Apple store in Marché Saint-Germain, Paris, July 15, 2020.Gonzalo Fuentes/Reuters
Apple AAPL-Q could face strong action if changes to the App Store don’t meet upcoming European Union regulations, the bloc’s industry chief said on Friday.
In a move aimed at complying with the EU’s upcoming Digital Markets Act (DMA), the company will soon allow software developers to distribute apps to Apple devices via alternative stores.
Starting in early March, developers will be able to offer alternative app stores on the iPhone and opt out of using Apple’s in-app payment system, which charges fees of up to 30 percent.
But critics say the changes don’t go far enough, arguing that Apple’s pricing structure remains unfair and that the changes may violate the DMA.
Asked about Apple’s plans, EU industry chief Thierry Breton told Reuters exclusively: Change is already happening. From March 7th, we will evaluate companies’ proposals with third-party feedback. ”
He added: “If the proposed solutions are not sufficient, we will not hesitate to take strong measures.”
Apple’s new EU regime will still require developers to submit their apps to Apple for review for cybersecurity risks and obvious fraud.
Apple device users in the EU can also choose their default web browser and contactless payment app, allowing them to make contactless payments without using the Apple Pay system.
But even if developers choose not to use Apple’s App Store or payment system, they will still have to pay a “core technology fee” of 50 euro cents per user account per year.
Apple said Friday that core technology fees will only apply to developers who choose to agree to the new terms.
The company estimates that 99% of developers will reduce or maintain the fees they owe Apple under the new EU app terms.
Companies like Meta and Spotify, which have millions of free users, are likely to be hit harder than smaller developers. Neither company could be reached for comment.
Apple’s critics warn that the trade-offs under Apple’s new rules have little merit.
Andy Yen, founder and CEO of privacy-focused software company Proton, said: “Although allowing alternative payments and marketplaces seems positive on the surface, there are conditions attached to Apple’s new policy. means that in practice it is impossible for developers to benefit from it.” ”
Paulo Trezentos, CEO of alternative app store Aptoide, said:
“This was definitely a good move, but the fees are still too high. We are preparing to send formal feedback to the European Commission.”
Apple did not immediately respond to a request for comment.
A European Commission spokesperson said: “We are closely monitoring Apple’s announcements ahead of the March 7 compliance deadline. We do not comment on these announcements.
“We strongly encourage designated gatekeepers to test their proposals with third parties.”
