Microsoft is stepping up its competition with Apple and plans to give developers who write software for Windows computers and devices a greater share of revenue sold through the company's upcoming Windows Store.
As long as the software, or app, has made at least US$25,000 in revenue, Microsoft plans to give developers an 80 percent cut. Apple now gives developers 70 percent of the revenue that apps bring in. If a Windows app hasn't reached the threshold yet, Microsoft will share 70 percent as well.
The bigger cut to successful developers is the latest sign that Microsoft is trying to compete with Apple - and with phones running Google's Android - on the app front by luring developers with financial incentives.
"We intend to offer the industry's best terms, so that the best apps make developers a lot more money on Windows than on any other platform," Ted Dworkin, partner program manager for the Windows Store, said in a blog post Tuesday.
The success of Apple's iPhones and iPads partly comes from the fact that its app store has a larger selection than any of its rivals. That means more games, entertainment guides and other apps available from outside developers to extend the functionality of the devices.
Through iTunes, Apple has also made it easy to buy and sell apps through its App Store, something other companies have been playing catch-up on.
Citi Investment Research analyst Walter H Pritchard said it's not surprising that the company is giving more lucrative financial terms for developers. That's because he doesn't consider Windows Store revenue as important for Microsoft, because the company's business focuses on the Windows platform itself.
In other words, Microsoft makes more money by getting people to buy devices running Windows software - even if it means sacrificing some of the app revenue to make that happen.
The Windows Store will be available on PCs, laptops and tablets running Windows 8. The company didn't disclose plans for mobile devices.
Microsoft, which is based in Redmond, Washington, plans to include apps in its Bing search engine results to make them easier to find.
It also plans to open the store to customers when it releases a "beta" test version of Windows 8 in late February. Pritchard said the February beta launch suggests a late October launch for the general market. Microsoft has not said when it's launching Windows 8 for everyone.
Microsoft's stock fell 26 cents, or 1 percent, to US$25.40 in late morning trading Wednesday.