Report from TechCrunch
In Brief – Apple has unveiled a new lower-fee commission structure for apps in the EU in a bid to resolve its dispute with the European Commission over compliance with the Digital Markets Act. Apple’s top in-app purchase commission will be 26%, down from 30%, although many developers will continue to qualify for a 15% rate through programs including the Small Business Program. Apps downloaded from Apple’s App Store that use non-Apple payment processing will pay 20%, or 10% for qualifying developers. The iPhone giant will abandon its proposed per-install Core Technology Fee on apps downloaded from alternative app stores or the web and instead charge them a flat 5% commission on digital goods sold. Apple also eased requirements for developers seeking to operate alternative app stores. External purchase links will remain restricted in Kids-category apps, while users under 18 will require parental approval for purchases outside the App Store.
Context – Ever since Epic Games launched its antitrust lawsuits against Apple and Google that technically alleged monopolies over in-app payments, we’ve said the issue was simply fees. Big app developers want to pay Apple and Google less. It’s been six years, but the numbers that might resolve the disputes are coming into focus. Google lost their US antitrust trial despite always allowing app downloads outside their Play Store. They are now rolling out a lower fee regime, with apps downloaded from their Play Store paying 20%, rather than 30%, and recurring subscriptions paying 10%, rather than 15%. Using Google Play Billing brings an additional 5%, so a top fee of 25%. Google is also easing the rules around alternative app stores. Although Apple prevailed over Epic on their federal antitrust complaints, they lost on a single charge under California’s Unfair Competition law. Judge Yvonne Gonzalez Rogers required Apple allow non-Apple payments. Apple proposed they pay 27%, a move the judge flatly rejected, imposing a contempt order that prohibited any fees on developers using non-Apple payments. The US Supreme Court has taken up Apple’s appeal. Regulators continue on in Japan, South Korea, India and elsewhere.