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Apple will slash App Store fees as antitrust pressure mounts

November 18, 2020. Summarized by summa-bot.

YOKOHAMA, KANAGAWA, JAPAN - 2020/10/31: In this photo illustration a woman swipes with her finger on the screen of the new iPhone 12. (Photo Illustration by Stanislav Kogiku/SOPA Images/LightRocket via Getty Images)

Apple said Wednesday it will slash the fees it charges app developers from 30% to 15% if the developer made less than $1 million in the prior year.

(CNN Business)Apple said Wednesday it will slash the fees it charges app developers from 30% to 15% if the developer made less than $1 million in the prior year.

The change for small businesses will go into effect on Jan. 1, Apple (AAPL) said, while apps that earn more than $1 million a year will continue to be covered by Apple's existing fee structure, which charges 30%.

It was not immediately clear how many small app developers will be affected by the change; Apple's announcement said only that the update will benefit "the vast majority of developers" on the App Store.

Those developers' economic activity accounted for an estimated 5% of the iOS App Store's total revenues in 2019, Sensor Tower told CNN Business.

Apple's App Store fees have increasingly come under scrutiny as lawmakers and regulators have zeroed in on Apple's dominance over iOS.

In addition to app store fees, Apple's developer policies have been criticized as helping to preserve the company's dominance.

This summer, Epic Games, the maker of the hit online game Fortnite, filed an antitrust lawsuit against Apple that could reshape how app stores work in the United States.

Apple has previously said that its fee structure reflects common practice across the digital services industry -- this year, it commissioned a report by the Analysis Group, a consulting firm, affirming that claim.

Asked whether the recent antitrust scrutiny may have played a role in Wednesday's announcement, an Apple spokesman did not provide a direct answer but told CNN Business that it has only ever lowered the fees developers must pay.

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