In a major policy shift, tech giant Apple has announced that it will allow music, video, and other media apps to direct users towards sign-up pages on their websites. This will allow companies like Spotify and Netflix to bypass Apple’s 15 to 30 percent payment processing fee.
The Wall Street Journal reports that Apple has agreed to allow media apps to add in-app links to sign-up pages on those companies’ websites. This will allow companies such as Netflix and Spotify to bypass Apple’s payment processing system which takes a 15 to 30 percent cut of all subscriptions and sales made through the app store.
Spotify has previously argued vehemently against Apple’s percentage split. In April of this year, the European Commission stated that Apple “abused its dominant position,” in the distribution of music streaming apps through its App Store following a complaint from music streaming service Spotify.
Margrethe Vestager, the head of competition policy in the EU, stated: “Our preliminary finding is that Apple exercises considerable market power in the distribution of music streaming apps to owners of Apple devices. On that market, Apple has a monopoly.”
The European Commission is the EU’s executive arm and opened an antitrust investigation into Apple’s App Store last year after the music streaming platform Spotify complained in 2019 that Apple’s license agreements were unfair.
The license agreement state that app developers have to pay a 30 percent commission on all subscription fees that come through the App Store. The EU stated that it took issue with the “mandatory use of Apple’s own in-app purchase mechanism imposed on music streaming app developers to distribute their apps via Apple’s App Store.”
Now, to close an investigation by the Japan Fair Trade Commission, Apple has agreed to allow media apps to direct customers to outside payment options. The changes are expected to go into effect early next year as governments around the world begin to question the control Apple has over third-party software developers that distribute their apps on Apple’s iOS platform.
This week, South Korea passed a bill designed to stop tech giants such as Google and Apple from preventing developers from using third-party payment systems. The bill will likely be signed into law by President Moon Jae-in, whose political party proposed the bill.
Under the new law, if tech companies fail to allow developers to use alternate payment processors, they could face fines of up to 3 percent of their revenue in South Korea. The law makes amendments to South Korea’s Telecommunications Business Act and could impact how Google’s Play Store and Apple’s App Store operate worldwide. Apple’s newly announced policy change will likely address South Korea’s issues with the tech giant.
Read more at the Wall Street Journal here.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship. Follow him on Twitter @LucasNolan or contact via secure email at the address firstname.lastname@example.org