It’s been a very good month and a very bad month for Apple. The good: The company was the first (and so far, only) public company in history to hit a $2 trillion market cap. Not only that, Apple doubled its value from a $1 trillion company in only two years. Doubling your market cap in two years would be something any company would die for.
But the bad: Apple has been getting hammered from all sides about the App Store fees it charges developers. Last week, Fortnite developer Epic Games included a third-party payment option for in-app purchases in its game. Apple quickly yanked from the game from the App Store for violating the rules all developers must agree to if they want to distribute their software via Apple’s platform. Epic, then, just as quickly, sued Apple and launched a massive PR war against the iPhone maker, arguing its App Store rules hurt developers (Epic also sued Google the same day).
The pinnacle of Epic’s complaint is that Apple’s 30% cut of in-app purchases is too much, especially when Apple only charges Amazon 15% for some App Store fees. But the thing is, Apple isn’t just dealing with Epic anymore. A number of other companies have now joined the bandwagon in saying Apple’s fees are too much, and the company’s lower fees for Amazon aren’t fair.
The latest to hop on the anti-Apple bandwagon is everyone from The New York Times to CNBC. As CNBC reports, Digital Content Next (DCN), a trade body that represents the biggest news organizations in the country, has sent Apple a letter asking how its members could get the 15% App Store fee deal that Apple is giving Amazon.
In the letter, the DCN asked Apple to “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 has yet to reply publicly on the matter of the DCN’s letter.
However, while it’s perfectly reasonable for other companies to want the same deal Apple is giving Amazon, the DCN’s letter ignores the fact that other companies can already get the deal Amazon is getting—if they meet the requirements. Amazon gets its 15% fee deal via a program Apple has initiated for premium subscription video entertainment providers. Under the program, developers must meet the following criteria:
- The developer must be a premium subscription video entertainment provider.
- The developer’s apps must also offer deep integration with Apple’s technologies including the “Apple TV app, AirPlay 2 support, tvOS apps, universal search, Siri support and, where applicable, single or zero sign-on.” (per what an Apple spokesperson told CNBC in April)
If a developer meets those criteria, they get the 15% fee waiver, too. And it’s not just Amazon that has met those criteria. Altice One and Canal Plus already have, too.
Regardless of these facts, Apple’s 30% cut is something many developers will still argue is too high. And of course, it’s reasonable that those developers and publishers would like lower fees because they are looking out for number one—their businesses. But will those lower fees happen if those devs and publishers don’t meet the status of a “premium subscription video entertainment provider?”
For now, it seems unlikely, but this battle is probably far from over.