- Apple’s controversial policy of taking up to a 30% cut of App Store purchases is under scrutiny again.
- The developer of email app Hey accused the tech giant of strong-arming developers into using Apple’s payment systems so it can take a 30% cut.
- Apple has been under scrutiny over concerns that its role as operator of the App Store and as a competitor with other apps gives it an unfair advantage.
- The episode has raised questions about Apple’s guidelines, with some developers questioning why some apps are subject to this rule and others aren’t.
- Are you an app developer with an insight on Apple’s App Store policies to share? Contact Business Insider reporter Lisa Eadicicco via encrypted email (email@example.com), standard email (firstname.lastname@example.org), Signal (+1-551-333-9072) or Twitter DM (@lisaeadicicco). We can keep sources anonymous. Use a nonwork device to reach out.
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Apple’s longstanding policy of taking up to a 30% cut from App Store transactions is under fresh scrutiny, as an email app developer recently accused the tech giant of unfairly strong-arming it into using its in-app payments system.
The conversation has prompted confusion among developers over the company’s guidelines, with some on Twitter accusing Apple of not giving all apps the same treatment during the review process.
David Heinemeier Hansson, CTO and cofounder of Basecamp, recently called out Apple on Twitter after the second version of his company’s paid email app, Hey, was rejected during the review process. Apple cited Section 3.1.1 of the App Store guidelines, which stipulate that app developers must use Apple’s in-app payment system if they offer paid services.
The notice caused confusion because Hey’s creators thought it would be exempt from this rule. After all, the app is designed to access an existing service that its users already pay for, similar to the way apps like Netflix and Slack work, as Protocol reported.
Apple’s developer guidelines allow app creators to offer access to content and services they’ve previously paid for through iOS apps. So, those who have already signed up for an annual $99 subscription to Hey should be able to access the service through the app as expected.
But developers can’t “directly or indirectly” discourage users from using Apple’s in-app purchasing method, says Apple’s guidelines. As such, Basecamp must also offer a way for new users to subscribe to Hey through the iOS app using Apple’s in-app payment system.
The decision prompted a lot of confusion from developers and app creators in response to Heinemeier Hansson’s tweets, with many wondering why some apps are required to offer in-app purchases and others aren’t.
We faced this w/an international calling app. We paid carriers for use of their lines to make the calls, and put a small margin on costs to be competitive. Apple wanted ‘digital service’ 30% because the calls ran on digital lines (like all telco). Stalled approvals.
— Dana Todd (@danatodd) June 17, 2020
This inconsistency in approval requirements has been applied to (albeit) much smaller apps that I have submitted and had rejected
— William Kethman (@wkethman) June 17, 2020
I worked at Spotify for 5 years. Apple consistently rejected our updates for doing stuff that not only other apps but Apple Music itself did.
It’s bullshit and it has to end.
— Juan 🧉 (@JMSerruya) June 16, 2020
I just checked and the Gmail app doesn’t offer any in-app purchases. I have an update pending from three days ago.
— Dave Jack (@davars) June 16, 2020
Apple says on its App Store principles and practices website that developers behind apps that fall into the “reader” category “receive all of the revenue they generate from bringing the customer to their app. Apple receives no commission from supporting, hosting, and distributing these apps.”
These rules only apply to specific types of content, provided the developer doesn’t try to steer users toward purchasing methods outside of the in-app purchasing system. The types of content covered by the “reader” app rule doesn’t include email services, but it does apply to magazines, books, audio, music, video, professional databases, and approved services like classroom management apps.
It’s far from being the first time Apple’s App Store policies and guidelines have caused unrest among developers. Spotify filed a complaint against Apple with the European Commission last year arguing that charging a fee on premium subscriptions while also offering its own music service made it more difficult for Spotify to compete with Apple Music. Rakuten has also filed a complaint against Apple on behalf of its e-reader business Kobo.
Apple has long maintained that it offers a level playing ground for all developers, despite the complaints. “And developers, from first-time engineers to larger companies, can rest assured that everyone is playing by the same set of rules,” Apple wrote in its response to Spotify’s complaint last year. Apple also said in an email to Business Insider that its policies on privacy, design, and business models apply to all app developers.
That hasn’t stopped regulators from targeting Apple. The European Commission has launched two competition probes into Apple, one examining Apple Pay and another targeting Apple’s App Store policies.
“It appears that Apple obtained a ‘gatekeeper’ role when it comes to the distribution of apps and content to users of Apple’s popular devices,” Margrethe Vestager, executive vice president of the European Commission, said in a statement announcing the investigation. “We need to ensure that Apple’s rules do not distort competition in markets where Apple is competing with other app developers, for example with its music streaming service Apple Music or with Apple Books.”
Are you an app developer with an insight on Apple’s App Store policies to share? Contact Business Insider reporter Lisa Eadicicco via encrypted email (email@example.com), standard email (firstname.lastname@example.org), Signal (+15513339072) or Twitter DM (@lisaeadicicco). We can keep sources anonymous. Use a nonwork device to reach out.
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