The App Store, Apple, Google and the end of the road for 30% commissions

the App Store
Image by stasokulov | Bigstockphoto

The App Store has become a battleground in the struggle between big tech and its hold on customers, data, competitors and even Governments.

The issue with the App Store has always been the level of commission Apple and Google charge developers for being part of it, while enjoying the reach and prominence of the platforms. It took some years to discover what the levels really were and even the most ardent supporter of a walled garden gasped slightly at the 30% answer.

Now, Apple is fighting this on at least two fronts.

Games giant Epic has taken Apple to court in the US, to dispute this level of commission in the App Store. A judgement is expected soon and the judge has said that it is unlikely that either side will enjoy the decision.

South Korea, now enjoying its place as the forward thinker of the tech world, has amended a law that allowed Apple and Google to force developers to push their customers’ payment through their proprietary payments systems.

Both companies were quick to condemn the ruling, saying that the rush to change the rules laid customers of both companies open to fraud and all sorts of other evils. The Korean Regulator said that other companies had the expertise to develop payments systems, in fact he was pretty sure that there were one or two out there already. Then he laughed (we hope).

The App Store was a genius concept when it launched and no-one would deny that it has been instrumental in getting the app worlds where they are today. What people have always wondered is how Apple and Google can justify such enormous commissions.

It now seems that the debate is about to become moot.

It seems clear that Epic will achieve something and that Apple will have to concede something on the commission issue.

It also seems clear that South Korea has forced the issue, making Apple and Google open up the payments options and allowing developers to avoid the 30% commission. Already India is calling for similar rules to be applied in its country, seeing the positive effect on competition and customer choice.

Whether this battle in the App Store is good for customers is unclear. What is clear is that developers will have extra revenue potential and therefore more incentive to innovate further.

Related article:

Apple versus Epic Games – courtroom battle is only half the fight

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