Apple to Collect 27% Commission on Third-Party App Payment Systems in the Netherlands

[Carnegie]

lol, you've got to laugh when a company is ordered to do something and they find a way to ignore obey the letter of the law while carrying on doing what they were doing before. Reminds me a bit of the hijinks Microsoft got up to with IE6.

The ACM's ruling had nothing to do with Apple's commission. Apple's right to collect such a commission wasn't in question. Such commission wasn't even mentioned in the ACM's summary of its ruling or the provisional-relief judge's review of the ACM's decision. The judge detailed the ways in which the policies in question harm developers and consumers and yet didn't mention the commission. That's because it wasn't at issue.

The ACM may, at some point, try to prevent Apple from collecting that commission. (I wouldn't count on that, in part because it might represent a violation of international agreements which the Netherlands has signed.) But the ruling Apple is now trying to comply with didn't prevent Apple from collecting that commission - either by letter or by spirit.

 

[mrochester]

These idiot lawmakers when Apple finally granted the third party payments they were clamoring for while still taking a cut of proceeds for, well you know, providing the hardware and software and store and promotion and infrastructure and userbase:
View attachment 1954288

I suspect the law-makers expected this outcome and are happy with it. After all the complaint is that app developers can’t bypass Apple as the payment processor for IAPs. This law makes it so that Apple can be bypassed for IAPs. What Dutch regulators have been unhappy with so far is the technical implementation proposed by Apple.

Nowhere does the law say Apple can’t and shouldn’t collect a commission.

I don’t know why some people are having such a hard time understanding this.

 

[Cosmosent]

It's just a stall tactic by Apple, NO more, NO less.

 

[alex2792]

Huh? What I said is factually correct. Just because iOS is really popular doesn’t mean it’s the only place these purchases can be made.

It doesn’t matter if a purchase can technically be made on Mint Linux. The reality is virtually all mobile digital app commerce is done through Google and Apple app stores both of which (surprise!) both charge the same rate and have nearly identical policies.

 

[Wildkraut]

Oh boy, still 27%, this will not land well with anti-monopolists and legislators

They simply will be sued to hell, over and over again, and their reputation will go down the river, too.
But as I said in another thread, Tim C. & Co. don't care, every month more monopoly floods millions into their pockets, it's all they care, they are not emotionally attached to Apple in any way.

 

[boss.king]

No, that is not the actual cost. That's just payment processing. Apple needs about 8 billion to run the App Store, that needs to come from somewhere. Are the authorities going to outlaw profit?

Out of interest, where did you come across that 8 billion to run stat?

Not saying you’re wrong, I just don’t recall Apple ever breaking down the cost to run the App Store by itself before.

 

[Velli]

Ok, now you MUST be trolling. The smartphone is by far the most widely used computing device for the masses to the point where it’s becoming increasingly difficult to get by without one in any developed (and many developing) countries. Try pitching a tech startup without an iOS app and you’ll get laughed out of the room.

You can totally purchase things online on an iPhone without going through the app store. You can totally purchase hardware, or food or whatever in an iPhone app without paying a dime to Apple. You can totally create an app that you can use with a login that you pay for outside of the app store, and many "tech startups" do just that. What you specifically cannot do, is to purchase apps or in-app software without going through the app store. Every single thing you want to do through the app store, you can do by getting a hold of your customers yourself. You just can't get access to Apple's app store customers without paying for them. It sounds to me like obtaining your customers in a different way will cost you more than the 30% that Apple charges, which makes the 30% the most compelling choice. Which is why most (but not all) pay up.

Apple is charging you to give you access to customers. If you don't like it, you can find your own customers and still use the app store for absolutely FREE.

 

[Maximara]

If Costco and Walmart were the only 2 retailers in existence and both charged the same percentage for selling stuff through their stores then they most definitely would be regulated. Look up the term “duopoly” to learn more.

Again unless they are working together a duopoly is not illegal (at least in the US).

Europe (Mobile): Apple 35.33% Samsung 31.14% Xiaomi 12.05% Huawei 10.03% Oppo 1.92% Motorola 1.58%.

Last time I checked 35.33% is not over 50% so by this metric Apple doesn't dominate the mobile market in Europe. If anything Android does.

 

[mrochester]

It doesn’t matter if a purchase can technically be made on Mint Linux. The reality is virtually all mobile digital app commerce is done through Google and Apple app stores both of which (surprise!) both charge the same rate and have nearly identical policies.

Because Apple and Google have made it very easy for developers to access those customers and their wallets. Hence developers pay a commission for that access.

Developers are very welcome to take longer and harder routes to obtain a customer base that doesn’t involve Apple or Google. But no one said it was gonna be easy without Apple or Google.

 

[alex2792]

Again unless they are working together a duopoly is not illegal (at least in the US).

Europe (Mobile): Apple 35.33% Samsung 31.14% Xiaomi 12.05% Huawei 10.03% Oppo 1.92% Motorola 1.58%.

Last time I checked 35.33% is not over 50% so by this metric Apple doesn't dominate the mobile market in Europe. If anything Android does.

We’re talking about app stores, not hardware.

 

[gnipgnop]

LOL...this is a great move by Apple. It underlines that the commission was not just based on payment processing like so many detractors were claiming.

 

[mrochester]

We’re talking about app stores, not hardware.

In which case the relevant metric is iOS/Android market share.

Looks like iOS has 42% market share in The Netherlands.

 

[Maximara]

We’re talking about app stores, not hardware.

You missed the point. For Apple iOS and its App Store is the hardware

 

[0924487]

They can revoke the license for Apple to operate an App Store in EU or similar measures like forcing consumer operating systems to be fully open sourced.

 

[alex2792]

LOL...this is a great move by Apple. It underlines that the commission was not just based on payment processing like so many detractors were claiming.

That’s actually good for the regulators. Since Apple admitted they it costs them 3% to process transaction then the remaining 27% is Apple (or Google) tax.

 

[mrochester]

They can revoke the license for Apple to operate an App Store in EU or similar measures like forcing consumer operating systems to be fully open sourced.

What is this license you speak of? I’ve never heard of there being a license to operate an App Store before!

 

[alex2792]

You missed the point. For Apple iOS and its App Store is the hardware

Huh? App Store and iOS apps aren’t hardware in any sense of the word.

 

[mrochester]

That’s actually good for the regulators. Since Apple admitted they it costs them 3% to process transaction then the remaining 27% is Apple (or Google) tax.

How does that help regulators? Are regulators going to tell Apple (and Google) that they are not allowed to make that much (if any) profit from their respective App Stores?

 

[alex2792]

How does that help regulators?

Because 27% commission only exists due to the fact that Apple and Google are colluding too control the mobile app distribution market. They would never be able to maintain those margins if forced to compete fairly with alternative app stores.

 

[Velli]

If 50% rebate club (Apple) and 50% rebate group (Google) were the only 2 avenues for selling hardware then they would definitely be sued.

1: Only if the 30% commission was deemed unreasonable. There are no laws that prohibits monopolies from making money. The only discussion is how much. I still don't see the argument why 30% is arbitrarily too much, and how much is then actually reasonable (and not least why).

2: Apple and Google are NOT the only avenues for in-app services for iOS and Android. As mentioned above, you can totally come strolling along with your own goddamn customers and use the app store for absolutely free thank you very much. It is being done as we speak. Epic can totally allow users to log in within the iOS app and spend all their whatevercurrency within the iOS app, which they did. The ONLY thing Apple won't allow you to do, is to get the app in the app store (potentially for free), and then from the app go outside the app to spend money.

The argument is that if the customer is coming from within the app that you downloaded from the app store, he is essentially an Apple customer, not an Epic customer. If you want to use a different avenue to get your customers, NO PROBLEM. Just as I was totally free to find my customers elsewhere, this just happened to be the most convenient, efficient and cost-effective.

 

[Maximara]

They can revoke the license for Apple to operate an App Store in EU or similar measures like forcing consumer operating systems to be fully open sourced.

Well the guts of the MacOS, Darwin, is open source so no problem there. Though Microsoft might have issues opening up their OS.

 

[mrochester]

Because 27% commission only exists due to the fact that Apple and Google are colluding too control the mobile app distribution market. They would never be able to maintain those margins if forced to compete fairly with alternative app stores.

Won’t regulators have to find evidence of collusion first? Is it a fact that Apple and Google are colluding? Where is the evidence of this collusion?

Are you perhaps incorrectly assuming that because Apple and Google both charge the same commission that this in itself is evidence of collusion? Because you’d be dead wrong if that is the case. Collusion requires two different organisations to work together to set a price. Two organisations working independently but ending up at the same price is not collusion.

 

[Velli]

Because 27% commission only exists due to the fact that Apple and Google are colluding too control the mobile app distribution market. They would never be able to maintain those margins if forced to compete fairly with alternative app stores.

What exactly is it about downloading an app for free from the app store and then spending all the money outside the app store that you consider "fair"?

 

[draugminaion]

Out of interest, where did you come across that 8 billion to run stat?

Not saying you’re wrong, I just don’t recall Apple ever breaking down the cost to run the App Store by itself before.

Apple doesn't say, we're all just guessing.
(From memory, I rounded some numbers)
Last year 60B went to developers so a total of 83B was collected, 60B to developers 23B to Apple.
Services margin was 65% then so Apple needed 35% of 23B to run the App Store. That comes to 8B.

It might well be that Apple needs more than 35% for the App Store though. It's probably more work that the rest of services. Especially since services includes Google's payments (traffic acquisition costs) of a few billion which is no work at all.

 

[Velli]

It is very simple. The Netherlands want to force Apple to give up some control, but what Apple really wants to do is tighten its grip on iOS. So if you want to have an App on Apples AppStore, you are forced to give Apple audit rights? Come on! Seriously?

Big companies like Epic (especially Epic) BMW and lots of other companies will be delighted when another company and maybe a competitor, takes a look at their numbers ....

The fight will go one .... Yeah ....

Boy, are you clueless. Do you even know what an audit is? BMW has audits, and audits sub-suppliers, all the time. There are lots of license agreements on chips, platforms etc in consumer electronics that work exactly like that, the higher your revenue the more you pay. Others are based on unit sales, that is just a matter of preference.