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The Apple App Store is the biggest app marketplace on the planet, and the company had to do some shady business practices to make that so. Thus, the company is facing some trouble. Apple was fined over nearly €2 billion for anti-steering practices toward music streaming services.
Right now, the App Store is going through a pretty big shake-up. Ever since its creation, the App Store has been the only app marketplace on iOS. However, the EU has forced the company to allow sideling apps. This means that European users will be able to download apps from places outside of the iOS App Store. However, Apple has a few issues with this and unveiled some absolutely horrendous terms for app developers developing apps for third-party app stores. These terms, if they go into effect, they’ll mean massive fees for companies whose apps gain more than a million downloads.
However, whether or not these policies stick is yet to be seen. In any case, the first third-party app store to launch on iOS is called SetApp, and it will be entering beta soon. So, we’re going to have to see if this works.
Apple to be fined nearly €2 billion for anti-steering practices toward music streaming services
We are all familiar with the egregious fees that Apple and Google charge developers for using their payment systems. Developers have to pay a 30% tax to the company just to use their payment systems. This is something that prompted companies like Hulu and Amazon to stop using Google’s payment system and use their own.
Well, Apple has been combatting this, but it got caught going overboard. The company has been caught forbidding music streaming services from offering alternative methods of payment outside of the iOS App Store.
According to the report, Apple has been committing anti-steering practices by banning developers from informing their users about cheaper alternative payment methods outside of iOS. So, if a streaming service can charge you less money by signing you up through another payment system, too bad, they can’t tell you. They’re not allowed to inform users at all.
This means that the developers cannot communicate with users within the app of alternative payment methods. This also forbids developers from contacting users directly about alternative payment methods. Users cannot inform their users about any alternative means of payment outside of the Apple App Store at all.
The fine
The EU believes that this is a tactic that negatively affects the user experience by keeping music subscription service prices high. By forcing all music streaming apps to constantly pay such a large amount of their income to use Apple’s payment system, the services are basically forced to offer the services at high prices in order to compensate. This means that the users using the services are forced to pay the higher prices.
Apple is being fined €1.8 billion for this offense. That roughly translates to $1.95 billion USD. So, this is a big no-no for the EU, and we are certain that, if Apple stops this practice, we will see more changes for apps on the App Store.