27% commission on the App Store: poking regulators with a stick

Apple’s latest response to antitrust regulations is to announce a 27% commission on the App Store instead of the standard 30% for apps offering alternative payment systems.

Not worldwide, of course. Apple always reacts country by country, settlement by settlement, lawsuit by lawsuit – so this specific policy only concerns dating apps, and only in the Netherlands…

As we noted earlier, this is clearly the least the company thinks is necessary to comply with the law – and also imposes an additional administrative burden on developers.

A 27% commission doesn’t really seem like a compelling option – when Apple’s in-app purchase is easy to use and deeply integrated into the system. Apple says the 27% discount is based on the price paid by the user, excluding value added tax. It says “this is a reduced rate that excludes value related to payment processing and related activities”.

Every month, developers will have to send a report to Apple listing their sales. Apple will then send invoices for its commission, which must be paid within 45 days.

Not only that, but the reduction of only three percentage points is less than the four points offered by Google in South Korea, and it was received with disappointment and concern.

The official said the KCC is aware of concerns over Google’s planned policy of only reducing its developer service fees by 4 percentage points when users choose an alternative billing system, and the regulator is awaiting further information. from Google.

Apple is, once again, doing the absolute minimum it thinks it can get away with. I’ve argued before that Apple could have avoided this whole antitrust avalanche by being proactive at an early stage, and emerging looking like the good guy instead of the grumbling guy doing the smallest things asked of him.

I can only echo my earlier astonishment at the company’s incompetence when it comes to protecting its most valuable asset: its brand image.

For a company that’s in the business of “skating where the puck will be,” I’m amazed at how badly the company does when it comes to reputational issues.

For each of the big issues that have given the company bad publicity this year, Apple has taken its usual “We know best” approach. When he made changes, he was kicked and shouted back to his revised position, rather than taking the lead.

I mean, I get it, the company wants to protect its service revenue as much as possible, and it wants to avoid setting precedents that will harm it in other countries. But this train hasn’t just left the station, it’s halfway to its destination and its passengers are settling in for dinner.

As long as Apple maintains its stingy approach to concessions, it will continue to face more and more additions to the mountain of antitrust pressures, legislation, and lawsuits it faces around the world. It is completely foolish to try to respond to every new development with a precipitate and a minor policy change in one country at a time.

Apple must behave like a global company, and like a responsible company that cares about its reputation. It must make significant changes; it must do so on a global scale; and it must do so proactively, rather than waiting to be forced into compliance.

Photo: Priscilla Du Preez/Unsplash

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Aurora J. William