Comment on Apple: The App Store as a Slot Machine – Economy

Developers around the world are likely to be eyeing South Korea with envy these days. The Asian country is the first country that dares to threaten Apple’s most secure source of income: the App Store, or more precisely the fees that Apple collects in this large application store. The law passed by Parliament requires Apple to allow developers to use payment options other than the company’s own system for subscriptions and in-app purchases.

So far, Apple’s business model is reminiscent of that of the highwaymen: “You want to go to the App Store in town? But it is quite expensive, thinks the traveling merchant who is confronted with it. No, replies the highwayman, it doesn’t matter, because we offer unbeatable service, no one will attack you in the App Store, and our customers love it.

But more and more regulators around the world are questioning whether Apple is using its market power to impose unfair conditions on developers. From a developer’s perspective, this is clear. For them, Apple’s rules are iron law. There is no other way to bring apps for the iOS operating system to Apple devices. If you don’t follow Apple’s rules, you can look for another job.

But developers complain that with a 30 percent commission there is hardly any money left to live on, let alone to invest. In order to keep maximum revenue with Apple, the group even forbids app makers from notifying customers that they could also purchase their subscriptions through the app providers website. It may be good for Apple, but bad for developers. And above all, it’s expensive for customers.

Apple claims that the App Store is safe, that customer data is in good hands there, that payment through the App Store is easy, so the way through the App Store is also best for customers. Customers are likely to see it differently. In 2021 there will be more than one payment provider who will handle payments competently and securely, not least thanks to the General Data Protection Regulation, data protection will be taken seriously, at least in Europe. And security is heavily commercialized at Apple, but research shows Apple may be taking the subject more seriously as well.

Under increasing pressure from the authorities, Apple has repeatedly made the slightest concessions in recent months. First, Apple lowered its commission for small developers to 15%. About a week ago, Apple reached an out-of-court settlement with US developers who were suing and now allows them to notify their customers of payment options outside of the App Store by email. And in Japan, the Fair Trade Commission (JFTC) ruled this week that so-called reader apps will be allowed to place a single link in their apps in the future, which redirects customers from the app to a website. , where they can then create an account and purchase a subscription. Apple’s press release leaves no doubt: not two or three links are allowed, but only one.

European regulators should take South Korea as an example

Whenever the opportunity presents itself, Apple uses such bogus concessions for public relations offensives: Apple generously announced this week that it would also allow developers in other countries to make the switch from Japan – at the start of this week. 2022. That Apple is in favor of a linguistic minimum The revision of the conditions of its App Store wants to allow up to six months, is understandable if we consider that the group earns about a billion dollars each month with its tax on the App Store. Anything that threatens this financial blessing should naturally be carefully considered and willingly postponed again.

The case is different in South Korea, here it is not Apple which dictated the rules of an agreement, but the legislator acted. These changes will immediately benefit developers. The past few months have shown that Apple only moves when it is absolutely necessary. That’s why European regulators should follow South Korea’s lead, for the benefit of developers – and customers.

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