Apple Faces Backlash from Big Tech Over New App Store Policies

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Last Updated on February 3, 2024 by TM

In recent news, Apple’s latest AR/VR headset, the Apple Vision Pro, grabs attention, but the tech giant is under fire from notable figures like Meta’s Mark Zuckerberg and other tech leaders for its new App Store policies.

Background
 Meta’s CEO, Mark Zuckerberg, has joined voices criticizing Apple’s App Store policies. Spotify, Xbox, Epic Games, and various app developers are expressing concerns. A new EU law, the Digital Markets Act (DMA), will soon come into effect, preventing companies like Apple from restricting alternative app marketplaces on their devices.

DMA Impact
The DMA opens up opportunities for developers as it allows alternative app distribution channels on consumer devices. Epic Games, for example, announced the return of Fortnite to iPhones in the EU, bypassing the App Store.

Apple’s Response
Apple has introduced a system under DMA, charging developers for every app download exceeding one million installs per year. They’ve also set strict requirements for launching alternative marketplaces, including a substantial financial commitment.

Zuckerberg’s Stance 
Mark Zuckerberg, in Meta’s Q4 2023 earnings call, criticized Apple’s DMA-based policies. He emphasized that Apple has made it burdensome for developers to explore alternative app stores, contrary to the intent of the EU regulation.

Challenges for Developers
The new policies, instead of benefiting developers as intended by the DMA, may lead to reduced earnings for many. Apple’s fees and stringent conditions for alternative marketplaces create obstacles for smaller developers.

Meta’s Standpoint
Zuckerberg acknowledged that Apple’s policies might not impact Meta significantly. Meta’s popular apps like Facebook and Instagram are on the App Store, and although Apple takes a cut from in-app purchases, Meta adapts by charging users more within the app to cover these fees.

Zuckerberg’s Critique
Zuckerberg expressed skepticism about developers opting for alternative app stores under Apple’s new system. He criticized the onerous nature of Apple’s approach, suggesting that it goes against the intended spirit of the EU regulation.

In-App Purchases Strategy
Unlike Fortnite, which aimed to avoid Apple’s revenue share, Meta covers the fees by adjusting prices within its apps. This strategy aligns with Meta’s approach to offering products like Meta Verified through in-app purchases while remaining on the App Store.

Final Thoughts
While Apple’s new policies are drawing criticism from industry leaders, including Meta’s Mark Zuckerberg, the impact on Meta might be limited. However, the broader concern is how these policies may hinder smaller developers and contradict the intended goals of the EU’s Digital Markets Act.

To wrap, the tech industry is closely watching the fallout from Apple’s App Store policies, with the debate centered on their compliance with the DMA and their potential impact on developer earnings and competition within the app marketplace.

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