Apple is exploring ways to increase App Store margins and generate more recurring revenue, with CEO John Ternus and services chief Eddy Cue reportedly driving the effort
Apple is reportedly considering changes to its App Store as the company looks for new ways to increase margins and generate additional recurring revenue from its software distribution platform.
According to Bloomberg’s Mark Gurman in his latest Power On newsletter, the initiative is being driven largely by Apple CEO John Ternus and Services chief Eddy Cue. The precise changes under consideration remain unclear, but the broader objective is to make the App Store more financially lucrative for Apple.
App Store Strategy Faces Developer Concerns
The reported push for higher revenue may also have contributed to the recent departure of longtime Apple executive Phil Schiller, who had continued overseeing the App Store after becoming an Apple Fellow in 2020.
Schiller reportedly opposed the direction, believing that further measures to extract revenue from the platform could create additional friction with developers and regulators. However, the reported disagreement did not result in an internal confrontation.
Apple already generates substantial revenue from the App Store through its developer commission structure and related services. Any significant changes could therefore have implications for both developers and consumers.
How Apple Could Increase App Store Revenue
There are several possible ways Apple could attempt to improve the platform’s margins, although these remain speculative.
One possibility would be greater automation of the App Store review process, potentially reducing the cost of manually reviewing applications. However, greater reliance on automated reviews could raise concerns among developers about accuracy and enforcement.
Apple could also increase its developer programme membership fee, currently priced at $99 per year. Another potential approach would be introducing additional charges for larger developers based on app traffic or infrastructure usage, allowing Apple to recover some of the costs associated with hosting and distributing applications.
For now, Apple has not publicly confirmed specific changes to the App Store. The company’s eventual strategy will likely need to balance its revenue ambitions with developer relationships and increasing regulatory scrutiny.