Apple Aims to Increase Services Revenue by Changing App Store Policy
Responding to the developer community’s requests — sometimes frustrated by Apple’s strict policies — Apple has made various changes to the App Store, reports Bloomberg. Developers can have access to analytical tools that provide insights on how the apps are used and monetized. Apple has also sped up the approval process and — as you may recall — halved its cut once a customer has subscribed to an app for 12 months.
All these changes, and more to come, according to Bloomberg, serve the scope of improving the relationship with developers who submit their apps for approval to the App Store. According to Gene Munster, the App Store has recorded a stunning 40% increase in revenue to $8.6 billion last year. The services business has become an important component of Apple’s revenue streams, as it has increased 22% to $24 billion.
For the first time since the App Store’s existence, Apple will allow developers to respond to customer reviews. It has also tried to tailor app recommendations to individual users. After enabling the subscription model to new app categories, Apple has also announced that it is reducing its cut by half when a customer has subscribed for more than 12 months to one app.
The changes started coming after Tim Cook assigned Phil Schiller to lead the App Store business 15 months ago. Starting in May of last year, developers started noticing a speed-up in the app approval process. Now, rather than a week or more, getting an app approved only takes two days or less.