Apple will allow developers to email customers to bypass App Store billing

Tim Cook at WWDC21 on June 7, 2021.

Source: Apple

Apple will allow app developers to email their users about non-Apple purchase options in a major change to the App Store policies.

Previously, Apple banned app makers from emailing users to their websites to pay for digital products. App makers want to contact their customers directly to encourage them to pay directly and avoid Apple’s App Store fees, which are between 15% and 30% of gross sales.

Now developers can use information they get in their apps, like an email address, to communicate with their customers and encourage them to pay directly instead of through Apple.

“To give developers even more flexibility to reach their customers, Apple also makes it clear that developers can use communications such as email to exchange information about payment methods outside of their iOS app,” said an Apple press release. “As always, developers don’t pay Apple any commission for purchases made outside of their app or the app store. Users must consent to the communication and have the right to opt out.”

The policy change came because Apple settled a class action lawsuit with developers alleging that Apple monopolized the distribution of iOS apps and in-app purchases, resulting in commission surcharges.

Regardless of that deal, Apple is also facing significant pressure on its App Store policies and commission rate from regulators and lawmakers around the world, and has been involved in a high-profile antitrust case against Fortnite maker Epic Games. A decision by a judge in the Epic Games trial is expected later this year.

“By informing customers about alternative payment options, developers can avoid paying Apple’s commissions and also put competitive pressure on Apple to discipline its pricing,” said a complaint by plaintiffs’ attorneys.

Developers who made less than $ 1 million per year from 2015 to 2021 can claim between $ 250 and $ 30,000 from a fund that Apple pays $ 100 million.

Hagens Berman law firm, which represents the plaintiffs, said more information would be available on a settlement website, although it is not yet operational. The settlement must be approved by Judge Yvonne Gonzalez Rogers, who will also decide the antitrust case at Epic Games.

The agreement between plaintiffs and Apple included several other changes to the App Store policy.

  • Small Business Program. Apple is maintaining its lower 15% commission for businesses making less than $ 1 million on the App Store for at least three years.
  • Search and discover. Apple will conduct experiments with the App Store search, among other things to “give new and high-quality apps a chance to be found,” according to a legal registration.
  • Price points. Apple will allow developers to choose different prices. Until now, developers in the US were only allowed to select roughly round dollar numbers ($ 0.99). For example, they can now price apps and in-app purchases at $ 1.49.
  • App rejection. Apple will continue to allow app makers to appeal their decisions and will post additional information on the appeal process on its website.
  • Transparency. Apple will publish an annual report with information on app rejections, searches, and other developer issues, according to a judicial file.

The European Commission has been looking at the inability of app developers to email their customers about payment alternatives. Above all, Spotify has rubbed against the rule. According to a judicial file, Apple will remove the restriction from its App Store Review Guidelines.

“If you’re a rival to Apple Music, you can’t send your subscribers an email asking them to subscribe to your website at no commission fee,” said EC contest director Margrethe Vestager in April after opening a formal Apple had submitted the objections to this.

However, app developers won’t be able to direct new users to a website in their apps to sign up for payment outside of Apple’s app store.

Apple’s “anti-steering” rules were the focus of the questioning by judge Yvonne Gonzalez Rogers opposite Apple CEO Tim Cook in an antitrust case against the Fortnite manufacturer Epic Games earlier this year. A decision is expected this year.

Separately, Apple announced on Thursday that it would lower the App Store fees for publishers who provide content for Apple News.

In a statement to CNBC in response to the Apple News announcement, Tim Sweeney, CEO of Epic Games, said that Apple has a “divide and conquer” strategy of offering special offers to various developer segments “to get each group to buy “. their distribution and payment monopoly. “

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