[REVIEW] : Apple finally loosens the noose of the App Store… for certain applications only

Apple has finally kept its word. The manufacturer will allow certain developers to offer a link to their websites in their applications, in order to allow users to create or manage their account… without going through the services of the App Store.

This decision is the result of an agreement reached last September with the Japanese Trade Commission (JFTC). But alas, it only concerns apps that fall into the Reader category (apps for reading newspapers, magazines or books, listening to music or watching videos). However, this category includes important titles like Kobo, Kindle, Spotify or Netflix.

However, developers of such applications cannot directly include a link in their software. They must first apply for access to Apple’s External Link Account Entitlement program. In addition, they must display a warning that specifies that the user is going to an external site, whose transactions are not managed by Apple.

They must also include a link to an Apple page that explains the risks of transmitting information to a third-party site. The manufacturer also imposes other constraints: the site cannot be opened within the application, but via the browser, the link must not transmit any parameters and the application must not indicate prices for purchases made. on the website. In short, it will be a simple link to an external site, which is ultimately very limited. And if in-app purchases are included, Apple will collect its commission as usual.

Integrated payment in dating apps in the Netherlands

The manufacturer has also loosened the screw for payments in dating apps. But this opening concerns only the Netherlands. Indeed, Apple must obey the order of the Dutch competition regulator. The manufacturer appealed the decision, but has already been fined 50 million euros for failing to comply.

Apple has also updated its information pages and indicates that developers will no longer have to provide a separate binary module for the Netherlands. The app may therefore include a payment system other than that of the App Store, but this function will not be available in other countries. Additionally, developers will need to make it clear to users that the payment system is not managed by Apple, as well as the risks of going through a third party.

Apple allows links to Netflix or Spotify to be added to their iOS app

It took some time, but Apple finally allows certain applications like Spotify, Netflix or Kindle to offer external links to their own site. iPhone and iPad users will now be able to use these links to register on these platforms, but also to manage their subscriptions and payments.

The relaxation of the rules for so-called “reader” applications means that it will be possible to avoid going through the App Store to pay for their services. These apps are described as “offering previously purchased content or a subscription for viewing magazines, books, music or videos”. The decision therefore potentially concerns many companies which, until now, had no right to provide any link allowing their subscribers to create their account on their own site. We owe this change in particular to an agreement between the Californian firm and the Japanese Fair Trade Commission (competition regulator), which Apple has chosen to extend to all “reading applications”.

Of course, there are rules to follow. In particular, developers must request access to an account dedicated to external links with Apple before they can offer them. The fact of doing without the App Store will certainly allow them to avoid paying a commission of 15% to 30% to the apple, which however can always collect some on in-app purchases if the service offers them. .

Google is following the same path

Google seems to be following the trend in order to avoid alienating developers and regulators. After reducing its tithe taken on fee-for-service purchases made on the Play Store in the summer of 2021, it recently began a similar approach regarding subscription-based applications. Since January 1, these apps have benefited from a reduced rate of 15% from day one. Previously, this rate was applied after the first year and was set at 30%.

The Mountain View giant has also just launched a pilot program allowing developers to use their own billing system. Sameer Samat, vice president of product management at Google, clarified the ins and outs of the initiative. “This pilot program will allow a small number of participating developers to offer an additional billing option alongside Google Play’s billing system,” he said.

The program will therefore make it possible to display the two invoices side by side and will let the consumer choose. Google will still recover a commission if you do not choose the Play Store, but this will be lower than the 15% usually collected. Spotify is the first company affected by this program.

Under pressure, Apple lowers its requirements to use an alternative payment system on its store

After being fined more than 50 million euros, Apple finally decides to modify the conditions of the App Store for the use of an alternative payment system in the Netherlands. The Autoriteit Consument & Markt (CMA), the equivalent of the Dutch Competition Authority, received the proposal on March 27 and welcomes it in a press release.

BLOCKING REQUIREMENTS

The new rules will be submitted for consultation to the publishers of dating applications, at the origin of the dispute. If they still do not meet the requirements previously set, Apple risks being financially sanctioned again.

As a reminder, in its previous version, it required the development of a local version of the applications to use an alternative payment system. An obligation that did not suit the Dutch regulator who saw it as a way of discouraging developers. The firm at the apple has therefore decided to drop this distinction. On the other hand, developers will still have to “limit” the use of the alternative system to the Dutch App Store. In addition, they do not escape any tax since they are levied 27%, instead of 30%, on all the income they generate via payments from smartphones, including monthly subscriptions.

A FINE OF 50 MILLION EUROS

It was in December 2021 that the Dutch authority ruled that the monetization conditions of the App Store violated competition law. A first in Europe. In response, Apple had presented a roadmap at the beginning of February which had not convinced. In total, ten fines of 5 million – the maximum – were imposed on him.

The situation in the Netherlands showed the limits of the effectiveness of pecuniary sanctions when it comes to companies that record record profits. Apple has made more than $100 billion in profits over the past 12 months, a figure multiplied by more than 40 years 15 years.

LAUNCH OF A CLASS ACTION

Civil society also wants to change things. A nonprofit consumer advocacy organization filed a class action lawsuit against Apple on March 28 for abuse of dominance in the Amsterdam District Court. She seeks damages for all people who have purchased an application in the App Store or an in-app purchase since September 1, 2009.

Apple will allow third-party payments on dating apps in the Netherlands

Apple has once again updated its App Store rules to allow dating app providers operating in the Netherlands to make payments using third-party systems, in hopes of permanently fixing its dispute with the country’s competition regulator.

As part of the change, the company said a 27% commission will still apply to payments, even if they’re made through a third-party system.

Last year, the competition watchdog ruled that Apple’s earlier reluctance to allow dating app providers to use payment systems other than its own was anti-competitive. This led the Dutch Authority for Consumers and Markets (ACM) to issue a penalty order fining Apple €5 million for each week it failed to meet the regulator’s demands, and this for 10 weeks.

Apple challenges the sanction

After 20 million euros in fines, Apple issued an update to allow dating apps to use alternative payment systems, but still imposing various conditions on how they could do so.

Earlier this week, Apple was fined its tenth weekly fine of 5 million euros to reach the ceiling of 50 million euros set by the order.

With the latest update to Apple’s App Store policies, now considering another larger periodic fine unless Apple’s most recent updates are sufficient to address anti-competitive imbalances. If the updates lead to “final terms” for dating apps, the watchdog will forward those terms to developers for review. If the developers are happy with the revised terms, then will give Apple its final decision on whether or not the company is in compliance with competition regulations.