffected by the CTF due to the 1 million threshold
Google's EU Changes
- User choice billing is available with a 3% commission reduction
- Third-party app stores can be distributed through Google Play
- Sideloading remains easier on Android than on iOS
Commission Comparison Table
| Scenario | Apple | |
|---|---|---|
| Standard IAP | 30% | 30% |
| Subscription Year 1 | 30% | 15% |
| Subscription Year 2+ | 15% | 15% |
| Small Business Program | 15% | 15% |
| EU Alternative Payment | 27% (+ CTF) | 26% |
| Media (ebooks, audio) | 30% | 10% |
How Proceeds Are Calculated
Understanding the math is important:
Gross Revenue: The total amount the customer pays ($9.99) Commission: The store's cut ($9.99 x 30% = $3.00) Proceeds: What the developer receives ($9.99 - $3.00 = $6.99)
Tax is handled differently depending on jurisdiction. In most cases, the store collects tax on top of the listed price and remits it to the government. The commission is calculated on the pre-tax price.
Strategies to Minimize Commission
- Qualify for Small Business Program: Keep proceeds under $1M to benefit from 15%
- Prioritize subscriptions on Google Play: The flat 15% rate from day one is a significant advantage
- Use web-based sign-up where allowed: Direct users to your website for initial subscription (reader app rule on Apple, external offers on both platforms)
- Leverage EU alternative payments: If your EU user base is significant, the math may favor alternative payment processing
- Build subscription retention: On Apple, reaching year 2 cuts the commission in half
Related Topics
- Small Business Program Guide - How to qualify and apply for the 15% commission rate
- Revenue Reporting and Payments - Understanding payment cycles and financial reports
- In-App Purchase Guide - Complete guide to IAP types and implementation