Apple adapts App Store policy in response to the EU regulations

Apple has made a significant concession in Europe by allowing software developers operating in Europe to distribute their applications to EU customers directly from their websites rather than exclusively through Apple’s App Store, a move aimed at complying with the European Union’s Digital Markets Act (DMA).

The changes announced by Apple include giving developers more flexibility in designing in-app promotions, discounts and deals when directing users to complete transactions on their websites. These adjustments are part of Apple’s efforts to comply with EU regulatory pressure, which could impose fines of up to 10% of a company’s global turnover for violations.

The shift could impact Apple’s high-profit margins and steady revenue stream from its App Store, where it charges developers fees of up to 30%. However, while the move allows developers to reach consumers more directly, Apple has introduced a ‘core technology fee’ of €0.50 per user account each year, regardless of whether developers use Apple’s App Store or payment system.

Why Does It Matter?

The DMA seeks to rein in tech giants like Apple and create a level playing field for smaller rivals, ultimately fostering more competition in the European market. After being hit with a massive antitrust case by Spotify, Apple’s decision reflects the increasing influence of regulatory measures (particularly in the EU) on the practices of major tech companies. Moreover, the adoption of the EU AI Act by the European Parliament underscores the potential for significant changes in the digital marketplace, impacting competition dynamics, developer relations, and user privacy considerations.