What Will We Learn When DMA Comes to an End? Theoretical Analysis of Apple’s iOS Core Technology Fee and Other EU Policy Challenges
The App Store will go through its largest shake-up since it was launched in 2008. Today, Apple announced how it plans to change the rules for developers releasing iOS software in the European Union in response to the bloc’s Digital Markets Act (DMA) coming into force in March. Third-party app stores will be allowed for the first time on the OS, taking away the Apple App Store’s position as the sole distributor of iPhone apps. The changes will arrive with iOS 17.4 in March.
The company is also introducing a new type of fee for particularly popular apps. The Core Technology Fee will only be charged after one million annual installs of the app in the EU. 99% of developers will either reduce or maintain their fees to Apple under the new business terms, and less than 1% will have to pay a core technology fee according to Apple.
We have to wait and see whether Apple’s new commission rates will satisfy the “Apple Tax” critics such as Spotify, who have fought hard against it. After years of theoretical debates and court battles, we are about to discover whether users prefer alternative app stores and payment methods over Apple’s in-house options.
As well as designating iOS, Safari, and the App Store as core platform services, the European Commission also opened an investigation into whether iMessage should be included (which would include having to make it interoperable with rivals), but reports suggest it might avoid being designated, and today’s announcement from Apple makes no mention of changes coming to iMessage.
Sweeney will surely have more to say about Apple’s EU policies, too, and it seems like he’s just getting started. “There’s a lot more hot garbage in Apple’s announcement,” he says. It will be a while before we see the finished product of this new horror show.
Apple can choose which stores are allowed to compete with their App Store. Apple could theoretically block all of the game companies from launching their storefronts, according to him. Still, Sweeney says his goal is to launch the Epic Games Store on iOS and Android and become the “#1 multi-platform software store. on the foundation of payment competition, 0%-12% fees, and exclusive games like Fortnite.”