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

[lunafox]

It's hard to make a case that Apple is being anti-competitive in the US when US antitrust looks at whether harm has been done to consumers, and a strong argument can (and has been) made that the App Store is to the consumer's benefit.

I also look at the state of politics in the US and as a general rule of thumb, I find that the more divided the government is, the less likely it is for any major legislation passes which specifically targets Apple. Republicans are mainly going after social media companies for what they perceive to be a censorship bias, while the arguments made by democrats are pretty weak in my book.

In the US at least, I will say that Apple is in a far less precarious position than the press makes it out to be. Lawmakers on both sides are just not going to be able to agree on how best to craft legislation to rein Apple in, when they can't even agree on just what sort of harm Apple poses, and to whom exactly.

It may get more traction in the EU which looks at harm to businesses, but I expect Apple to still have a card or two up their sleeve. We have just have to wait and see, I suppose.

Preventing users access to new technologies, forcing developers to remove features from their apps, preventing users from installing software that has certain functionality or content that Apple doesn't like (for example, even though marijuana is legal in many states, Apple has decided that all apps related to "vaping" are bad and not allowed on the app store) – these negatively impact users.

A couple of years ago Apple revoked the enterprise certificate for Facebook because they found out Facebook was using the certificate to allow users to install a certain type of app outside of the App Store. This instantly prevented that app from running on tens of thousands of user's devices (which also prevented those users from getting paid by Facebook which was a primary feature of the app. It was essentially the equivalent of Progressive's Snapshot monitoring device for cars but for smartphone users.). It also disabled Facebook's internal applications for ordering food from their campus restaurants amongst other things causing significant damage to Facebook and their employees for several days.

Since Apple also has insisted on controlling all means of installing software on iOS devices, while the app store itself can be viewed as beneficial, there is harm being done to consumers by demanding absolute control of the means of installing software.

 

[Rogifan]

They wouldn't, and that's the whole point.

The court ruling allows developers to link out to an external payment option, but it also ruled that Apple was well within their rights to still seek some form of compensation for the value their App Store brings. It is very difficult to argue that Google and Apple shouldn’t be compensated in some way for building a platform, developer tools, and a digital store. If developers find themselves paying other payment providers to use the Apple and Google ecosystems, Apple and Google are entitled to compensation.

We can debate what that compensation should be (10%, 15%, 30%), but that ends up just being more about semantics.

This situation serves as a great example of what happens when lawmakers (and regulators) rush to enact new laws without thinking of unintended consequences. It's a Pyrrhic victory at best for developers.

Well I think there are other ways they could be compensated for this, and ways where all developers would contribute not like it is now where game developers basically subsidize everything else. Apple makes a crap ton of money off of IAP in games. That’s not a business I’d be proud of.

 

[Btaylor_prod]

”With respect to the alleged need for clarification because, anecdotally, some developers may not understand the scope of the injunction, the parties themselves have not indicated any confusion. The Developer Agreement prohibits third party in-app purchasing systems other than Apple’s IAP. The Court did not enjoin that provision but rather enjoined the prohibition to communicate external alternatives and to allow links to those external sites.”

In other words, Apple does NOT have to allow in-app purchasing mechanisms - what Epic tried to do is NOT what the court says Apple has to allow.

More here: https://talkedabout.com/threads/hea...partial-stay-of-injunction-in-epic-case.2155/

In-app purchasing (with Apple’s IAP) will, no doubt, be destroyed. The app developers won’t use in-app purchasing at all, forcing you to use a link. The advertising options will be very incentivized, I.e. Pay $10 per month with in-app or $10 for 3 months with this link.
Does this promote security issues…

 

[duanepatrick]

See you guys on December 9.

 

[Abazigal]

How about everyone who buys $1000 iPhones? Does none of that sale go towards the App Store?

Should it?

You are basically calling for Apple to subsidise the costs of operating the App Store using hardware profits, the same way they do with services like iMessage, Siri and Maps (none of which earn any money in themselves, but form an indispensable part of the overall user experience).

I agree that Apple probably could (and they certainly make more than enough money to do this many times over), but they shouldn't be expected to.

 

[WiseAJ]

So does this mean I'll finally be able to click a link in the kindle app to take me directly to the book I want to buy, and be able to buy it? Because really that's all I want.

And maybe a way to sign up for Spotify without giving Apple a cut would be nice too.

Why do you care if Apple takes a cut from Spotify or not. Are you Spotify?

 

[cmaier]

In-app purchasing (with Apple’s IAP) will, no doubt, be destroyed. The app developers won’t use in-app purchasing at all, forcing you to use a link. The advertising options will be very incentivized, I.e. Pay $10 per month with in-app or $10 for 3 months with this link.
Does this promote security issues…

Except when you follow the link, Apple still is entitled to its cut. And the judge says Apple is permitted to require IAP. So the rule could be “if you have a link to outside payment, you must also offer in-app payment.”

 

[TiggrToo]

Yes and for everyone complaining about security….well what about all the non-digital goods that don’t go through Apple’s IAP? Or purchases made in the browser? How come those are OK and no one mentions security concerns?

And pray tell, what security concerns would there be buying a pound of HoneyCrisp apples through Amazon fresh on my iPhone?

 

[vipergts2207]

Hard for a judge stuck in the 19th century to understand this at all. So the nuts are still trying to convince the world that a company that makes a device has to allow any and all other companies full access to anything on it. X-Box will have to support PlayStation. Walmart can’t chose what they sell. Costco can’t only accept Visa? This is very much the case of antiquated thinking.

It’s almost like you’re completely off base.

 

[TiggrToo]

A couple of years ago Apple revoked the enterprise certificate for Facebook because they found out Facebook was using the certificate to allow users to install a certain type of app outside of the App Store. This instantly prevented that app from running on tens of thousands of user's devices (which also prevented those users from getting paid by Facebook which was a primary feature of the app. It was essentially the equivalent of Progressive's Snapshot monitoring device for cars but for smartphone users.). It also

So contracts shouldn‘t be enforeable?

 

[TiggrToo]

So does this mean I'll finally be able to click a link in the kindle app to take me directly to the book I want to buy, and be able to buy it? Because really that's all I want.

And maybe a way to sign up for Spotify without giving Apple a cut would be nice too.

And of course using your Kindle to buy eBooks from Barnes & Noble.

Oh that’s right, you can’t…

 

[vipergts2207]

Sorry I wasn’t clear.

The difference between a mac and an iPad is, as you note, largely software. But those differences are very important to people - iOS is insanely more popular than macOS. And for a reason. People who buy iOS devices mostly LIKE the safety and security that comes from its more locked-down nature.

Purporting that people like iOS because it’s locked down would seem rather baseless. Apple’s hardware and software design would seem larger factors.

 

[vipergts2207]

As per forum rules, please provide a source for your claim.

Source your claim.

 

[Yojimbo007]

This ruling does NOT mean that 3rd party systems are allowed (accepting CC payment within the App). The ruling only requires that a link to Safari is provided moving them outside the app for the transaction. Of course the link could include unique identifiers for the individual user and that could affect user privacy and link tracking.

Ultimately this means that a developer could completely bypass the In-App system and unlock features with credit cards on their website... giving the developer 97% of the purchase price instead of 70%/85%. Another advantage is immediate payment instead of waiting 30+ days for Apple to payout. The disadvantage is that users will have to go through a whole lot of additional steps instead of the one-click purchase that In-App provides... so even though the developers are making more per transaction, they might actually be making less overall because of the increased user difficulty in purchasing.

If a developer would ultimatly be able to bypass the cut Apple takes yet have the luxsury of having exposure to the world through Apple‘s AppStore, ..then Apple should CHARGE AN ADVERTISING FEE (per day,month, year..etc) for every app presence in the Appstore (Just like any magazine would) and on top add a DOWNLOAD FEE/DOWNLOAD! (ofcourse to those developers who choose to resort to this ruling)

Developers want to have their cake and eat it too….. Get exposure through Apples Appstore for free and owe nothing to Apple for providing them the platform and the mechanism of downloading… Thats BS!

I agree that this ruling may actually endup hurting what developers net if Apple plays its cards right.

 

[Abazigal]

Well I think there are other ways they could be compensated for this, and ways where all developers would contribute not like it is now where game developers basically subsidize everything else. Apple makes a crap ton of money off of IAP in games. That’s not a business I’d be proud of.

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.

 

[toobravetosave]

Why do you care if Apple takes a cut from Spotify or not. Are you Spotify?

Why do you care if apple gets a cut from everything they don't make? are you apple?

 

[lunafox]

Why do you care if Apple takes a cut from Spotify or not. Are you Spotify?

I would care if I was a Spotify user, because it would likely mean that fee was passed on to me as a user. And since Apple demands that the price be the same regardless of if its purchased through in-app purchase or externally, that fee gets passed on to Spotify users regardless of if they're Apple users.

And I would care if I was a music producer that was being paid per-listen to my content, since this fee would likely create a pressure for Spotify to reduce my compensation so that they could stay competitive with Apple's own Music subscription service.

And I would care as a person that loves music because this difference in compensation to music producers would likely create an incentive for producers to pick and choose the platforms they were available on, fracturing music listeners across lines of which subscription service they used. Heard a great new song on Apple Music you want to tell your friend about? Too bad, Spotify doesn't have that song because Whatever Records has decided to only be on Apple Music because Spotify doesn't pay them enough.

There are negative impacts to everyone here except Apple who benefits in every way:
- An unfair advantage in the pricing model for music subscription services.
- Imposed difficulty for users to sign up for their competitor's music subscription service.
- Profit for users who subscribe to Spotify, Apple's competitor.
- Profit when users capitulate and use Apple's Music subscription service.
- Having user frustration misdirected at Spotify even though the issues are imposed by Apple.
- Music producers favoring Apple Music over spotify because they can offer better compensation at the same monthly subscriber price point.

 

[StupidOpinion]

this is a win for consumers. some of you guys are saying that you don't trust your credit card information with 3rd party apps but why would you trust it with apple? apple has been hacked multiple times over the years. also, you would still have the option to make payments through the app at the premium that you would have been paying for anyway. i see this as a win for consumers and loss for apple

 

[Abazigal]

Why do you care if apple gets a cut from everything they don't make? are you apple?

I don't own any Apple stock, so beyond a certain point, how well Apple does is immaterial to me, but I will still argue that Google and Apple do deserve to be compensated in some way (beyond the annual $99 developer fee).

As an iOS user, I feel it is in my interests to ensure the viability and vitality of the App Store. I am not in favour of side loading and alternative app stores because I don't want to see the day when I am forced by certain developers to use other app stores just to access a certain app I want.

We also see the disparity in the amount of care and quality that is dedicated to the iOS App Store and google play store respectively. In this context, I will also argue that it is in the user's vested interest that the iOS App Store not be positioned as a loss leader. The more money it makes, the more incentive Apple has in running it well, and the better it is for consumers overall.

 

[123]

Apple has to allow third party developers to communicate that they can get better prices outside the App Store

No. Nothings says Apple has to allow better prices. And they won't. Buttons and links to alternative methods outside the app must be allowed, but Apple will allow this only for the same price as you pay in the app. The ruling doesn't touch this subject so Apple will add additional clauses to protect their method.

 

[Abazigal]

this is a win for consumers. some of you guys are saying that you don't trust your credit card information with 3rd party apps but why would you trust it with apple? apple has been hacked multiple times over the years. also, you would still have the option to make payments through the app at the premium that you would have been paying for anyway. i see this as a win for consumers and loss for apple

I am not against it. I am simply pointing out that given how (I think) Apple will likely implement this feature, it's not going to have the impact or the benefit that many people here think it will.

Many people seem to think that this ruling represents a crack in the app dam and is the first of many dominoes to fall with regards to the imploding of Apple's App Store model.

I just don't see much changing in the bigger scheme of things.

 

[staypuftforums]

I'm not sure how I feel about all this. A part of me agrees but I don't like it when a company like Epic try and state that they are looking out for users when it's blatantly obvious they are only interested in their own bank balance.

Also, if I started something successful through hard work and innovation but was then told 'No, you can't do it that way, you must do it like this' then I'd probably be pretty fed up. I appreciate competition and all that but to be told you have to change something you created would be very frustrating.

Every company in the US is subject to consumer protection laws. Most industries are heavily regulated.

Unless you are a strict anarchist, I don’t see why you’d hold those feelings towards Apple.

This is a good first step.

 

[123]

iOS is insanely more popular than macOS. And for a reason. People who buy iOS devices mostly LIKE the safety and security that comes from its more locked-down nature.

Actually, they LIKE the UI.

 

[Fousthvk]

Apple should just shut the App Store down for a month. It's theirs. Do with it what they want. Bet that would make so many developers angry apple would get their way.

 

[Gasu E.]

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

But currently Apple doesn't get a cut of Kindle books I read on my iOS Kindle app. Why would Apple get a cut of such books after this ruling?