Evolving our business model to address developer needs

Posted by Sameer Samat, Vice President, Product Administration

After we began Android and Google Play greater than a decade in the past, we made a guess {that a} free and open cellular ecosystem might compete with the proprietary walled gardens that dominated the business. It wasn’t but clear what varieties of companies would transfer to cellular or what apps would achieve success. To maintain issues easy, we went with an easy-to-understand enterprise mannequin: The overwhelming majority of builders might distribute their apps on Google Play without spending a dime (at the moment 97% achieve this at no cost). For the builders who supplied a paid app or offered in-app digital items (at the moment simply 3% of builders), the flat service charge was 30%. This mannequin helped apps to change into one of many fastest-growing software program segments. And as a substitute of charging licensing charges for our OS, our service charge allowed us to repeatedly put money into Android and Play whereas making them out there without spending a dime to gadget makers all around the world.

The creativity and innovation from builders all over the world spurred superb new app experiences we might have by no means imagined once we first launched Android. Because the ecosystem advanced, a wider vary of enterprise fashions emerged to help these several types of apps. We have made essential modifications alongside the way in which, together with transferring past a “one measurement matches all” service charge mannequin to make sure all forms of companies could be profitable. As an alternative of a single service charge, we now have a number of packages designed to help and encourage our numerous app ecosystem.

The result’s that 99% of builders qualify for a service charge of 15% or much less. And after studying from and listening to builders throughout many industries and areas, together with builders like Anghami, AWA, Bumble, Calm, Duolingo, KADOKAWA, KKBOX, Picsart, and Smule, we’re saying extra modifications to additional help our ecosystem of companions and assist them construct sustainable companies, and guarantee Play continues to steer within the cellular app ecosystem.

Lowering service charges on subscriptions to fifteen%

Digital subscriptions have change into one of many quickest rising fashions for builders however we all know that subscription companies face particular challenges in buyer acquisition and retention. We’ve labored with our companions in courting, health, schooling and different sectors to know the nuances of their companies. Our present service charge drops from 30% to fifteen% after 12 months of a recurring subscription. However we’ve heard that buyer churn makes it difficult for subscription companies to profit from that decreased price. So, we’re simplifying issues to make sure they will.

To assist help the particular wants of builders providing subscriptions, beginning on January 1, 2022, we’re lowering the service charge for all subscriptions on Google Play from 30% to fifteen%, ranging from day one.

For builders providing subscriptions, which means first-year subscription charges can be minimize in half. We’ve already gotten constructive suggestions from our developer companions on this transformation:

“Our partnership with Google has been a robust one for our enterprise, serving to us to scale and in the end enjoying a key position in advancing our mission to empower girls globally. The pricing change they’ve introduced will permit us to raised put money into our merchandise and additional empower customers to confidently join on-line.”

– Whitney Wolfe Herd, Founder and CEO, Bumble Inc.

“Simply as each individual learns in several methods, each developer is totally different as properly. We’re excited to see Google persevering with to collaborate with the ecosystem to seek out fashions that work for each the developer and platform. This discount in subscription charges will assist Duolingo speed up our mission of universally out there language studying.”

– Luis von Ahn, Co-Founder and CEO of Duolingo.

Going additional with cross platform experiences

Whereas apps stay extremely essential for cellphones, nice providers should now additionally span TVs, automobiles, watches, tablets and extra. And we acknowledge that builders must put money into constructing for these platforms now greater than ever.

Earlier this 12 months we launched the Play Media Expertise program to encourage video, audio and e book builders alike to assist develop the Android platform by constructing superb cross-device experiences. This helped builders put money into these multi-screen experiences with a service charge as little as 15%.

As we speak, we’re additionally making modifications to the service charge within the Media Expertise program, to raised accommodate variations in these classes. Ebooks and on-demand music streaming providers, the place content material prices account for almost all of gross sales, will now be eligible for a service charge as little as 10%. The brand new charges acknowledge business economics of media content material verticals and make Google Play work higher for builders and the communities of artists, musicians and authors they signify. You’ll be able to go right here for extra info.

We are going to proceed to interact with builders to know their challenges and alternatives — and the way we will finest help them in constructing sustainable companies. It’s a theme that can be entrance and heart on the Android Developer Summit on October 27-28, the place you’ll hear extra about our newest instruments, utility programming interfaces (APIs) and applied sciences designed to assist builders be extra productive and create higher apps.

In case you’re in search of extra details about Google Play and its service charges, we have answered some frequent questions right here.