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Apple Will Let App Developers Tell Users About Ways To Pay Them Outside Of Its Ecosystem In Rare Move

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Apple Will Let App Developers Tell Users About Ways To Pay Them Outside Of Its Ecosystem In Rare Move

Apple Inc (NASDAQ: AAPL) said Thursday it would allow developers to inform users of purchase options outside of its ecosystem, a rare move from the tech giant as it faces legal and regulatory scrutiny over alleged anti-competitive behavior.

The Key Changes: The Cupertino, California-based Apple said it has reached an agreement with plaintiffs that identifies the following seven key priorities that have been submitted to the concerned judge:

  • App Store commission for small developers lowered last year to 15% from 30% for developers earning up to $1 million a year from their apps and those who are new to the store will continue for a period of another three years at least.
  • Search results on the App Store will continue to be based on objective characteristics such as downloads, star ratings, text relevance, and user behavior signals for at least the next three years.
  • Developers can now inform users of other payment options and will still not need to pay a commission on any purchases taking place outside of their app or the App Store.
  • Developers can continue to set their own prices and Apple will also expand the number of price points available to developers. 
  • An option will continue to be available to developers to appeal the rejection of an app based on perceived unfair treatment and Apple promises to add new content explaining the appeals process.
  • An annual transparency report will be published to highlight the number of apps rejected for different reasons, the number of customer and developer accounts deactivated,  and other data. 
  • iPhone maker to establish a fund to assist small US developers.
  • See Also: Apple In Epic Antitrust Trial Says It Doesn't 'Want To Be' Like Android

Why It Matters: The changes from Apple, pending court approval, will resolve a class-action lawsuit from U.S. developers and allow developers more freedom to get payments from their customers outside of the iOS ecosystem, where commissions could be lower.

The changes follow a 2019 lawsuit in which a group of app makers sued the maker of iPhones for allegedly breaching antitrust laws in how it managed its App Store. Apple is also awaiting a ruling in another lawsuit filed by Epic Games over the removal of the latter's Fortnite game for attempting to skirt App Store rules relating to payments outside the ecosystem.

Price Action: Apple shares closed 0.55% lower at $147.54 on Thursday.

 

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Posted-In: Antitrust App Store Apps iOS iPhoneNews Legal Tech Best of Benzinga

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