Ahead of the Google I/O developer conference next week, Google announced Friday it is lowering the fees for apps accessing its API from $4 per 1,000 map loads to $0.50 per 1,000 map loads. After years of offering free access, Google imposed fees and restrictions on third-party apps using Google Maps in October 2011. But with big news looming for app developers next week, Google has begun to loosen up around maps and hint at imminent updates.

Google is also eliminating a distinction between styled maps and maps that use Google’s default style. Previously, apps using maps with a customized appearance were subject to fees after 2,500 daily map loads, while un-styled maps could have 25,000 loads for free. Now all apps accessing the Google Maps API will get 25,000 loads.

Apps must exceed the limits every day for 90 consecutive days to be subject to fees.

Google has also decided to begin monitoring usage of the Maps API as of Friday. According to product manager Thor Mitchell, only 0.35% of sites accessing the Maps API will exceed the limits based on current usage. Google is not automating the application of the limits. Rather, it’s manually contacting developers of apps when they cross the threshold.

“Please rest assured that your map will not stop working due to a sudden surge in popularity,” Mitchell says.

Chilling Effects for Big Developers

Apps that use fewer than 25,000 app loads per day aren’t subject to fees. Neither are apps developed by nonprofit organizations or “deemed by Google to be in the public interest.” Nonprofits with high traffic that want additional, enterprise-level capabilities can also apply for grants to pay for a license through the Google Earth Outreach program.

But the fees and limitations on the API for commercial, high-traffic sites – at least at the previous rate of $4 per 1,000 map loads – had a chilling effect on the developer ecosystem.

Since Google imposed the fees last October, major map-driven applications, including Foursquare and the mobile apps from Wikipedia, decided to abandon Google for open-source solutions built on OpenStreetMap.

Google’s Wariness of Apple’s Maps

Lately, an even bigger developer has ditched Google Maps, although the dynamics are quite different. The terms aren’t disclosed, but Google pays Apple to use its services as the defaults in its operating system. Google has provided maps to Apple’s iOS since the beginning. But due to the increasing friction from Google’s ad-driven business models, Apple has decided to push Google out of core iOS services, starting with maps.

At its Worldwide Developers Conference on June 11, Apple unveiled all-new, in-house maps with 3D views, turn-by-turn directions and automated flyovers of some of the world’s great cities. And it was all presented with developers in mind; while Google provides transit and biking directions within the Google Maps service, Apple provides APIs for them and positions them as business opportunities for app developers.

In anticipation of Apple’s maps move, Google held a press event on June 6 to demonstrate upcoming capabilities of Google Maps. They were the same kinds of 3D features and interface improvements that Apple would show the following week. It was a defensive move. Google has dominated mobile mapping thus far, but Apple has threatened its dominance by using new maps to entice developers to its already more lucrative platform.

Friday’s changes to the Google Maps API fees and restrictions are just a prelude to more maps news for developers at the upcoming Google I/O. A Google spokesperson tells ReadWriteWeb to “keep an eye out for more Maps API updates at Google I/O next week.”