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Apple has changed its App Store policies for the EU regarding purchases outside the App Store.
Apple recently revised its terms for developers in the EU, allowing them to send promotions and offers with users through means other than the app or the iOS App Store. Apple brings these changes exclusively to the region in compliance with the Digital Markets Act (DMA) after the European Commission found it guilty of preventing developers from “steering users elsewhere” or sharing prices and promotions through other means.
This is in addition to Apple’s previous changes allowing developers to direct users outside the app to complete payments for services or subscriptions, or (unwillingly) opening gates to alternative app stores. Notably, Apple, along with Meta and Google are being looked at by the EU for potentially flouting rules under the DMA for restrictive payment options. The changes allow Apple to avoid – or at least delay – fines up to 10% of the global annual turnover for not complying with the DMA.
Despite these changes, Apple is not completely removing the so-called “junk fees” it levies on each transaction, including those happening outside the app. Instead, it is introducing changes to the payment structure. It would previously charge developers a “reduced commission of [at least] 10%” on each transaction processed using means other than Apple’s own payment processing services. It also levied an additional Core Technology Fee of €0.50 for every first install on apps with more than a million users, though it said the fees apply to less than 1% of the developers in the EU.
These have now been replaced with another set of fees, including a 5% “initial acquisition fee” associated with new paying users and an additional 10% as a “store service fee” (5% for developers who classify as smaller businesses and generate less than $1 million in yearly revenue) for recurring subscribers. These fees apply to purchases made on platforms other than the app itself – such as on the developer’s website.
Developers Unhappy With New “Junk Fees”
Apple’s wording for these new fee structures is being seen as an attempt to circumvent the Commission’s directives once again. The changes have been met with fresh criticism from Epic Games and Spotify, both having long opposed Apple charging a share of their earnings.
“At first glance, by demanding as much as a 25% fee for basic communication with users, Apple once again blatantly disregards the fundamental requirements of the Digital Markets Act,” a Spotify spokesperson was quoted by Reuters. Meanwhile, Epic Games founder and CEO Tim Sweeney called it a “malicious compliance by imposing an illegal new 15% junk fee on users”.
In the European Union where the new DMA law opens up app store competition, Apple continues its malicious compliance by imposing an illegal new 15% junk fee on users migrating to competing stores and monitor commerce on these competing stores.https://t.co/YUYwsnrh32 pic.twitter.com/xAWGkOWPrH
— Tim Sweeney (@TimSweeneyEpic) August 8, 2024
Addressing criticism for the new developments, a Commission spokesperson told Reuters that it “will assess Apple’s eventual changes to the compliance measures, also taking into account any feedback from the market, notably developers.” The Commission has given itself until March 2025 to make its final decision on whether Apple violates the DMA – and therefore stands liable to pay hefty fines.
