Fortnite Introduces Direct Payment Option on iOS Despite Apple's App Store Review Guidelines [Updated]

[falainber]

Bye bye Fortnight.

Let's assume you are right. What will Google do? If Fortnite is gone from iOS and stays on Android, is it a win for Android?

 

[rgeneral]

i love fortnight!!!! Forrnight is awesome.

I love Doom!

 

[mabhatter]

Remember its a level playing field for all developers. Except for the developers, Apple wants to cater to.

The rules have always been separate for physical goods. Apple takes its cut for IAP in software because Apple’s App Store is the “physical server” that’s hosting the developers programs and also because Apple is verifying that the IAP is part of the software and taking a financial risk that the User won’t try to back charge Apple.

physical goods and services like Uber, McDonald’s, Walmart are not things that Apple can verify for the customers, they do not want to use their payment system for that financial risk. the items are supplied primarily outside Apple’s App Store. Apple hosts the developer apps for free as a courtesy to the users of Apple’s devices.

this will probably push Apple to start charging Devs for Reviews and for the Bandwidth each App consumes when users download it. Then Apple would probably only let certified non-profits have “free apps”. The bandwidth for a 200MB app x 10 Million users isn’t cheap... especially when certain Devs are pushing trivial changes to their apps every week.

 

[PJWilkin]

Well if Trumps ban on Tik Tok and WeChat goes through this may be a non-issue

because TenCent own a big stake in Epic Games, and that could be an issue for them

 

[Massimo1926]

This is gonna be an interesting standoff 🤔

 

[Tovenaar]

Apple currently bundles the cost of running the App store (+ profit) within that 30%. So free apps get a free ride and wildly popular apps subsidize everyone else. The payment cut is just an easy and convenient way to collect that money. This is not unheard of in the gaming industry, where some game engines now allowing game developers to not pay until they make a certain milestone of revenue. So again, free or low volume games get a free ride, the big ones pay. It's a great way to get developers to tinker and experiment and perhaps create something great. It also means that Epic going around the Apple payment system is, in a way, piracy because they've essentially benefited from 95% of the service that Apple has provided (other than the payment gateway), and doesn't want to pay for it.

Apple could unbundle the services they provide. So they might make developers pay an annual fee for hosting on the App store, a fee per 1000 downloads of your app/game, a fee for every version update, a fee to process credit card payments (that will presumably be competitive with other payment gateways), and so on. It would be more complicated but perhaps satisfy all the people who are looking for fairness. But this might turn the app store into a place where only well funded developers could compete, which maybe isn't what Apple wants.

 

[1144557]

Let's assume you are right. What will Google do? If Fortnite is gone from iOS and stays on Android, is it a win for Android?

Theyre doing it to Google too, check the last few posts before yours for screenshot.

If you think Google and Apple are going to give up money, LOLOLOL. They want the free customer base to promote to and not pay a penny for it.



And generally, not in directly reply, the app store, curation, approval, etc also isnt free. This will only hurt consumers. Are you willing to pay monthly a subscription for the privilege to use the App Store install apps?

Apple currently bundles the cost of running the App store (+ profit) within that 30%. So free apps get a free ride and wildly popular apps subsidize everyone else. The payment cut is just an easy and convenient way to collect that money. This is not unheard of in the gaming industry, where some game engines now allowing game developers to not pay until they make a certain milestone of revenue. So again, free or low volume games get a free ride, the big ones pay. It's a great way to get developers to tinker and experiment and perhaps create something great. It also means that Epic going around the Apple payment system is, in a way, piracy because they've essentially benefited from 95% of the service that Apple has provided (other than the payment gateway), and doesn't want to pay for it.

Apple could unbundle the services they provide. So they might make developers pay an annual fee for hosting on the App store, a fee per 1000 downloads of your app/game, a fee for every version update, a fee to process credit card payments (that will presumably be competitive with other payment gateways), and so on. It would be more complicated but perhaps satisfy all the people who are looking for fairness. But this might turn the app store into a place where only well funded developers could compete, which maybe isn't what Apple wants.

Just to edit per my above point, bingo.

 

[TriBruin]

physical goods and services like Uber, McDonald’s, Walmart are not things that Apple can verify for the customers, they do not want to use their payment system for that financial risk. the items are supplied primarily outside Apple’s App Store. Apple hosts the developer apps for free as a courtesy to the users of Apple’s devices.

Other than the medium of delivery, there is no difference between McDonald's app and Netflix's app. Both are hosted by Apple for free (because neither company charges a fee to download the App.) Neither App uses any App Store services to fulfill the customer's order. McDonalds cooks and delivers the food. Netflix streams their video directly to the end user from their own servers (or CDN servers they pay for.)

But, Apple has made an arbitrary (yes, it I believe it is arbitrary) decision to allow outside in-app payment for McDonald's, but not Netflix.

 

[Bluetoot-]

This is a very interesting time. There’s more to this, and the Tik Tok ban, than meets the eye.

 

[popesammyjoe]

There is absolutely no mystery as to how Apple will respond. Fortnite will be removed immediately or given X days to comply.

 

[noon11111]

Epic actually has huge leverage here because Tencent is an investor and Tencent owns WeChat. Given what's going on with WeChat right now, Tencent could leverage WeChat's availability on iOS.

Imagine what would happen to iPhone sales if Tencent stopped supporting iOS (by choice or by force). iPhone sales would tank in China.

It's no skin off Tencent's back if people don't buy iPhones because they'll just buy Android and get WeChat on that. This might be one of the first times Apple is not in a position of power. WeChat is a unique in that the app itself is more important than the phone.

 

[DanTheMan827]

Well, if it’s a fight that fortnite wants...

You could say they want a battle royale

 

[DanTheMan827]

Let me get this straight. Apple charges 30%. They give you a 20% discount. Meaning they get an extra 10%. Sounds like we know the winner.

The users and the developer

 

[Rogifan]

Well, if it’s a fight that fortnite wants...

This is a fight Apple will lose in the end. Maybe they won’t have to allow other payment options in-app but they’ll have to allow users to sign up outside of the app. There’s no way Apple can justify Fortnight having to cough up 30% when Uber and Lyft don’t. And now that Apple is getting more heavily into services they’re going to be competing more with existing businesses on the App Store. The Apple tax/cut/rent/commission or whatever you want to call it will be seen as favoring their own services and will become untenable.

 

[JohnnyDelirious]

Let me get this straight. Apple charges 30%. They give you a 20% discount. Meaning they get an extra 10%. Sounds like we know the winner.

And this is for a purchase of in-game “V-bucks”, rather than an item or features.

So Epic is pocketing an extra 10% cut on an unneeded currency conversion (solely benefitting Epic), on top of taking their usual massive markup when customers use those V-bucks to buy a stylish digital hat.

Which they can only charge because they don’t allow Fortnite users to make their own items, skins and emotes.

 

[mi7chy]

This actually seems reasonable and should be implemented everywhere. Just let us choose if we want to use „Apple payment“ or „3rd party“ but we all know WHY Apple doesn’t want that. Security my ass. It’s all about those 30% 🤑🤑🤑

Seems reasonable like paying cash with no fee or credit with a fee at gas stations.

 

[Rogifan]

Apps that provide a physical service or good are allowed their own payment options

It’s a stupid rule though. I could easily argue Uber probably wouldn’t exist without iOS/iPhone (btw, Eddy Cue did say that in an interview a few years ago). Could the same be said for Fortnight? If Apple deserve a cut because they provide the platform/tools/customers how come they deserve it of one business but not the other? I guarantee you if Apple thought they could get away with taking a cut any transaction that happens via an iOS app they would.

 

[discuit]

30% for paid apps is not exorbitant at all, before the App Store and the Internet app developers (as I was) had to pay up to 70% to distributors/etc to sell our apps. Then we got paid 180 days later sometimes.

The problem is you're conflating the internet and App Store as the same thing, when they're really very different.

1. Bricks and Mortar > high % cuts surrendered to distribution and retailers
2. Internet > very low distribution costs, direct-to-consumer sales requiring miniscule overhead > 95% revenue straight to the creator
3. App Store > Apple's monopoly on enabling software to run on iOS leads them to rent-seeking behavior where they take 30% (note their distribution costs are miniscule, same as internet DtC)

 

[nottorp]

So a company peddling free to play crap and that is trying to take over the PC gaming industry by bribing developers is a ... victim?

Completely orthogonal to Apple's 30% cut being fair or not. Epic/Tencent are proven *******s. And as several people have pointed out already, they don't even pass the whole 30% discount to the customer.

 

[atoqir]

Instead of all whining about the rules and the too high Apple cut...why don't they unite

YouTube, Spotify, Netflix, Microsoft, Epic, Disney etc. They are all very high profile apps and services. Make a pact an delist all the apps from the App Store a week before a new iPhone releases.

Then Apple can decide if the customer and developer are indeed important and take action. But now they are all fighting as lone soldiers. Group up and make a change.

I am pro-Apple and use a lot of their services and hardware but I really don't agree of their censorship lately or trying to ban innovations like xCloud with 'customer protection' as their sole argument or not compete on the same ground as third party services.

 

[DanTheMan827]

So here is the question(s).
1) Is Apple charging too much (30% for the first year i believe, 15% every year after)?
2) Who should pay for Apple setting up the store, maintaining it, securing it, and making it so easy to use?
3) If there is no Apple Store, would you still use an iOS device?
4) Would you as customer trust any other competing "app" store on your iOS device?
5) If developers are right, how come there are so many apps on the app store?
6) If the developers are right, why not stop developing on Apples platform?


Every store has to make money, be it retail or virtual. They all sell products that they have to make money on (Markup) in order to provide that store to the customers. Everything that goes into it is maintained by the owners of the store. The merchandise that is in the store costs the owner money to buy. They make money by reselling it AND marking it up by whatever they see fit (what the market will bare). This is NORMAL. If you want to make your own store, you can go ahead and do so. But Apple WILL NOT LET YOU PUT YOUR APP ON THEIR DEVICES. Because they are not going to deal with YOUR BS when things go badly. This isn't hard to understand. Money is part of it, of course. BUT, Apple 100% prides itself in controlling the ENTIRE experience on the iOS devices.

When Apple moves all products to Apple Silicon. Then sell that same app via the Mac side how every you like.

1) When the purchase doesn't require any resources from Apple, yes, 30% is too much.
2) Developers, pay for the yearly developer account as the listing fee and then pay for bandwidth and fees for the other services that Apple provides like customer service for refunds.
3) Yes, provided there's a way to install Apps
4) Yes, provided those apps are subject to the same sandbox that the App Store apps have
5) Because the App Store is the only way to distribute your apps on iOS devices
6) Because of the userbase size and the fact that premium apps have been shown to be more likely to sell on Apple devices rather than Android.

The problem is that Apple wants to take a large cut of every transaction while forcing developers to charge the same price as their own payment processing method even when that transaction is only a token saying you paid.

PayPal is probably on the more expensive side, but even then, they only charge a 3% transaction fee.

I'm not saying the 30% doesn't go towards maintaining the store, but maybe Apple should change how the store fees are handled and charge the developer directly based on the size of their App for the storage and bandwidth required for distribution.

 

[Appleman3546]

It's pretty clear Apple's review team is dysfunctional. The App Store, esp on the Mac, is a junkyard of low quality apps.

That is because there is competition, as apps can still be downloaded by the internet browser on a mac. The same thing will probably happen to the iPhone if customers are given the option to download apps from the browser as developers likely won't release on the Apple app store or promote their web app.

 

[MvdM]

Easy. It's a server side screen and it didn't appear in app review.

They're trying to leverage the current public scrutiny of the store and the size of their user base to openly challenge Apple's policies.

I noticed the payment options are not always in the same order.

 

[DanTheMan827]

It's similar in that just as Epic rightfully has complete control over their game, Apple has complete control over iOS. Years ago before smartphones there were no App stores and phones came with a set of default/basic apps and that's what you got. Apple could (theoretically, and legally...not practically) go back to just offering stock apps that they create and not allowing others to submit apps for iOS. Publishing an app for an operating system (iOS in this case) is not a right that developers have, Apple gets to set the rules (in this case their commission rate/payment methods allowed) and enforce them since it's their product .

The app store prevents listing apps that people want, things that are perfectly capable of running on the devices...

Things that are perfectly legal like Kodi, RetroArch, xCloud, Stadia while imposing restrictions on other apps like Facebook Gaming.

 

[atoqir]

Epic actually has huge leverage here because Tencent is an investor and Tencent owns WeChat. Given what's going on with WeChat right now, Tencent could leverage WeChat's availability on iOS.

Imagine what would happen to iPhone sales if Tencent stopped supporting iOS (by choice or by force). iPhone sales would tank in China.

It's no skin off Tencent's back if people don't buy iPhones because they'll just buy Android and get WeChat on that. This might be one of the first times Apple is not in a position of power. WeChat is a unique in that the app itself is more important than the phone.

Tencent is also behind that other top downloaded game: Call Of Duty Mobile