The European Commission has informed Apple that it believes it is in breach of the EU Digital Markets Act, and will launch new investigations into its alleged anti-competitive practices in the market. With this, those from Cupertino have become the first company in the history of the European Union to be officially accused by the European Commission of breaching the EU Digital Markets Act. Specifically, for its policies regarding the App Store, third-party app stores. The Commission says it will make a decision before March 2025, so Apple still has time to fix it.
In a statement, the Commission has gone into detail about what it understands that Apple is carrying out as “anti-competitive practices”, explaining what they are about and how they affect the market and competition, as well as what, according to them, Apple should do to not have any type of problem with European regulators. Of course, the literal application of its terms would mean such a loss of income that we do not even know if it would be profitable to maintain the App Store as we know it today. At least, in Europe.
More obstacles, fewer applications
The European Commission has highlighted three points as those that they like least about the Apple policies regarding dealing with developers, and what they can or cannot do with their applications and payments within them:
“Under the DMA, developers who distribute their apps through Apple’s App Store must be able to inform their customers of other, cheaper purchasing options free of charge, direct them to those offers, and allow them to make purchases.
Apple currently has three sets of commercial terms that govern its relationship with app developers, including the App Store guidance rules. The Commission preliminarily confirms that:
– None of these commercial conditions allow developers to freely guide their customers. For example, developers cannot provide in-app pricing information or otherwise communicate with their customers to promote offers available through alternative distribution channels.
– Under most of the commercial terms available to app developers, Apple only allows directing via “link-outs” – i.e. app developers can include a link in their app that redirects the customer to a web page where the customer can conclude a contract. The linking process is subject to several restrictions imposed by Apple that prevent app developers from communicating, promoting offers and concluding contracts through the distribution channel of their choice.
– Although Apple may receive a commission for facilitating the initial acquisition of a new customer by developers through the App Store, the commissions it charges go beyond what is strictly necessary for said remuneration. For example, Apple charges developers a fee for each purchase of digital goods or services that a user makes within seven days of the app's release.
That is, what the European Commission is looking for is for Apple to allow external payment platformsthat developers can redirect their users wherever they want for those payments, and that Apple does not take any commission on those payments. That the App Store, despite the service it provides to developers and what it costs to maintain, is free, of course. The curious thing is that for most people it is, and only the big developers end up financing it. In any case, it seems that the Commission is serious. We will have to see what the next steps are, but Apple must not be very happy about this.
