You took the words out of my mouth. Well said.
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Apple Tweaks EU Core Technology Fee to Avoid Bankrupting Unexpectedly Viral Apps
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You took the words out of my mouth. Well said.
If I sell goods online, should I also pay your Internet service provider a part of my income because I'm making money off their infra?
And developers already pay for the API without any per-install fees since you need to get your application notarised to publish it, and you can't get a notarisation if you don't pay Apple $99/year.
These changes are way more generous than I’d have expected them to come up with as a solution to this problem. I’d have expected a “you have to pay, but the payments are waived if you fold back into the App Store henceforward”
Apple today announced that it is tweaking the terms of the 0.50 euro Core Technology Fee (CTF) that apps distributed using the new EU business terms must pay, introducing a solution that would keep small apps that go viral from being bankrupt.
First, independent and small developers who earn no revenue at all will not have to pay the CTF. Students, hobbyists, and freeware app developers who distribute free apps and earn no money will not be charged the fee. Developers will need to declare their non-commercial status on an annual basis, and to maintain this status, developers must have no revenue in or out of the App Store for their app product.
Second, to address fears of the CTF causing outrageous fees for an app that suddenly goes viral, Apple has implemented a three year on-ramping process for small developers. The three year period begins when a developer agrees to the new App Store business terms, and during this time, if an app goes viral and exceeds the one million annual install threshold that triggers the CTF, the CTF won't be charged if the developer earns less than 10 million euros in global business revenue, and the fee is reduced after that.
Note that this ramp up period is only available to small developers who have not previously exceeded one million first annual installs, and it is calculated based on global business revenue rather than just App Store revenue.
- Under 10 million euros: No CTF during the three year period.
- Between 10 million and 50 million euros: CTF must be paid, but it is capped at one million euros per year for the three year period.
- Beyond 50 million euros: Benefit is no longer available, and the full CTF has to be paid.
- After three years: Developers will pay for each first annual install after the initial one million first annual installs per year.
Apple says that 99 percent of developers will not be subject to the CTF to begin with, but the new ramp up period will go further to make sure that small developers who get a breakout hit will have time to scale their businesses before having to pay fees.
Back in March, developer Riley Testut spoke with Apple officials at a workshop on the Digital Markets Act, and he asked what would happen if a young developer had an app go viral and unwittingly racked up millions in fees. Testut asked the question because when he was a high school student, he released GBA4iOS outside of the App Store. It was unexpectedly downloaded more than 10 million times, and that would have bankrupted him had he been subject to the Core Technology Fee.
In response, Apple VP of regulatory law Kyle Andeers said that Apple was working on a solution because the company is not trying to stifle innovation. Apple believes that a free app going viral and being subject to exorbitant fees will be a rare occurrence, but the changes will keep that from happening. The CTF update will also be a welcome change for those who want to release entirely free apps outside of the App Store.
The CTF is only applicable to apps that have opted in to the new App Store business terms in the European Union. Apps in the EU are now able to be distributed through alternative app stores and developer websites without having to rely on the App Store.
Apple has more information about the new changes to the CTF on its updated CTF support page.
Article Link: Apple Tweaks EU Core Technology Fee to Avoid Bankrupting Unexpectedly Viral Apps
Because of the increased potential for piracy
My opinion is this: either the EU should accept some form of a fee like this OR the prices of iPhones and iPads go up €100 this year.
Either way Apple’s gonna get their money. That’s how Tim Cook works.
Either way Apple’s gonna get their money. That’s how Tim Cook works.
Personally, I’d like to see if Apple could back the EU into a corner to argue against the fee but also claim Apple can’t raise the prices of their devices.
That would just blow up the whole “free market” thing.
They would if they could.
That's actually part of what the whole net neutrality fight is about. We're trying to keep the internet from turning into a walled garden.
Net neutrality is about treating everyone the same.
If an ISP charged everyone the same fee that would still be neutral.
Certainly you’re not arguing the EU has the power to ban the CTF and place a cap on how much Apple can charge for their products, right?
If that’s the case I’d like a Michelin-starred restaurant dinner for 5 euros please.
And one of the ways it will do that is stopping ISPs from double dipping by requiring payment from sites their customers visit.
The EU needs to recognise how much good Apple is doing in terms of creating and spreading wealth around the world with these incredible tools.
So start lobbying the EU for restaurant price caps. It probably won't happen, but get enough people behind it and it could.
Governments have always been able to regulate prices. Sure, most haven't done it recently, but rent controls exist, and the US used to have gasoline price caps. There are still laws against price gouging, even if they're rarely enforced.
Price caps make sense on essential services like housing, gas, electricity, water, etc. App store fees? Not really an essential thing.
So you are advocating price caps on consumer electronic products?
Not rent, not fuel, not food, not medical care… but consumer electronic products.
Look, I respect the argument about Apple being a monopoly and needing regulatory oversight, but this argument is too much.
If you sell goods online you do so on a webstore based platform. This is either hosted by yourself. Which means you pay your own ISP for the bandwith and connection, hosted by a cloud platform which you pay directly, or hosted by a third party webstore. WHICH ALL REQUIRE A FEE TO SELL STUFF ON THEIR PLATFORM!
You have to pay in order to be able to sell stuff. This is nothing new, and has been from the invention of money. (transaction fees, sales taxes, etc)
Yes you have to pay them to have them test your app before you are allowed to release it. Which is basically the same as having a lab test your products before you are allowed to sell them.
And if I host my own iPhone application on a server that I own that goes through the connection I own and uses my bandwidth, I still need to pay Apple their cut for what exactly? And I mean the cut that exists beyond the separate $99/fee.
This would be the point, where my love for my MacBook Pro would end instantly.
Apple is continually setting themselves up as the commissioner( this is a legally defined word) and the DMA doesn’t give Apple the authority to ask a mandatory commission, nor to discriminate between the those distributing in and outside the AppStore.
As in the fees they pay isn’t tracked to actual costs they already pay if they distribute in the AppStore exclusively and those that choose to distribution them in other storefronts.
Article 5 obligations for the gatekeepers
4. The gatekeeper shall allow business users, free of charge, to communicate and promote offers, including under different conditions, to end users acquired via its core platform service or through other channels, and to conclude contracts with those end users, regardless of whether, for that purpose, they use the core platform services of the gatekeeper.
The DMA states free access and the ability to conclude those agreements without using apples core platform services. And the payment system Apple implements is part of their Core platform as defined in the DMA point 7 and 8, as they again request that developers sign up to another service that also identifies them. Well nobody is forcing Apple to sell in EU. It’s their market their rules.
This is about the ongoing financing of the software platforms that developers leverage to build and sell their apps. iOS and macOS are not open-source operating systems like Linux. Remember when we end-users had to buy Mac OS upgrades for $129.00? That cost was moved over to developers instead.
Some can argue that developers don't need to pay Microsoft to install an app on Windows, but neither are they paying Apple for installing onto macOS. (Yet)
iOS has always been a closed ecosystem money-machine for Apple, so that's why they are trying to keep it that way. Developers that make a profit should not be able to do so at Apple's expense. When you open a business, you don't get your space for free. You buy or rent it. Don't pay for that and it gets taken away from you. Simple concept.
If we want Apple to continue investing into their platforms, the money has to keep flowing.
And sadly the EU is forcing me to live to their rules unless I either migrate to a different country, or vote for my country to leave the EU. I really don't have a choice.