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Apple to Reduce Affiliate Program Commission Rate to 2.5% for Apps Next Week [Updated]

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Apple today emailed its iTunes Affiliate Program members to inform them that its commission rate for all apps and in-app content will be reduced to 2.5 percent on May 1, down from 7 percent, globally.

itunes-affiliates.jpg

Apple will continue to offer a 7 percent commission rate for all other iTunes content, including music, movies, TV shows, and books. Apple will also continue to offer a one-time 50 percent commission on Apple Music subscriptions.

Ouch! Apple just slashed the affiliate commission on apps and IAP. This will impact lots of great sites/apps. pic.twitter.com/dbv7CboMX3 - David Barnard (@drbarnard) April 24, 2017
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Through the iTunes Affiliate Program, websites can link to and promote App Store apps and receive a percentage of the sale in return.

Update: Apple now says the reduced 2.5 percent commission rate only applies to iOS in-app purchases.

Article Link: Apple to Reduce Affiliate Program Commission Rate to 2.5% for Apps Next Week [Updated]
 
Article Link
https://www.macrumors.com/2017/04/24/apple-reducing-app-store-commission-rate/
dannyyankou said:
Haha, funny joke.

I think these ads just aren't effective, that's why they reduced the rate.
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If they weren't effective, they wouldn't have any reason to drop the rate. The reason you drop the commission rate is because you're paying out too much and need to increase your profits.
 
Doesn't that seem like a bit much, from 7 percent down to 2.5? It sound more like Apple is trying to kill the Affiliate Program. The only other scenario I can imagine is that the Program is so effective and with so many members, that Apple needs to thin the herd a bit.
 
I guess this is their plan to kill off the 3rd party affiliate sites because they won't be able to keep things afloat with such a drastic reduction in commission. Either that, or affiliates will have to consolidate. Either way, it's a crappy play by Apple.
 
ck2875 said:
The affiliate program and third-party store parsers would be a lot less necessary if app discovery on the App Store wasn't so horrendous. I basically have to rely on AppShopper & Product Hunt to find price drops & new apps.
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You've got a point.

Unless I know the name of an app I actually always use Google.
 
OldSchoolMacGuy said:
If they weren't effective, they wouldn't have any reason to drop the rate. The reason you drop the commission rate is because you're paying out too much and need to increase your profits.
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There is not a 'need to increase profits.' There is a desire to increase profits and with apple executives, pay less taxes but still demand services from their local, state and national government.
 
ignatius345 said:
Does this mean MacRumors articles can just link to the App Store instead of that AppShopper site?
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AppShopper has been a very good service (in the past, at least, I haven't paid much attention lately), with a variety of uses. One of the key ones for me was, I had marked "I own/have this" on a bunch of apps, and was subscribed to the RSS feed for updates to things I'd marked... you know that situation where you find an app that's almost what you want, but it's got a glaring deficiency or bug, so you take it off your phone? Oftentimes, a few months later, AppShopper would pop up with news of an update to said app, showing that the bug/deficiency was fixed, leading me to go back to try that app again. There was no other good central way to track such things. It has had other uses as well - a lot of people would throw apps that seemed kind of interesting on their wishlist, then buy them if/when they were informed that the price had dropped.

AppShopper and TouchArcade are part of the same company as MacRumors, as well, if I understand correctly, which is part of the reason why MacRumors has always listed their links in stories (next to a direct link to iTunes). Ah, I just noticed that the "Links" section at the bottom of every MacRumors page has gone from listing recent items from TouchArcade & AppShopper to listing recent items from TouchArcade and the YouTube MacRumors channel, as of sometime very recent - a reasonable change, since the "news" section at AppShopper was never kept up, it was still reporting on the "new iPhone 6s" just recently (I kept meaning to suggest to them that they change it to show the new apps feed from AppShopper instead of the news feed).
 
OldSchoolMacGuy said:
If they weren't effective, they wouldn't have any reason to drop the rate. The reason you drop the commission rate is because you're paying out too much and need to increase your profits.
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Or, another very likely scenario, is Apple doesn't like the behavior of these ad-producers and wants to reduce the amount of ads, which lowering the commission rate does.
 
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I make $250/month from promoting my own apps (via various methods) using affiliate links. With the cut down to 2.5%, I'll now be making $85/month. So essentially a $2000 loss per year (basically a mortgage payment for me).

I'm a small developer with one partner. We've been on the App Store for years. Will we survive? Yes. But this hurts small shops like me... every dollar counts.

Considering how many billions of dollars you have in your bank accounts, this is lame Apple.
 
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macTW said:
Or, another very likely scenario, is Apple doesn't like the behavior of these ad-producers and wants to reduce the amount of ads, which lowering the commission rate does.
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If that was the case they'd just change the terms of the affiliate program to limit it in that way.
 
OldSchoolMacGuy said:
If they weren't effective, they wouldn't have any reason to drop the rate. The reason you drop the commission rate is because you're paying out too much and need to increase your profits.
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Not true. Advertising is ineffective when the sale would have been made anyway without the advertising. And even if the advertising results in net new sales, any money spent above and beyond the amount required to drive the sale is also a waste of money.

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ethanwa79 said:
I make $250/month from promoting my own apps (via various methods) using affiliate links. With the cut down to 2.5%, I'll now be making $85/month. So essentially a $2000 loss per year (basically a mortgage payment for me).

I'm a small developer with one partner. We've been on the App Store for years. Will we survive? Yes. But this hurts small shops like me... every dollar counts.

Considering how many billions of dollars you have in your bank accounts, this is lame Apple.
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How DARE a business make a decision to increase its own profit at the expense of others!!!
 
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What this MacRumors post doesn't speculate on and Apple's email declines to provide is a reason for this reduction.

My speculation for the reason is simple - Apple is going to reduce the commission percentage they take from apps sales from 30% to about 10%. They'll probably announce this during WWDC.
 
ethanwa79 said:
I make $250/month from promoting my own apps (via various methods) using affiliate links. With the cut down to 2.5%, I'll now be making $85/month. So essentially a $2000 loss per year (basically a mortgage payment for me).

I'm a small developer with one partner. We've been on the App Store for years. Will we survive? Yes. But this hurts small shops like me... every dollar counts.

Considering how many billions of dollars you have in your bank accounts, this is lame Apple.
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Tim is looking in every nook and cranny to realize savings. Didn't he recently tell some suppliers to lower component costs to Apple? When the Earnings Calls come around every Quarter, this nickel-and-diming pays off, especially when some other revenue stream is slightly off.
 
BeyondtheTech said:
Check out the latest post on TouchArcade. It's not good.
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Yeah they flat out admit they promote higher priced "premium" apps because they make more money on them.

Given the huge number of free to use apps and the huge revenue they bring apple this could be one factor.
 
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