When Epic Games decided to skip the Google Play Store last year for the Android version of Fortnite, the main issue was the store's 30-percent cut of all app revenue. With the comically lucrative battle royale shooter raking in hundreds of millions of dollars every quarter, it might not have been possible for Google to provide a service that would be worth the cost.
Epic Games followed up a few months later with a competitor to Steam, the latter of which also customarily gets a 30-percent cut. The Epic Games Store threw down the gauntlet with an answer of just 12 percent, and the app industry has continued to strain under the growing pressure of new competition armed with unprecedented revenue splits.
Now word comes from The Inquirer that Microsoft is finally making good on its promise back in April 2018 to drop the cut on its Microsoft Store app from 30 percent to just 5. That means that app developers on that marketplace will take home nearly all the money they make there. Well, if they meet certain conditions.
For example, games on the Microsoft Store will continue with the 70/30 split. Additionally, the company says that the 95 percent developer share will be restricted to "when a customer uses a deep link to get to and purchase your application."
The company adds, "When Microsoft delivers you a customer through any other method, such as in a collection on Microsoft Store or any other owned Microsoft properties, and purchases your application, you will receive 85% of the revenue earned from the purchase of your application or any in-app products in your application" (emphasis original).
Any non-game app purchases made on Microsoft's Xbox game consoles will also continue with the old split, even though those devices are technically using the company's digital storefront.
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Of course, one might argue that Microsoft can afford to do this, because its digital store has never been known as a substantial money maker. That's despite being built into Windows 10, which is now on hundreds of millions of computers around the world.
The reasons for its struggle are manifold, but the main one is probably the long string of technical glitches that marred its launch alongside that of Windows 10 in 2015. Perhaps with a friendlier revenue split, Microsoft can entice more developers to roll the dice on its marketplace.
- The Microsoft Store will now take just a 5 percent cut of revenue on the app store built into Windows 10, with the remainder going to app developers -- with a couple important caveats.
- Games will still use the old 70/30 split, and promotions within the Microsoft Store will use an 85/15 split.
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