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Apple must make changes to its in-app purchasing rules, says Dutch antitrust regulator

Competition regulators around the world are looking into curbing the dominance of the Apple App Store and Google Play Store.

The Dutch antitrust authority has found that Apple’s rules requiring app developers to use its own payment system are anti-competitive, a report by Reuters revealed. While the Netherlands’ Authority for Consumers and Markets has not fined Apple, it has demanded changes in the company’s in-app payment policies, according to the report.

Apple and Google have recently been facing backlash in many countries for their in-app payment policies, including in India.

Antitrust complaint filed by Tinder’s parent company

The Netherlands antitrust regulator started investigating Apple in 2019 but later reduced its scope to include only dating apps. According to Reuters, the complainants in the case included Match Group, the company behind popular dating apps Tinder and Hinge.

In a statement to Axios in 2020, a Match Group representative said:

Apple is a partner, but also a dominant platform whose actions force the vast majority of consumers to pay more for third-party apps that Apple arbitrarily defines as “digital services.” Apple squeezes industries like e-books, music and video streaming, cloud storage, gaming and online dating for 30% of their revenue, which is all the more alarming when Apple then enters that space, as we’ve repeatedly seen. We’re acutely aware of their power over us. They claim we’re asking for a “free ride” when the reality is, “digital services” are the only category of apps that have to pay the App Store fees.

Apple faces similar antitrust case in India

A non-profit called Together We Fight Society recently filed an antitrust case over Apple’s in-app payment policies with the Competition Commission of India.  The filing accuses Apple of abusing its dominant position in the apps market by forcing developers to use its in-app purchase system.

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Speaking to MediaNama, Together We Fight said that the following issues were highlighted in its complaint:

  1. Increased prices for consumers: The 30 percent in-app purchase fee called the “Apple tax” impacts consumers because app developers pass on the fee to them by charging more.
  2. Communication barriers: App developers are not allowed to communicate with users about alternative purchasing options that don’t include the 30 percent commission.
  3. Unreasonable suspension of apps: The complainant has also highlighted the “capricious, whimsical nature of the App Store policy” that may lead to either suspension or removal of apps, but the same rules do not apply to Apple’s own apps. This suspension further leads to loss of revenue, reputation for the start-ups, the organisation said.
  4. Apple is player and umpire: Apple sets the rules of the game with the App Store guidelines, plays in the game with its own apps, and is also the umpire because it is the adjudicator on whether to allow, suspend or remove an app, Together We Fight noted.

Read: Exclusive: A Deep Dive Into The Antitrust Complaint Against Apple In India

Recent concessions made by Apple amidst backlash

  • Netflix, Spotify allowed to link out to the web for sign-ups: Last month, Apple announced that it will allow developers of some to include an in-app link to their website for users to set up or manage an account.
  • Developers allowed to email users of alternate payment methods: In a settlement to a 2019 US lawsuit, Apple proposed allowing developers to let users know about payment methods available outside the in-app billing system through external communication methods like email.
  • Reduced 15 percent commission: Apple last November said that it will reduce commissions to 15 percent for developers that make less than US$1 million per year.

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Written By

Figuring out subscriptions and growth at MediaNama. Email: nishant@medianama.com

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.



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