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Apple exposes intricate system of App Store fees to avoid E.U. fine of 500 million euros








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Apple Thursday made modifications to its App Store European policies, stating it thinks the new rules will help the business prevent a fine of 500 million euro ($585 million) from the EU for violating the Digital Markets Act.

The new policies are a complex system of fees and programs for app makers, with some developers now paying 3 separate costs for one download. Apple also is going to present a brand-new set of rules for all app developers in Europe, which consists of a cost called the "core technology commission" of 5% on all digital purchases made outside the App Store.

The modifications Apple announced are not a complete departure from the company's previous policy that drew the European Commission's attention in the very first place.

Apple said it did not wish to make the modifications but was required to by the European Commission's regulations, which threatened fines of up to 50 million euros each day. Apple said it believed its strategy remains in compliance with the DMA which it will avoid fines.

"The European Commission is requiring Apple to make a series of extra changes to the App Store," an Apple spokesperson stated in a declaration. "We disagree with this outcome and plan to appeal."

A spokesperson for the European Commission did not say that Apple was no longer topic to the fine. He said in a statement that the EC is looking at Apple's brand-new terms to see if the remains in compliance.

"As part of this assessment the Commission considers it especially important to get the views of market operators and interested third celebrations before choosing on next actions," the representative said in a statement.

The legend in Brussels is the current example of Apple increasingly defending its App Store policies, a key source of revenue for the iPhone maker through charges of in between 15% and 30% on downloads through its App Store.

It likewise shows that Apple is continuing to declare it is owed a commission when iPhone apps connect to websites for digital purchases overseas in spite of a current court judgment that disallowed the practice in the U.S.

Steering guidelines no longer in result in U.S.

Under the Digital Markets Act, Apple was required to enable app developers more options for how they disperse and promote their apps. In particular, designers are no longer restricted from informing their users about less expensive alternatives to Apple's App Store, a practice called "steering" by regulators.

In early 2024, Apple announced its changes, consisting of a 50 cent fee on off-platform app downloads.

Critics, including Sweden's Spotify, pressed back on Apple's proposed changes, stating that the tech company selected an approach that violated the spirit of the rules, and that its fees and commissions challenge the viability of the alternative billing system. The European Commission examined for a year, and it said on Thursday that it would once again seek feedback from Apple's critics.

"From the beginning, Apple has been clear that they didn't like the idea of complying with the DMA," Spotify stated in 2015.

Epic Games CEO Tim Sweeney, whose company successfully altered Apple's guiding guidelines in the U.S. earlier this year, implicated Apple of "malicious compliance" in its technique to the DMA.

"Apple's new Digital Markets Act malicious compliance plan is blatantly illegal in both Europe and the United States and makes a mockery of reasonable competitors in digital markets," Sweeney posted on social networks on Thursday. "Apps with contending payments are not just taxed however commercially crippled in the App Store."

The European Commission revealed the 500 million euro fine in April. The commission at the time said that the tech business may still have the ability to make changes to avoid the fine.
zhihu.com
Apple's limitations on steering in the United States were tossed earlier this year, following a court order in the long-running Epic Games case. A judge in California discovered that Apple had actually deliberately misinformed the court about its steering concessions in the United States and instructed it to immediately stop asking charging a cost or commission on for external downloads.

The order is presently in impact in the United States as it is being appealed and has actually currently shifted the economics of app development. As a result, companies like Amazon and Spotify in the U.S.