4 ms·

It's not clear to me from the article what remedy they're proposing. Seems like it could be any of: * Drop the 30% fee * Drop the 30% fee for apps the compete

by mnd999 6y ago

It's not clear to me from the article what remedy they're proposing. Seems like it could be any of: * Drop the 30% fee * Drop the 30% fee for apps the compete directly with Apple apps. * Allow users to install other app stores.

spzb 6y ago
I don't think they're proposing anything at this point but the obvious remedy would be to allow third party payment options.
- yarcob 6y ago
  I think this would be the best solution. Apples only (real) reason for forbidding sideloading is because then they could no longer force people to use their payments. If developers were free to use 3rd party payment solutions, then Apple would probably be a lot more lenient towards side loading apps. I believe that Apple generally wants to build what's best for their customers, except when money is on the line.
  - evgen 6y ago
    The (real) reason to forbid sideloading is that it opens your customers up to the malware sewer that is Android. If sideloading is allowed it would take about 30 seconds for Facebook to create their own 'store' where the only product is Facebook apps with tracking turned on and data pilfering turned up to 11. You would see similar fly-by-night 'malware r' us' stores pop up pushing casinos, lotteries, and whatever other crap they can A/B test which shows that users with few technical skills can be tricked into using/installing. Happy to have 3rd party payment options as long as it prevents sideloading.
    - simion314 6y ago
      The malware on Android is mostly FUD. But if the OS would be competent enough then this would not be a problem. OSX is not locked and there are not millions of daily victims, so maybe it is not impossible to have low malware problems and freedom.
    - yarcob 6y ago
      The security on iOS comes from extremely well working sandboxing, not from Apple's control. A lot of scam apps get through app review. From a security point of view app review is not effective at all. That's just a story Apple likes to tell to hide the fact that they want the power to block anything they don't like.
  - mnd999 6y ago
    I think security is a valid consideration as well. The average non-technical iPhone user would not be hard to hoodwink into installing a 3rd party App Store full of malware. Agree, revenue is probably the primary driver.
huhtenberg 6y ago
* Allow alternative payment options. The rest will follow. If supporting alt-monetized apps in AppStore will be too much for Apple, then they should allow AppStore alternatives or start charging hosting/processing fees. If paying through AppStore will be more expensive than paying in some other way, then Apple should lower the fees. Just needs some form of competitive pressure to get the ball rolling.
- jsnell 6y ago
  Yes, this. Except they won't allow alternative payment forms for everything, but try to restrict it to as little as the commission lets them get away with.
- Spivak 6y ago
  Would you be okay with allowing alternative payments methods if Apple still billed you 30% of your revenue rather than collecting it at the point of sale? Because if no then it is about the fee and not the payment processing.
  - huhtenberg 6y ago
    Not sure I follow. What would justify this 30% cut in this case? The fact that they are forcing all app installs to be done through the AppStore? A fair fraction of vendors don't need that the exact same way they don't need payments to be funneled through Apple. It's Apple's choice. No reason why the vendors should be forced to pay for it.
kryptiskt 6y ago
I presume Apple could get out of the music business too. From a profit standpoint that would be the best alternative for them, there's no real money in it. That is, if the EU would let them get away with just doing that.
Mindwipe 6y ago
They haven't proposed the remedy yet. I'd suggest - * Remove the requirement to use Apple for IAPs * Allow users to install software from third parties, including app stores. * Introduce an active choice ballot. * Force Apple to divest the App Store into a separate company that is forbidden from entering into exclusivity arrangements with hardware platforms. * Forbid clauses that require price fixing, or informing consumers of other purchase options.
lawtalkinghuman 6y ago
Microsoft is an applicable precedent here - when it was found that they had breached competition law in using bundling with Windows as a way to gain unfair market dominance for Internet Explorer, the remedy was to require that Microsoft offer users a means to select and download competing browsers on first use. The Commission can then fine them a significant amount if they fail to comply with the decision. Of the options you've suggested, the second seems most likely. One potential solution that may also work is instead of not taking the 30% fee, to allow Spotify and others to take payment through another channel (e.g. by bouncing users to a web-based payment gateway) - the enforcement there just becomes an injunction to not enforce the app review rules that prevent affected apps from using third-party payment providers in addition to or as an alternative to payment through the App Store. The difficulty will be where they draw the line. A lot of third party services compete with built-in apps/OS features: for instance, Dropbox/iCloud Storage, Notes/Evernote, Office 365/Google Docs/iWork. The difference between Apple Music and Spotify (and presumably also Tidal and Deezer etc.) is really clear, but quite where you divide up these markets is a real tough issue in EU competition law. An Apple Music user could very easily be a Spotify user and vice versa, but not every iCloud user would necessarily be a Dropbox user.
moffatman 6y ago
Something which is unintuitive is that the 30% payment fee does not advantage Apple as much as it seems. Converting a customer to Apple Music from Spotify can't increase Apple's profit by more than what Spotify lost. You have to consider that the App Store's revenue will be reduced by that 30% cut if they are not charging that to the Apple Music department.

by mnd999 6y ago

spzb 6y ago

I don't think they're proposing anything at this point but the obvious remedy would be to allow third party payment options.

yarcob 6y ago
I think this would be the best solution. Apples only (real) reason for forbidding sideloading is because then they could no longer force people to use their payments. If developers were free to use 3rd party payment solutions, then Apple would probably be a lot more lenient towards side loading apps. I believe that Apple generally wants to build what's best for their customers, except when money is on the line.
- evgen 6y ago
  The (real) reason to forbid sideloading is that it opens your customers up to the malware sewer that is Android. If sideloading is allowed it would take about 30 seconds for Facebook to create their own 'store' where the only product is Facebook apps with tracking turned on and data pilfering turned up to 11. You would see similar fly-by-night 'malware r' us' stores pop up pushing casinos, lotteries, and whatever other crap they can A/B test which shows that users with few technical skills can be tricked into using/installing. Happy to have 3rd party payment options as long as it prevents sideloading.
  - simion314 6y ago
    The malware on Android is mostly FUD. But if the OS would be competent enough then this would not be a problem. OSX is not locked and there are not millions of daily victims, so maybe it is not impossible to have low malware problems and freedom.
  - yarcob 6y ago
    The security on iOS comes from extremely well working sandboxing, not from Apple's control. A lot of scam apps get through app review. From a security point of view app review is not effective at all. That's just a story Apple likes to tell to hide the fact that they want the power to block anything they don't like.
- mnd999 6y ago
  I think security is a valid consideration as well. The average non-technical iPhone user would not be hard to hoodwink into installing a 3rd party App Store full of malware. Agree, revenue is probably the primary driver.

huhtenberg 6y ago

* Allow alternative payment options. The rest will follow. If supporting alt-monetized apps in AppStore will be too much for Apple, then they should allow AppStore alternatives or start charging hosting/processing fees. If paying through AppStore will be more expensive than paying in some other way, then Apple should lower the fees. Just needs some form of competitive pressure to get the ball rolling.

jsnell 6y ago
Yes, this. Except they won't allow alternative payment forms for everything, but try to restrict it to as little as the commission lets them get away with.
Spivak 6y ago
Would you be okay with allowing alternative payments methods if Apple still billed you 30% of your revenue rather than collecting it at the point of sale? Because if no then it is about the fee and not the payment processing.
- huhtenberg 6y ago
  Not sure I follow. What would justify this 30% cut in this case? The fact that they are forcing all app installs to be done through the AppStore? A fair fraction of vendors don't need that the exact same way they don't need payments to be funneled through Apple. It's Apple's choice. No reason why the vendors should be forced to pay for it.

kryptiskt 6y ago

I presume Apple could get out of the music business too. From a profit standpoint that would be the best alternative for them, there's no real money in it. That is, if the EU would let them get away with just doing that.

Mindwipe 6y ago

They haven't proposed the remedy yet. I'd suggest - * Remove the requirement to use Apple for IAPs * Allow users to install software from third parties, including app stores. * Introduce an active choice ballot. * Force Apple to divest the App Store into a separate company that is forbidden from entering into exclusivity arrangements with hardware platforms. * Forbid clauses that require price fixing, or informing consumers of other purchase options.

lawtalkinghuman 6y ago

Microsoft is an applicable precedent here - when it was found that they had breached competition law in using bundling with Windows as a way to gain unfair market dominance for Internet Explorer, the remedy was to require that Microsoft offer users a means to select and download competing browsers on first use. The Commission can then fine them a significant amount if they fail to comply with the decision. Of the options you've suggested, the second seems most likely. One potential solution that may also work is instead of not taking the 30% fee, to allow Spotify and others to take payment through another channel (e.g. by bouncing users to a web-based payment gateway) - the enforcement there just becomes an injunction to not enforce the app review rules that prevent affected apps from using third-party payment providers in addition to or as an alternative to payment through the App Store. The difficulty will be where they draw the line. A lot of third party services compete with built-in apps/OS features: for instance, Dropbox/iCloud Storage, Notes/Evernote, Office 365/Google Docs/iWork. The difference between Apple Music and Spotify (and presumably also Tidal and Deezer etc.) is really clear, but quite where you divide up these markets is a real tough issue in EU competition law. An Apple Music user could very easily be a Spotify user and vice versa, but not every iCloud user would necessarily be a Dropbox user.

moffatman 6y ago

Something which is unintuitive is that the 30% payment fee does not advantage Apple as much as it seems. Converting a customer to Apple Music from Spotify can't increase Apple's profit by more than what Spotify lost. You have to consider that the App Store's revenue will be reduced by that 30% cut if they are not charging that to the Apple Music department.