Apple Loosens App Store External Linking Rules and Changes Fee Structure in European Union

[ProbablyDylan]

I find it har to believe the EU can't si down and review a proposal and identify what passes muster and what doesn't so a company has some certainty it is compliant. Any similarly situated company would have he ability to do the same thing so it isn't a special deal but rather adding some certainty to the process. If the outcome turns out to be bad some things may change but then it's not a fiable offense since the company is making good faith efforts to comply.

There's a provision in the DMA for exactly this. A gatekeeper could request consultation to ensure their compliance plans are acceptable before implementing them.

It's hard to feel bad for Apple when they don't take advantage of help that is offered.

 

[webkit]

You're conflating the cost to an OEM vs an end user. Windows was over $100 as a boxed product, OS/2 was nearly $200. Apple was pretty unique in the ][ era and early Mac with free updates as the software developed, then had a period where they charged such as Snow Leopard for $29 before going back to the old model. Windows has since moved to more of a free upgrade model.

The comment I had replied to stated, "operating systems used to cost hundreds of dollars to properly compensate the OS developers for all of that work and maintenance and support."

I assume "OS developers" was referring to Microsoft (with Windows), Apple (with macOS), etc. Since most operating systems have been sold with a device, I was saying that Microsoft typically sold Windows licenses for far less than "hundreds of dollars" (OEM licenses were under $100, even under $50) and therefore weren't typically being compensated hundreds of dollars as was claimed.

 

[Sophisticatednut]

I find it har to believe the EU can't si down and review a proposal and identify what passes muster and what doesn't so a company has some certainty it is compliant. Any similarly situated company would have he ability to do the same thing so it isn't a special deal but rather adding some certainty to the process. If the outcome turns out to be bad some things may change but then it's not a fiable offense since the company is making good faith efforts to comply.

Well it is, they do reach out and talk about changes you need to do if the legal case should not go forward, but the moment it’s started then it’s too late and the legal process will run its course irrespective if you are willing to compromise afterwards (Google felt this hard) only after the EU found against Google in the search anti-trust case in 2017 did Google attempt to settle on the issues of the Android anti-trust issues, which was far too late after the EU filed the initial charges against Google.

Compared to the U.S. adversarial system where the judge is a neutral arbiter of the case and the lawyers are the ones who are very active.

EU Commission Procedure:

1. Preliminary Assessment: The Commission conducts an initial assessment based on its own investigations or complaints from citizens or businesses.
2. Formal Investigation: If there’s a suspected violation, a formal investigation is launched, and the company may be asked to provide information.
3. Statement of Objections: The Commission sends a Statement of Objections to the company, detailing the alleged violations.
4. Company’s Response: The company can respond in writing and request an oral hearing to present its defense.
5. Commission’s Decision: After reviewing the company’s defense, the Commission decides whether EU law has been violated and may impose fines.
6. Judicial Review: The company can appeal the decision to the General Court, which reviews the legality of the Commission’s decision

The General Court’s ruling process involves:

1. Written Phase: The parties submit written observations to the Court.
2. Oral Phase: A public hearing may be held where lawyers present their case, and judges may ask questions.
3. Deliberation: The judges deliberate based on the evidence and arguments presented5.
4. Judgment: The Court issues its judgment, which can be appealed to the Court of Justice of the European Union.

I am not sure how objective outcomes will be determined.

Mathematical formulas and standard hypothetical scenarios.

What if store custs don't go down or developers pay more in the end for alt stores? Is that Apple's fault?
What if most developers chose to stick with Apple and alt stores don't gain traction? Is that Apple's fault?
If Epic doesn't lower its price after getting away from Apple's "tax" is that a failure of the DMA?


Objective criteria are hard to find.

None would be of relevance. The only thing that could be investigated is if any anti competitive activities and behavior was done, but if it’s the natural outcome of a free market that competes on merits then that’s the end of it.

The price could go up 1.000% and it wouldn’t matter as it’s unrelated to the goal of the DMA. As long as the fees from Apple can be zero or optional.

This is a regulation targeting the effect before it’s been caused.

Yea, you can pay 299/year for an enterprise certificate or 99 for a developer one with some limitations, but that kinda cuts into the financial gain; or get an app from some who is using it to violate Apple's agreement.

I can also pay 5-10$ for it( something I have done) so I can side load apps.

My point is sideloading enables the loading of signed and unsigned apps it could have a negative effect on developers if more piracy results.

That’s a likely scenario, but unfortunately unrelated for the freedom of the market.

IMHO, the low prices for many games and apps may actually drive piracy if it becomes easy to just load an IPA without playing certificate games; .i.e. "the app only cost a few Euros so my pirating it isn't costing the developer much" could very well be teh rational people used. Of course, there will always be the old standby f since I would not have bough it it isn't wrong to pirate it since the developer wasn't getting my money anyway.

Well I think lower prices will drive piracy away as the most common type of piracy is the one committed by those who wouldn’t purchase it in the first place.

If they can implement as good of a return policy as Steam then people can securely purchase something and return it if it’s not up to expectations.

A 30$ game is more risky than a 10$ game.

There a reason why I do games are so popular on steam.

I think they should, or some variant, and then charge for its use if a developer wanted it.

Well I think they should do it for free as per of the system. Sometimes you just have to sell an attractive service that isn’t hamfisted.

A bad thing is the fact that the DRM is practically never updated once it’s breached

 

[surferfb]

Um nope.

Why Amazon got out of the Apple App Store tax, and why other developers won’t

It’s leverage. The reason is leverage.

www.theverge.com

Was genuinely not aware of this. Thanks for sharing; I was wrong about that and retract my statement.

 

[Sophisticatednut]

Was genuinely not aware of this. Thanks for sharing; I was wrong about that and retract my statement.

Now you understand the conundrum Apple have put themselves in when it comes to EU and the DMA

 

[AppliedMicro]

ON ANY of these platforms you need to pay money to develop and publish any form of software:

1. You need to buy a computer with a license for the OS. MacOS and Linux are free here. Windows still costs a lot of money.
2. You need to pay for the software you use to develop the app(s). Visual Studio, IntelliJ, etc. XCode is free.
3. You need to pay for the digital signatures for the software. For Windows you'll need EV code signatures. Costing around $ 500 / year. On Mac / iOS you pay Apple $ 100 / year.
4. You need to pay for the hosting of the software files. Depending on the size and data usage of your app, this goes into thousands of dollars per year. Hosted in the App Store? CTF = €0,50 after 1.000.000 first installs.
5. You need to pay for listing in any/all (App) Stores. Most of them are 30% or more. Apple is 15% (up till $1000.000 in revenue).

Development costs money. But hardware prices, IDE / development tools and web hosting are competitive markets. And App Stores aren't necessary when you can distribute yourself. They are, at least on Windows, Linux and macOS, again subject to competition.

And that's what the law is trying to achieve: Make app distribution become a competitive market and let prices be determined by competition.

Also no one else taxes competitors as a percentage of revenue. Microsoft doesn't, and neither do mainstream Linux distributions. Not even Android, I believe.

Then it would be quite impossible to release a free app on the iPhone

So what?! 🤷‍♀️

What would be the problem with that? Developers simply would have to charge for their apps - even for apps that have been free until now.

Hurting smaller developers more than bigger developers.

You're forgetting one, the biggest player that may be hurt: Apple themselves!

Once hitherto "free" apps all cost a subscription, consumers are going factor it into their overall purchasing decisions on smartphones. So will I. And so will the media receive and report on Apple's pricing and fee structure. I guarantee you that Apple is going to bleed customers defecting to other smartphone brands.

👉 At this point we will finally have arrived at a much fairer and equitable state of the market:

The vast number of free apps is a big part of what made and makes Apple devices so popular - and what made smartphone operating systems and mobile application stores duopoly markets. And Apple won't be able to leverage the platform popularity gained from "free" apps against providers of digital content/services to take them hostage and tax them - just because they can't reasonably leave and offer their service as a web app.

 

[surferfb]

Now you understand the conundrum Apple have put themselves in when it comes to EU and the DMA

Still don't think Apple is put themselves in a conundrum, and still think it's a terrible law that is terrible for normal users and will set the EU back technologically, just not going to argue that that Apple wants a cut of any on-device purchase of ALL digital goods or services.

I expect what happens is the developer fee goes up astronomically, with cost based on prior year app sales and/or size of the developer. All of you will scream malicious compliance again, because you actually want Apple to give away their property for free.

 

[surferfb]

I guarantee you that Apple is going to bleed customers defecting to other smartphone brands.

👉 At this point we will finally have arrived at a much fairer and equitable state of the market:

The vast number of free apps is a big part of what made and makes Apple devices so popular - and what made smartphone operating systems and mobile application stores duopoly markets. And Apple won't be able to leverage the platform popularity gained from "free" apps against providers of digital content/services to take them hostage and tax them - just because they can't reasonably leave and offer their service as a web app.

How small does Apple have to get in the EU before you think things are fair? Serious question.

 

[AppliedMicro]

Again, it is clear here that the vocal EU defenders on here want Apple to give up its intellectual property for free, or close to it

No.

They're free to charge for

• hardware devices
• operating system updates/functionality
• App Store downloads
• in-app purchases made through them
• developer tools

All I'd be asking - and the DMA isn't asking for anything very different - is that they

• charge and treat developers and apps equitably and fairly (they don't) and that includes that
• charge the same for digital and physical goods/services
• aren't a monopoly for app downloads or purchases of digital goods/services
• that their ability to enforce commissions/charges is limited to when the third-party product has been delivered.

Apple is entitled to nothing from developers for developing iOS, creating the APIs they use, maintaining the OS, fixing bugs, developing the features that developers use. Apple should do that for free because they make enough money selling hardware.

No. They can sell iOS and functionality upgrades.
I have little problem with that.
Customers will factor it into their hardware purchasing decisions.

Every app THAT CHARGES A FEE OR HAS A SUBSCRIPTION FOR DIGITAL GOODS has to pay.

NOT EVERY APP that sells something sells DIGITAL goods.

And there's no reason why a digital music download should be subject to a different commission than the sale of of music CD in Safari or in-app.

Apple is perfectly within its rights to say "if an app is free, it doesn't have to pay IP licensing costs."

But they aren't free to leverage all the free apps that made them a duopoly in the smartphone OS market to take hostage developers of other apps.

To give another example, just because a lawyer occasionally provides pro bono services, that doesn't mean they're not allowed to charge other clients for the same services.

The market for lawyers isn't a monopoly or duopoly.

If there were as many operating systems or application software stores in any given market as there are lawyers, I would strongly advocate the EU to bloody stop regulating Apple and Google.

 

[AppliedMicro]

So any store that acts as an intermediary does not deserve to charge for their services? A third party store will charge developers as well. Steam gets 30%, is that unreasonable?

Any store that is a monopoly or duopoly intermediary in a market sufficiently large and important for the greater economy does not deserve to charge at will. They deserve to be regulated - and in many other markets they are.

And now the EU is trying to make Apple give that away for free, despite Apple only having ~25% of the market in the EU (i.e. not a dominant player - influential yes, dominant, no).

They're estimated to command more than 50% of all mobile app spending.
Also, they've been found dominant when being fined by the EU.

How small does Apple have to get in the EU before you think things are fair? Serious question.

It's not about Apple's size at all.
It's about the number of market participants and competition between them for purchases on hand-held computing devices. And about fair and equitable pricing models and competition existing for them.

 

[surferfb]

It's not about Apple's size at all.

You literally typed, and I quote:

I guarantee you that Apple is going to bleed customers defecting to other smartphone brands.
👉 At this point we will finally have arrived at a much fairer and equitable state of the market:"

So how many customers does Apple have to bleed until the market is fair?

 

[AppliedMicro]

So how many customers does Apple have to bleed until the market is fair?

Up to them.

They should set their pricing according to what they're comfortably with and what they believe customers will be comfortable with.

Could be low or zero. It does take acknowledging that third-party apps are what make Apple sell iPhones.
It's a two-way street: Apple are just as dependent on third-party apps (as a whole) than their developers are on Apple.

What Apple does is leverage the breadth and popularity of free third-party apps (and, ultimately, Apple's platform) against developers selling paid apps and/or digital goods/services that can't sell provide their content otherwise.

 

[Sophisticatednut]

How small does Apple have to get in the EU before you think things are fair? Serious question.

Hmm if app fails to meet this criteria:

• The undertaking Apple generates EU revenues of at least €7.5bn in each of the last three financial years, or had an average market capitalisation of at least €75bn in the last financial year, and the undertaking provides the same core platform service in at least three Member States.
• Apple In each of the last three financial years, the undertaking provides a core platform service with at least 45m EU monthly active end users in the last financial year, and at least 10,000 yearly active EU business users.
• The undertaking Apple meet the second criteria in each of the last three financial years.

 

[Sophisticatednut]

Still don't think Apple is put themselves in a conundrum, and still think it's a terrible law that is terrible for normal users and will set the EU back technologically, just not going to argue that that Apple wants a cut of any on-device purchase of ALL digital goods or services.

Well Apple have the legal obligation to not discriminate against other companies because they have a dominant position( this isn’t a monopoly and a very different legal concept )

I expect what happens is the developer fee goes up astronomically, with cost based on prior year app sales and/or size of the developer. All of you will scream malicious compliance again, because you actually want Apple to give away their property for free.

Well if Apple wants to increase the developer fee then so be it.

As long as developers can publish their apps on appDB without having to pay Apple anything and not need to use Xcode or Apple services

 

[The Phazer]

This is absolutely embarrassing. Apple really don't give a **** about the user experience as long as they can rent seek.

 

[Infinity Vortex]

If you have been following the news for at least the last half decade, you should have noticed that hardware sales' contribution diminishes year by year and services increase...
Explain to me otherwise why Apple has gotten into the f€%##ing film business...

Have you been following the news?

https://forums.macrumors.com/threads/apple-reports-3q-2024-results-21-4b-profit-on-85-8b-revenue.2432709/

Even today iPhone alone makes up almost half of Apple’s revenue. Hardware as a whole makes up almost 3/4 of their revenue. And few people take advantage of Apple’s services without owning Apple hardware. I absolutely stand by my statement, the iPhone has made Apple what they are today.

 

[Sophisticatednut]

Have you been following the news?

https://forums.macrumors.com/threads/apple-reports-3q-2024-results-21-4b-profit-on-85-8b-revenue.2432709/

Even today iPhone alone makes up almost half of Apple’s revenue. Hardware as a whole makes up almost 3/4 of their revenue. And few people take advantage of Apple’s services without owning Apple hardware. I absolutely stand by my statement, the iPhone has made Apple what they are today.

Well looking back with 3 years increment we can see the services have steadily grown more and more prominent and important for their growth.

Services is essentially half the revenue of the iPhone….

 

[surferfb]

This is absolutely embarrassing. Apple really don't give a **** about the user experience as long as they can rent seek.

I’d argue that multiple app stores, allowing apps to link out to Hoover up your personal information, required pop ups to choose who provides core OS features, etc. make for a much worse user experience than the current “use the App Store for everything and if you don’t like it, buy an android” method.

 

[ProbablyDylan]

I’d argue that multiple app stores, allowing apps to link out to Hoover up your personal information, required pop ups to choose who provides core OS features, etc. make for a much worse user experience than the current “use the App Store for everything and if you don’t like it, buy an android” method.

Wouldn't a separate app store solve a lot of those problems, actually? Apple could enforce all their strict rules about linking out, annoying popups, and privacy requirements if developers had somewhere else to peddle all of the junk they wanted to make with those features. Give the trash the option to take itself out.

Then Apple could parade their store as the bastion of privacy, security, and customer satisfaction. Like the Williams-Sonoma of software or something. Apple would still come out on top by a wide margin, due to the fact that it's what the phone comes with and what people are used to.

 

[surferfb]

Wouldn't a separate app store solve a lot of those problems, actually? Apple could enforce all their strict rules about linking out, annoying popups, and privacy requirements if developers had somewhere else to peddle all of the junk they wanted to make with those features. Give the trash the option to take itself out.

Then Apple could parade their store as the bastion of privacy, security, and customer satisfaction. Like the Williams-Sonoma of software or something. Apple would still come out on top by a wide margin, due to the fact that it's what the phone comes with and what people are used to.

Agreed! I know it probably doesn’t seem like it based on my posts, but I actually wish Apple would open up on their own accord. They’re doing themselves a disservice by not, and had they done it years ago I suspect the DMA wouldn’t be nearly as bad for them as it is.

I just have a philosophical problem with governments forcing Apple to do it, especially when they’re (in my opinion) nowhere near the market share to warrant it.

If you can’t tell, I feel strongly about property rights, which is why I also have issues with developers (and posters here) thinking they’re entitled to force Apple to run their business differently because Apple makes enough money on hardware, or that IP rights somehow don’t apply when you make an OS, or because they think android is icky but want to be able to install Leisure Suite Larry roms on their device.

 

[AppliedMicro]

I just have a philosophical problem with governments forcing Apple to do it, especially when they’re (in my opinion) nowhere near the market share to warrant it.

More than 50% of consumer app spending does warrant it.
I mean, you’re not going to claim Spotfiy and Epic games are just chasing users and not money, are you?

Honestly, while I can „get“ and accept the „philosophical“ side of your argument (disagreeing with it as I may), I find the repeated „oh but their market share is so small“ claims pretty disingenuous.

You know it’s about money for Spotify, Epic and Match.com - and I not so disingenuous to dispute it (though I believe Sweeney in particular at least partly fights his war at least partly out of some intrinsic motivation and for „doing the right thing“ rather than must money and fame).

So let’s not disregard their share of all the money spent.

 

[ProbablyDylan]

Agreed! I know it probably doesn’t seem like it based on my posts, but I actually wish Apple would open up on their own accord. They’re doing themselves a disservice by not, and had they done it years ago I suspect the DMA wouldn’t be nearly as bad for them as it is.

I just wish Apple had the self-confidence to let developers shoot themselves in the foot if they so please. Let Sweeny make a fool of himself like he has on Windows instead of looking greedy yourself.

Instead, we have these hundreds of posts back and forth about Tim's apparent greed.

I just have a philosophical problem with governments forcing Apple to do it, especially when they’re (in my opinion) nowhere near the market share to warrant it.

A government will do what they think they must, just like the Tiktok ban in the states. Just the unfortunate state of things.

If you can’t tell, I feel strongly about property rights, which is why I also have issues with developers (and posters here) thinking they’re entitled to force Apple to run their business differently because Apple makes enough money on hardware, or that IP rights somehow don’t apply when you make an OS, or because they think android is icky but want to be able to install Leisure Suite Larry roms on their device.

This is where we disagree. Physical property rights I'm right there with you, digital though? I find myself struggling to feel bad for Big Tech, especially when it comes to byzantine fee structures and policies.

At least the EU allows us to disagree - for now!

 

[surferfb]

More than 50% of consumer app spending does warrant it.
I mean, you’re not going to claim Spotfiy and Epic games are just chasing users and not money, are you?

Honestly, while I can „get“ and accept the „philosophical“ side of your argument (disagreeing with it as I may), I find the repeated „oh but their market share is so small“ claims pretty disingenuous.

You know it’s about money for Spotify, Epic and Match.com - and I not so disingenuous to dispute it (though I believe Sweeney in particular at least partly fights his war at least partly out of some intrinsic motivation and for „doing the right thing“ rather than must money and fame).

So let’s not disregard their share of all the money spent.

Answered why I think that’s a bad measure to cite in the other thead. Link:

https://forums.macrumors.com/thread...-deliberately-confusing.2433232/post-33309701

 

[Infinity Vortex]

Well looking back with 3 years increment we can see the services have steadily grown more and more prominent and important for their growth.

Services is essentially half the revenue of the iPhone….

View attachment 2404470View attachment 2404467View attachment 2404466View attachment 2404468View attachment 2404469

Right, so 10 years from now someone might be able to factually say “services made Apple what they are today.” But historically through today? Hardware.

Mac?
Revolutionary.

iPod?
Revolutionary.

iPhone?
Revolutionary.

Apply TV+?
Apple Music?
iCloud?

They’re fine services, but revolutionary? Really?? I can think of at least two services more iconic and revolutionary in those spaces, Netflix and Spotify. Apple is really an also-ran in comparison.

 

[SanderEvers]

Development costs money. But hardware prices, IDE / development tools and web hosting are competitive markets. And App Stores aren't necessary when you can distribute yourself. They are, at least on Windows, Linux and macOS, again subject to competition.

There aren't any app stores on Linux. Also Linux is entirely free. But with a market share of less than 5% on desktop I'm noit going to count it. On Windows this is 100% NOT TRUE every single "competitive" app on Windows needs a code signed signature from an "trusted" authority. Trusted by MS that is. This is similar to the CTF Apple asks. And is a lot more expensive than what Apple asks.

On Mac, by default, you can't install apps that aren't signed either. So this is the same as on Windows. Though on Mac this costs no more than $ 100 / year. Like I said before. This is about $ 400 / year cheaper than on Windows.

Also no one else taxes competitors as a percentage of revenue. Microsoft doesn't, and neither do mainstream Linux distributions. Not even Android, I believe.

Microsoft also asks for a 30% cut on EVERY SINGLE App sold on Windows through the Microsoft Store... and.. EVERY SINGLE GAME on XBOX INCLUDING Physical.

So what?! 🤷‍♀️

What would be the problem with that? Developers simply would have to charge for their apps - even for apps that have been free until now.

You're forgetting one, the biggest player that may be hurt: Apple themselves!

Once hitherto "free" apps all cost a subscription, consumers are going factor it into their overall purchasing decisions on smartphones. So will I. And so will the media receive and report on Apple's pricing and fee structure. I guarantee you that Apple is going to bleed customers defecting to other smartphone brands.

These developers will all lose customers. Which is anti-competitive. Because smaller developers aren't going to be able to get those back as easily as bigger developers / publishers. It will basically destroy ANY self published app!!!

And no Apple isn't going to lose customers, because 99% of the Apple customer base is loyal to Apple. Brand loyality is a lot stronger with Apple than any singular Android producer.

The DMA on IT'S OWN is anti-competitive. And one of the worst pieces of legislation created by the EU.