Firms Selling on App Store-Push Apple on Fees & Flexibilty-Apple Fires Back No "Free Ride"

The Economist June 27th 2020 Apple “Squeezing the pips”. “App developers are cross with the iPhone maker”.




Apple App Store enables $519B in annual sales; for China ~$250B, America ~$140B, Europe ~$50B and ROW ~$75B. Most of this is ecommerce; China ~$225B, America ~$90B, Europe $40B and Row ~55B. About 20% of the $519B total are “In-app advertising and Digital goods and services” segments subject to an unavoidable 30% fee to Apple. Unavoidable because Apple doesn’t allow purchase to run through external sites. “the European Union…announced antitrust probes into Apple’s App Store after complaints from Spotify (Swedish music streaming), Tile (Tracking devices) and Kobo (e-book readers). Besides these formal-complaints unhappy others include Basecamp (EMAIL app “Hey”) and Match.com (Online Dating).

Apple emphasizes that complaining entities just want a "free ride". They note ~$400B in sales are not subject to commissions. In response to pressure, Apple has made some “small concessions, such as promising to loosen restrictions on non-Apple web browsers, music-streaming apps and other software and letting developers appeal when their products are said to violate App Store rules”. In America, the Supreme Court is allowing a court case to move forward by companies protesting the 30% commission for “every sale of any app in the App store”. Regarding anti-trust, Apple also cites competition from Alphabet (Google) and others.

As iPhone sales have leveled off Apple is counting on an ever-expanding market, these App Store fees and streaming content for a larger fraction of ongoing revenue.