Tuesday, April 25, 2017 [Tweets] [Favorites]

Apple Cuts App and IAP Affiliate Commissions

John Voorhees (Hacker News, MacRumors):

Today, Apple announced that it is reducing the commissions it pays on apps and In-App Purchases from 7% to 2.5% effective May 1st. The iTunes Affiliate Program pays a commission from Apple’s portion of the sale of apps and other media when a purchase is made with a link that contains the affiliate credentials of a member of the program. Anyone can join, but the Affiliate Program is used heavily by websites that cover media sold by Apple and app developers.

Via John Gruber (tweet):

Everything about this strikes me as strange, including the mere one week notice and the severity of the cut. It’s not a small reduction — it’s effectively been cut by two thirds. Note too that Apple is only reducing the affiliate commission for apps and in-app purchases — movies, music, and books are all still at 7 percent.

Brett Terpstra:

I’m guessing some sites you read are going to be showing you a few more ads. Some may shut down completely. I won’t be one of them, but I’ll be going out to eat less often until I replace the revenue.

Michael Love:

If your goal is to get more people into your ecosystem then it’s kind of counterproductive to pay them less $ for linking to you.

If they’re dropping % simply to make a little bit more Services revenue we may truly be entering the no-more-free-soda-at-Microsoft phase.

It sure seems like a bean counter decision. Some are speculating that it will make sense in light of a forthcoming drastic reduction to Apple’s 30% cut from developers. But if that were the case, you’d think Apple would lead with the good news.

Update (2017-04-27): Dr. Drang:

But Apple’s not the only online seller to cut commissions. A couple of months ago Amazon changed its commission structure, and I was a little surprised when none of the stories about Apple’s cut mentioned that.

Update (2017-05-04): Chance Miller:

While some clarity from Apple would be nice, it seems like last month’s statement was largely misinterpreted and that app affiliate rates are staying at 7 percent, while in-app rates are dropping to 2.5 percent.

Update (2017-05-07): Ric Molina:

Because I never saw a clear mention of Mac Apps, I decided to contact the iTunes Affiliate team. Turns out, not only are Mac Apps not impacted. iOS Apps aren’t impacted either.

The change in affiliate commissions applies to in-app purchases only, at least according to their support team[…]

Update (2017-05-08): Apple (via John Voorhees):

We’d like to clarify some changes being made to the Affiliate Program. Commissions for all iOS in-app purchases will be reduced from 7% to 2.5% globally, and all other content types (including music, movies, books, paid iOS apps and TV) will remain at the current 7%.

This contradicts the plain wording of the original announcement (“commissions for all app and in-app content”), so either there was a drafting error or they are backtracking.

1 Comment

[…] from 7% to 2.5%, effective next week. As usual, Michael Tsai’s blog has the most convenient roundup of reporting and reaction. There’s quite a bit of head-scratching, along with some hope the […]

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