Apple has revealed a series of new regulations for its App Store in the European Union as it aims to comply with the Digital Markets Act, which seeks to challenge the market dominance of major tech companies.
As part of its efforts to adhere to the new EU rules, Apple will now allow third-party app stores and alternative payment options on iOS.
The key changes to Apple’s terms in the EU include reducing its commission from 30% to 17% – or 10% for some developers – on in-app purchases.
Publishers who wish to continue using Apple Pay will be required to pay an additional 3% fee. However, those who want to use an alternative payment method or link to an external website will pay no additional fee.
However, to take advantage of these new terms, Apple will add a ‘core technology fee, charging €0.50 for each first annual install per year over one million downloads for installs from the App Store and/or an alternative marketplace.
The fee is similar to Unity’s controversial Runtime Fee, which also charges for downloads rather than revenue share. Unity eventually altered its proposed terms, but did not remove the runtime fee, while CEO John Riccitiello departed the company within a month after the initial announcement following a backlash.
You can find a calculator that provides estimates for the new fees here.
If any publisher or developer does not want to adhere to these new business terms, they can continue to choose the existing revenue share deal.
The changes are set to take effect in March.
Apple doubles down on ‘privacy’
Apple has emphasized that it will still require reviews of all apps, regardless of their distribution channel, through its new ‘Notarization’ scheme. This will include a combination of automated checks and human review, with the stated goal of ensuring “platform integrity and protecting users”.
Apple insisted that privacy remains a key part of the iOS ecosystem and that app tracking transparency will “continue to work with apps distributed outside of the App Store – asking a user’s permission before a developer tracks their data across apps or websites”.
In addition to allowing developers to link to an alternative website, Apple said it would allow developers to inform EU users of promotions, discounts, and other deals available outside of their apps.
Alongside the new rules, Apple was keen to notify its users of the potential risks of “malware, fraud and scams, illicit and harmful content, and other privacy and security threats” from websites and stores outside of its own ecosystem.
Epic Games CEO Tim Sweeney has been a long-time critic of Apple and Google’s 30% fees. The U.S. Supreme Court recently declined to listen to an appeal from Apple in the U.S. over a long-running dispute between the two companies, maintaining a previous decision that Epic had “failed to prove the existence of substantially less restrictive alternatives” to Apple’s system.
However, it did allow developers to link to third-party web links, which Apple was quick to quash with a 27% fee for such transactions.
“Malicious compliance”
Taking to Twitter, Sweeney claimed Apple’s new rules were “a devious new instance of malicious compliance”.
He stated that the new rules could force developers to choose between App Store exclusivity and illegal store terms under the DMA, or accept a new anticompetitive scheme rife with new fees and taxes on payments they don’t process.
He also expressed that Epic Games Store, among others, is determined to enter the competition and become the number one multi-platform software store, based on payment competition, low fees, and exclusive games like Fortnite.
Epic has supported the notion of Apple notarization and malware scanning for apps, but rejects Apple’s twisting of the process to undermine competition and continue imposing taxes on transactions they’re not involved in.
Sweeney also highlighted other concerns with Apple’s announcement and hinted at further analysis of the written and unwritten parts of the new rules.
