Facebook Claims Apple is Damaging Small Businesses by Collecting Fees From Paid Facebook Events

[MacRumors]

As Apple battles with Epic Games over its App Store fees, Facebook is joining the fight over its new Paid Online Events feature, which allows small businesses in 20 countries to charge Facebook users to attend online classes and events.

Facebook wants Apple to waive its 30 percent fee taken from in-app purchases or let Facebook process event payments with Facebook Pay, both of which Apple has refused.

We asked Apple to reduce its 30% App Store tax or allow us to offer Facebook Pay so we could absorb all costs for businesses struggling during COVID-19. Unfortunately, they dismissed both our requests and SMBs will only be paid 70% of their hard-earned revenue. Because this is complicated, as long as Facebook is waiving its fees, we will make all fees clear in our products.

When a business owner schedules an event through Facebook on iOS, Facebook will make it clear that Apple is taking a 30 percent cut of the purchase price. Facebook is waiving its own fees for the feature "for at least the next year."

Transactions done on the web or on Android where Facebook Pay is available will allow business owners to keep 100 percent of revenue generated from paid online events. The feature is meant to allow Facebook Page owners to create an online event, set a price, promote the event, collect payment, and host the event all on Facebook.

Without calling out Apple directly, Facebook's announcement for the new feature says that businesses "shouldn't have to worry about fees charged by platforms" and points out that Apple's fees will make it so businesses will only be paid "70 percent of their hard-earned revenue."

Other companies, including Airbnb and ClassPass, have made similar complaints about Apple's refusal to waive in-app fees for virtual classes and features that have been forced to transition to online due to the ongoing pandemic.

ClassPass, for example, normally allows users to book classes at local gyms, but has instead moved its business online and started offering virtual classes. Under Apple's App Store rules, virtual classes require providing Apple its 30 percent commission, which ClassPass has balked at. ClassPass ultimately pulled virtual classes from the iPhone app.

Airbnb offers online experiences like virtual cooking classes and meditation sessions, which Apple also collects fees from. Apple has refused to grant special permission to apps like ClassPass, Facebook, and Airbnb in the name of fairness for other developers who are subject to the fees.

Article Link: Facebook Claims Apple is Damaging Small Businesses by Collecting Fees From Paid Facebook Events

 

[sniffies]

Facebook is damaging the entire world:

Misinformation
Meddling
Nazis
Hate
Racism

Must I go on?

They really should shut up.

 

[Vividxl]

Frankly Facebook users can just log into the web and bypass the App Store, it not like they don't already have a way around it. Facebook is just whining to whine.

 

[DinkThifferent]

Oh boohoo Mark Zuckerberg. Do we all get a 30% fee for all our data you sell?

 

[Rogifan]

I’m surprised Apple is allowing Facebook to put in that disclaimer. They don’t seem to want any company to be able to expose their rent seeking.

 

[Unggoy Murderer]

"Facebook claims Apple is damaging Facebook's profit margins by collecting fees from paid Facebook events."

Fixed!

 

[Quu]

Funny to me how all these multi-billion dollar businesses are coming out of the woodwork to demand lower fees. I don't necessarily side with Apple on this issue but it's hard to feel sorry for these giants.

If any of them were in Apples position to have a smash hit phone ecosystem they would undoubtedly do the same. Heck Epic Games takes a cut from the games on their game store as an example.

 

[Mimiron]

Lol yeah sure. Now Apple is the villain thanks to Epic and Facebook

 

[TravelsInBlue]

People who fail to see the issue with all of this really need to put down the Apple Kool-aid. Sure, App Store purchases make sense to have a commission fee, but does it make sense for Apple to take 30% of every single transaction within the ecosystem, even inside of each app?

No.

 

[atoqir]

Spotify, Netflix, Epic, Microsoft, Facebook (WhatsApp/Instagram/Messenger) should have all did the same what Epic did yesterday and get their apps pulled.

With that much leverage Apple would be forced to act quickly.

I am a huge Apple fan, but they got very bad points for blocking innovation like xCloud because I am a gamer.

They should just allow sideloading of stuff they don't want to approve. Everybody happy. They can even keep their 30 percent then without issue.

 

[ducknalddon]

Tim Cook must be so tempted to hit the delete button for the Facebook and Epic apps.

 

[xilla]

I love how these supposed tech giants turn into a crybaby. Develop your own platform and hardware and reach millions if you're not happy with the terms thats provided to you.

 

[ElRojito]

Funny to me how all these multi-billion dollar businesses are coming out of the woodwork to demand lower fees. I don't necessarily side with Apple on this issue but it's hard to feel sorry for these giants.

If any of them were in Apples position to have a smash hit phone ecosystem they would undoubtedly do the same. Heck Epic Games takes a cut from the games on their game store as an example.

That's why I feel the policy should be changed, but not in favor of these big businesses. Who does this really hurt? The independent developers with small teams (sometimes one person!) who then have to leave 30% of their profits on the table. Facebook is complaining about a 30% charge for something that, in the end, they could eat. They could eat the entire surcharge and their bottom line wouldn't change much at all. Facebook does not have my sympathy here at all. Maybe Apple should charge up to 30% based on the size of your development team.

 

[Martius]

Oh, jealousy is such a sad thing... wish Apple would create a social network. You know, just for your contacts, secure, minimalist and not selling your personal information.

Maybe someday.

 

[1144557]

I love how these supposed tech giants turn into a crybaby. Develop your own platform and hardware and reach millions if you're not happy with the terms thats provided to you.

Facebook did. It failed big time

Here's why the Facebook phone flopped

<b>commentary</b> The HTC First has a lot going against it, despite support from some heavy hitters.

www.cnet.com

That's why I feel the policy should be changed, but not in favor of these big businesses. Who does this really hurt? The independent developers with small teams (sometimes one person!) who then have to leave 30% of their profits on the table. Facebook is complaining about a 30% charge for something that, in the end, they could eat. They could eat the entire surcharge and their bottom line wouldn't change much at all. Facebook does not have my sympathy here at all. Maybe Apple should charge up to 30% based on the size of your development team.

Agree, the same as you make more money you pay more taxes. Epic and Facebook have zero legit complaints for their profit levels off of Apple.

 

[fmillion]

Funny how I mentioned basically this in a comment on the post about Epic Games. Now things are going to get really interesting. Not only does Facebook have a ton of market power (they existed well before the App Store did, and I'd argue that any mobile platform today owes some of its success to Facebook's presence on that platform), but they and others like ClassPass have an interesting argument with respect to COVID.

If Apple's rules are "things in person don't require payment via Apple, but things online do", then the fact that things being moved to online is largely due to COVID will put them in an interesting position - regardless of how you feel about Facebook, it's pretty easy to argue that Apple is hurting businesses in their time of need by charging a cut for paid online events that would otherwise not be online, but have been forced to move online due to COVID.

The one thing I see as a positive here is that all of these companies are, at the very least, trying to draw a lot more public attention to the issue. Epic did this pretty brutally, by allowing Fortnite to be completely pulled off the store. Facebook is doing it more subtly, including language that I'm pretty sure Apple is going to try to force them to remove. But both of these moves have the potential to draw a lot more public attention to the issue. If customers are fully aware that 30% of their online purchases are going to Apple (and are OK with the potential increase in cost and/or the reduction in profit for their target business) then the argument that customers want this is valid. But the truly shady part of the whole thing is Apple forcing developers not to even include language in the app indicating that you can purchase elsewhere. This keeps the customer in the dark unless they are the type to follow tech news. I could be wrong but I also seem to recall Apple not allowing you to charge more for iOS users because of their cut, which even further lets them hide what they're doing from the typical consumer. The free market works best when customers are fully aware of what's going on, and these moves will help make customers more aware so they can make truly informed decisions.

 

[bayelrey80]

People who fail to see the issue with all of this really need to put down the Apple Kool-aid. Sure, App Store purchases make sense to have a commission fee, but does it make sense for Apple to take 30% of every single transaction within the ecosystem, even inside of each app?

No.

Isn’t it 30% the first year, then it drops to 15%?

 

[Rogifan]

"Facebook claims Apple is damaging Facebook's profit margins by collecting fees from paid Facebook events."

Fixed!

According to the article Facebook is waving any fees it would normally collect so I’m not sure what this has to do with their profit margins.

Isn’t it 30% the first year, then it drops to 15%?

Only for subscriptions.

Just curious...does Apple Music on Android use Google’s IAP or does the user have to put in credit card information to pay Apple directly?

 

[Analog Kid]

Oh Facebook, cry me a river...

I can't imagine a less sympathetic victim...

 

[MvdM]

Spotify, Netflix, Epic, Microsoft, Facebook (WhatsApp/Instagram/Messenger) should have all did the same what Epic did yesterday and get their apps pulled.

With that much leverage Apple would be forced to act quickly.

I am a huge Apple fan, but they got very bad points for blocking innovation like xCloud because I am a gamer.

They should just allow sideloading of stuff they don't want to approve. Everybody happy. They can even keep their 30 percent then without issue.

Stop saying they block innovation when they give Epic etc. an app store.

 

[fmillion]

Tim Cook must be so tempted to hit the delete button for the Facebook and Epic apps.

They already did delete Fortnite. They'd really rather you use Apple Arcade, because remember Apple TV has the world's best programming.

I doubt they're as anxious to delete Facebook. I'm pretty sure kicking the leading social network off of their platform would not fare well for them.

 

[fmillion]

Stop saying they block innovation when they give Epic etc. an app store.

Except Epic does has their own store, and I'm sure they'd be happy to implement whatever infrastructure would be needed to make it into a viable mobile store for iOS. Call me back when Apple allows a third party app store, then we can talk about allowing innovation.

 

[rgeneral]

People who fail to see the issue with all of this really need to put down the Apple Kool-aid. Sure, App Store purchases make sense to have a commission fee, but does it make sense for Apple to take 30% of every single transaction within the ecosystem, even inside of each app?

No.

I understand. Conversely. Why does Facebook need to track and profile every user who uses their platform for monetary purposes.

 

[jonblatho]

Just curious...does Apple Music on Android use Google’s IAP or does the user have to put in credit card information to pay Apple directly?

The latter.

 

[ArPe]

Facebook took action against pages devoted to anti-Semitic content this week.

After 15 years of complaints.

And they are still a cesspool of filth. I reported an Instagram profile that was trafficking children yesterday and within 5 MINUTES I was told that the profile didn’t violate their policies.

Facebook has no right to complain about anyone or anything. They are a crime network.