Even as Apple and Epic Games face-off, major American news publishers have now joined Epic Games in criticising Apple’s 30% commission over in-app purchases. In a letter to Apple CEO Tim Cook, Digital Content Next — an association that includes New York Times and Washington Post — asked how member news publishers can “qualify for the arrangement Amazon is receiving for its Amazon Prime Video app in the Apple App Store”.
During the US Congressional antitrust hearings last month, where Apple’s Cook also testified, Senator Hank Johnson had questioned him about an arrangement Apple afforded to Amazon, where it was allowed to keep 85% of the revenue, with Apple only earning a 15% commission for every Amazon Prime subscription purchased on the Apple App store. Cook’s response was that the arrangement is available to “anyone meeting the conditions”.
The DCN essentially wants to know what these “conditions” are, and is demanding that its members be offered the same agreement. “Nearly all of DCN’s members offer apps in the Apple App Store and, as noted above, many offer subscription-based access to a wide variety of content. The terms of Apple’s unique marketplace greatly impact the ability to continue to invest in high-quality, trusted news and entertainment particularly in competition with other larger firms,” the organisation’s CEO Jason Kint wrote in the letter. “In keeping with your statement to the Committee, I ask that you clearly define the conditions that Amazon satisfied for its arrangement so that DCN’s member companies meeting those conditions can be offered the same agreement”.
Apple is pushing publishers towards ‘murky’ digital advertising: In a separate blog post, DCN wrote that Apple’s “anticompetitive practices” push companies away from direct audience revenue and toward the “murky world of digital advertising”, where a publisher doesn’t have to take a 30% haircut on all customer revenue and keeps all of the upside from its advertising earnings. “In some ways, Apple’s behavior actually works to the disadvantage of companies looking to follow their lead on consumer trust,” the post said.
In June, the New York Times, a DCN member, had called its partnership with Apple News off, alleging that Apple “had given it little in the way of direct relationships with readers and little control over the business”.
Apple-Epic at loggerheads: This development comes as Apple is caught in the middle of a legal battle with Epic Games, after it removed the developers’ popular app Fortnite following the introduction of an alternate payment system within the app. Google had followed suit too, as Fortnite’s Android app had also introduced a similar system. In return, Epic sued both Apple and Google for allegedly acting as monopolies. In retaliation, Apple threatened Epic with termination of all of its developer accounts — which includes Unreal Engine — and to cut Epic from iOS and Mac development tools by August 28.
Before Epic, Microsoft, subscription email service Hey, and Match Group, the parent of dating app Tinder, have all criticised the 30% commission Apple charges over in-app purchases, while prohibiting developers to redirect users to an alternate payment method outside of the apps.
Antitrust scrutiny against Apple: Just this month, the Russian competition watchdog pulled up Apple for anticompetitive App Store policies, following a complaint by Kaspersky which said that its parental control app was booted off the App Store just as Apple upgraded its own competing solution. The EU has also initiated two antitrust probes into Apple, one of which looks at the commission that Apple charges on in-app purchases following complains by Spotify and Rakuten.