Apple Accused of Not Doing Enough to Comply With South Korean App Store Law

[MacRumors]

Apple is not doing enough to comply with South Korean legislation that forbids app store operators from forcing developers to use their payment systems, according to lawmaker Jo Seoung-lae, Reuters reports.

Via an amendment to the Telecommunication Business Act, South Korea is the first country endeavouring to stop developers from being forced to use a single payment system offered by app store operators. The law came into effect in September, but the exact details of what companies need to do to comply with it had not yet been fully drafted.

This month, Apple reportedly told the South Korean government that it was already complying with the new law and did not need to change its App Store policies. Jo Seoung-lae, the lawmaker who spearheaded the amendment, told Reuters:

Frankly, we are not satisfied... Apple's claim that it's already complying is nonsensical. Excessive fees take away developers' chances for innovation ... parliament is to be closely informed as the government drafts detailed regulations to make sure there is accountability.

It is as yet unclear how platform operators will be sanctioned if the regulations are breached, but according to a draft seen by Reuters, it could involve fines of up to two percent of revenue.

The initial details of what Apple will need to do to meet its new obligations in South Korea are expected to be made public by the Korea Communications Commission (KCC) tomorrow, ahead of them coming into full effect by March 2022.

In an interview at the Global Conference for Mobile Application Ecosystem Fairness in Seoul today, Epic Games CEO Tim Sweeney renewed his ongoing attack on Apple and called for a single, universal app store.

Elsewhere, Law Street reports that an antitrust lawsuit has been filed against Apple in Northern District of California, accusing the company of charging supracompetitive prices on the App Store.

Article Link: Apple Accused of Not Doing Enough to Comply With South Korean App Store Law

 

[neuropsychguy]

"Excessive fees take away developers' chances for innovation"

Let's flip this argument around. "Removing [Apple's] fees takes away Apple's chances for innovation". It's somehow better for companies/app developers to freeload with Apple?

Edit: I know there’s a modest developer’s fee but that doesn’t cover all the costs of running the App Store.

 

[Hammerd]

Yes they’re braking as possible.
They will comply with CCP but won’t follow the law passed by South korea’s democracy.. it’s all about money again. They are arm wrestling with countries now

 

[Supermacguy]

Appeals of laws and their interpretations are nothing new. And as a dev, I can see how maybe the change to do this is not "quick and easy" nor well tested. As a dev, I would hate having a deadline to make major changes to one of the largest revenue systems in my company within a month.

 

[Mockletoy]

This reminds me of a time when I was a kid. My mom told me I couldn’t go do whatever I wanted to do until I cleaned my room.

So, I “cleaned” it, told her it was done, and took off.

Turns out, not only was her definition of clean different from mine, but it was also the only one that mattered.

Apple is in much the same situation here, and will end up with the same outcome.

 

[syklee26]

Just comply with law.

 

[visualseed]

That statement gives Apple a lot of ammunition to fight this. Even Google’s ”accepted” implementation did not absolve developers of paying fees. I’m not sure how S. Korean courts would look at this, but in the US this law my not pass the three levels of scrutiny as the government’s stated interests are not reflected in the language of the law. But it’s not a US law so we will see how it plays out.

As I have said before, rightly or wrongly, Apple has decided they already comply and are calling their bluff. So it’s popcorn time.

 

[GMShadow]

To the folks saying Apple just needs to comply…

The law came into effect in September, but the exact details of what companies need to do to comply with it had not yet been fully drafted.

Maybe South Korea could get their act together and tell Apple exactly what they’re supposed to be doing?

 

[BvizioN]

Yep. Developers want a free ride. They even complain when Apple advertises their apps.... for free.

 

[Mockletoy]

Just comply with law.

I sure wish Apple would put as much resistance into complying with the Chinese Communist Party’s and other regimes’ censorship, surveillance, and human rights abuses as they have been willing to put into defending their profits.

 

[BootsWalking]

Even the Big-Brother oppressor in Apple's 1984 commercial let third-party developers use their own payment system. ?

 

[Mockletoy]

Yep. Developers want a free ride. They even complain when Apple advertises their apps.... for free.

Think of just the bandwidth costs of distributing something the size of Fortnite, with all its updates.

How does Epic imagine all that gets paid for? I mean, I get not wanting to give up a huge chunk of your profits, and maybe they could argue that Apple charges too much, but Sweeney thinking he should get a storefront and distribution and customer service totally free is super sleazy.

 

[Marius123]

population of 50 mln, they probably can’t just pack up and leave

 

[NotTooLate]

I am not surprised other countries are trying to put some shackles on the US big tech , it does them no good to have a powerful Apple when in this case they much rather have a strong Samsung , the question here would be if the us government will try and defend its companies interest in the those countries , example , Korea will now ask for additional 30% import tax on Apple devices , this will lower Apple sales for other brands , in this scenario the US government will need to intervene to protect its company and ask for similar tax on Korean goods.
Let’s see how the politics play out.

 

[svish]

Legal hurdles for Apple is never ending

 

[I7guy]

We'll see how this all plays out. Apple doesn't spend billions in legal fees for nothing.

 

[Mockletoy]

Yes they’re braking as possible.
They will comply with CCP but won’t follow the law passed by South korea’s democracy.. it’s all about money again. They are arm wrestling with countries now

The reactions of Apple’s most faithful devotees never cease to amuse.

Whenever a new story comes out about Apple meekly complying with oppressive laws and censorship requirements in places like China:

“Apple has to comply with local laws! There’s nothing they can do! Stop blaming them!”

Whenever Apple’s profits are on the line in a thriving democracy:

“Fight this stupid law! Disobey! Do whatever it takes! Just stop doing business there, that’ll teach ‘em!”

I find that … fascinating.

 

[canadianreader]

Just comply with law.

South Korea doesn't scare Tim Apple, China does.

 

[Havoc035]

Just comply with law.

Apple's definition of compliance is different than this lawmaker's. While I'm no expert on Korean law or this legislation, from what I've read the phrasing leaves some wiggle room for Apple to argue about what compliance means. It will be interesting to see if this goes to court.

 

[Marius123]

if the law “prohibits app distribution platforms from forcing developers to use their payment method alone” then isn’t Apple in the clear, as they claim? I mean, app devs can use their own payment methods outside the App Store. No one is forcing them to use Apple’s. They can even get a free ride by making the app free in the app store and still charge for it on their own websites

 

[metapunk2077fail]

Take away or cut App Store fees very hard means they would have to charge more for the developer's program, charge for Xcode and charge for macOS/iOS/iPadOS updates. Like the 90s again when we paid for IDEs and OSes.

If they took profits from hardware only and used it for software development it would mean less profit on their products.

The current model works better. It will become cheaper over time anyway. They already cut the cost for small timers.

 

[thejadedmonkey]

"Excessive fees take away developers' chances for innovation"

Let's flip this argument around. "Removing [Apple's] fees takes away Apple's chances for innovation". It's somehow better for companies/app developers to freeload with Apple?

Maybe Apple should have thought of that before becoming so greedy that the government literally had to step in and regulate them.

 

[Mockletoy]

So...

Take away App Store fees means they would have to charge more for the developer's program, charge for Xcode and charge for macOS.

Basically the 90s again.

Or they could just stop giving them a free ride altogether, and stop hosting their apps and providing bandwidth and distribution services and customer service for them.

Why, Apple could wash their hands of these greedy developers entirely, and let them set up their own competing App Store if they think they’re so smart and want to do things their way —

— oh, wait. Never mind.

 

[neuropsychguy]

Maybe Apple should have thought of that before becoming so greedy that the government literally had to step in and regulate them.

What level of profit would no longer count as greedy? What fee structure would also not count as greedy?

First, what is Apple's gross profit margin on the App Store? Second, what is Apple's net profit margin on the App Store? What profit margin (gross and net) is appropriate? Why is that level appropriate? If Apple has a lower App Store profit margin, is it acceptable to raise margins elsewhere to make up for it? If not, why? What company-wide profit margin (gross and net) is appropriate (i.e., no longer "greedy")?

Should Apple take a different approach to the App Store? Should they offer it as a free public service and receive no compensation? Should they increase developer fees instead of having a 15-30% commission (or no commission for free apps)? Does Apple charging a commission mean Apple is greedy but companies developing apps that want to use Apple's services without paying mean they are not greedy?

Complaints don’t help if you don't also at least provide a possible solution. What is one of your proposed solutions? It doesn't have to be ideal or perfect but I'm interested in what you think is a non-greedy and fair solution for all parties. If you think something is bad or unfair, that's fine but also state what can be done to make it better.

None of what I wrote is a defense of Apple. What I hope is people will stop offering terse "Apple bad" type of responses and instead offer suggestions for improvement.

 

[Force332]

"Apple is not doing enough to comply with South Korean legislation that forbids app store operators from forcing developers to use their payment systems, according to lawmaker Jo Seoung-lae, Reuters reports."

Also,

"The law came into effect in September, but the exact details of what companies need to do to comply with it had not yet been fully drafted."

How can you claim someone is not complying if you haven't even established what they need to do to comply? Surely I must be missing something here. I mean, I personally have concerns with some of Apple's App Store practices but doing stuff like this doesn't help your case against them either.