EU Reportedly Planning to Charge Apple for Violating Digital Markets Act

[bcortens]

The EU brought the special CTF on themselves... hence it isn't "applied to all publishers (worldwide)".
Outside EU, it is still AppStore only.
So there is no CTF added because they dont need to.

The fact that there is no CTF worldwide is evidence that Apple already thinks that the $99/year covers their SDK and tooling licensing. If they thought otherwise apps that use their IP would have to pay for it on top of that $99/year. Since they don't I am unconvinced by Apple's arguments.

I think the CTF exists to steer devs towards the App Store as its primary purpose. Unless Apple expects most games to leave the App Store the CTF would have a negligible impact in making up for lost App Store revenue (since there is unlikely to be much lost revenue) unless all of the big game publishers left the App Store.

As I've said, Apple's App Store revenue is largely made up of scummy micro-transaction games that deserve to be buried in a pit. Apple would rather keep those games on the store and advertise borderline gambling to people and grow the App Store revenue than actually justify their store on its own merits.

Any other country who goes down this path would more than likely be charged the same fee.
This is just another whinge because Apple did what they weren't told they couldnt do.
If it is decided they cant charge the CTF or has to reduce it, will be known sometime.
It should have been known at the start.

Apple was never going to make it easy for them.

If the whole world forced this on Apple I expect the CTF would go away because it would push the big devs like Facebook and Amazon to build PWAs instead of native apps. The more onerous and punitive Apple gets the less benefits to devs to be on their platform. There is a reason most Platforms don't try and extract a fee just to access users of the platform.

Apple should make it easier for devs to support their platform not harder. The maximization of revenue from the developers that make the platform viable is only going to make devs less likely to support them in the future.

do you have the document that spells this out?

i've done a quick Google for the DMA and nothing is showing up in top results... just high level wording that could be very open to interpretation still... (most articles now are various commentators putting their spin on the DMA which isnt the source material to rely on).

From: https://eur-lex.europa.eu/eli/reg/2022/1925/oj
Article 5
3. The gatekeeper shall not prevent business users from offering the same products or services to end users through third-party online intermediation services or through their own direct online sales channel at prices or conditions that are different from those offered through the online intermediation services of the gatekeeper.

This explicitly says that Apple cannot prevent them from competing through third party stores at prices or conditions that are different from the first party store. Given that the CTF doesn't apply to apps using Apple's store exclusively this is clearly in violation since it prevents a free app from existing on a third party store but doesn't do so if said free app remains exclusive to Apple's store.

 

[Beautyspin]

From the EU website:

What are the benefits of the Digital Markets Act?​

• Business users who depend on gatekeepers to offer their services in the single market will have a fairer business environment.
• Innovators and technology start-ups will have new opportunities to compete and innovate in the online platform environment without having to comply with unfair terms and conditions limiting their development.
• Consumers will have more and better services to choose from, more opportunities to switch their provider if they wish so, direct access to services, and fairer prices.
• Gatekeepers will keep all opportunities to innovate and offer new services. They will simply not be allowed to use unfair practices towards the business users and customers that depend on them, in order to gain an undue advantage.

What does the third point mention? It is still about competition. Due to competition, consumers will have better options and fairer prices. By removing the barriers, there will be competition, which results in seamless switching of operators. Sure, there will be benefits to consumers, but that is not their primary goal. It will be the end result, but the goal of the legislation is to foster competition.

 

[AppliedMicro]

Look at the operating systems that run on the most popular computing platforms today.

iOS - US company
Android - US company
Windows - US company
macOS - US company

Let’s look at their developers:
Apple
Google
Microsoft

Now let’s at the biggest companies in the world (by market cap):

Nvidia - biggest
Microsoft - 2nd biggest
Apple - 3rd biggest
Alphabet (Google) - 4th biggest

The DMA is really just an attempt by EU officials to slow down a handful of U.S. companies in order to give homegrown companies a heads-up.

It’s not about U.S. companies. It’s about the biggest, most powerful companies in the world - and making their software platforms play fair. And maintain or enable competition to happen - and hence innovation to thrive (hopefully driven by EU companies too, yes).

Considering these companies stock price history and their market powers, they clearly don‘t need any pity from us.

👉🏻 What’s your suggestion, alternative and perspective on the topic anyway?

• let’s run them run their platforms unregulated?
• let’s let them close their software platforms further, bit by bit?
• let our personal and businesses’ dependency on them increase more and more?
• let them regulate any software run by end users, down to words that developers can say? And, ban or deny any third-party software application at will (because hey, it might interfere with their own monetisation models)?
• let them accrue more and more money? Cause being the biggest, richest companies in the world isn’t enough?
• …so influence politics and government regulation even more?

…until we live in a dystopian corpocracy where these companies control access and visibility to all of our communications and all online visibility that businesses habe to consumers?

 

[AppliedMicro]

But Apple doesn't say the $99 covers those tools. You just want it to.

Looking at the Uber or DoorDash apps (that don’t pay in-app purchase commissions to Apple) and countless other free to download apps, it clearly does cover the tools.

Anything else - namely the App Store commissions - is merely “taxing other businesses, because hey, we can (force them)”

Look at clothing. The people who sit in shacks and sew stuff sometimes get 10 cents for something you pay $100+.
Is it exploitation? Yes. And we support consumerism and disposable products.

This DMA is about exploiting what Apple created and keeping all the sticker price.

👉🏻 Clothing manufacturers or clothing retailers aren’t in a position to restrict other companies market access.

 

[Abazigal]

👉🏻 What’s your suggestion, alternative and perspective on the topic anyway?

• let’s run them run their platforms unregulated?
• let’s let them close their software platforms further, bit by bit?
• let our personal and businesses’ dependency on them increase more and more?
• let them regulate any software run by end users, down to words that developers can say? And, ban or deny any third-party software application at will (because hey, it might interfere with their own monetisation models)?
• let them accrue more and more money? Cause being the biggest, richest companies in the world isn’t enough?
• …so influence politics and government regulation even more?

…until we live in a dystopian corpocracy where these companies control access and visibility to all of our communications and all online visibility that businesses habe to consumers?

I don't have an answer, just like how I would never have come up with a proposal like the CTF in a million years. All I can do is believe that Apple knows what they are doing (I know the last few news snippets make it seem like the EU is set to crush Apple with the flick of a finger) and that they have a means of navigating the DMA without losing much, if any momentum in the impacted countries. And for this, I will leave it to the company with the army of lawyers who are likely better at dealing with this sort of scenario than I ever will be, and to Tim Cook's leadership (he strikes me as cold and calculated and possibly the best person to navigate tricky political minefields, but I could also well be wrong).

I can support well-crafted legislation but it needs to be honest first and foremost.

Off the top of my head, I feel that the EU needs to come out and admit that yes, they are violating Apple's property rights in this regard, but there is going to be a FRAND type licensing arrangement, Apple is still going to get compensated (somehow), we are measuring this tradeoff as a society, and that Apple should still invest in their platform because they are making so much money and it's good for the platform as a whole and Apple will still be assured a profit.

And the whole point is the EU can't even be 100% honest with what they are trying to do here (can anyone here even suggest a manner in which Apple can monetise third party app stores and sideloading which would get the green light by the EU?). And so in this regard, I appreciate Apple pushing back, because at least this drives us towards real clarity about just what is being asked (people here seem to think they know, but I still want the EU to come out and say it out loud).

Second, I really don't understand how Apple, a company with less than 30% market share in the EU, is considered a gatekeeper preventing a company such as Spotify from gaining traction in the market. Does anyone here think that the DMA will magically allow Spotify to be profitable in the next quarter?

If you ask me, the DMA is not the solution, but a symptom of why there is perceived to be less innovation and competition in the EU. Like they started off with Nokia, and then what happened after that?

Lastly, I just find it a shame that Apple, a company who won by making legitimate good products that made consumers happy, is now being attacked in one of the areas that made them so very successful in the first place.

In my opinion, an attack on Apple's integration has only one outcome, which is not just making Apple worse for everyone, but computing worse for everyone, because Apple seems to be the only company that actually cares about this sort of thing.

Apologies, I know it's probably not the answer you were looking for. 😕

 

[wbeasley]

The fact that there is no CTF worldwide is evidence that Apple already thinks that the $99/year covers their SDK and tooling licensing. If they thought otherwise apps that use their IP would have to pay for it on top of that $99/year. Since they don't I am unconvinced by Apple's arguments.

I think the CTF exists to steer devs towards the App Store as its primary purpose. Unless Apple expects most games to leave the App Store the CTF would have a negligible impact in making up for lost App Store revenue (since there is unlikely to be much lost revenue) unless all of the big game publishers left the App Store.

As I've said, Apple's App Store revenue is largely made up of scummy micro-transaction games that deserve to be buried in a pit. Apple would rather keep those games on the store and advertise borderline gambling to people and grow the App Store revenue than actually justify their store on its own merits.


If the whole world forced this on Apple I expect the CTF would go away because it would push the big devs like Facebook and Amazon to build PWAs instead of native apps. The more onerous and punitive Apple gets the less benefits to devs to be on their platform. There is a reason most Platforms don't try and extract a fee just to access users of the platform.

Apple should make it easier for devs to support their platform not harder. The maximization of revenue from the developers that make the platform viable is only going to make devs less likely to support them in the future.



From: https://eur-lex.europa.eu/eli/reg/2022/1925/oj
Article 5
3. The gatekeeper shall not prevent business users from offering the same products or services to end users through third-party online intermediation services or through their own direct online sales channel at prices or conditions that are different from those offered through the online intermediation services of the gatekeeper.

This explicitly says that Apple cannot prevent them from competing through third party stores at prices or conditions that are different from the first party store. Given that the CTF doesn't apply to apps using Apple's store exclusively this is clearly in violation since it prevents a free app from existing on a third party store but doesn't do so if said free app remains exclusive to Apple's store.

Nope.

There is no CTF worldwide because there isnt any alt app store elsewhere being imposed.

 

[wbeasley]

Looking at the Uber or DoorDash apps (that don’t pay in-app purchase commissions to Apple) and countless other free to download apps, it clearly does cover the tools.

Anything else - namely the App Store commissions - is merely “taxing other businesses, because hey, we can (force them)”

👉🏻 Clothing manufacturers or clothing retailers aren’t in a position to restrict other companies market access.

And Uber and DoorDash are not paying in-app purchase fees because they are just tech tools for delivering goods.

 

[wbeasley]

I don't have an answer, just like how I would never have come up with a proposal like the CTF in a million years. All I can do is believe that Apple knows what they are doing (I know the last few news snippets make it seem like the EU is set to crush Apple with the flick of a finger) and that they have a means of navigating the DMA without losing much, if any momentum in the impacted countries. And for this, I will leave it to the company with the army of lawyers who are likely better at dealing with this sort of scenario than I ever will be, and to Tim Cook's leadership (he strikes me as cold and calculated and possibly the best person to navigate tricky political minefields, but I could also well be wrong).

I can support well-crafted legislation but it needs to be honest first and foremost.

Off the top of my head, I feel that the EU needs to come out and admit that yes, they are violating Apple's property rights in this regard, but there is going to be a FRAND type licensing arrangement, Apple is still going to get compensated (somehow), we are measuring this tradeoff as a society, and that Apple should still invest in their platform because they are making so much money and it's good for the platform as a whole and Apple will still be assured a profit.

And the whole point is the EU can't even be 100% honest with what they are trying to do here (can anyone here even suggest a manner in which Apple can monetise third party app stores and sideloading which would get the green light by the EU?). And so in this regard, I appreciate Apple pushing back, because at least this drives us towards real clarity about just what is being asked (people here seem to think they know, but I still want the EU to come out and say it out loud).

Second, I really don't understand how Apple, a company with less than 30% market share in the EU, is considered a gatekeeper preventing a company such as Spotify from gaining traction in the market. Does anyone here think that the DMA will magically allow Spotify to be profitable in the next quarter?

If you ask me, the DMA is not the solution, but a symptom of why there is perceived to be less innovation and competition in the EU. Like they started off with Nokia, and then what happened after that?

Lastly, I just find it a shame that Apple, a company who won by making legitimate good products that made consumers happy, is now being attacked in one of the areas that made them so very successful in the first place.

In my opinion, an attack on Apple's integration has only one outcome, which is not just making Apple worse for everyone, but computing worse for everyone, because Apple seems to be the only company that actually cares about this sort of thing.

Apologies, I know it's probably not the answer you were looking for. 😕

You shouldnt need to apologize for clearly stating what indeed seems to be going on.

Spotify will be no more profitable with their own business model regardless of platform.
Not buying from the app hasnt stopped their customer growth.
Their stupid podcasts cost a fortune and delivered nothing worth listening to.
Frankly it would have been better paying artists more instead and shown good will.

 

[bcortens]

Nope.

There is no CTF worldwide because there isnt any alt app store elsewhere being imposed.

The CTF has nothing to do with apple not charging Facebook, Amazon, Walmart etc... to use their SDK, Tools and IP. The fact that there aren't alt stores doesn't change this. Either the Tools and SDK costs are included in the 99/year fee or they aren't if they aren't then how are Amazon, Facebook, etc.. paying for them? If they are are included then Apple shouldn't impose the CTF anywhere in the world.

The 30% commission (which these companies don't pay) paid by other apps doesn't magically cover the SDK and Tooling licensing by Facebook Amazon etc... these companies earn billions off of their iOS user base and yet pay nothing to Apple for access to their users, for access to the tools and SDKs, etc...

Perhaps you'll claim Apple is allowed to charge different companies different licensing terms, except in the EU they aren't if those terms privilege Apple's own store and terms in any way. Which the CTF does. It privileges Apple's existing terms and encourages devs to stick with them rather than accept the DMA terms.

 

[bcortens]

And Uber and DoorDash are not paying in-app purchase fees because they are just tech tools for delivering goods.

So? They still use Apple's tools and SDK to reach their customers. Thus the 99/year must cover the licensing costs of the SDK and tools.

 

[wbeasley]

So? They still use Apple's tools and SDK to reach their customers. Thus the 99/year must cover the licensing costs of the SDK and tools.

Uber and DoorDash are free apps to users.
Like banking.
and shopping for real items.

the tired old "$99 covers it" argument is a lie.
it gets you access to tools to release apps that Apple vet.
it also discourages casual fake accounts that would proliferate if the fee was $0.

 

[wbeasley]

The CTF has nothing to do with apple not charging Facebook, Amazon, Walmart etc... to use their SDK, Tools and IP. The fact that there aren't alt stores doesn't change this. Either the Tools and SDK costs are included in the 99/year fee or they aren't if they aren't then how are Amazon, Facebook, etc.. paying for them? If they are are included then Apple shouldn't impose the CTF anywhere in the world.

The 30% commission (which these companies don't pay) paid by other apps doesn't magically cover the SDK and Tooling licensing by Facebook Amazon etc... these companies earn billions off of their iOS user base and yet pay nothing to Apple for access to their users, for access to the tools and SDKs, etc...

Perhaps you'll claim Apple is allowed to charge different companies different licensing terms, except in the EU they aren't if those terms privilege Apple's own store and terms in any way. Which the CTF does. It privileges Apple's existing terms and encourages devs to stick with them rather than accept the DMA terms.

Facebook and co will have the option to pay CTF fee if they want to should they choose to put their app in an alt app store. it is up to the app dev to decide which option costs them more and which one generates more income.

Apple has even amended the fee so small devs that have viral hits dont get whammied.

 

[wbeasley]

The CTF has nothing to do with apple not charging Facebook, Amazon, Walmart etc... to use their SDK, Tools and IP. The fact that there aren't alt stores doesn't change this. Either the Tools and SDK costs are included in the 99/year fee or they aren't if they aren't then how are Amazon, Facebook, etc.. paying for them? If they are are included then Apple shouldn't impose the CTF anywhere in the world.

The 30% commission (which these companies don't pay) paid by other apps doesn't magically cover the SDK and Tooling licensing by Facebook Amazon etc... these companies earn billions off of their iOS user base and yet pay nothing to Apple for access to their users, for access to the tools and SDKs, etc...

Perhaps you'll claim Apple is allowed to charge different companies different licensing terms, except in the EU they aren't if those terms privilege Apple's own store and terms in any way. Which the CTF does. It privileges Apple's existing terms and encourages devs to stick with them rather than accept the DMA terms.

lets cut to the chase...

what do you want Apple to do? what fees? for what service.

let's see where you draw the line...

 

[d686546s]

Lastly, I just find it a shame that Apple, a company who won by making legitimate good products that made consumers happy, is now being attacked in one of the areas that made them so very successful in the first place.

In my opinion, an attack on Apple's integration has only one outcome, which is not just making Apple worse for everyone, but computing worse for everyone, because Apple seems to be the only company that actually cares about this sort of thing.

Apologies, I know it's probably not the answer you were looking for. 😕

What the DOJ's complaint has picked up on, and is absolutely worth thinking about here, is how much of Apple's success actually depended on being able to freely deploy their products and services to work on rival platforms.

Leaving their design decisions aside for the moment, the Apple we have today is really built on the massive success of two products: the iPod and the iPhone. Both came to market when personal computers were a much bigger digital hub than they are today and so being able to make them work with Windows was essential. If Windows had been more restrictive in working with devices of other manufacturers neither the iPod and especially the iPhone would likely have been as successful as they were.

I'm saying this because I'm sceptical of this underlying narrative that openness and transparency stifle innovation. In many ways, innovation depends on it. In other words, yes I think Apple has made computing better, but at the same time it may just as well prevent the next big innovation.

 

[bcortens]

lets cut to the chase...

what do you want Apple to do? what fees? for what service.

let's see where you draw the line...

I've a few ideas depending on the actual goals:

• Option 1: If the goal is to keep iOS as the number one dev platform and minimize future regulatory risk then:
  • For Apps in the App Store
    • If using Apple's payment processing system
      • 15/30% of each payment to Apple as commission
    • If using a third party payment system
      • 0% (Apple isn't entitled to reach into other companies property)
    • AllApps: 0.05/download up to max of 2.5% of revenue earned via the app
      • This pays for running the App Store
      • It can likely be very low because it is a universal fee
      • Truly free apps are always free (Truly free = no ads, no tie in products, no sales of any goods or services through the app, no required subscription or payment plan)
  • For apps outside the app store
    • Just the 99/year fee
    • These apps do not use any of Apple's payment processing or hosting services and thus Apple shouldn't be allowed to dig into other companies work to earn money.
• Option 2: If the goal is to maximize revenue earned by Apple at the risk of future regulation:
  • Global/Worldwide 0.05/download CTF for all apps (regardless of where or how they are distributed) up to a maximum of 2.5% of revenue earned through the app. This is the IP/SDK/Tooling charge that covers all apps that use Apple's IP - no one but truly free apps get an exemption. Ex: Facebook earns money through ads, those ads mean they would have to pay the fee.
  • Apps in the App Store
    • The CTF as described above
    • If using Apple's payment processing system
      • 15/30% of each payment
    • If using a third party payment system
      • 0% (Even in this case Apple still isn't entitled to reach into other companies property)
    • All Apps: 0.05/download up to max of 2.5% of revenue earned via the app
      • This pays for running the App Store and is in addition to the per download CTF above
      • Again, like option 1, free apps are always free
  • Apps outside of the store
    • The CTF as described above
    • No fees in addition to the CTF above - these aren't hosted by apple or using any of their payment services so they don't need to pay any additional fees

In both Option 1 and Option 2 I don't know that 0.05/download or 2.5% max would be appropriate, those numbers could go up or down based on what would keep the App Store profitable and keep a profitable licensing business.
What these options have is primarily fairness:

• In both 1 and 2 all app developers that have monetization pay something to Apple for hosting fees involved in running the store.
  • Just because Facebook etc... are free to the user doesn't mean they aren't revenue generating apps for the companies, these companies can therefore pay to be hosed in the App Store.
• If Apple really wants to monetize everything and earn money for SDK and tooling access then Option 2 means that all companies pay it, it isn't just some punitive measure imposed on the EU and apps that want to exercise their rights under the DMA.

I think option 1 is best, it keeps the App Store profitable (thanks to the universal 0.05/download fee) and it keeps developers invested in the platform.

It also doesn't put Apple at further regulatory risk because they want to both Monetize access to the platform (act as a platform vendor and gatekeeper) AND simultaneously Apple wants to compete with Apps on its platform. This I think is one of the biggest obstacles to Apple charging something like the CTF in option 2. While I think it would be fine it does put them at further regulatory risk because they compete with Apps on their platform. They don't just build the platform for third party devs, they do it for themselves, and then use the fact that they own the platform to undercut the devs on the platform.

If Apple really wants to earn money as an IP/SDK/Tooling vendor they should get out of the App business themselves. They should stop selling any apps on iOS, stop bundling all of the default apps, include only the bare minimum of Apps (a browser, the App Store, SMS, Contacts, Camera, and Phone) and then let third party devs take over from their.

Personally I hate this idea, but Apple wants to have its cake and eat it too, they want to both monetize their IP through charging devs for access to iOS and simultaneously offer their own apps using that Ip and compete with those third party devs.

I also think that Apple might be at risk because if the EU interprets the notion that the users own the phone and a copy of IP on it after Apple sells it to them then Apple actually can't charge devs for access to that IP because the user has already paid for it. Apple could charge for SDK and tooling access but if A dev just wants to reverse engineer and offer their own tools there would be nothing Apple could do. Again, I think the CTF I described, which is universal and doesn't look like a punitive measure imposed on the EU would be fine. I just think the EU might not see it that way and can see an argument for why the Eu would be right not to.

 

[Sophisticatednut]

do you have the document that spells this out?

i've done a quick Google for the DMA and nothing is showing up in top results... just high level wording that could be very open to interpretation still... (most articles now are various commentators putting their spin on the DMA which isnt the source material to rely on).

Well you need to actually read the bill

Regulation - 2022/1925 - EN - EUR-Lex

eur-lex.europa.eu

 

[Sophisticatednut]

do you have the document that spells this out?

i've done a quick Google for the DMA and nothing is showing up in top results... just high level wording that could be very open to interpretation still... (most articles now are various commentators putting their spin on the DMA which isnt the source material to rely on).

Or you can read this entire thread I made few months back.

I’m quite it for your convenience.

Apple is clear that it considers its commission to primarily be a licensing fee for use of its property and services.
What legal basis are a developer falling in this category?
what service are a developer using? Apple can’t require developer to register for any service?
How can a developer have free access to the hardware and API functions as described below if they are forced to pay a commission?
How can a competing application store compete on similar terms if they must pay a commission on all sales to Apple who runs their own store and have no fee for themselves?
If developers uses logos and iconography they would fall under a fair, reasonable, and non-discriminatory(FRAND) terms.

In these points that describe the intentions of the Digital Market Act
2-4,7,31,33-34,39-41,43-44,50,57,62,70,75

Article 2 Definitions​

Spoiler: Click to read the first part. Bellow this I go through the CTF

Here all the legal definitions that EU uses are found.

• 2: core platform service
• 7: online social networking service
• 10: operating system
• 14 :software application stores
• 15: software application
• 16: payment service
• 17: technical service supporting payment service
• 18: payment system for in-app purchases
• 19: identification service
• 20: end user
• 21: business user
• 29: interoperability

(EU) 2015/2366​

(EU)2019/1150​

(EU)2015/1535​

Article 5​

There’s are the relevant Obligations for a Gatekeeper such as Apple.

• 3-4,7-8​

Arricle 6​

• 4,7,10​

Text with EEA relevance​

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty on the Functioning of the European Union, and in particular Article 114 thereof

Article 2 Definitions​

For the purposes of this Regulation, the following definitions apply:

Article 5 Obligations for gatekeepers​

3. The gatekeeper shall not prevent business users from offering the same products or services to end users through third-party online intermediation services or through their own direct online sales channel at prices or conditions that are different from those offered through the online intermediation services of the gatekeeper.

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.

7. The gatekeeper shall not require end users to use, or business users to use, to offer, or to interoperate with, an identification service, a web browser engine or a payment service, or technical services that support the provision of payment services, such as payment systems for in-app purchases, of that gatekeeper in the context of services provided by the business users using that gatekeeper’s core platform services.

8. The gatekeeper shall not require business users or end users to subscribe to, or register with, any further core platform services …as a condition for being able to use, access, sign up for or registering with any of that gatekeeper’s core platform services…

Article 6 Obligations for gatekeepers susceptible of being further specified under Article 8​

4. The gatekeeper shall allow and technically enable the installation and effective use of third-party software applications or software application stores using, or interoperating with, its operating system and allow those software applications or software application stores to be accessed by means other than the relevant core platform services of that gatekeeper.

7. The gatekeeper shall allow providers of services and providers of hardware, free of charge, effective interoperability with, and access for the purposes of interoperability to, the same hardware and software features accessed or controlled via the operating system…

10. The gatekeeper shall provide business users and third parties authorised by a business user, at their request, free of charge, with effective, high-quality, continuous and real-time access to, and use of, aggregated and non-aggregated data, including personal data, that is provided for or generated in the context of the use of the relevant core platform services or services provided together with, or in support of, the relevant core platform services by those business users and the end users engaging with the products or services provided by those business users.

The CTF is a fee that Apple charges developers who use third-party app marketplaces or payment processors in the EU, starting from March 2024. The fee is €0.50 for each first annual install per year over a 1 million threshold, and 3% of the transaction value if developers use Apple as a payment processor. Apple claims that the fee is necessary to cover the costs of providing core platform services, such as security, privacy, and interoperability, to developers and users.

However, the CTF is illegal under the EU law, as it violates several clauses of the Digital Markets Act (DMA), which aims to ensure fair and contestable digital markets in the EU. The DMA imposes a number of obligations and prohibitions on gatekeepers, which are large online platforms that provide core platform services, such as app stores, search engines, or social networks. Apple has been designated as a gatekeeper for 22 core platform services, including the iOS App Store and Safari.

The CTF breaks the following DMA clauses:

• Article 5 Obligations for gatekeepers
  7. The gatekeeper shall not require end users to use, or business users to use, to offer, or to interoperate with, an identification service, a web browser engine or a payment service, or technical services that support the provision of payment services, such as payment systems for in-app purchases, of that gatekeeper in the context of services provided by the business users using that gatekeeper’s core platform services.
  
  8. The gatekeeper shall not require business users or end users to subscribe to, or register with, any further core platform services …as a condition for being able to use, access, sign up for or registering with any of that gatekeeper’s core platform services…
  
  
• The CTF prevents or restricts business users from offering better prices or conditions through alternative app marketplaces or payment processors, as it imposes an additional cost on developers and users who choose those options. This reduces the incentives and the benefits for developers and users to switch to alternative platforms or services, and creates an unfair advantage for Apple and its own services.
• The CTF prevents or restricts end users from installing or using software applications of their choice, as it imposes an additional cost on users who download apps from alternative app marketplaces or pay through alternative payment processors. This reduces the attractiveness and the accessibility of alternative apps and services for users, and creates a lock-in effect for Apple and its own services.
• The CTF prevents or restricts business users from accessing and interoperating with the core platform services that Apple provides, such as security, privacy, and interoperability features, as it imposes an additional cost on developers who use alternative app marketplaces or payment processors. This reduces the quality and the functionality of alternative apps and services for developers and users, and creates a competitive disadvantage for Apple’s rivals and a competitive advantage for Apple and its own services.
• Article 6
  
  Obligations for gatekeepers susceptible of being further specified under Article 8
  
  4. The gatekeeper shall allow and technically enable the installation and effective use of third-party software applications or software application stores using, or interoperating with, its operating system and allow those software applications or software application stores to be accessed by means other than the relevant core platform services of that gatekeeper.
  
  7. The gatekeeper shall allow providers of services and providers of hardware, free of charge, effective interoperability with, and access for the purposes of interoperability to, the same hardware and software features accessed or controlled via the operating system…
  
  10. The gatekeeper shall provide business users and third parties authorised by a business user, at their request, free of charge, with effective, high-quality, continuous and real-time access to, and use of, aggregated and non-aggregated data, including personal data, that is provided for or generated in the context of the use of the relevant core platform services or services provided together with, or in support of, the relevant core platform services by those business users and the end users engaging with the products or services provided by those business users.
• The CTF enables Apple to use, in competition with business users, the data generated by the developers and users who use alternative app marketplaces or payment processors, as it requires developers to report to Apple the number and the value of the transactions processed through alternative platforms or services. This gives Apple access to valuable and sensitive information about the performance, the preferences, and the behavior of its competitors and their customers, and allows Apple to use that information to improve its own products and services, or to target its own offers and advertisements.

Therefore, the CTF is a clear violation of the DMA, and should be declared illegal and abolished by the EU authorities. The CTF is a way for Apple to discourage developers from using alternative distribution and payment methods, and to maintain its dominance and profits in the app market, at the expense of the consumers’ rights and freedoms, and the competitors’ opportunities and innovation.

(16)	‘payment service’ means a payment service as defined in Article 4, point (3) of Directive (EU) 2015/2366;
(EU) 2015/2366	Article 4, point (3) ‘payment service’ means any business activity set out in Annex I; ANNEX I PAYMENT SERVICES (as referred to in point (3) of Article 4) 1.Services enabling cash to be placed on a payment account as well as all the operations required for operating a payment account. 2.Services enabling cash withdrawals from a payment account as well as all the operations required for operating a payment account. 3.Execution of payment transactions, including transfers of funds on a payment account with the user’s payment service provider or with another payment service provider: (a)execution of direct debits, including one-off direct debits; (b)execution of payment transactions through a payment card or a similar device; (c)execution of credit transfers, including standing orders. 4.Execution of payment transactions where the funds are covered by a credit line for a payment service user: (a)execution of direct debits, including one-off direct debits; (b)execution of payment transactions through a payment card or a similar device; (c)execution of credit transfers, including standing orders. 5.Issuing of payment instruments and/or acquiring of payment transactions. 6.Money remittance. 7.Payment initiation services. 8.Account information services.
(17)	‘technical service supporting payment service’ means a service within the meaning of Article 3, point (j), of Directive (EU) 2015/2366;
(EU) 2015/2366	Article 3, point (j) services provided by technical service providers, which support the provision of payment services, without them entering at any time into possession of the funds to be transferred, including processing and storage of data, trust and privacy protection services, data and entity authentication, information technology (IT) and communication network provision, provision and maintenance of terminals and devices used for payment services, with the exclusion of payment initiation services and account information services;

(19)	‘identification service’ means a type of service provided together with or in support of core platform services that enables any type of verification of the identity of end users or business users, regardless of the technology used;
(20)	‘end user’ means any natural or legal person using core platform services other than as a business user;
(21)	‘business user’ means any natural or legal person acting in a commercial or professional capacity using core platform services for the purpose of or in the course of providing goods or services to end users;
(29)	‘interoperability’ means the ability to exchange information and mutually use the information which has been exchanged through interfaces or other solutions, so that all elements of hardware or software work with other hardware and software and with users in all the ways in which they are intended to function;

 

[I7guy]

Well you need to actually read the bill

Regulation - 2022/1925 - EN - EUR-Lex

eur-lex.europa.eu

Or use chatgpt or copilot to summarize it.

 

[Sophisticatednut]

Or use chatgpt or copilot to summarize it.

Easier to click ctrl+F and search the thing

Especially considering the first part explains the goal and intention of the DMA. And just a handful of articles are relevant here

 

[AppliedMicro]

And Uber and DoorDash are not paying in-app purchase fees because they are just tech tools for delivering goods.

…and ordering goods.

So is the Epic Games Store or Apple’s App Store:
A mere to deliver (digital) goods (applications, games).

Uber and DoorDash are free apps to users.

Can’t say I’ve used DoorDash - but using the Uber app to order a ride certainly wasn’t free.

Wait… free to download, you mean?
So are Spotify’s and Netflix’ apps: free to download.
And mere tools to deliver a good or service.

Can’t say I’ve used DoorDash - but using the Uber app isn’t free.

the tired old "$99 covers it" argument is a lie.
it gets you access to tools to release apps that Apple vet.

Your repeated claims don’t make it any (more) true.

Uber’s app is a good example: they make use of quite a lot of APIs/tools provided Apple:
Most notably location services and push messaging. For free, beyond a $99 subscription.

Surely much more expensive to develop/licence tech than Spotify does.

 

[wbeasley]

…and ordering goods.

So is the Epic Games Store or Apple’s App Store:
A mere to deliver (digital) goods (applications, games).


Can’t say I’ve used DoorDash - but using the Uber app to order a ride certainly wasn’t free.

Wait… free to download, you mean?
So are Spotify’s and Netflix’ apps: free to download.
And mere tools to deliver a good or service.

Can’t say I’ve used DoorDash - but using the Uber app isn’t free.


Your repeated claims don’t make it any (more) true.

Uber’s app is a good example: they make use of quite a lot of APIs/tools provided Apple:
Most notably location services and push messaging. For free, beyond a $99 subscription.

Surely much more expensive to develop/licence tech than Spotify does.

Spotify (and any app) can use any or all of the APIs provided.

If they wanted to add food ordering to their app, I'm sure they could. Apple isnt stopping them.

$99 get you access to the whole dev kit.

Just because they use a few bits means nothing.
it's like a CostCo member fee. it gets you unlimited entry. but you cant play until you buy in.

 

[wbeasley]

Where are all the ideas of what Apple should do from those vocal EU supporters?

What would you have Apple do?

Explicit detail of fees and controls you think are fair and embrace the spirit of the EU's DMA.

 

[ProbablyDylan]

Where are all the ideas of what Apple should do from those vocal EU supporters?

What would you have Apple do?

Explicit detail of fees and controls you think are fair and embrace the spirit of the EU's DMA.

Allow distribution via alternative channels. That's the most reasonable solution that does not place undue burden on any party. These apps would have zero cost on Apple's servers, so they would not need compensation for hosting or distribution.

If the cost of developing iOS is too high (which I doubt, they should be recouping the cost from hardware sales), then they should just increase the developer fee. No professional or hobbyist on the planet is opposed to purchasing tools to do their job or hobby.

It doesn't need to be complicated.

 

[Sophisticatednut]

Where are all the ideas of what Apple should do from those vocal EU supporters?

What would you have Apple do?

Explicit detail of fees and controls you think are fair and embrace the spirit of the EU's DMA.

Carbon copy of the macOS model

 

[DaPhox]

It’s a representative democracy…. In most eu states you don’t elect the PM…

But I recommend you actually learn how it works.
View attachment 2389538
View attachment 2389537

Well its not ”democracy”. Thats for sure.