Dutch Regulator Still Unsatisfied With Apple's Rules Surrounding Dating Apps

[tobybrut]

That isn't 'intent'. That's being specific, which was my point. If they want to play that game, fine. But then, while they can say "you didn't fulfill this objective" they can't turn around and say "we don't like HOW you fulfilled the objectives."

That's true. Apple fulfilled the requirement that they allow developers to choose their own payment processor, yet when Apple submitted the plans the first time around, they rejected the solution because it required two binaries. If the EU doesn't tell you how to meet the requirements, why did they tell Apple they couldn't do it that way even though it met the requirement? What it really does is allow them to arbitrarily decide what a good fix is or isn't and to move goal posts all over the place on a whim. Basically there is no way for a company to know until some bureacrat comes back to them with a thumbs down.

And then when Apple fixed the objection to having two binaries and re-submitted the proposal, they moved the goal post again and said no. So what do they want? They expect people to read their minds.

 

[visualseed]

Actually, they settled out of court. They wrote up a new contract where Apple essentially gave in to most of Qualcomm's demands because Intel failed in producing decent modem chips. Apple had no choice. It was either give in or not ship an iPhone. The conditions of the new contract were that both sides would drop all litigation and enter into a new cross-licensing agreement. I don't know who would have won in the end, but Apple did have a good case on FRAND. Qualcomm had a monopoly, which required them to charge royalties according to FRAND principles.

It's quite arguable they didn't, since they not only charged for the parts, but they charged royalty on IP, AND charged additional royalties based on the total retail price of the phone. So if Apple or anyone else decided to upgrade the screen on their phone, for instance, they would have been forced to pay higher royalties to Qualcomm, even though Qualcomm had nothing to do with the screen. Apple's argument was that they were paying Qualomm for a large part of the phone where Qualcomm owned no IP. Even though I worked for Qualcomm for over 17 years, I still thought Qualcomm was in the wrong, charging monopoly prices despite being bound to FRAND, though it did wonders for my RSU's.

A reasonable person would think that someone who bought an identical chipset from Qualcomm should pay the same royalty regardless of whether the phone cost $300 or $1200 retail since no QCOM IP was used in that $900 difference in price. Yet because Apple only made premium phones, they were hit harder than any other phone maker.

Qualcomm might have won in the end because FRAND is a subjective criteria. A judge could easily rule in either direction. But to me, personally, I think it's wrong to charge royalties for parts you didn't make and had nothing to do with, IP-wise.

I forgot that they just abruptly reached a settlement in the middle of the trial. I just remembered the outcome was Apple continued to pay Qualcomm their asking rate. I don't like the idea of paying royalties for the total product "retail" price either and I think this is a big reason why iPads with cell modems cost on overage $100+ more and we don't have cellular MacBooks. But, FRAND aside, Gross royalties have been a common way to license IP for a long time. One could always argue that the modem is a cheap commodity that only costs a few dollars to make, but how valuable is an iPhone without a cellular modem? Since Apple doesn't own that technology their iPhone wouldn't be a "phone" at all without licensing it from someone. Is $8-9 a phone too much to pay for the technology that actually makes it a phone? I don't know, but the fact that Qualcomm is predicting a decrease in future modem revenue from Apple, I suspect Apple has figured out a way out of this either using their own IP exclusively or cross-licensing some new or acquired patents (maybe from Intel though, I don't see anything published of significance, but there could have been tech in the works when they bought that business unit) to offset that cost.

Also, late in 2020 Apple joined ATIS's 6G Alliance meaning they may have just decided their money and influences is better spent skating to where the puck is going rather than where it is now.

PS: I do think the mutual litigation moratorium in the agreement was to keep Qualcomm from suing over CPU patents that may have put Apple in the crosshairs over the A and M series chips. Well-founded or not, Qualcomm was desperate to preserve their modem revenue and would have gone nuclear to do it. Apple may have just decided that paying Qualcomm a few more years while they weaned themselves off of their IP was a better course of action.

 

[urbanman2004]

Netherland gov't a/b to make Apple pull the plug... and the rug underneath their feet if they don't stop playing around ???

 

[amartinez1660]

Because they are "dating" apps.

dating in NL means prostitution. abd its controlled by bad people with deep pockets

Oh wait, this is such a sudden different perspective…
Could it mean that everybody defending these dating apps they just want to pay with a different pay method so that they aren’t found out?! ?
Or maybe people want a small discount? Over time it will definitely add up.

Could have said it before, in that case fine, I can get behind this… where do I sign to help..

 

[Beautyspin]

get the feeling that no matter what Apple does, it will never be enough.

Or, Maybe Apple is not doing enough?

 

[Beautyspin]

That’s a possibility.

It’s also a possibility that, like some companies that tell nuisance suit filers to pound sand, realizing Apple won’t roll over will slow these types of things.

Most likely, Apple eventually will fold and the EU, etc. will define how Apple does business, no matter how many buyers would’ve chosen to keep buying from Apple as it was.

They know Apple will rollover, like they did in China and Russia. So, they will rollover once they are fined 10% of their annual global turnover, then 20%, then periodic 5% fines, followed by breakup of the company. There is no question of not rolling over.

 

[Beautyspin]

People keep saying that Apple didn't fulfill the original order.

Here it is:

The order subject to periodic penalty payments
20. ACM orders Apple to put an end to the violation established by ACM. Apple must adjust its
conditions in such a way that, with regard to their dating apps that they offer in the Dutch App
Store, dating-app providers are able to choose themselves what market participant they want to
process the payments for digital content and services sold within the app. [suspended], and, in
addition, they must have the ability to refer within the app to other payment systems outside the
app.

https://www.acm.nl/sites/default/files/documents/summary-of-decision-on-abuse-of-dominant-position-by-apple.pdf

Which part of that order does Apple's proposal violate?

Maybe this will provide some more insight.

Apple’s Dance With the Netherlands ACM Continues

Baby steps, but all of these changes are in the direction of decreasing regulatory pressure. Apple can be stubborn but they’re not stupid.

daringfireball.net

 

[Beautyspin]

How the HELL does one address 'intent'? That's just a smokescreen excuse. Lay out, in plain language, what the expectations are. "Intent" just means "we want to keep changing things and getting fine revenue."

Initially, Apple did this as one of the changes:

The other notable change is to the required language in the warning screen users must be presented before making purchases via non-Apple payment processors or being sent to the web. Here’s the previous version of the warning screen:

Title: This app does not support the App Store’s private and secure payment system

Body: All purchases in the <App Name> app will be managed by the developer “﹤Developer Name﹥.” Your stored App Store payment method and related features, such as subscription management and refund requests, will not be available. Only purchases through the App Store are secured by Apple.

Here’s the updated version, from Apple’s developer page for the StoreKit External Purchase Entitlement:

Title: This app doesn’t support the App Store’s payment system.

Body: All purchases in this app will be managed by the developer “<Developer Name>.” You will no longer be transacting with Apple. Your stored App Store payment method and related features, such as subscription management and refund requests, will not be available. Apple is not responsible for the privacy or security of transactions made with this developer.

Learn More

Action 1: Continue
Action 2: Cancel


Do you see any difference? Do you now understand what ACM means by intent?

 

[wbeasley]

Just pull the apps, pay the fine and move along.

Let the app users whinge at their government.

 

[LV426]

Free Apps are Subsidized by paid apps, they would disappear if a per MB fee was introduced.

Whilst true, I would not personally miss free apps. There are too many apps on the App Store, frankly, with a lot of free dross out there. They can get in the way of finding something decent.

I have very few free apps installed, and none of them have adverts (e.g. BBC iPlayer, remote controls for my air conditioner & lights, Nest). The way I look at it is if an app is good, it’s worth paying for.

 

[tobybrut]

Initially, Apple did this as one of the changes:

The other notable change is to the required language in the warning screen users must be presented before making purchases via non-Apple payment processors or being sent to the web. Here’s the previous version of the warning screen:

Title: This app does not support the App Store’s private and secure payment system

Body: All purchases in the <App Name> app will be managed by the developer “﹤Developer Name﹥.” Your stored App Store payment method and related features, such as subscription management and refund requests, will not be available. Only purchases through the App Store are secured by Apple.

Here’s the updated version, from Apple’s developer page for the StoreKit External Purchase Entitlement:

Title: This app doesn’t support the App Store’s payment system.

Body: All purchases in this app will be managed by the developer “<Developer Name>.” You will no longer be transacting with Apple. Your stored App Store payment method and related features, such as subscription management and refund requests, will not be available. Apple is not responsible for the privacy or security of transactions made with this developer.

Learn More

Action 1: Continue
Action 2: Cancel


Do you see any difference? Do you now understand what ACM means by intent?

The question remains why that isn't good enough. It seems to meet the requirement to tell the user about the alternate payment processor and if it's allegedly correct that the EU don't tell you how to meet it, just that you do, how does this not meet the requirement? it seems ACM is nit picking and arbitrarily saying it isn't good enough. But why? Seems to me both versions meet the requirement. So what is the hidden requirement they're not telling us, assuming that's the actual reason the proposal was rejected?

 

[cupcakes2000]

They know Apple will rollover, like they did in China and Russia. So, they will rollover once they are fined 10% of their annual global turnover, then 20%, then periodic 5% fines, followed by breakup of the company. There is no question of not rolling over.

I’m pretty sure that the Dutch government cannot implement the breakup of a foreign company.

 

[boyarka]

ALL apps not just dating apps should have any payment method they choose.

 

[mrochester]

ALL apps not just dating apps should have any payment method they choose.

They will do as per EU regulations coming down the line. This is a single EU member state legislation on a specific issue raised by Match Group, I believe.

 

[Beautyspin]

I’m pretty sure that the Dutch government cannot implement the breakup of a foreign company.

Not the dutch, the EU, under the DMA.
The remedies could ultimately include forcing companies to divest if they breach the rules systematically. The same official said that selling parts of the business would only happen “if no other remedy is available.”

EU announces sweeping new rules that could force breakups and hefty fines for Big Tech

Tech giants could soon face hefty fines and stricter controls over their behavior as part of sweeping new rules in the European Union.

www.cnbc.com

 

[Beautyspin]

The question remains why that isn't good enough. It seems to meet the requirement to tell the user about the alternate payment processor and if it's allegedly correct that the EU don't tell you how to meet it, just that you do, how does this not meet the requirement? it seems ACM is nit picking and arbitrarily saying it isn't good enough. But why? Seems to me both versions meet the requirement. So what is the hidden requirement they're not telling us, assuming that's the actual reason the proposal was rejected?

Well, I guess Apple is learning what is wrong with the statements, each week costing five million. From next week, the lessons are going to become costlier, it seems. The more stubborn Apple is, the more costly the lessons become.

 

[tobybrut]

Well, I guess Apple is learning what is wrong with the statements, each week costing five million. From next week, the lessons are going to become costlier, it seems. The more stubborn Apple is, the more costly the lessons become.

My career is as a software engineer, so I know the development process. I held that job for 25 years. Engineers do best when given requirements by a marketing department that are clear and precise. ACM did not do that, so it's not stubborness that's costing Apple money. It's what I would have called a piss-poor marketing department that doesn't know how to communicate what it wants. When bad or vague (same thing) requirements are given, marketing doesn't get what they want, and that's exactly what we have here. If engineers have to guess, the project is doomed from the beginning.

So to correct your conclusion since I'll bet you're not an engineer and have no idea what it takes to do a job of one, Apple isn't being stubborn because both of their proposals met written requirements. They are not being told what ACM really wants. No engineering department in any company is going to go beyond stated requirements due to costs in money, time, and risk, and there's a high risk exposing that code in other countries. Engineers will always make the minimal changes necessary. That's universal for all companies. We as engineers do exactly what we're told, no more, no less. ACM isn't doing that, so no one should be surprised they aren't getting what they want. The blame is clearly on the Dutch government since none of their public documents can point to why the latest proposal, or even the previous one, was rejected given the stated requirements. I suspect if the ACM continues to yank Apple's chain on this, Apple's just going to ban all "dating" apps from the App Store. People only have so much patience for incompetence, and that's what the ACM is presenting. The only lesson being taught is that Apple is finding out the ACM is completely incompetent and clueless, or hopelessly corrupt.

 

[mrochester]

My career is as a software engineer, so I know the development process. I held that job for 25 years. Engineers do best when given requirements by a marketing department that are clear and precise. ACM did not do that, so it's not stubborness that's costing Apple money. It's what I would have called a piss-poor marketing department that doesn't know how to communicate what it wants. When bad or vague (same thing) requirements are given, marketing doesn't get what they want, and that's exactly what we have here. If engineers have to guess, the project is doomed from the beginning.

So to correct your conclusion since I'll bet you're not an engineer and have no idea what it takes to do a job of one, Apple isn't being stubborn because both of their proposals met written requirements. They are not being told what ACM really wants. No engineering department in any company is going to go beyond stated requirements due to costs in money, time, and risk, and there's a high risk exposing that code in other countries. Engineers will always make the minimal changes necessary. That's universal for all companies. We as engineers do exactly what we're told, no more, no less. ACM isn't doing that, so no one should be surprised they aren't getting what they want. The blame is clearly on the Dutch government since none of their public documents can point to why the latest proposal, or even the previous one, was rejected given the stated requirements. I suspect if the ACM continues to yank Apple's chain on this, Apple's just going to ban all "dating" apps from the App Store. People only have so much patience for incompetence, and that's what the ACM is presenting. The only lesson being taught is that Apple is finding out the ACM is completely incompetent and clueless, or hopelessly corrupt.

I agree from a development POV.

Rather than pulling the apps I think Apple will just continue to not be in compliance until the whole decision ends up being in a court of law to decide one way or another.

 

[Sophisticatednut]

The question remains why that isn't good enough. It seems to meet the requirement to tell the user about the alternate payment processor and if it's allegedly correct that the EU don't tell you how to meet it, just that you do, how does this not meet the requirement? it seems ACM is nit picking and arbitrarily saying it isn't good enough. But why? Seems to me both versions meet the requirement. So what is the hidden requirement they're not telling us, assuming that's the actual reason the proposal was rejected?

The reason is anti competitive practices. You can’t just implement a function and use even more hostile actions to minimize its use.

 

[cmcbhi]

Saw where a certain "dating" app had been tracking locations of users.
Doesn't THATmake you feel safer?

 

[Sophisticatednut]

Not every company does as there are enforcement actions and court rulings against different companies all the time. And not every company that resists complying with regulatory authorities is guilty as often courts side with them against the regulators on one point of law or another. The only thing unique about Apple is that they have a well-recognized name and any press about them generates a lot of discussion.

You can’t resist regulatory actions just because you believe you’re right. You go through the court. Just as you don’t resist arrest even if you’re innocent.

Old news. It was mostly decided in Qualcomm's favor. Apple is paying them which is the right thing to do. Really odd that the temperament among many here is that Apple should pay when they use IP from other companies but other companies should not have to pay Apple to use their IP.

They settled and the point is more that reason behind apples complaint paying more for the IP depending on the device price. Just as developers complain about paying too much.

Right, that’s what I said, they don’t have jurisdiction to define the details. Or, are you saying they DO have the jurisdiction, they just don’t do it because that’s how the EU is?

No court in EU have the jurisdiction, this is how EU works. They aren’t the regulatory body and precedent rulings only comes from the Supreme Court(European court of justice)

The point of not specifying how things should be done is to allow uneque solutions the court very likely never could have thought of, this is done by clearly stating what must be met, but not how it’s met as that’s the private companies job.

Nope, but once it’s signed, there is no “Ah, nope, it’s illegal, so I’m not following it”. One has to define what’s illegal (it may truly be illegal or it may be something one just doesn’t like) and why it’s illegal in court and hope that some judge rules in their favor. If the judge DOESN’T rule in their favor, then the contract as signed is what they have to adhere to.

Which is why it’s VERY VERY important to know what a contract says before signing it.

Indeed but the fact it’s more the fact they are non binding. We have had many cases where non binding clauses have essentially rendered the whole thing void.

That isn't 'intent'. That's being specific, which was my point. If they want to play that game, fine. But then, while they can say "you didn't fulfill this objective" they can't turn around and say "we don't like HOW you fulfilled the objectives."

It’s not intent. They can absolutely say you’d till didn’t fulfill the objectives by breaking other rules. Explicitly the act of being anti competitive. Apple was already established to have a dominating position, this makes it clear of their legal obligations and limits.

 

[AppliedMicro]

They are not being told what ACM really wants

The ACM demanded that app developers can choose. Apple has decided to venture into a cat and mouse game by offering that choice on paper - while doing everything they can to make that choice untenable in practice.

Free Apps are Subsidized by paid apps, they would disappear if a per MB fee was introduced.

Free Apps subsidise device sales - on which Apple has more than a healthy margin.

Engineers will always make the minimal changes necessary

This has got nothing to do with minimal change. Minimal change, in fact, would be getting rid of prohibiting external purchasing mechanisms in their App Store rules. That’s it. EPIC has already proven with Fortnite that one can, technologically, offer in-app purchases without Apple‘s IAP without any problems. But all that is not what Apple has done.

Apple has been carefully crafting new technical and contractual barriers and limitations in response to the ACM‘s ruling. They‘ve gone out of their way to make it more difficult for app developers.

The blame is clearly on the Dutch government since none of their public documents can point to why the latest proposal, or even the previous one, was rejected given the stated requirements

The fact that they haven’t publicly explained their objections in detail doesn‘t mean that they haven’t to Apple.

 

[mrochester]

The ACM demanded that app developers can choose. Apple has decided to venture into a cat and mouse game by offering that choice on paper - while doing everything they can to make that choice untenable in practice.

Free Apps subsidise device sales - on which Apple has more than a healthy margin.

This has got nothing to do with minimal change. Minimal change, in fact, would be getting rid of prohibiting external purchasing mechanisms in their App Store rules. That’s it. EPIC has already proven with Fortnite that one can, technologically, offer in-app purchases without Apple‘s IAP without any problems. But all that is not what Apple has done.

Apple has been carefully crafting new technical and contractual barriers and limitations in response to the ACM‘s ruling. They‘ve gone out of their way to make it more difficult for app developers.

The fact that they haven’t publicly explained their objections in detail doesn‘t mean that they haven’t to Apple.

What would make the choice tenable? If it’s just as easy to develop the app to accept Apple IAP as it is to accept 3rd party IAP, what more is there for Apple to do? Do Apple need to make it easier to accept 3rd party IAP than Apple IAP?

Im puzzled as to what more could be done.

 

[svish]

Apple might have to make further changes. Might be hearing about it more in the near future. Or maybe Apple could be imposed another fine.

 

[BaldiMac]

Maybe this will provide some more insight.

Apple’s Dance With the Netherlands ACM Continues

Baby steps, but all of these changes are in the direction of decreasing regulatory pressure. Apple can be stubborn but they’re not stupid.

daringfireball.net

That doesn't appear to address my question at all. It lays out how Apple's changes are reasonable.