Apple's App Charges Violate EU Antitrust Law, Dutch Agency Says (bloomberg.com) 50
Apple could be forced to scale back its App Store fees for developers after one of the European Union's antitrust watchdogs said its commissions violate the bloc's rules. From a report: In the latest twist in a long-running clash between the Dutch Authority for Consumers & Markets and the US tech giant, officials ruled that Apple's commission on certain app subscriptions are an abuse of the company's market power. In a confidential decision seen by Bloomberg, the Dutch regulator said Apple's rules unfairly target companies that offer subscription services, such as Match Group's dating app Tinder, which has to pay high commission rates on app sales, unlike ones that don't have paid digital content.
Apple harms such companies "by charging them an additional and inexplicably higher fee," according to the Dutch decision, which was sent in July. Apple had earlier offered to reduce app sale commission in the Netherlands from 30% to 27%, but the ACM's confidential findings state this offer doesn't go far enough. The decision could pave the wave for greater antitrust scrutiny across the 27-nation EU on the fairness of Apple's fee structure for different apps. The European Commission in Brussels is already investigating how Apple restricts apps from informing users of cheaper subscriptions outside the app store.
Apple harms such companies "by charging them an additional and inexplicably higher fee," according to the Dutch decision, which was sent in July. Apple had earlier offered to reduce app sale commission in the Netherlands from 30% to 27%, but the ACM's confidential findings state this offer doesn't go far enough. The decision could pave the wave for greater antitrust scrutiny across the 27-nation EU on the fairness of Apple's fee structure for different apps. The European Commission in Brussels is already investigating how Apple restricts apps from informing users of cheaper subscriptions outside the app store.
Re: Costco vs Apple (Score:2)
Costco and Apple arenâ(TM)t too different in that regards, whatever percentage it is, much of it is eaten by credit card fees, employees, infrastructure, refunds, fraud and fraud prevention etc etc.
Apple doesnâ(TM)t have a monopoly in the mobile market, with only 25% in the US and a few percent less than that in the EU. Google has a much bigger share. This is just a shakedown of big companies as the EU keeps deficit spending on par with the US.
Re: (Score:2)
1) The EU is not involved here. It's the Dutch regulator (reading EU law). 2) EU anti-trust laws don't require monopoly, but significant market share. Over 10-15% is enough. 3) According to your rationale, if "The EU" was greedy after company money, they would go after google first, which they are not doing for some reason, meaning your rationale is not correct. The reason why they target Apple and not Google: walled garden.
Also, the explanation that they want to apply fines to collect money is not very muc
Re: (Score:2)
1) The Dutch government is part of the EU apparatus, as the EU courts have repeatedly stated, EU law is sovereign over its members when it comes to regulation.
2) I would suggest you read the definition of monopoly: the exclusive possession or control over commodities in trade. Anti-trust means the legislation surrounding exclusive trusts or commodities. Apple has neither an exclusive trust nor an exclusive commodity on the smartphone market.
3) They would go after Google first, if it wasn't that Google is ha
Re: Costco vs Apple (Score:2)
Re: Costco vs Apple (Score:4, Insightful)
It's a captive market. Apple has a pure monopoly what's allowed installed on iPhones entirely.
That's what the vast majority of iPhone users want. I'm not forced to only use software that Apple approves of on my iPhone, I use an iPhone because I don't want a phone that can have just any software installed on it. I don't want my bank to tell me I have to install the Epic Store to get their app and then my work to require me to install the Microsoft Store for my 2FA and my kid's school to require me to install the Facebook Store for their stupid bullshit.
Apple might not be perfect, but I know that my bank app and my 2FA app won't be as shady as they want to be because of Apple and their "monopoly" over the iPhone software market. Consumers win, shady developers lose, so shady developers try to frame this whole situation as some sort of anti-competitive crime where consumers are somehow victimized by not being subjected to their bullshit.
I'm not captive to Apple. When a decent Linux tablet comes out I'll probably buy one because that's a space where I want to do real computing and I find the iPad limiting. But for my kid's tablet, the iPad is perfect. Just like for me, the iPhone is perfect (except for the lack of a decent dictionary app, but there's no decent dictionary app anywhere except macOS).
Re: (Score:1)
That is exactly it!!
There is already a mobile platform for people who want multiple app stores, all the customization they want and RCS. It's called "Android". Go fucking get it if that's what you want.
Those who don't want that shit can buy Apple. Leave us the fuck alone.
Re: (Score:2)
Re: (Score:2)
And so does my car manufacuterer have a monopoly on the seats installed in it. Don't like it, don't buy it.
Re: (Score:2)
Re: Costco vs Apple (Score:2)
Thatâ(TM)s not true. Apple supports enterprise app stores and there are quite a few third party app stores you can load on your phone simply by downloading an XML. It is a feature of the platform. Donâ(TM)t blame me for getting malware on it through that, but they do exist (AltStore, CokerNutX, TweakBox etc, some are complete packages with a server, some are open source projects)
Re: (Score:2)
Re: (Score:2)
Costco sets a maximum markup of 14%, to maintain "value" in consumer expectations. Otherwise shoppers will need to shop around for value.
Apple sets an arbitrary 30% markup, as they face no competition in the walled garden. They have determined that 30% is enough to keep most customers from fleeing the walled garden.
App Sales Commission is only 15% for the vast majority of Publishers that have $1,000,000 or less in App Sales.
Recurring App Subscriptions over 12 months long also drop to 15%.
Everyone conveeeniently forgets that!
Wonder why?
Heh (Score:2, Troll)
Re: Heh (Score:2)
Re: Heh (Score:2)
About that butt hurt... it goes away after a few times.
TBF (Score:2, Insightful)
Apple does not do anything worth holding on to 30%. At best, Apple deserves no more than 5% if, and only if, Apple is processing the subscription payments.
Stop wasting your money on shitty Apple products. Stop paying their shitty developer fees.
Re: (Score:3)
At best, Apple deserves no more than 5% if, and only if, Apple is processing the subscription payments.
It takes money to run the App Store, and it takes money to process payments. I'm not sure about exactly where the payment processing amount should be, as I see 1.5-3.5% is the norm for credit cards. There would be some overhead and what not. In around 5% seems reasonable there.
The other part of the issue here is that it's a free app, that then charges a subscription. If Apple doesn't take a cut of the subscription, the app is effectively a paid app curtailing the payment system. I absolutely agree they d
Re: (Score:2)
The other part of the issue here is that it's a free app, that then charges a subscription. If Apple doesn't take a cut of the subscription, the app is effectively a paid app curtailing the payment system.
An alternate view is that the app store provides a huge benefit to iPhone users and therefore would already be of immense benefit to Apple even the app store brought in negative revenue. Apple doesn't need the app store revenue to support operations, but it is nice for supporting the stock price.
Re: (Score:3)
An alternate view is that the app store provides a huge benefit to iPhone users
Does it? It's a huge benefit to Apple and its stock price, but I'm not convinced that it is a huge benefit to users at all. In the early days, maybe, but not anymore.
For a point of comparison, as a Mac user, I find the Mac App Store to be a net negative. App Store apps have less functionality than non-App-Store versions of the same app in many cases, Apple's cut almost certainly raises the cost to consumers, and it separates the documentation (on the publisher's website) from the download, which reduces
Re: (Score:2)
If the apps I got from Apple's App Store were no longer available there, but instead only available on some other App Store, I would have less apps.
I'm not chasing app stores any more than I am chasing streaming services.
Re: (Score:2)
If the apps I got from Apple's App Store were no longer available there, but instead only available on some other App Store, I would have less apps.
I'm not chasing app stores any more than I am chasing streaming services.
Heck no. Other app stores might technically be good enough to avoid antitrust scrutiny, but I want to be able to just go to the website of the software vendor, and one-tap download the app. The entire notion of having to have a store as a go-between between users and software vendors harkens back to the BBS days when you bought most of your software in physical form from a retail store.
Re: (Score:2)
If the apps I got from Apple's App Store were no longer available there, but instead only available on some other App Store, I would have less apps.
I'm not chasing app stores any more than I am chasing streaming services.
Heck no. Other app stores might technically be good enough to avoid antitrust scrutiny, but I want to be able to just go to the website of the software vendor, and one-tap download the app. The entire notion of having to have a store as a go-between between users and software vendors harkens back to the BBS days when you bought most of your software in physical form from a retail store.
You have a very short memory; or are simply masochistic!
Re: (Score:2)
If the apps I got from Apple's App Store were no longer available there, but instead only available on some other App Store, I would have less apps.
I'm not chasing app stores any more than I am chasing streaming services.
Heck no. Other app stores might technically be good enough to avoid antitrust scrutiny, but I want to be able to just go to the website of the software vendor, and one-tap download the app. The entire notion of having to have a store as a go-between between users and software vendors harkens back to the BBS days when you bought most of your software in physical form from a retail store.
You have a very short memory; or are simply masochistic!
I think you probably misunderstood what I was saying. I assume you thought I was comparing Apple to BBSes, and are disagreeing because BBSes were slow. But that wasn't the comparison I was intending to make. I'll make it clearer.
In the BBS era, there were three technological barriers to downloading software directly from the software manufacturer. First, websites didn't exist yet (though I vaguely recall some company-specific forums on CompuServe and GEnie), so the manufacturer would need a giant dialup
Re: (Score:2)
So the app developer now has to be a DevOps developer as well?
Because to do that, they need to develop a payment system. E-
Re: (Score:2)
So the app developer now has to be a DevOps developer as well?
[Long post about handling payments directly snipped, because it misses the point.]
Of course not. Developers didn't do that when they sold directly to consumers before. Why would they have to do that now? I mean yes, big companies tended to do their own payment processing for cost reasons, but smaller companies did something much simpler.
What they did instead was make the software downloadable gratis, and require you to unlock it with a serial number. Then, they would set up a store site for their compan
Re: (Score:2)
Apple counts on that laziness as a reason to assert more control. In reality, there is no need for a "store" at all.
Re: (Score:2)
Android also proves that having alternative ways to install and pay for apps is a huge net positive for users.
F-Droid offers a variety of open source apps, many of them superior to the Google Play Store versions because they can have functionality that Play does not allow. Their open source natures means that it's the first place I look when I need an app, as they are more likely to respect my privacy and F-Droid makes it very clear when they have anti-features.
There is also the Amazon app store, which I th
Re: (Score:2)
At best, Apple deserves no more than 5% if, and only if, Apple is processing the subscription payments.
It takes money to run the App Store, and it takes money to process payments. I'm not sure about exactly where the payment processing amount should be, as I see 1.5-3.5% is the norm for credit cards. There would be some overhead and what not. In around 5% seems reasonable there.
The other part of the issue here is that it's a free app, that then charges a subscription. If Apple doesn't take a cut of the subscription, the app is effectively a paid app curtailing the payment system. I absolutely agree they don't deserve 30%, or even a % based cut beyond payment processing. However, I do believe they deserve some form of payment for store maintenance. It could be a one time cut of the first month, or similar one-time payment for subscribed users.
The flip side of that is that the only reason people get iOS apps from Apple in the first place is because Apple forces you to do so. All iOS App Store profit made by Apple is basically technological rent seeking, not unlike someone setting up an unauthorized road block on the I-5 during rush hour and charging everyone a toll.
If there were no mandate to get things through the iOS App Store — if I could go in Safari, tap on an IPA file, and have it install the app so I can run it — then Apple's
Re: (Score:2)
However, I do believe they deserve some form of payment for store maintenance. It could be a one time cut of the first month, or similar one-time payment for subscribed users.
They absolutely DO NOT deserve any of that money for store maintenance. They already charge app developers between $99 and $299 ANNUALLY to be allowed to distribute your apps in the store. That is the maintenance money right there. The cost of maintenance of the store doesn't fluctuate based on the price of the apps, whether it has subscriptions inside of the app, or any other nonsense - it's a relatively static cost. They are just double dipping on the developers - who keep rolling over and letting it happ
Re: (Score:2)
At best, Apple deserves no more than 5% if, and only if, Apple is processing the subscription payments.
It takes money to run the App Store, and it takes money to process payments. I'm not sure about exactly where the payment processing amount should be, as I see 1.5-3.5% is the norm for credit cards. There would be some overhead and what not. In around 5% seems reasonable there.
The other part of the issue here is that it's a free app, that then charges a subscription. If Apple doesn't take a cut of the subscription, the app is effectively a paid app curtailing the payment system. I absolutely agree they don't deserve 30%, or even a % based cut beyond payment processing. However, I do believe they deserve some form of payment for store maintenance. It could be a one time cut of the first month, or similar one-time payment for subscribed users.
The vast majority of Publishers that actually sell their Apps, instead of just churning out bait and switch "Free" Apps that are just Trojans for a never-ending-stream of IAPs, actually only pay Apple 15% Commission, until their App Sales exceed 1 MEELION Dollars!
Jeebus, people, why do you keep harping on "30%", when only the wildly-successful, and the wildly-greedy (In-App-Purchase-Scammers) actually Pay that.
Stop and think for a moment exactly for who and for what you are advocating!
Re: (Score:2)
Re: (Score:2)
The vast majority of Publishers that actually sell their Apps, instead of just churning out bait and switch "Free" Apps that are just Trojans for a never-ending-stream of IAPs, actually only pay Apple 15% Commission, until their App Sales exceed 1 MEELION Dollars!
Apple doesn't do anything to deserve even that 15%. The store doesn't have anywhere near that level of value to any app developer - big or small.
Re: TBF (Score:2)
1.5-3.5% + .25c/transaction is the norm for high volume, low risk like grocery stores. Higher risk, small business etc, not unusual to pay 5%+50c or even more if you are classified high risk due to adult content for example or repeated customer disputes. That also still doesnâ(TM)t provides a system that stores any data (some of these apps, like games run into many TBs across decades worth of versions and various architectures), runs code signing, push notifications, makes a polished IDE and documentat
Re: (Score:2)
Re: (Score:2)
Why do people keep paying for subscription apps if no new content is generated? Subscription apps implies you are creating content within the app or doing other things like push notifications and hosting it (mostly) at Apple data centers.
I've not been involved in Apple app development for about a decade, but I remember content distribution through Apple was a huge time-and-money saver. Again, if app makers think 30% is too much, then they can just not develop for the platform and it will die.
Re: (Score:2)
Re: (Score:2)
Again, you ignore that all those apps get updates, and have content and push notifications and bug fixes that needs distributing.
Re: (Score:2)
Re: (Score:2)
But a single app may cost $8.99 or $25.00, so all the money is upfront, a subscription may cost $0.99 or less per month which comes back to the higher transaction costs as an aggregate (if every transaction costs 25 cents to process, processing them monthly vs once is costing Apple more). It's a different business model, sure, but the economies are different too.
Re: (Score:2)
It could be a one time cut of the first month, or similar one-time payment for subscribed users.
Re: (Score:2)
So, what is wrong with the way they currently do it? 30% of 99c * 12 or 30% of $10, there isn't much of a difference.
Re: (Score:2)
Re: (Score:2)
Sounds more like Tinder and co is profiting off you more than Apple is. You can't blame Apple since the dev still is to blame for 70% of that cost. $120/year for a dating app is ridiculous, you can go to a gym for that cost and talk to real people instead of conning people online.
Re: (Score:2)
Re: (Score:2)
No, my reasoning isn't flawed. You made it sound like this was about a subscription service for something like a newspaper that charges $1/month and raising the cost overhead by 30% was cutting into their profits.
You're talking about a service that starts out at $10/month and goes to $499/month, that's for rich people, I don't care how much it cost and how much Apple raises on top of that, if you're willing to plunk down $10-499/month for an app, you are getting and deserve to get fleeced.
Re: (Score:2)
Pass the cost onto consumers (Score:2)
Re: (Score:2, Insightful)
35.5% market is nowhere near a monopoly.
You don't need to be a monopoly to have significant market power. No anti-trust laws use the world "monopoly". 35.5% is well and truly above any threshold used for determining if a company has sufficent power to manipulate a market.