Spotify, Epic Games, and Others Argue Apple's App Store Changes Do Not Comply With DMA

[Rogifan]

"Rent seeking" is primarily about companies lobbying the government for subsidies or protective tariffs. Who was lobbying the EU? Not Apple.

What exactly does Apple do to deserve 15 or 30% of Netflix’s monthly subscriptions? If Apple wants to argue someone signed up for Netflix because the app exists in the App Store then charge Netflix a one time finders fee. But taking 15% of Netflix’s monthly subscriptions when Apple doesn’t host the content or have anything else to do with the business is rent seeking.

There’s a reason Apple created the ‘reader’ app category and allows apps like Netflix and Spotify to exist without having to offer IAP.

 

[AppliedMicro]

And the idea that the iPhone/iOS in 2024 have hardly changed versus 2007 doesn't make any sense

It doesn’t - I fully agree with you on that.
But it hasn’t changed much since 2018.
In fact, it hasn’t substantially changed at all (save for bundling some features that could just as well exist in dedicated third-party apps).

How did Spotify or Tinder or Microsoft or Epic "innovate" more than Apple on iOS?

As an example, streaming AAA games to mobile devices (like Xbox Cloud gaming) is clearly somewhat innovative.

That’s why Apple came up with b***sh*t store rules to tax them with commissions for doing it through apps (that provide best experienc).

 

[Rogifan]

…and neither would Apple’s App Store work.

Exactly. Should Apple be paying every ISP and cellular provider a percentage of the sale of every internet connected device they sell?

 

[Rogifan]

Spotify's subscribers pay through the internet just like with Netflix and Amazon Kindle. Apple doesn't get a cut.

Because Apple exempted those apps.

 

[AppliedMicro]

Should Apple be paying every ISP and cellular provider a percentage of the sale of every internet connected device they sell?

“ISPs clearly deserve a cut. They invest a lot in their IP and infrastrucker. Apple can’t expect to freeload on them when making money on digital transactions conducted through the internet connection they provide.”

Side note: EU is working on it. (https://digital-strategy.ec.europa....-communications-sector-and-its-infrastructure)

 

[gnipgnop]

What exactly does Apple do to deserve 15 or 30% of Netflix’s monthly subscriptions? If Apple wants to argue someone signed up for Netflix because the app exists in the App Store then charge Netflix a one time finders fee. But taking 15% of Netflix’s monthly subscriptions when Apple doesn’t host the content or have anything else to do with the business is rent seeking.

There’s a reason Apple created the ‘reader’ app category and allows apps like Netflix and Spotify to exist without having to offer IAP.

You seem to be way behind the news per Netflix/Spotify etc. Those companies discontinued in-app payments a long time ago. Their subscribers pay via the internet and Apple gets 0%.

And, once again, "rent seeking" doesn't mean what you think it does.

What Is Rent Seeking in Economics, and What Are Some Examples?

Rent seeking is defined as any practice in which an entity aims to increase its wealth without making any contribution to the wealth or benefit of society

www.investopedia.com

"Rent seeking is an economic concept that occurs when an entity seeks to gain wealth without any reciprocal contribution of productivity. An example of rent seeking is when a company lobbies the government for grants, subsidies, or tariff protection.

Rent seeking comes in many forms from lobbying or donating funds. For example, if you donate money but write it off on your taxes, it could be considered a form of rent seeking. Rent seeking interferes with the efficient operation of the free market, and it imposes unfair prices and barriers on individuals and companies."

 

[visualseed]

I'd be surprised if the 50¢/year per install fee remains. The way it's worded now, if a developer releases a free calculator and never once updates it, they could still end up owing Apple millions of dollars a year for that "technology fee".

If you put licensable content from others in a book or film and give it away, you can also be liable for millions of dollars in fees. I think, out of everything, the fees are the one thing that the EU has the least amount of jurisdiction over, and the one thing developers were hoping were going to magically go away but never outright had any legal claim to challenge so they hoped that sideloading and alternate app stores would open that door and are quickly finding out that will not be the case.

 

[Sophisticatednut]

“ISPs clearly deserve a cut. They invest a lot in their IP and infrastrucker. Apple can’t expect to freeload on them when making money on digital transactions conducted through the internet connection they provide.”

Side note: EU is working on it.

Nono, obviously TSMC deserves 30% cut of the sales apple make through the AppStore, and Qualcomm also deserve a 30% cut. Etc etc 😂

Then perhaps the ISP deserves a cut afterwards.

 

[gnipgnop]

Because Apple exempted those apps.

No, it's because they moved their subscription payments to the internet. Subscriptions via App Store = 30% first year and 15% successive years. Subscriptions via internet = 0%.

 

[gnipgnop]

It doesn’t - I fully agree with you on that.
But it hasn’t changed much since 2018.
In fact, it hasn’t substantially changed at all (save for bundling some features that could just as well exist in dedicated third-party apps).


As an example, streaming AAA games to mobile devices (like Xbox Cloud gaming) is clearly somewhat innovative.

That’s why Apple came up with b***sh*t store rules to tax them with commissions for doing it through apps (that provide best experienc).

iPhone/iOS haven't changed substantially since 2018? Based on what standard? Are you trying to say that 3rd party apps have changed substantially since that time but iPhone/iOS haven't? How would that even be possible?

Per cloud gaming, it predates the iPhone/App Store so I'm not sure how that would qualify as being more innovative.

 

[visualseed]

Nono, obviously TSMC deserves 30% cut of the sales apple make through the AppStore, and Qualcomm also deserve a 30% cut. Etc etc 😂

Then perhaps the ISP deserves a cut afterwards.

I deserve a cut of the things I buy because without me hitting the buy button none of this would be possible.

 

[Born2Run]

Oh no, the big mentally challenged babies that are Epic Games have another complaint about Apple because they lost and haven't been mentioned in the news much recently... Please can we just take Epic Games out back, shoot them in the head and put us out of our misery!

 

[headlessmike]

So you think the iPhone is a game console and not a general purpose computer? How about a compromise where Apple only rent seeks on games. That’s where they make most of their IAP money anyway.

It’s neither. It’s a telephone. But if console manufacturers can get away with all software requiring licensing and vetting, then there should be no legal reason why Apple can’t too in this case. I’m not claiming that it’s morally right or wrong, just that it’s not unprecedented.

 

[jgwsto]

Guess, work is ongoing to implement a subscription model for iOS upgrades.

 

[headlessmike]

Guess, work is ongoing to implement a subscription model for iOS upgrades.

That’s how it worked for the first few versions of iPhoneOS. iPhone upgrades were subsidized by their monthly contracts but iPod users had to pay for updates outright.

 

[Sophisticatednut]

It’s neither. It’s a telephone. But if console manufacturers can get away with all software requiring licensing and vetting, then there should be no legal reason why Apple can’t too in this case. I’m not claiming that it’s morally right or wrong, just that it’s not unprecedented.

Easy, consoles aren’t classified as gatekeepers and don’t have the same legal obligations

 

[gnipgnop]

Easy, consoles aren’t classified as gatekeepers and don’t have the same legal obligations

You might want to read the EU's gatekeeper rules before commenting. There's nothing in there about preventing gatekeepers from charging $$ for use of their platforms. EU never said there was anything wrong with commissions or fees etc.

The Digital Markets Act: ensuring fair and open digital markets

Discover how the Digital Markets Act ensures large online platforms in the EU behave fairly, and allows new players to enter the market, thus developing a fast evolving digital sector.

commission.europa.eu

 

[Sophisticatednut]

You might want to read the EU's gatekeeper rules before commenting. There's nothing in there about preventing gatekeepers from charging $$ for use of their platforms. EU never said there was anything wrong with commissions or fees etc.

The Digital Markets Act: ensuring fair and open digital markets

Discover how the Digital Markets Act ensures large online platforms in the EU behave fairly, and allows new players to enter the market, thus developing a fast evolving digital sector.

commission.europa.eu

Indeed, and in the DMA it states what they must provide for free or at no cost

 

[gnipgnop]

Indeed, and in the DMA it states what they must provide for free or at no cost

No, it doesn't.

 

[headlessmike]

Easy, consoles aren’t classified as gatekeepers and don’t have the same legal obligations

But the current change is not opening up iOS, just the AppStore monopoly. So, they still may be able to require a licensing fees for apps sold through alternative stores. That’s what we’ll find out.

 

[Sophisticatednut]

But the current change is not opening up iOS, just the AppStore monopoly. So, they still may be able to require a licensing fees for apps sold through alternative stores. That’s what we’ll find out.

No, it doesn't.

7. The gatekeeper shall allow providers of services and providers of hardware, free of charge, effective interoperability with, and access for the purposes of interoperability to, the same hardware and software features accessed or controlled via the operating system or virtual assistant listed in the designation decision pursuant to Article 3(9) as are available to services or hardware provided by the gatekeeper.

 

[I7guy]

Difference: They’re in a duopoly with Android and have (had commercially) a monopoly for distribution of iOS apps.

There is no duopoly. There is no one forcing other phone manufacturers to pay google $1 to use their operating system. There would be a duopoly if these android manufacturers were forced to use an operating system.

Apple has much lower incentive to innovate - cause they have less competition due to network effects and customer lock-in.

That’s just plain ********.

 

[gnipgnop]

7. The gatekeeper shall allow providers of services and providers of hardware, free of charge, effective interoperability with, and access for the purposes of interoperability to, the same hardware and software features accessed or controlled via the operating system or virtual assistant listed in the designation decision pursuant to Article 3(9) as are available to services or hardware provided by the gatekeeper.

That doesn't mean what you think it does.

 

[Sophisticatednut]

That doesn't mean what you think it does.

So what is required to be provided free of charge? So what does it mean?

I’m using these 3 ways to analyze the text

1. comparative Interpretation​

Looking at the literal definition of the words and how the regulations is written in the different legal language in EU, for me that would be , Swedish, danish, English and German text.

2. Contextual Interpretation​

Contextual interpretation asks us to look beyond the words of a text and to examine the context in which the law exists. This interpretation has two possible perspectives:

A. Systemic interpretation​

The ECJ can look inward and consider the EU law provision in question as being a cog in the system, and ask which interpretation makes the most sense based on how this law should function as part of the overarching system. This method of interpretation assumes that the legislator is rational and emphasises the effect a law will have when it is put into practise. The aim of this is to bring more consistency to EU law and to avoid an interpretation which clashes with the broader system.

B. Travaux Préparatoires (preparatory work)​

Alternatively, the ECJ can consider what the legislators (the Commission, the Parliament, and the Council) intended by looking at what they said during negotiation. This can be accessed from preparatory documents produced during the various stages of the legislative and budgetary process.

3. Teleological interpretation​

Teleological interpretation has been very important for EU law. It looks at the objective of the law, considering the purpose, values, legal social and economic goals it aims to achieve.

 

[AppliedMicro]

There is no duopoly. There is no one forcing other phone manufacturers to pay google $1 to use their operating system. There would be a duopoly if these android manufacturers were forced to use an operating system.

There is no “one” forcing them. But market conditions do - there is no other smartphone OS suitable for distribution in developed markets (since iOS is exclusive to Apple). Selling smartphones in EU markets without the ecosystem of iOS or Android apps isn’t viable.

That’s just plain ********.

That’s just devoid of any factual (counter)argument.