Apple has recently modified its App Store policies within the European Union, a move that follows an ongoing investigation by the European Commission into the company’s compliance with the bloc’s stringent technology regulations. This change is significant as it now allows app developers to communicate directly with their users outside of the App Store environment, a shift from previous restrictions where communication was mostly confined to “link-outs.” These link-outs redirected users from the app to external websites where contracts could be completed, limiting the developers’ ability to promote their services effectively within the app itself.
This policy adjustment comes in response to the Commission’s June 2024 charges against Apple, which accused the tech giant of breaching the EU’s Digital Markets Act (DMA). The Act, which aims to curtail the monopolistic power of major tech companies, emphasizes the need for fair competition and the prevention of unfair practices. The Commission specifically criticized Apple’s business terms, highlighting that they overly restricted how developers could interact with their customers, thereby limiting consumer choice and developer autonomy.
Under the new policy, developers will be able to promote offers and communicate directly with users from within their apps, regardless of where these offers are available. This change is seen as a win for developers who have long argued for more freedom in how they can engage with their customer base.
However, Apple is introducing two new fees as part of this update. There will be a 5% acquisition fee for new users, along with a 10% store services fee for any sales made by app users on any platform within 12 months of the app’s installation. These fees will replace the previously reduced commission that Apple charged on all digital goods and services sold through the App Store.
Currently, Apple’s fee structure includes a core technology fee for less than 1% of apps, a reduced commission for digital goods and services, and an optional fee for payments and commerce services. The introduction of these new fees has sparked concern among developers, with companies like Spotify, which has been vocal in its criticism of Apple, expressing apprehension over what it sees as an excessive charge for basic communication with users.
The European Commission has stated that it will closely monitor Apple’s compliance with the DMA, taking into account feedback from developers and other market participants. The outcome of this case could set a precedent for how other major tech companies operate within the EU, particularly in how they manage their app ecosystems.
This charge against Apple is notably the first under the DMA, which represents a significant regulatory step aimed at reining in the power of Big Tech. Should Apple be found in violation of the Act, it could face penalties amounting to as much as 10% of its global annual turnover. This case underscores the ongoing tension between regulatory bodies and major technology companies as they navigate the evolving landscape of digital markets.
