Subscription, not one time fee, will be the new model for all paid apps in the App Store

Apple’s WWDC event kicks off on Monday, but App Store head Phil Schiller is already sharing some major changes coming to the App Store that will impact developers. The news comes just six months after Schiller added additional App Store responsibilities to his role.

The SVP of Worldwide Marketing shared the news in an interview with The Verge just before Apple announced the details. One controversial change includes ad placement in App Store search results, which was rumored earlier this year:

Apple is also going to start showing search ads for apps in its iOS App Store search results for the first time, something the company had previously resisted. “We’ve thought about how to carefully do it in a way that, first and foremost, customers will be happy with,” Schiller says, adding that he believes the ad auction system in App Store search will be “fair to developers, and fair for indie developers, too.”

Another change that we’ve already seen previewed on Apple TV is how installed Featured apps appear. When you install a featured app, it will no longer be promoted by the App Store.

3D Touch-enabled iPhones (currently iPhone 6s and 6s Plus) will be able to access a new option for sharing App Store apps with others from the Home screen as well.

Perhaps most positive for developers is a change to the revenue sharing model. Currently, subscription revenue is shared 70-30 between developers and Apple. Subscription based apps will see that model change to 85-15 for a customer subscription active for at least one year.

For the first year of a subscription Apple will maintain its 70 / 30 revenue share; after one year, the new 85 percent / 15 percent revenue share will kick in (applied per subscriber). The new app subscription model will roll out to developers this fall, though if app makers have subscribers they’ve already retained for a year, the new revenue split starts June 13th.
Schiller also discussed the faster app review process developers have noticed, and highlighted that app review won’t go away. Using the current model, Schiller said half of all submissions are approved in 24 hours and 90% are approved in 48 hours.

Apple has a news post detailing some of the upcoming changes as well:

We’re introducing exciting new capabilities and tools designed to help grow your app’s business and engage with new and existing customers on the App Store.

Search Ads Search Ads is an efficient and easy way for you to promote your app directly within the U.S. App Store search results, helping customers discover or reengage with your app, while respecting their privacy. Starting this summer, you’ll be able to participate in the Search Ads beta and see the ads in action. Learn more about Search Ads.

Subscription Enhancements We’re opening auto-renewable subscriptions to all app categories including games, increasing developer revenue for eligible subscriptions after one year, providing greater pricing flexibility, and more. Learn about what’s new in subscriptions.