Apple's New Fees Will Kill Free Apps

Summary

The video examines Apple's monopoly over iPhone apps, which requires developers to pay fees and give Apple a 30% cut of sales. It covers the US court ruling against Apple in the Epic lawsuit, allowing alternate payment links, and the EU's Digital Markets Act forcing Apple to allow third-party app stores. However, Apple is maliciously complying by making alternate payment links cumbersome and charging exorbitant fees for third-party app installs that could bankrupt developers. The video argues Apple is maintaining its monopoly against the spirit of the rulings.

Takeaways

• 😡 Apple has a monopoly on iOS app distribution and in-app purchases through the App Store.
• 💸 Apple charges a 30% commission on digital goods purchased through iOS apps.
• ❌ Apple imposes strict rules on what kinds of apps can be distributed through the App Store.
• 📱 The only way to install apps on an iPhone is through the App Store.
• 👎 Apple blocked game streaming services like Xbox and Nvidia from the App Store.
• 💥 Epic Games challenged Apple's monopoly and commission structure through lawsuits.
• 🇺🇸 A US court ruled Apple can no longer block external payment links in apps.
• 🇪🇺 The EU Digital Markets Act aims to open up iOS app distribution and payments.
• 😠 Apple is using 'malicious compliance' to undermine the impact of these rulings.
• 💸 Apple's new EU terms include fees that could bankrupt free apps that go viral.

Q & A

What is Apple's monopoly related to?

Apple's monopoly is related to the apps and services available on iPhones, specifically the requirement that all apps must be distributed through their App Store where they take a 30% cut of sales.

How did Apple respond to the US court ruling on allowing external payment links?

Apple responded by only allowing one external link, opened in Safari, with a warning popup, and charging a 27% fee on purchases, making it worse than just using in-app purchase.

What new terms did Apple introduce for the EU market?

For the EU market, Apple introduced a reduced 17% commission but with fees of €0.50 per install after the first 1 million, and requirements for large credit lines, which make it unfeasible for most developers.

How could the new EU terms be exploited maliciously?

The per install fee structure means a malicious actor could easily bankrupt a developer by installing their app millions of times from different devices.

Why can't services like Xbox Cloud Gaming release on iOS?

Apple bans game streaming services because they consider interactive games to be apps, so game streaming violates their rule against app streaming services.

What happened when Epic Games added direct payments to Fortnite?

When Epic added direct payments to Fortnite, it was banned from the iOS App Store, and Epic employees were even locked out of their Apple devices.

How much does Apple make from App Store fees?

Apple makes billions in revenue from its 30% cut of App Store sales and mandatory in-app purchase commissions.

Why can't you create a Netflix account in the Netflix iOS app?

Due to Apple's rules, you can't sign up for a Netflix account in the iOS app, to avoid paying Apple's commission. Users have to sign up on the web instead.

What are some examples of Apple's App Store restrictions?

Apple restricts apps from offering gaming streaming, alternate app stores, alternate browser engines, and more. They also restrict communications and payments.

How did the EU Digital Markets Act attempt to address these issues?

The EU Digital Markets Act designated Apple as a 'gatekeeper' and attempted to prohibit restrictions on third-party apps and payment processing to promote competition.