Not long after Apple said Wednesday it would give app developers a sweeter revenue-share deal along with the news of forthcoming Search Ads in the U.S. App Store, reports
surfaced that Google would jump in and provide a similar revenue split.
Macquarie Securities Analyst Ben Schachter in a research note said Apple will change its app subscription model to reduce
its take from keeping 70% of all revenue generated from subscriptions. Publishers will be able to keep 85% once a subscriber has been paying for a year.
"We estimate 90%+ operating margin that will actually improve the experience for users while allowing app developers to highlight their apps," Schachter wrote in a note. "We are
surprised it has taken Apple this long to introduce app ads, but better late than never."
Schachter also notes that the announcement is another sign that Apple is becoming more serious
about its software and services opportunity, particularly around monetizing services.
The latest report estimates Google will move from a 70/30 split to a 85/15 split for subscriptions, making
the deal available immediately without asking the developer to wait a year. That's the catch.
One report cites sources that suggests Google has been testing the new split with some entertainment
companies, and running the new model more than a year ago with video services as a way to get Play subscriptions to work with its TV streaming offerings like the Cast dongle.