Alphabet (GOOGL) - Get Report shares rose Tuesday after the tech giant’s Google unit announced it’s slashing the percentage of revenue it takes from app sellers on its Google Play store to 30% from 15%.
The reduction applies to the first $1 million in revenue earned each year by Google Play developers. It will take effect on July 1, and matches a similar move announced last year by Apple when it cut the fee it takes from developers on its App Store from 30% to 15% for those making less than $1 million.
As for Google, the saved funds “can help developers scale up at a critical phase of their growth by hiring more engineers, adding to their marketing staff, increasing server capacity, and more,” Sameer Samat, vice president of product management for Google, said in a statement.
“While these investments are most critical when developers are in the earlier stages of growth, scaling an app doesn’t stop once a partner has reached $1 million in revenue. … This is why we are making this reduced fee on the first $1 million of total revenue earned each year available to every Play developer, regardless of size,” Samat added.
Google and Apple have faced criticism from developers over their fees and their unwillingness to allow companies to bypass their in-app payment systems.
Alphabet shares recently traded at $2,084.42, up 1.46%.
In other Alphabet and Apple news, TheStreet.com founder Jim Cramer said March 4 that he was looking at them as possible buys amid the tech stock correction.
Last month, Loop Capital Markets upgraded Alphabet to buy from hold and lifted its price target by a third to $2,525 from $1,895.
Alphabet had blowout earnings for the fourth quarter.