It was not a good morning for website and blog owners. In the mailbox, there was mail from Apple. Sent overnight, soberly formulated – but with great explosive power for participants in the affiliate program of the group. In the mail, Apple announces in just a few sentences that the affiliate program for the iOS and the macOS app store ends on September 30th. The commissions are canceled!
Apple’s “string concert” hits a section of the technology industry hard
Participants in this program – ie Apple and technology-related websites and blogs – received for years partly high commissions from Cupertino, if they spread app links using the Apple affiliate program, which led to the download of an app. For example, various sites financed their editorial work over the years with the revenue from app recommendations. Initially, Apple granted seven percent commission on the purchase of an app. Already about a year ago, the amount of the commission was reduced to 2.5 percent. Previously, there was already the complete out for app affiliate Provisons in the room, but it was not implemented.
That should have been a warning signal for those websites that had built their business model solely on the App Store revenue. But except a short groan in the blogs happened – nothing! Business as usual, even though monthly revenues have fallen from just those seven to just 2.5 percent.
A fallacy that the company just wanted to adjust the profit margin. It was the prelude to the total payment of commissions for iOS and macOS app downloads, which Apple announced in yesterday’s mail and implemented on September 30th. A move that will save the Group from paying thousands upon thousands of dollars, euros, and other national currencies worldwide. That fuels your own sales or profit.
Apple bites the hand that fed it
Surprised but inasmuch as Apple has just celebrated the tenth anniversary of the App Store with record numbers. Records that could not have been possible without creative developers and also the various websites and blogs that have adopted app themes and brought the store into the limelight over and over again.
For example, the decision from Cupertino now threatens the existence of only on Apps specialized known blogs and websites, even if Apple continues to pay commissions for the distribution of eBook links to the in-house bookstore, movie and series links or Apple Music link recommendations. The latter were even increased.
The renowned games portal touch Arcade, since 2008 at the start and known for detailed and thus elaborate game reviews of iOS and Mac apps, threw after a few minutes, almost the towel, because touch Arcade hangs on the drip of App Store commissions that Apple previously paid. Owner Eli Hodapp posted shortly after the arrival of the mail from Apple a separate article on the website. He has “no idea what we are doing now (…) I really did not think Apple would ultimately kill us.”
A massive charge. However, such a one-sided business model, such as Hodapp and touch ArcadeOn the other hand, relying solely on funding through app store commissions always harbored the risk of being dependent on Apple’s commissions goodwill. A risky business model, which went well for years – and now threatens to fail, because other financing options are not available or the creators seem creative ideas for alternative financing sometimes missing. An alternative would be two app versions: one with much (more) banners, one with a monthly / annual subscription model completely without ads.
Decision hits black sheep, but also honorable technology blogs
Apple itself justified the departure of lush commission payments on the one hand against website operators in the mail with the fact that with the “introduction of the new App stores on iOS and macOS and their extended methods for App finding” there is no need to pay affiliate commissions. With iOS 11, Apple had completely overhauled the iOS App Store. An editorial team now curates daily own contributions and puts app collections into focus.
On the other hand, there may be other, quite important reasons for the end of the affiliate commissions: Apple wants so-called link farms like AppShopper.com Forcing a lot of money with affiliate links over years and ultimately offering only a counter-app store with page-by-page app price changes without editorially offering added value in the form of news and background coverage or real tests.
Also in the sights of Apple: Free games that offered “credits” against a referral download from other apps on the App Store. And providers of sites that simply recommended as many apps as possible to collect as many commissions, regardless of the quality of the applications discussed.
So when it comes to cleaning up, it always hits some black sheep, but also honorable and independent technology blogs.
Good editorial content suffers, sponsored posts benefit
Could there have been a compromise? For example, Apple could have limited the amount of potential commissions. Also, an audit of where dubious app download clicks come from could have resulted in removing disreputable affiliate partners from the program.
Apple has opted for a different path. For financially ill-heeled but creative developers, that could be a problem, not just for website owners. After all, not everyone can afford to put an ad banner on the App Store. Often helped a press release about a nice new app idea to various blogs, who then presented the project and drove the downloads. But why should profit-driven bloggers now go through elaborate testing of apps where they do not see a penny in commission?
On the one hand, the editorial offer of independent websites could be severely restricted in the future in the app area, on the other hand so-called sponsored posts could boom, if financially weak app developers prefer to pay a small amount to a blog operator for a friendly reporting, than in the app store much more expensive banner ads in the App Store to book.
Advertising banners in the German App Store confuse users
Everything is related to everything on this day. If Apple can move more developers to buy app banners, the revenue, not the expenses (for commissions) will increase. Since 1 August these banner ads are also displayed in the German App Store, if a user makes the search.
An example: The user wants to find the app from Spotify. If he enters the term “Spotify” in the search, the app TuneIn Radio, which paid for this premium slot, appears today in the large upper part of the result field because the operators bought the banner with the tag Spotify.
The app store user has to look very carefully to realize that this is advertising. At first glance, the TuneIn ad looks just like the second search hit, aka Spotify. Difference: Apple underlines the banner ad with a very delicate light blue. And features the ad with the small tag “AD”. AD stands for Advertisement, German: Anzeige.
The premium advertising space is likely to treat especially larger developers, who have been equipped by their business angels with cash injections. The small developer, who only has a mini-promotion budget, will turn his Euros over several times before ordering such a banner.
He can now rely less on the blogger scene. Many bloggers should now orient themselves contentwise and set more affiliate links with major tech companies such as Saturn, MediaMarkt, Gravis, Cyberport and Co. Networks like AWin, Zanox and Affililnet continue to attract good commissions. But not with apps, rather with accessories for the big Apple cosmos.
Editor’s note: The author is the founder and owner of the Apple News app iTopnews.