Game developers around the world rely on the App Store and Google Play to get their games in front of valued audiences. This kind of exposure can come at a hefty price in the form of commission fees. After some pushback by the gaming industry, Google Play announced that they are reducing service fees starting this summer. Meanwhile, a new report revealed smartphone gaming grossed $64 billion in 2020. To learn more about mobile gaming, read on for this week’s Mobile Monday!
Google Play Revenue Cut Lowered to 15% on First $1 Million
In an effort to boost developers’ businesses, Google announced it will be slashing its commission on the Play Store for in-app digital products. An update on the Android blog said that the company would lower its revenue share to 15% for the first $1 million each developer makes every year. This new policy will be effective on July 1st and 99% of Google Play developers are expected to benefit from this 50% reduction in fees.
Google’s blog update also added that scaling an app didn’t stop at the $1 million mark. The tech giant stated, “we’ve heard from our partners making $2M, $5M and even $10M a year that their services are still on a path to self-sustaining orbit. This is why we are making this reduced fee on the first $1M of total revenue earned each year available to every Play developer, regardless of size.” Google is not the first company to make this commission change, as Apple made a similar decision in November 2020.
Gaming Industry is Expected to Earn $189.3 Billion This Year
Next Games‘ annual report revealed the global games market generated $159.3 billion in 2020, representing a 9.3% growth. According to the report, the biggest contributor was smartphones which grossed $63.6 billion last year, growing 16% year-over-year. Furthermore, tablets made $13.7 billion with a growth rate of 3%. Combined, mobile devices brought in $77.3 billion. The report indicated that spending in mobile games increased despite the decline in household income. The mobile games industry reached new heights and earned 77.2 billion in 2020, equivalent to a 13% growth from 2019.
Console games were the second top-grossing platform and made $45.2 billion. PC and browser games generated $33.9 billion and $3 billion, respectively, the latter decreasing 13% year-over-year. Next Games’ report also pointed out that socializing was the #2 reason people have spent more time playing games. Many brands are looking to enter the virtual experience of gaming. Gaming is expected to continue serving as a platform for virtual gatherings, fostering a needed sense of community.
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