Late last week, Apple changed its policies that allow developers of apps for Apple devices to communicate with customers in the European Union. This seemingly small change is intended to bring the platform into line with elements of the European Union’s new Digital Markets Act (DMA), which broadly aims to increase competition in digital markets and keep in check the power of the few large companies that make up the modern technology space.
What does this revision mean? Essentially, the new policy allows developers to put links to websites in their iOS app without accepting Apple’s current rules. Previously, developers who wanted to market and sell, for example, a discounted subscription outside of the app (and thus outside of Apple’s financial infrastructure) could only put an in-app link that took users to the app developer’s website where they could learn more and complete the process. This new change allows for flexibility: developers can now promote offers within the app that are available anywhere, not just on their website via that one link.
But Apple gives and takes: Two new fees have been introduced – a 5% “initial acquisition fee” and a 10% “store service fee”. The first fee is a kind of finder’s fee paid for the developer acquiring a new user thanks to the App Store, and the second is used to pay for the operation of the App Store. Both fees are charged on a 12-month basis.
Spotify, of course, has been vocal in its criticism of both the way Apple communicates and pays its users, as well as the various App Store fees. So was Spotify happy with this new move? “On its face, Apple once again blatantly disregards the basic requirements of the Digital Markets Act by charging a fee of up to 25% for basic communications with users,” the company said in a statement to TechCrunch. “We call on the Commission to expedite its investigation, impose daily fines, and enforce the DMA.”
Note that “at first glance” – these new fee and regulation proposals from Apple might seem confusing, as the new policy on the one hand loosens enforcement of the old rules, but on the other hand also introduces new rules in the form of fees. Platforms with large install bases like Spotify will calculate the impact of the new fee structure, and we may soon receive more critical feedback.
Six “core” companies – Alphabet, Amazon, Apple, ByteDance, Meta and Microsoft – are the first target of the DMA, and Apple’s latest change follows the EU’s announcement that Apple’s initial response to the law still violates the rules. The EU can expect tough action: DMA violations can result in potentially hefty fines of up to 10% of a company’s annual global turnover.
