Apple Adjusts App Store Fees in EU, Introduces New Commission Structure
Apple's Response to EU Regulations and Impact on App Store Fees
By Supantha Mukherjee
Overview of the New Commission Structure
STOCKHOLM, Aug 18 (Reuters) - Apple said on Tuesday it will charge a 5% commission on digital transactions in apps distributed outside its App Store, replacing a more complex system as it seeks to comply with the European Union's Digital Markets Act.
Background: Changes Prompted by EU Antitrust Regulators
The company last year changed App Store rules and fees in the EU after the bloc's antitrust regulators ordered it to remove commercial barriers that they said hindered developers from directing customers outside the store.
The regulators criticised Apple's conditions, including a new Core Technology Fee, saying they discouraged developers from using alternative app distribution channels on its iOS mobile operating system.
Details of the Updated Fee Structure
Apple said on Tuesday that App Store apps using alternative payment processing will face a 20% commission, although fees could fall to 10% under its small business programme.
For apps distributed through alternative app marketplaces or the web, Apple will charge a 5% Core Technology Commission.
Elimination of Previous Fees
The new terms eliminate the initial acquisition fee and store services fee charged under the previous system.
Reactions and Broader Implications
Resolution with the European Commission
The changes, effective October 1, will resolve disagreements with the EU and the European Commission over these issues, Apple said.
The Commission said it welcomed Apple's changes, and will monitor their implementation.
Global Context and Ongoing Legal Disputes
Apple will introduce a single set of terms for developers operating in the EU that are similar to the commission-based terms it offers in markets such as Japan and Brazil, the company said.
Japan and Brazil have sought to open up Apple's App Store business model, under which developers have long paid commissions of up to 30% on in-app purchases of digital goods and services. Apple is still litigating over what it can charge developers in the United States.
Industry Response: Criticism from Epic Games
"Fortnite" maker Epic Games, which has been in a legal battle with Apple contesting App Store fees, called the new commission "junk fees", adding that it does "nothing to open up the mobile app ecosystem to competition, as required by Digital Market Act."
"If the Commission accepts the terms and drops their ongoing enforcement actions, the law will become meaningless and consumers and developers will not experience the benefits it was designed to provide," Epic said in a post on X.
(Reporting by Supantha Mukherjee in Stockholm; additional reporting by Juby Babu in Mexico City; Editing by Mark Potter)
