Apple has been highly criticized for its 30 percent cut that it takes from app developers. But by next year, Apple will remove this cut for some developers. The company announced that it will update its App Store next year, so that some developers can avoid paying the company a huge commission. It would enable “reader” app developers to include in-app links into their websites, allowing users to create accounts and make purchases. Applications that “offer previously purchased material or content subscriptions for digital periodicals, newspapers, books, radio, music, and video,” are considered reader apps by Apple. As reports points out, this means that the new feature will apply to streaming services such as Netflix and Spotify.
The update was announced after the end of an investigation conducted by the Japan Fair Trade Commission. Apple took into account the commission’s proposal to enable a single link to the websites of reader apps because such apps do not have in-app purchases. Every reader app will be benefitted from this. But first Apple has to update its rules and review process. Phill Schiller, an executive of App Store said that they respect the commission and is happy with the joint work done that makes it easier for reader apps to manage their products and services.
Apple has long been criticized by Netflix and Spotify for collecting 30% of their profits. Spotify filed a complaint with the European Commission in 2019 alleging that Apple is engaging in anti-competitive behaviour. It removed users’ option to pay for premium upgrades from the iOS app because it was unwilling to pay a 30% commission. Netflix also made a similar move to remove iOS app users’ ability to pay for a subscription in 2018.
Because the upcoming update excludes games, it will not be able to end Apple’s legal struggle with Epic. Since it chose to provide discounts on Fortnite’s V-bucks currency and other cash purchases outside the App Store last year, the gaming developer has been leading the assault against the tech giant. As a result, Apple banned Fortnite from the App Store, and the investigation that followed revealed some extremely fascinating information. Tim Cook’s testimony in court indicated that many creators are dissatisfied with Apple, while court records revealed that Epic pays publishers millions of dollars to give their games out for free on its store.
