Apple found in breach of EU competition rules

I wish the United States would follow the EU on this. It's insane that 1 company has near complete control over what software can and cannot be published, and they get to take a tax on all software sold. Absolutely insane. Obviously there's web, Android, Windows, Linux, gaming consoles, and smart tvs, so there are some work-arounds to avoid the evil empire, but most consumers here in the United States use iPhones and probably have no idea that Apple is taxing all of the app developers and exercising complete editorial control over all software published for the iPhone. Do you think consumers know that Apple literally reviews all software companies products and then decide whether they will allow that company or product to exist? Even worse, its not even high level executives making these decisions, it's $20 an hour employees on their App Review Board making these decisions to kill entire companies.

Here's some context which a lot of people, including most news media, seem to have missed:

The reason Apple is still playing games with the EC is that they're waiting on an EU Court's ruling[1] on whether Article 6 (7), the provision that mandates free of charge iOS APIs for all developers, is "constitutional" within the EU framework itself.

Most people who call out the Core Technology Fee use that provision as one of their main arguments, and it's one of their strongest, because the "free of charge" language throws away the general idea that the law doesn't want to interfere with Apple's monetization strategies. Since Apple could very well have chosen to monetize certain local API access in the past, the fact that this provision put a stop to that effectively nullifies Apple's argument (to the courts) that the law could never have meant to actually control how they make money.

[1] https://curia.europa.eu/juris/fiche.jsf?id=T%3B1080%3B23%3BR...

While I think Apple's rules are ridiculous, it is pretty standard in the industry. AirBnB doesn't allow hosts to accept cash or arrange alternative payment. Amazon doesn't allow suppliers to offer direct sales to potential customers. Even Visa and Mastercard officially don't allow merchants to offer discounts for cash transactions (although many do anyway). Etc, etc. I think this should be a more general rule, no "platform" or "aggregator" should be allowed to prevent the free communication of users of their platform from arranging their deal elsewhere. Just because they met on the platform doesn't give the right to the platform to strong-arm their users into using them. The platform must compete with alternative payment methods on its own merits, such as convenience, security, etc., not by forcing people to use them just because they happen to be the matchmaker. Because this policy cements monopolies and rewards the largest incumbents.

Apple's app-store policies are anti-competitive. Even though they recently 'allowed' (How kind of them) publishers to create a link to an external form of payment, where the offer may be better, Apple still demands a significant slice of commission.

I think many users would continue to use in-app purchases as it is a convenient way to pay, but the actions from Apple are poor and heavily restrictive. To save yourself some money, if subscribing, always go to the website, you'll get a better offer than within the app and more of your money will go to the publisher.

You can feel however you want about Apple's rules and EU regulation, but I think it's pretty indispuitable how wrong it is that Apple prevents developers from explaining these rules to their users. Apple prevents developers from saying that Apple takes a % cut of the sale. Apple prevents developers from saying its available cheaper elsewhere. If Apple feels these rules are so just and fair and indispuitably correct, why does it go to such measures to hide them from its consumers?

Consistently these anti-steering rules are what gets Apple in trouble all around the world. It's the one part Apple lost in the US Epic case, and it's the EUs first point on their breach. Apple has done this to themselves by being so stubborn and refusing to budge an inch on how they run their platforms. The tiniest concession years ago could have avoided all this regulation on them.

Here's the actual EC press release: https://ec.europa.eu/commission/presscorner/detail/en/ip_24_...

It's very readable!

Apple currently has three sets of business terms governing its relationship with app developers, including the App Store's steering rules. The Commission preliminarily finds that:

- None of these business terms allow developers to freely steer their customers. For example, developers cannot provide pricing information within the app or communicate in any other way with their customers to promote offers available on alternative distribution channels.

- Under most of the business terms available to app developers, Apple allows steering only through “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 link-out 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.

- Whilst Apple can receive a fee for facilitating via the AppStore the initial acquisition of a new customer by developers, the fees charged by Apple go beyond what is strictly necessary for such remuneration. For example, Apple charges developers a fee for every purchase of digital goods or services a user makes within seven days after a link-out from the app.

[edit] I will add one thing: right now, i'm rich enough that i wouldn't care about paying 30% less if it saves me the hassle of using a new payment processor, and i think this is the case for most people here, or even most people using Apple phones. But 10 years ago when i was scraping by, i had a phone that was given to me (not an iphone, but it could have been), and i would totally do everything i could to save 33% on anything (mostly food tbh). T=Not allowing link out and price discovery is not only anti-market, it's anti-poor.

I don't understand why so many people think that if Apple didn't take a percentage cut of sales, prices would go down. Products are typically priced at what customers are willing to pay, which likely wouldn't change. The developer would simply earn more. The only real benefit to customers might be the existence of some apps with extremely thin margins that wouldn't be viable otherwise. As a developer, I naturally approve this though.

Surely, Apple will respond by artificially hampering one or more of their products in the EU and hence take away even the slightest reason to upgrade hardware in the name of Apple Intelligence.

Customers need a company that acts and reasons like an adult.

I guess reasonable fine for this breach is 30% of revenue in EU just like in the app store.

Apple keeps half assing its compliance in EU, thinking their malicious compliance will fly.

They want to learn it won't work through their wallets.

Many years ago I would have said Apple would never leave the EU, but now I’d say it’s firmly in the “possible” territory.

Maybe it’s a win for both parties of Apple leaves the EU, though I’m skeptical any homegrown EU product would have any traction unless they also force Google to divest Android.

I’d love to know how much work it is for Apple to comply and deal with the EU regulatory environment.

Interesting times.

Apple's services in the app store(in app purchase system, refunds, API's, app store distribution infrastructure) is indisputly useful and deserved to be paid, however, it could be time to relax the fee circumventing rules since they are so big and has a target on their backs now.

I'm excited to see where this goes. Whether you agree or disagree with Apple, them losing (or even just lessening) their monopoly status would make room for new and upcoming businesses. New apps, new app stores, etc etc. Disruption may not always turn out better in the end, but if the status quo is not good, it's often worth the risk.

"Move fast and break stuff" is very divisive, because of course 'stuff' could include optimal stuff, people, the environment, etc.

"Move fast and break monopolies" on the other hand, should, as a forum for startup aspirants, be pretty easy to agree on.

What EU is doing is wrong. There are costs in running App Store, and asking for it to be fee free does not make sense. Allowing 3rd party Stores will wide open mass public to scams, data leaks and worse.

Developers are getting a very good deal for their small fee by SW industry metrics. Their apps gets displayed and sold by Apple, all things covered, no chargebacks, no running costs.

I feel threatened as a user by what EU is doing. Next thing to expect - many apps will require(!) always on location...

[dupe]

Some more discussion on the official commission release: https://news.ycombinator.com/item?id=40773806

As a EU-citizen, I'm not happy with this legislation and enforcement. I choose Apple versus Android, because I want the safe and user friendly ecosystem Apple offers. Otherwise, it makes much more sense to go with Android. Those phones are much cheaper and are very much the same quality-wise (performance, screen, form factor...).

The same goes with iOS on iPad. I'm very happy that my parents can use those devices versus a Windows machine (or even a MacBook) and know that they are pretty much safe from malware.

Even now, I noticed that with the mandatory browser selection screen both my parents independently have moved on from built-in Safari to Chrome (independently), since that was the only browser name they know. And now they are in a much worse position privacy-wise than before. Which is certainly not in the spirit of the GDPR and DMA.

Wow! What if Apple decided to stop operating in EU altogether ?

That was quick.

The EU is too soft with Apple. Apple has consistently shown harmful intentions towards users, and it needs to change. They have had numerous opportunities to change but have refused to do so. I'm a big fan of Apple products, but I cannot accept the fact that I cannot install apps on my device from any source I want. Even if I develop my own app, I cannot install it on my iPhone. Why is the iPhone different from the Mac? It should be just as easy to install an app on the iPhone, simply download it and you're done, or drag and drop it from the desktop.

I hope the EU sets a precedent once and for all with a maximum fine (10% of global revenue).

Apple's App Store policy is unbelievably ridiculously hubristic. Imagine if Google/Microsoft charged you 30% of your entire business just because you ran it on top of Excel/Sheets and Gmail/Outlook. Or if Adobe took a 30% royalty from all artists creative works. It's madness, plain and simple. Developers already pay an annual fee to publish to the App Store, and consumers pay massive dollar to buy their iDevices. And yet they still have the nerve to demand 30% of entire business revenue, and charge a tax even when conducted outside of the App Store (so-called Core Technology Fee)? Even most governments in the world don't tax out-of-jurisdiction income.

What makes Apple such a unique company beloved by billions of people and such a valuable company for investors is because there’s no other company like Apple. It’s the only company that has managed to be a successful software AND hardware company, it has 3 extremely popular operating systems (iOS, ipadOS, MacOS) and the only company that is vertically integrated from top down. Wait it gets better. There are no laws in the books that says what Apple is doing is illegal. Apple’s culture might be Steve Jobs’ greatest product.

This is ridiculous. The EU has a complete axe to grind against Apple, for reasons that I believe border on corruption (if not, veer completely into it). Meanwhile, Meta has a near-monopoly on social networking in the Western world and is subject to a slap on the wrist at best.

Helle Thorning-Schmidt, one of the best friends of the current EU Commissioner for Competition, Margrethe Vestager, is currently on Meta's payroll. For this reason alone, the current EU Competition Commissioner should recuse herself from being involved in this role. There are other reasons, including direct conversations I have had with co-founders of Meta regarding EU commissioners, that cause me to have very little faith in these people to act fairly, or to do little other than carry out Meta's very long agenda to be able to ride on top of Apple's platform and deliver their own App Store with their own currency (remember Facebook Credits, anyone?) and completely replace iMessage etc for people who live within the mass-scale dystopia that is the Facebook-Instagram-WhatsApp Industrial Complex.

Meta is a total monopoly that causes daily harm to society, and yet this is what the EU finds itself obsessed with. These people should be ashamed of themselves. And, they should release the records of every meeting and every communication they have with Meta and its various lobbyists, and the children/spouses of these people (because they love using the family connection to avoid scrutiny, as evidenced by their hiring of various congresspeople's children in roles that make no sense).

So when do we address the elephant in the room and designate Apple a Criminal Enterprise™?