Phil Schiller: Apple making major changes to the App Store

Not even six months after taking over the App Store, and just five days before the start of the Worldwide Developers Conference (WWDC), Apple’s Senior Vice President of Worldwide Marketing, Phil Schiller sat down on Tuesday to discuss some major changes coming to the App Store this year.

Schiller outlined three areas that his team has been working to improve:

  1. App Review
  2. Business Models
  3. App Discovery/Search Ads

App Review

If you talk to any developer, you will hear a variety of issues they have with the App Store. Some are very specific, while others have been affecting all developers. One of those issues, and one that Schiller’s team focused on, is app review.

App review ensures the products submitted by developers work properly and that they don’t contain any type of code that could adversely affect the consumer. It’s quality control, but it’s also Apple looking out for its customers. It’s an important step in the entire App Store process.

Typically, when a developer submits an app, it gets reviewed by the app review team. They make sure the app adheres to the guidelines that Apple set out for all apps. This process could take up to five days to complete. In the past month or so we’ve seen that time drop to just one day for a lot of apps.

It would be easy to just get rid of that step, but instead of doing that, Schiller’s team focused on why it took so long and fixed it.

“We’re never going to get rid of that [app review] because it matters,” said Schiller.

He said that Apple does about 100,000 app reviews per week and that they’ve developed new processes to make reviews faster, while maintaining the quality that Apple, and its customers, expect.

The end result is that Apple has a sustained rate of reviewing 50% of apps in 24 hours and 90% in 48 hours.

Business Models

In addition to app review, Apple looked at its subscription model and decided to open it up to all product categories. Until now, news apps and other publications were the only products that could really take advantage of the subscription-based business model on the App Store.

This will be a big move for companies that have multiple apps—instead of trying to get customers to subscribe to every app, they can offer a value subscription to all the content they offer.

“Having to subscribe to multiple apps can be very confusing for our customers,” said Eduardo Henrique, co-founder & head of global expansion at PlayKids. “This brings value to customers and it’s easier to communicate what we offer.”

When the new subscription platform is rolled out, Henrique said, “this is our top priority.”

There is more to the new subscription model than just having it across the product categories.

Currently the 70-30 revenue split for subscriptions is the same as regular purchased apps. However, under the new subscription rules, that revenue split will favor the developers more in the second year on individual subscriptions. Developers will get an 85-15 revenue share for all subscribers that have been customers for over a year. This will also affect all existing apps and subscribers, not just new apps.

Developers will be able to choose one of over 200 subscription price points, and they can create territory specific prices, making subscriptions even more flexible. If a developer chooses to increase the subscription price, customers will be notified and they will have to authorize that increase. No customer will ever be charged a higher rate without first authorizing it, explained Schiller.

Customers will also be able to upgrade, downgrade or even side grade subscriptions, if those options are available to them. Developers can also keep current subscriptions at one price, but charge new subscribers a different price.

The options for the new subscription model seem very well thought out.

App Discovery

App discovery is one of those areas that developers and customers have complained about for years. Finding apps is sometimes just a chore, but Apple has some ideas here too.

“We want our customers to have a reason to come to the App Store every day,” said Schiller.

The “Featured” section of the App Store will filter apps you already have installed on your device, so you are only looking at new apps. Apple is also bringing back the Categories tab for the store, allowing users to more easily browse through apps.

One of the ways many of us find apps is through personal recommendations. Apple will now have a Share sheet when you 3D Touch on an app on your home screen that will allow you to share the app on social networks, or with your family and friends. Developers can still use the sharing feature inside the apps, but this is another way for people to directly recommend an app they like.

The biggest change to this section of the App Store is that Apple will be accepting search ads from developers.

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Schiller said developers have contacted Apple in the past and offered to pay to be part of App Store Collections and other features of the store, but Apple turned them all down.

“Our store is not for sale—that’s not how we handle things,” said Schiller. “We are only going to do this if we can, first and foremost, respect the user and be fair to developers, especially small developers.”

There will only be one ad on the search results page and it will be clearly marked as an ad, according to Schiller. What’s more, the content of the ad will be exactly the same as the content of the app on the App Store. In other words, no spammy ads. Apple will only accept ads from developers in the App Store—they won’t have any third-party product ads in the store.

Schiller said the ads are done through an auction system for the developers. There are no minimums, and there will be no exclusives, so small developers can get in on the action as well. The ad system will roll out as a beta this summer and Apple will be watching to make sure the system is fair for all developers.

In keeping with its focus on privacy, Apple will not track users and will not share data about users ad clicks with developers. Developers will get reports, but no user data. Apple will also not serve ads to people 13 years old or under, if it can determine that from the device.

Developers will be able to sign-up for the search ad beta and there will be no charge to them during the beta period. When it does go live, after the beta period, it will launch in the U.S. first.

Major changes

These are some major changes from the App Store team—more than we’ve seen in years from Apple. It’s a good sign that Apple is focusing so much attention on making the App Store better for developers and customers. We’ll have to see how it all works out in the coming months, but a focus on making things relevant, fair, and easier to use should pay off for Apple, its developers and the customer.