Apple’s new App Store rules make it ‘like the Godfather’

This week, Apple made a long-awaited breakthrough move to allow other companies to launch app stores on the iPhone.

The tech giant was forced into action by EU politicians concerned about its market monopoly.

The decision has been closely watched around the world and was initially celebrated as an industry victory for businesses and consumers in the EU.

The company is one of many companies, including Fortnite maker Epic Games, asking Apple to allow an alternative app store on the iPhone.

EU lawmakers had hoped that the rule changes would encourage smaller challengers to enter the lucrative iPhone market.

“Apple says they’re opening up, but they’re still taking a hard line when it comes to the iPhone,” said the former hacker and businessman who lives near Chicago and is the founder of one of the EU’s first alternative app shops. says Colton Adamski, who is trying to raise the bar.

The 22-year-old has been running an unofficial iPhone app store for more than six years.

In his words, it is a “gray business” that operates on the edge of legality. In regions outside the EU, launching an app store violates Apple’s terms and conditions, and installing apps outside of the official App Store is prohibited.

This process, known as sideloading, is common on Android smartphones, but Apple has banned it since the iPhone’s launch, citing security risks. Tech giants have long insisted that apps need to be authenticated through the official App Store.

Apple charges an average 30% fee for apps that use its store, which it says is to protect consumers. Although this fee is debatable, it is generally true that Apple has been more successful in eliminating malicious apps than other marketplaces such as Google’s Play Store. .

Colton’s app shop has hundreds of thousands of downloads of unofficial apps and games. The BBC tried his service and was able to download the app onto an iPhone with a simple workaround of changing the phone’s settings and disabling the security warning.

He makes a decent living running a low-key app shop, but he’s long wanted to start one legally. So when the new EU law was announced in January, he jumped at the chance.

“I was very excited to finally have the opportunity to go from being a ‘gray’ store operating within the confines of a permit to opening a full-fledged store,” he says.

Apple is currently the world’s largest smartphone retailer and has the most affluent user base, so bringing the iPhone to its store would be a big win.

But Colton’s excitement died down when he and his team started reading Apple’s terms of service.

He likens Apple’s rules to the gangsters in The Godfather and The Sopranos. Yes, you can open a shop on their turf, but if you don’t do what they say, they will shut you down.

Apple claims the new app shop has €1m (about £851,000) in the bank, but could be shut down if its reserves fall below that figure. Apple didn’t answer our questions about why this is needed, but has previously said this is to weed out risky or fraudulent stores.

In recent weeks, since Colton secured the line of credit, Apple has said that app developers who have been in “good standing” for at least two years can build an app shop without needing €1 million.

The next hurdle for Colton is how to make a profit. Apple automatically charges new app stores his 0.5 euros for every download over 1 million. Apple says this core technology fee is meant to keep iPhones safe through security updates.

But Colton feels this is more like protection money, paid to the mob in the name of ensuring the safety of a store owner’s business.

So if someone downloads your App Shop app but never uses it, they still have to pay Apple 50 cents.

Apple is also applying a 50 cent fee to individual apps that have been downloaded more than 1 million times, worrying some popular app makers.

The company is Created a website Here, app developers can estimate the amount they would have to pay Apple if they chose to list their app on other stores. If his number of downloads exceeds 1 million, the total could be in the thousands, but if you sell only on Apple’s App Store, it won’t cost you anything.

Another fee that has been criticized is that Apple charges a 17% commission on app sales on stores such as the App Store.

Apple claims that 99% of the apps it currently hosts are small enough that it can reduce or maintain current charges. “Ultimately, we want to give developers the flexibility to choose the business terms that make the most sense for them,” the spokesperson said.

But like The Godfather, Colton says Apple is making companies an offer they can’t refuse: to remain exclusively listed on the App Store.

“Many app developers I know are angry and upset. How on earth can they explain this core technology fee? I can’t believe Android is doing that nonsense.” says Colton.

Android smartphones running Google software have historically been more open, allowing the existence of other app shops such as the Samsung Galaxy Store and Huawei AppGallery.

But Google’s own app shop, Google Play, is the most dominant player, and like Apple’s App Store, it charges apps an average of 30% of profits or subscriptions in fees.

EU lawmakers who enacted the Digital Markets Act have not yet opined on Apple’s alternative rules for the app store, saying they would evaluate them once they are implemented.

For now, Colton said he’s determined to make his app store work. “It’s proving to be really tough, but this is literally the future of iPhone, so me and my team are working hard,” he said.