Looking to save oodles of money, Apple awaits major decision from EC
App developers wanted the freedom to send customers to third-party processing platforms
One of the main conditions that developers wanted was the freedom to redirect their customers looking to make a payment for an App Store purchase to a third-party processing platform, bypassing Apple's fees. Under the new fee structure, developers who send customers to a third party to process an App Store transaction will pay a fee between 5% and 15%. There will also be no limits on the number of links developers can send their customers that will take them to a non-Apple processing platform.
Back in April, Apple was fined €500 million ($587 million) for violating the Digital Markets Act (DMA). The latter is the groundbreaking EU legislation designed to keep competition among tech firms fair in the union of 27 European states. After the fine was announced, Apple blamed the issue on technical problems that it said prevented app developers from sending customers to cheaper prices outside of the App Store. As a result, Apple had committed a DMA violation despite the excuses mentioned by the tech giant.
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Should the EU approve the App Store changes?
Yes. The changes are fair to app developers.
No. Apple is still ripping off app developers.
I really don't care either way.
Yes. The changes are fair to app developers.
0%
No. Apple is still ripping off app developers.
0%
I really don't care either way.
0%
Apple appealed the fine this month, but at the same time, it said that the changes to the App Store's processing fees it announced in June were done to prevent the tech giant from getting hit with punitive daily fines. After Apple was fined in April, the EC, charged with enforcing EU law, gave Apple 60 days to comply with the DMA or face daily fines of up to five per cent of its global revenue, which is equivalent to approximately €50 million per day ($58.5 million).
A report published today says that the EC is expected to approve the changes , although it might be several weeks before this approval becomes official and is announced. Meanwhile, the EC said, "All options remain on the table. We are still assessing Apple's proposed changes."
Spotify's CEO Daniel Ek was one of the App Store's loudest critics in the EU
Many iOS app developers protested the fees over the years, which became known as the "Apple Tax." One CEO who might have had the loudest voice complaining about the fees was Spotify founder and CEO Daniel Ek, who filed a complaint with the EC back in 2019. Ek complained that Apple Music had an unfair advantage over Spotify in the EU due to what was then a 30% fee Apple charged to developers for processing in-app subscriptions.
The fight between Apple and Spotify continued even after the DMA was passed. Last year, the music streamer accused Apple of not allowing physical iPhone buttons to control the volume on Spotify Connect . The latter is a feature that allows iOS users to control the playback of music streamed by Spotify across compatible devices while using the Spotify app as a remote.
Other firms fighting back against the Apple Tax included Netflix. In 2018, the video streamer stopped allowing new or re-joining subscribers to open their Netflix accounts via the App Store. In 2024, Netflix stopped allowing grandfathered subscribers to pay their monthly subscription charge through the App Store. Instead, Netflix subscribers had to agree to make direct payments to Netflix to keep their subscriptions. Netflix was trying to eliminate any subscribers who were still making their subscription payments through Apple.
While you can say that the force of legislation and the possibility of huge fines led Apple to make changes to how and how much developers are charged to process App Store purchases and subscriptions, companies like Spotify and Netflix were also instrumental in forcing Apple to make some of the changes they wanted.
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