The controversy over Apple’s fees for apps sold outside the App Store continues, with both Epic Games and Spotify objecting to the company’s latest attempt to comply with EU antitrust law.

Spotify has called Apple’s latest fee structure “confusing and unacceptable,” while Epic Games has called the fees “illegal”…

A brief summary

For many years, the official App Store was the only way to sell iPhone apps. Apple set the commissions and it was a case of “eat or die” for developers.

Apple argued that this was not a monopoly because the relevant market was mobile apps and the App Store only owned a portion of that market. However, the EU disagreed, stating that the relevant market was iPhone apps and that it was anti-competitive to prevent developers from selling apps either directly from their own websites (as is the case with Mac apps) or through third-party app stores.

Apple initially announced a plan to comply with the rules, but developers called the terms “bad faith compliance” because they would have to pay the iPhone maker the same commission regardless of whether an app was sold through the App Store or not. The EU said Apple’s announcement did not appear to comply with the law and launched a formal investigation.

Apple’s new fees

The Cupertino company has apparently accepted that its original plan would not work and announced a complicated alternative fee structure yesterday.

The Initial acquisition fee is a commission on sales of digital goods and services made by a new app user across all platforms where the service offers purchases. This applies for the first 12 months after the first download of the app with the “Link Out” permission.

Over and beyond Store Services Fee is a commission on the sale of digital goods and services, which in turn applies to purchases made on any platform. The Store Services Fee applies within a fixed period of 12 months from the date of installation, update or reinstallation of an app (…)

The amount of these two new fees varies depending on the developer’s circumstances, resulting in a complicated matrix of eligibility and fee costs that developers must carefully consider.

Spotify and Epic Games protest

Spotify and Epic Games were two of the developers who had long alleged that Apple was abusing its dominant market position, and whose complaints were partly responsible for the development of the EU’s antitrust law, the Digital Markets Act (DMA).

Neither company was happy with Apple’s first attempt and its complacency, and nothing has changed this time either.

Epic Games CEO Tim Sweeney immediately reiterated the accusation of “malicious subjugation” and claimed the new fees were illegal.

Apple continues its malicious compliance by imposing an illegal new 15% junk fee on users who switch to competing stores and monitoring trading on those competing stores.

TechCrunch received a statement from Spotify calling Apple’s new fees confusing and unacceptable.

We are currently reviewing Apple’s intentionally confusing proposal,” the company said in a statement. “On its face, Apple once again blatantly disregards the basic requirements of the Digital Markets Act (DMA) by charging a fee of up to 25% for basic communications with users. The European Commission has made it clear that charging recurring fees for basic elements such as pricing and linking is unacceptable. We call on the Commission to speed up its investigation, impose daily fines and enforce the DMA.

9to5Mac’s opinion

Everyone agrees that this is a mess. We have a law that essentially says companies have to act fairly, but doesn’t specify exactly what is and isn’t acceptable when it comes to app stores.

We have Apple’s original proposal – which the company could not possibly have believed would satisfy the EU – and now a second attempt that is horribly complex and also appears to ignore the spirit of the law.

The inevitable result is that the EU will launch another compliance investigation. This will likely conclude that Apple has not complied with the law, and we will end up with another Version. The only question is whether the iPhone manufacturer will do this voluntarily or take legal action.

The only sensible way out is for EU lawmakers to either amend the law to specify exactly what it requires of app store operators or to make a clear statement about what it expects of them.Apple can then either accept and fulfill these terms, or the two sides can go to court and let a judge decide.

What we cannot do is allow this endless cycle of suggestions, complaints and investigations to continue.

Photo by Manh Tuan Nguyen on Unsplash