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Epic Games and Spotify Say Apple's Latest DMA Changes Are 'Illegal'

blackeyeblitzar 2y ago
It’s time for the EU to issue unreasonably massive fines against Apple for the malicious compliance and continued anti competitive behavior. And they should issue warrants for the arrest of executives like Cook.
CafeRacer 2y ago
I understand what Apple does is shady, but both Epic and Spotify also shady af. This, coming from Epic and Spotify is the definition of irony.
snapcaster 2y ago
All these legal battles have me thinking: what is the appropriate amount for someone like apple to charge developers using their app store? It's clearly not 0% since Apple is incurring lots of costs and providing very real benefits for the developers on the platform, but also 30% seems so high that it's hard to justify
- sorenjan 2y ago
  Epic charges 12% on their store.
- maxsilver 2y ago
  Something like ~6% feels "fair" (where "fair" means, is equal to the approximate value provided). Apple isn't really incurring any costs for this. They don't make any of the content, they don't write any of the software, they do host the 'applications', but they only deliver the tiniest parts of the app (they host a small binary, but they aren't hosting the videos on Netflix or YouTube, for example, or the major assets in an MMO game or such) and a lot of the labor they do "provide" isn't necessarily valuable (their "review" of the apps, for example). The 30% figure seems to be pulled from gaming console markets, but it was never really justified over there either, and the previous economics that made it work (like subsidized hardware) never applied to Apple's ecosystem. (iPads aren't like, $99 each, and priced at that point, with the expectation that Apple will 'make it up' via the 30% tax on app store sales, the way consoles once were)
  - dialup_sounds 2y ago
    The value being fought over here is distribution. For Epic this is almost entirely about Fortnite, where they're making ~$5 billion a year selling skins and emotes to children while not being in App Store or Google Play. Epic wants the millions of users and IAP they would get by being on these platforms but they want to pay 0% to the platforms for it.
    - spywaregorilla 2y ago
      Which is completely fair because Apple does not "own" those users.
      - dialup_sounds 2y ago
        If I want to run a television ad during the Super Bowl it should cost $0 because the network doesn't own the audience, right? Of course not. That's why the ask has always been a percentage reflecting the economic value to the developer created by the platform, which is surely non-zero.
        FireBeyond 2y ago
        That's a specious example. If I'm showing your Super Bowl ad, I can't show anyone else's at the same time. Having one app available by a means doesn't make others unavailable. And even then - the Super Bowl ad pricing is directly correlated to the number of users that ad will be delivered to. All of that becomes even more emphasized if there's an alternate app store experience.
        dialup_sounds 2y ago
        the Super Bowl ad pricing is directly correlated to the number of users that ad will be delivered to Correct. The value is in the audience reach, not the opportunity cost of not being able to show another ad. Epic stands to make billions from the audience reach of these platforms, but when it comes to paying for that reach it somehow computes the value to be zero. That's some Hollywood accounting.
- blackeyeblitzar 2y ago
  The appropriate amount is 0%. They are not allowing alternate app stores, or allowing users to freely download apps from the Internet. The devices are locked down. Because there is a monopolistic barrier against competition, their profit margin should be reduced to 0% just like in perfect competition.
- COGlory 2y ago
  This is very simple: 1) Apple should be able to charge as much as they want to use their app store. Even 100%!! 2) You should be allowed to install other app stores on the device you own, over which Apple has no control. Anything else is a half measure.
  - iotku 2y ago
    I'd probably flip the order, but to a certain extent I don't disagree. In theory, if there's a truely competitive market (has such a thijg evwr actually existed for anything?) it shouldn't matter what a particular store charges as any other store could come in and charge a lower percentage and provide a 'better' service. That can't happen without very open access to alternative app stores though. In an idealized enviornment whoever could provide the best app store for the least amount of overhead and fees would be successful. That said there's something about defaults and the many year headstart Apple has had with their own app store which makes me skeptical that even in a completely open environment that there could ever realistically be a mass alternative for everyone and expecting the average user to care about developer fees they don't understand is a hard sell.
    - bloppe 2y ago
      Even if Apple manages to keep 99% of all transactions, simply having open competition will open the door to all sorts of improvements. You could decouple distribution from payment processing. Have an "app store" with only free apps, but they can have in-app purchases if they handle their own payment processing. This is basically just a CDN. We already have a very mature and open market for CDNs, and they're very cheap. We also already have a mature, slightly less open market for payment processors. Stripe charges about 3% and provides almost all the features the App Store provides for 10x bigger fees. The one feature most people would probably miss is centralized subscription management, but there would be nothing stopping Stripe (or someone else) from offering the exact same basic feature, charging way less than Apple, and still making a huge profit for themselves
  - jocoda 2y ago
    It's clear that you do not own your device. It comes with limitations that tbf were agreed to upfront. For mobile, there is no real choice. Devil 1 is apple, devil 2 is google. Imo, Apple should be allowed to charge what they want - I'm ok with that as long as I can sidestep their thrall and sideload whatever I choose at no cost. If I get burned, that's on me. I think their costs in running the AppStore are the cost of doing business. They need this for their product. Without it, the product is nothing. And they get to suck 30% out of everything. Got to admire that. Better would be a replacement OS but is that even possible?
- willcipriano 2y ago
  I feel like if you get 30% of a deal you should be a valid target in a lawsuit about that deal. Scam app steals your bitcoin? Apple is on the hook if they want to get the middle of it like that. They can sue their business partner to recover. Something smaller, like under 5%, close to the cost of providing the service, would be more like a "finders fee" on the other hand shouldn't have such a duty.
- basiccalendar74 2y ago
  credit card processors charge around 3%
manofmanysmiles 2y ago
I'd love to see what would happen if the board said "Okay fine, we won't sell anything to anyone in Europe." I know, unrealistic, but a fun thought experiment. Walk away from $21B profit on $86B revenue. https://www.apple.com/newsroom/2024/08/apple-reports-third-quarter-results/ https://www.apple.com/newsroom/2024/08/apple-reports-third-q...
- chuckadams 2y ago
  I believe “bloodbath” is the term that would apply at the next shareholder vote.
jerojero 2y ago
It does read like malicious compliance. It kind of sees to me that Apple is doing as much as possible to teeter the line , to see how much they can get away with. It is definitely a burden on the European Union just to make this one company comply; though it has always been this way with Apple. Anyone remembers how USB-C would "hinder innovation" on the iPhones? I hope the European Union sees through this malicious compliance and gets Apple in line. But honestly, it just shows how monstrously big companies like Apple are. I do think these problems pile up and eventually they're going to be fined a big sum of money for the repeated offenses. We'll see though, maybe they get away with it.
- RandomThoughts3 2y ago
  Dangerous play with the EU. They don’t take kindly to this usually. I’m expecting a massive fine coming for Apple.
  - JumpCrisscross 2y ago
    > They don’t take kindly to this usually. I’m expecting a massive fine coming for Apple. I hear this a lot, but what’s the precedence?
    - RandomThoughts3 2y ago
      Meta and Google with the GDPR. It started nicely with the equivalent of a slap on the wrist but Meta finally got hit with a 1.2 billions fine for towing the line on international data transfer mostly because it’s the fifth time they are fined and apparently they had yet to get the message.
      - Nextgrid 2y ago
        Meta and Google are still around and their business model is still fully based on non-consensual data collection and processing. This is a poor example, and if anything suggests that ignoring the EU's demands is a valid business strategy.
    - 2y ago
exabrial 2y ago
Apple has everything to lose with malicious compliance and nothing to gain. Very short term thinking. They've already invited enough scrutiny and regulation into their niche.
- muro 2y ago
  They have billions to lose if they comply the way other devs want them to. They like money.
  - zarzavat 2y ago
    They like money but if they keep this up the EU will be forced to fine them into submission. Do they think this is the US where the DMA will be ruled unconstitutional or the Commission will be defanged by the ECJ? It ain’t gonna happen.
    - muro 2y ago
      They get the money while they play these games. The fine they got for treating their own music store differently than competition is still peanuts.
- daghamm 2y ago
  Remember their ebook business malicious compliance in UK? The judge got annoyed but did anything came out of that?
NotPractical 2y ago
It's not malicious compliance, it's non-compliance. Apple still has 100% control over which apps you can install on your iPhone in the EU. The EU must force Apple to provide EU citizens with some way to bypass mandatory "notarization"[*]. Don't get me wrong, I'm all for scary warning screens -- malicious software does exist and Apple devices should be secure by default. But the DMA is toothless if Apple can "comply" and still have their final say over what EU citizens can and cannot install. [*] "Notarization" for iOS is a misnomer and imposes a laundry list of requirements in addition to "the app isn't malware". The guidelines aren't even a separate document; they're quite literally a subset of the App Store guidelines (notice the "only notarization requirements" checkbox): https://developer.apple.com/app-store/review/guidelines/ https://developer.apple.com/app-store/review/guidelines/ Compare that to the macOS notarization requirements, which are quite succinct and are anything but a subset of the macOS App Store guidelines: https://developer.apple.com/documentation/security/notarizing_macos_software_before_distribution/ https://developer.apple.com/documentation/security/notarizin... (macOS of course still allows you run apps that aren't notarized after passing through several scary warning screens.) These extra unnecessary guidelines, along with the fact that you still need a paid Apple Developer account at $100/year to submit your apps for notarization (even if you just want to use them on your own device and distribute them nowhere), shut out FOSS entirely and render the DMA nearly useless from my point of view.
Spivak 2y ago
These lawsuits are such good fun to watch because it's not often a company complies with laws with a developer mindset and it's honestly kind of refreshing. I think this kind of back-and-forth is good because it's laying bare just how ridiculous the DMA actually is as a piece of law. It has good intentions but has to ultimately dance around the fact that the law they wanted would never pass. So they keep trying to legally corner Apple into hitching the wagon they want, significant reduction/elimination of the 30% fee, to the compliance of unrelated related things and Apple is taking full advantage. It's feels the exact same with the GDPR cookie banner nonsense where actually banning tracking is legally untenable so they tried the shame banner. Except that companies can't feel shame and this affected their revenue so they just added the banner and moved on, and users added the banners to their ad block and moved on.
- chmod775 2y ago
  > they tried the shame banner. Cookie banners are something the industry invented. > and users added the banners to their ad block and moved on. Which means no consent was given.
- margana 2y ago
  The only being ridiculous here is Apple. DMA is fairly clear and reasonable in what it wants to achieve. It's Apple that is trying different ways of not complying with it. There is no "back and forth". The EU is not negotiating with Apple. Laws are not up for negotiation after they've been passed. This is the whole issue here - Apple thinks they're at a corporate negotiation table, but they're not. Laws that are in effect are meant to be followed - it's a one-way process.
  - Spivak 2y ago
    > The EU is not negotiating with Apple. Laws are not up for negotiation after they've been passed. ??? Of course they are what are you talking about? Hell even criminal law is up for negotiation some 90%+ of the time with plea deals and DA's declining to prosecute certain crimes. It is unfathomable to me that you can look around and not see regulators working with companies to meet the company's business objectives and the regulator's compliance goals. And of course this is the case, regulators would rather not spend time and resources suing and so will give more liberal interpretations of the law in exchange for the company willingly following it. It's the solution to the iterated regulators dilemma— if you have no give then companies will fight you at every step and make you spend years in court for the smallest things.
KolmogorovComp 2y ago
To those wondering about LLM hallucinations, I think a git diff between the raw OCR and after the LLM pass should be very quick to review by a human (assuming formatting changes are done separately).
sianyancey307 2y ago
[dead]

It’s time for the EU to issue unreasonably massive fines against Apple for the malicious compliance and continued anti competitive behavior. And they should issue warrants for the arrest of executives like Cook.

CafeRacer 2y ago

I understand what Apple does is shady, but both Epic and Spotify also shady af. This, coming from Epic and Spotify is the definition of irony.

snapcaster 2y ago

All these legal battles have me thinking: what is the appropriate amount for someone like apple to charge developers using their app store? It's clearly not 0% since Apple is incurring lots of costs and providing very real benefits for the developers on the platform, but also 30% seems so high that it's hard to justify

sorenjan 2y ago
Epic charges 12% on their store.
maxsilver 2y ago
Something like ~6% feels "fair" (where "fair" means, is equal to the approximate value provided). Apple isn't really incurring any costs for this. They don't make any of the content, they don't write any of the software, they do host the 'applications', but they only deliver the tiniest parts of the app (they host a small binary, but they aren't hosting the videos on Netflix or YouTube, for example, or the major assets in an MMO game or such) and a lot of the labor they do "provide" isn't necessarily valuable (their "review" of the apps, for example). The 30% figure seems to be pulled from gaming console markets, but it was never really justified over there either, and the previous economics that made it work (like subsidized hardware) never applied to Apple's ecosystem. (iPads aren't like, $99 each, and priced at that point, with the expectation that Apple will 'make it up' via the 30% tax on app store sales, the way consoles once were)
- dialup_sounds 2y ago
  The value being fought over here is distribution. For Epic this is almost entirely about Fortnite, where they're making ~$5 billion a year selling skins and emotes to children while not being in App Store or Google Play. Epic wants the millions of users and IAP they would get by being on these platforms but they want to pay 0% to the platforms for it.
  - spywaregorilla 2y ago
    Which is completely fair because Apple does not "own" those users.
    - dialup_sounds 2y ago
      If I want to run a television ad during the Super Bowl it should cost $0 because the network doesn't own the audience, right? Of course not. That's why the ask has always been a percentage reflecting the economic value to the developer created by the platform, which is surely non-zero.
      - FireBeyond 2y ago
        That's a specious example. If I'm showing your Super Bowl ad, I can't show anyone else's at the same time. Having one app available by a means doesn't make others unavailable. And even then - the Super Bowl ad pricing is directly correlated to the number of users that ad will be delivered to. All of that becomes even more emphasized if there's an alternate app store experience.
        dialup_sounds 2y ago
        the Super Bowl ad pricing is directly correlated to the number of users that ad will be delivered to Correct. The value is in the audience reach, not the opportunity cost of not being able to show another ad. Epic stands to make billions from the audience reach of these platforms, but when it comes to paying for that reach it somehow computes the value to be zero. That's some Hollywood accounting.
blackeyeblitzar 2y ago
The appropriate amount is 0%. They are not allowing alternate app stores, or allowing users to freely download apps from the Internet. The devices are locked down. Because there is a monopolistic barrier against competition, their profit margin should be reduced to 0% just like in perfect competition.
COGlory 2y ago
This is very simple: 1) Apple should be able to charge as much as they want to use their app store. Even 100%!! 2) You should be allowed to install other app stores on the device you own, over which Apple has no control. Anything else is a half measure.
- iotku 2y ago
  I'd probably flip the order, but to a certain extent I don't disagree. In theory, if there's a truely competitive market (has such a thijg evwr actually existed for anything?) it shouldn't matter what a particular store charges as any other store could come in and charge a lower percentage and provide a 'better' service. That can't happen without very open access to alternative app stores though. In an idealized enviornment whoever could provide the best app store for the least amount of overhead and fees would be successful. That said there's something about defaults and the many year headstart Apple has had with their own app store which makes me skeptical that even in a completely open environment that there could ever realistically be a mass alternative for everyone and expecting the average user to care about developer fees they don't understand is a hard sell.
  - bloppe 2y ago
    Even if Apple manages to keep 99% of all transactions, simply having open competition will open the door to all sorts of improvements. You could decouple distribution from payment processing. Have an "app store" with only free apps, but they can have in-app purchases if they handle their own payment processing. This is basically just a CDN. We already have a very mature and open market for CDNs, and they're very cheap. We also already have a mature, slightly less open market for payment processors. Stripe charges about 3% and provides almost all the features the App Store provides for 10x bigger fees. The one feature most people would probably miss is centralized subscription management, but there would be nothing stopping Stripe (or someone else) from offering the exact same basic feature, charging way less than Apple, and still making a huge profit for themselves
- jocoda 2y ago
  It's clear that you do not own your device. It comes with limitations that tbf were agreed to upfront. For mobile, there is no real choice. Devil 1 is apple, devil 2 is google. Imo, Apple should be allowed to charge what they want - I'm ok with that as long as I can sidestep their thrall and sideload whatever I choose at no cost. If I get burned, that's on me. I think their costs in running the AppStore are the cost of doing business. They need this for their product. Without it, the product is nothing. And they get to suck 30% out of everything. Got to admire that. Better would be a replacement OS but is that even possible?
willcipriano 2y ago
I feel like if you get 30% of a deal you should be a valid target in a lawsuit about that deal. Scam app steals your bitcoin? Apple is on the hook if they want to get the middle of it like that. They can sue their business partner to recover. Something smaller, like under 5%, close to the cost of providing the service, would be more like a "finders fee" on the other hand shouldn't have such a duty.
basiccalendar74 2y ago
credit card processors charge around 3%

manofmanysmiles 2y ago

I'd love to see what would happen if the board said "Okay fine, we won't sell anything to anyone in Europe." I know, unrealistic, but a fun thought experiment. Walk away from $21B profit on $86B revenue. https://www.apple.com/newsroom/2024/08/apple-reports-third-quarter-results/ https://www.apple.com/newsroom/2024/08/apple-reports-third-q...

chuckadams 2y ago
I believe “bloodbath” is the term that would apply at the next shareholder vote.

jerojero 2y ago

It does read like malicious compliance. It kind of sees to me that Apple is doing as much as possible to teeter the line , to see how much they can get away with. It is definitely a burden on the European Union just to make this one company comply; though it has always been this way with Apple. Anyone remembers how USB-C would "hinder innovation" on the iPhones? I hope the European Union sees through this malicious compliance and gets Apple in line. But honestly, it just shows how monstrously big companies like Apple are. I do think these problems pile up and eventually they're going to be fined a big sum of money for the repeated offenses. We'll see though, maybe they get away with it.

RandomThoughts3 2y ago
Dangerous play with the EU. They don’t take kindly to this usually. I’m expecting a massive fine coming for Apple.
- JumpCrisscross 2y ago
  > They don’t take kindly to this usually. I’m expecting a massive fine coming for Apple. I hear this a lot, but what’s the precedence?
  - RandomThoughts3 2y ago
    Meta and Google with the GDPR. It started nicely with the equivalent of a slap on the wrist but Meta finally got hit with a 1.2 billions fine for towing the line on international data transfer mostly because it’s the fifth time they are fined and apparently they had yet to get the message.
    - Nextgrid 2y ago
      Meta and Google are still around and their business model is still fully based on non-consensual data collection and processing. This is a poor example, and if anything suggests that ignoring the EU's demands is a valid business strategy.
  - 2y ago

exabrial 2y ago

Apple has everything to lose with malicious compliance and nothing to gain. Very short term thinking. They've already invited enough scrutiny and regulation into their niche.

muro 2y ago
They have billions to lose if they comply the way other devs want them to. They like money.
- zarzavat 2y ago
  They like money but if they keep this up the EU will be forced to fine them into submission. Do they think this is the US where the DMA will be ruled unconstitutional or the Commission will be defanged by the ECJ? It ain’t gonna happen.
  - muro 2y ago
    They get the money while they play these games. The fine they got for treating their own music store differently than competition is still peanuts.
daghamm 2y ago
Remember their ebook business malicious compliance in UK? The judge got annoyed but did anything came out of that?

NotPractical 2y ago

It's not malicious compliance, it's non-compliance. Apple still has 100% control over which apps you can install on your iPhone in the EU. The EU must force Apple to provide EU citizens with some way to bypass mandatory "notarization"[*]. Don't get me wrong, I'm all for scary warning screens -- malicious software does exist and Apple devices should be secure by default. But the DMA is toothless if Apple can "comply" and still have their final say over what EU citizens can and cannot install. [*] "Notarization" for iOS is a misnomer and imposes a laundry list of requirements in addition to "the app isn't malware". The guidelines aren't even a separate document; they're quite literally a subset of the App Store guidelines (notice the "only notarization requirements" checkbox): https://developer.apple.com/app-store/review/guidelines/ https://developer.apple.com/app-store/review/guidelines/ Compare that to the macOS notarization requirements, which are quite succinct and are anything but a subset of the macOS App Store guidelines: https://developer.apple.com/documentation/security/notarizing_macos_software_before_distribution/ https://developer.apple.com/documentation/security/notarizin... (macOS of course still allows you run apps that aren't notarized after passing through several scary warning screens.) These extra unnecessary guidelines, along with the fact that you still need a paid Apple Developer account at $100/year to submit your apps for notarization (even if you just want to use them on your own device and distribute them nowhere), shut out FOSS entirely and render the DMA nearly useless from my point of view.

Spivak 2y ago

These lawsuits are such good fun to watch because it's not often a company complies with laws with a developer mindset and it's honestly kind of refreshing. I think this kind of back-and-forth is good because it's laying bare just how ridiculous the DMA actually is as a piece of law. It has good intentions but has to ultimately dance around the fact that the law they wanted would never pass. So they keep trying to legally corner Apple into hitching the wagon they want, significant reduction/elimination of the 30% fee, to the compliance of unrelated related things and Apple is taking full advantage. It's feels the exact same with the GDPR cookie banner nonsense where actually banning tracking is legally untenable so they tried the shame banner. Except that companies can't feel shame and this affected their revenue so they just added the banner and moved on, and users added the banners to their ad block and moved on.

chmod775 2y ago
> they tried the shame banner. Cookie banners are something the industry invented. > and users added the banners to their ad block and moved on. Which means no consent was given.
margana 2y ago
The only being ridiculous here is Apple. DMA is fairly clear and reasonable in what it wants to achieve. It's Apple that is trying different ways of not complying with it. There is no "back and forth". The EU is not negotiating with Apple. Laws are not up for negotiation after they've been passed. This is the whole issue here - Apple thinks they're at a corporate negotiation table, but they're not. Laws that are in effect are meant to be followed - it's a one-way process.
- Spivak 2y ago
  > The EU is not negotiating with Apple. Laws are not up for negotiation after they've been passed. ??? Of course they are what are you talking about? Hell even criminal law is up for negotiation some 90%+ of the time with plea deals and DA's declining to prosecute certain crimes. It is unfathomable to me that you can look around and not see regulators working with companies to meet the company's business objectives and the regulator's compliance goals. And of course this is the case, regulators would rather not spend time and resources suing and so will give more liberal interpretations of the law in exchange for the company willingly following it. It's the solution to the iterated regulators dilemma— if you have no give then companies will fight you at every step and make you spend years in court for the smallest things.

KolmogorovComp 2y ago

To those wondering about LLM hallucinations, I think a git diff between the raw OCR and after the LLM pass should be very quick to review by a human (assuming formatting changes are done separately).

sianyancey307 2y ago

[dead]