Apple has recently found itself in hot water with the European Commission over its App Store rules. The Commission has shared its preliminary findings, stating that Apple’s current rules violate the Digital Markets Act (DMA). This violation could potentially lead to fines of up to 10% of Apple’s global annual turnover.
The EU’s internal market commissioner, Thierry Breton, criticized Apple for stifling innovation and limiting consumer choices. The Commission specifically takes issue with Apple’s restrictions on third-party developers, preventing them from advertising different prices or alternative distribution channels within their apps. While Apple does allow developers to include a link to their websites, the Commission believes there are still too many limitations.
Apple argues that it has made changes to comply with the DMA based on feedback from developers and the Commission. The company insists that its new business terms will benefit the vast majority of developers, with more than 99% expected to pay the same or lower fees under the new plan.
In addition to the preliminary findings, the European Commission is launching a third non-compliance investigation into Apple’s new contractual terms for EU developers. This investigation will focus on Apple’s Core Technology Fee (CTF) and the option for developers to distribute their apps outside of the App Store. The Commission will examine whether these new terms effectively comply with the DMA.
If you’ve tried to install a third-party app store in the EU, you may have encountered multiple steps and warnings due to Apple’s restrictions. The Commission is concerned that Apple’s new business model may discourage developers and users from taking advantage of alternative app stores, which goes against the DMA’s principles of promoting competition and consumer choice.
Apple now has the opportunity to respond to the Commission’s findings before a final decision is made, which is expected within a year of the formal investigation’s opening. This gives Apple a chance to negotiate with the EU and potentially adjust its business terms to avoid significant fines.
Overall, the dispute between Apple and the European Commission highlights the ongoing challenges of regulating tech giants and ensuring a fair and competitive digital marketplace for developers and consumers alike. The outcome of this case could have far-reaching implications for the future of app distribution and competition within the EU.
