Judge Says Apple Has Until December 9 to Make App Store Change Letting Developers Link to Alternate Payment Methods

[WB2Colorado]

I think people here forget that for the first two years of the App Store’s existence there was no in-app purchase mechanism. I don’t remember scams being rampant in the App Store during that time. There was a whole big controversy with Apple removing the Kindle app when Apple first implemented IAP because it had its own store to purchase books from.

 

[draugminaion]

For those who defend Apple whatever they do, what is your red line that Apple should not overstep?

Become an ad company like Google and Facebook. Or sell to businesses instead of people like Microsoft.

 

[tann]

How do they expect Apple to code this so quickly?

Apple don't need to do anything other than update their developer guidelines. They don't need to code anything, the simple use of external mechanisms or links to payment were only ever forbidden via words in the agreement.

 

[mrochester]

Become an ad company like Google and Facebook. Or sell to businesses instead of people like Microsoft.

That’s my red line too. Becoming like google and Facebook with their anti-competitive, data slurping, algorithmic business practices is a sure fire way to get me to dump Apple!

 

[mrochester]

Apple don't need to do anything other than update their developer guidelines. They don't need to code anything, the simple use of external mechanisms or links to payment were only ever forbidden via words in the agreement.

Silly question, but how does Apple know that the payment has been made so that the IAP can be unlocked/downloaded if the payment is via a third party?

 

[threesixty360]

I feel like people like to be closed minded when it comes to Apple and what Apple thinks is right. Remember this is nothing different then what you do on your Mac on the web. Paying for Amazon purchases, Netflix, Spotify, buying/ downloading apps on the web, paying bills online etc. This is literally the same thing. It’s like asking Apple to only allow the installation and payments of Apps on Macs exclusively through the App Store. I would switch off Mac in heart beat off Apple ever did that.

It's a little different as MacOS was always designed as an open system. Whereas IphoneOS was designed to be closed as a feature of that OS. The thinking being that closed systems which can only be updated through a gatekeeper are more secure and lead to less support issues and maintenance.

Given what we have seen pretty much every open OS suffer from security issues that even require AV software to be running Apple went a different direction with the phone. Its that distinction that Apple feels is a competitive asset in selling its products and users have agreed with them as seen by the sales.

The issue for Apple is they feel that
a) they have gathered a user base from their own hard work and risk in being a closed situation
b) Why should people profit off that without compensating apple?

Which is why they tried to stop people from jumping outside to make payments

Obviously, you can advertise that you can pay for things outside of the store, but you can't be in Target and have a sign saying "buy this at our online store its cheaper" can you?

Just because traditional PC's have one set of principals doesn't mean every machine has to go by that. Should your washing machine, your tv allow for apps and purchases? I think any rules you make on something you created should be out of bounds from lawmakers unless its a safety issue or your a monopoly and everyone needs what you make.

I just dont understand how a capitalist country can require competitive companies to lose money on IP they created.Let the market decide surely?

 

[draugminaion]

I have the impression Apple has forgotten that the App Store as a marketplace has to serve the needs of customer and developers.
For Apple the AppStore seems to be mainly a means to maximise their profits.

If that was true why is Apple OK with more than 80% of apps being free?

 

[WB2Colorado]

It's a little different as MacOS was always designed as an open system. Whereas IphoneOS was designed to be closed as a feature of that OS. The thinking being that closed systems which can only be updated through a gatekeeper are more secure and lead to less support issues and maintenance.

Given what we have seen pretty much every open OS suffer from security issues that even require AV software to be running Apple went a different direction with the phone. Its that distinction that Apple feels is a competitive asset in selling its products and users have agreed with them as seen by the sales.

The issue for Apple is they feel that
a) they have gathered a user base from their own hard work and risk in being a closed situation
b) Why should people profit off that without compensating apple?

Which is why they tried to stop people from jumping outside to make payments

Obviously, you can advertise that you can pay for things outside of the store, but you can't be in Target and have a sign saying "buy this at our online store its cheaper" can you?

Just because traditional PC's have one set of principals doesn't mean every machine has to go by that. Should your washing machine, your tv allow for apps and purchases? I think any rules you make on something you created should be out of bounds from lawmakers unless its a safety issue or your a monopoly and everyone needs what you make.

I just dont understand how a capitalist country can require competitive companies to lose money on IP they created.Let the market decide surely?

You might have a point if that App Store always had a in-app purchase mechanism, which it didn’t.

 

[draugminaion]

Epic started this whole thing with external payment methods and all Apple fanboys were so confident.

Yet, Epic won the battle

Epic got nothing. They are out and Apple is not required to let them back in.

 

[TiggrToo]

Do we need the "What's a computer?" talk again?

PCs, Macs, tablets, phones: yes
Consoles, eReaders, microwaves: no

General purpose vs fixed purpose. One is integrated deeply into your life, the other is an optional feature of your life. Government keeps their eye on the former.

You really don't know, do you?

Wow - your post is so in accurate it's unreal.

Kindle's run on Linux.
XBOX runs a Windows derivative.
PS5 uses FreeBSD.

How does that not make them "a computer"? - the 'fixed purpose' aspect? Heck no.

And your response that what defines a computer is based upon the government interest is equally as wrong.

And finally I found your initial "Do we need to have..." statement insulting. Especially since I've been using the bloody things since the 1970s.

This is Merriam-Webster's definition, for example.

 

[TiggrToo]

Epic started this whole thing with external payment methods and all Apple fanboys were so confident.

Yet, Epic won the battle

Epic lost 9 of the 10 rulings.

Try again.

 

[smallcoffee]

You can still use Apple's payment system. All this does is allow devs to give you another option.

Yea until that mechanism is the only option…

 

[imdropbear]

You can still use Apple's payment system. All this does is allow devs to give you another option.

Exactly, but now devs can choose not to use Apple's payment system but use their own - and they will. As a customer, I don't have the choice, the developer is making it. We as customers lose comfort and security.

I'm not against developers making more money but I just don't trust them with my payment information as much.

 

[imdropbear]

If that was true why is Apple OK with more than 80% of apps being free?

Because those apps make the platform more attractive, luring more people to potentially purchase apps that are not free.

That being said, there is absolutely no way 80% of apps in the appstore are "free" unless you don't count in-app purchases. That's where the money for apple is. They also get a bit of money from Apps using Apple's iAd.

 

[gvanvoor]

It's not quite that straight forward!

I don't think Apple has to code anything. If a developer adds a button that redirects you to a specific url to make the payment, apple doesn't need to code anything. The only thing they have to do is not reject any apps that have such buttons.

 

[Ceed]

You really don't know, do you?

Wow - your post is so in accurate it's unreal.

Kindle's run on Linux.
XBOX runs a Windows derivative.
PS5 uses FreeBSD.

How does that not make them "a computer"? - the 'fixed purpose' aspect? Heck no.

And your response that what defines a computer is based upon the government interest is equally as wrong.

And finally I found your initial "Do we need to have..." statement insulting. Especially since I've been using the bloody things since the 1970s.

This is Merriam-Webster's definition, for example.

View attachment 1907292

I anticipated this exact response. Not focused on how the product is purposed for the user, but focused on the fact that the device has silicon and runs on a kernel. A Tickle Me Elmo is a computer, do you think a Tickle Me Elmo is general-purpose enough, and integral to (and ingrained into) life enough, to need a free and open marketplace for developers to put out applications for all of life's essential needs, or does that seem absurd? Maybe not a "computer computer" then?

The key term is general purpose, and I'm not the only one to use it, it's one of the arguments put forth in this conflict.

 

[draugminaion]

I'm an app developer and I have been for over 13 years now. I run a small business and have made my living off of apps the entire time.

What I like about this from my perspective is that it gives user's a choice and benefits both them and me. I'm going to offer my in-app purchases at a slight discount if you don't use Apple's system (for example, credit card or PayPal), and in return it's a win-win for both me and the consumer, because I also get to avoid Apple's draconian 15%.

You see, it's simple. If Apple's cut was even SOMEWHAT competitive (say, 5% vs the 2-3% some credit processing companies take), then I'd just use Apple's system 100% of the time. But because it's 15%, I'd rather give my user's a choice that benefits us both in the process.

Business is business.

Your move Apple. Time to adjust your cut if you want developers to avoid all this nonsense.

The 15% is not for payment processing. It's for the tools, access to the platform, hosting, app review and access to Apple's more than one billion customers in a world-wide curated store that people trust.
Look at what Google is doing in Korea, developers still pay Google but they deduct 4% if you use another payment processor.
Apple will do something similar.

What percentage would not be draconian?
Break even would need about 12%.

 

[turbotech]

It seems like you’ll be able to do that sort of thing. However, Apple will likely still get a cut.

BZZZZ WRONG. Apple is not going to be able to take a cut of the external, optional alternative payment methods. That's the very essence of the judge's ruling against Apple's anti-steering anti-competitive behavior.

Apple will get a big whopping ZERO from external payment options.

 

[mrochester]

The 15% is not for payment processing. It's for the tools, access to the platform, hosting, app review and access to Apple's more than one billion customers in a world-wide curated store that people trust.
Look at what Google is doing in Korea, developers still pay Google but they deduct 4% if you use another payment processor.
Apple will do something similar.

What percentage would not be draconian?
Break even would need about 12%.

I think some people are expecting Apple to do it for nothing, subsidising the cost of the App Store from hardware sales.

 

[turbotech]

The 15% is not for payment processing. It's for the tools, access to the platform, hosting, app review and access to Apple's more than one billion customers in a world-wide curated store that people trust.
Look at what Google is doing in Korea, developers still pay Google but they deduct 4% if you use another payment processor.
Apple will do something similar.

What percentage would not be draconian?
Break even would need about 12%.

LOLZ. Breakeven at 12%? You're out of your mind. Their margins on the App Store have been estimated to be close to 90% (based on the 30% cut). It's not costing them an avg. of 12% to process transactions and to provide tools and other services that are completely scalable at a very small incremental cost of scale. Apple could charge 5-7% and still make billions in profit.

 

[Masonry]

On this site people seem happy when rulings go against Apple.

Personally I am happy to have Apple handle payments for apps. I don’t want to have to turn over my credit card information to 20 different apps and be worried about data breaches all the time. Also I trust Apple more to refund me for issues than random developers.

I am exactly the same way. I will never purchase an app from any developer or company with their own payment system. I also suspect all these types of developers and company’s who have been so outspoken to have their own payment system, will realize what it costs and that the majority of people simply don’t want it.

 

[Rogifan]

Personally, while I maintain that this is something which Apple is well within their rights to do (as backed by the courts no less), I do feel that Apple could afford to not enforce this for non-gaming apps.

You are right in that Apple makes most of their App Store revenue from freemium games, and if there was one area to go after, it would be this. Let the makers of productivity apps like Hey direct users to an external payment source and let DHH keep 100% of that $100 a year (minus processing fees); small fry like him are not worth the bad press Apple would incur for going after them.

Apple is already bifurcating the App Store into two segments - the smaller developers (defined as earning less than 1 million a year) and the larger ones. I think Apple can also go on to make a distinction between gaming apps and non-gaming apps. Just waive the revenue split for non-gaming apps, since they account for just 2% of App Store revenue, and recoup some developer goodwill while they are at it.

I mean, if you are going to spend manpower and time auditing companies, may as well just go after the big fish right away.

But then you’re basically saying Apple should continue to take a cut of game IAP because it’s a cash cow.

 

[TheMacDaddy1]

On this site people seem happy when rulings go against Apple.

Personally I am happy to have Apple handle payments for apps. I don’t want to have to turn over my credit card information to 20 different apps and be worried about data breaches all the time. Also I trust Apple more to refund me for issues than random developers.

I will not buy an app in the store unless I can pay for it using the current process. If they charge me more through the Apple store I will not buy it.

 

[boss.king]

Exactly, but now devs can choose not to use Apple's payment system but use their own - and they will. As a customer, I don't have the choice, the developer is making it. We as customers lose comfort and security.

I'm not against developers making more money but I just don't trust them with my payment information as much.

You’re misunderstanding what I said. Devs still have to offer Apple’s payment method, but now they’re allowed to also offer an alternative method in addition to Apple’s.

 

[boss.king]

Yea until that mechanism is the only option…

It’s not. They still have to include Apple’s payment option.