As the public feud between Apple and mobile games developer Epic Games heats up, some might wonder why it’s such a big deal. After all, how big of a difference can a couple of percentage points in commissions/app store fees make in the grand scheme of things? Well, considering that mobile game revenue generated on Apple’s App Store alone amounted to $11.6 billion in the past quarter, the answer is: quite a difference.
As the following chart shows, mobile games have grown into a giant business in recent years, generating tens of billions a year, mostly through in-app purchases of virtual items and/or additional content. According to estimates from Sensor Tower, mobile game revenue on Apple’s App Store amounted to $42 billion in the 12 months ended June 30, 2020, with Google Play adding another $27 billion to the equation. Assuming Apple would give in and lower its commission from 30 to say 20 percent, that would take $4 billion in revenue from its flourishing services business.