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Apple pays off developers in a bid to buy them off

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Back in May, we wrote about how Apple was in trouble as a number of developers sued the company over its iron-grip rule of the App store. It seems the company has now found a way out of its trouble by settling with some of the developers. It will pay about US$100 million in settlements in addition to making some much-needed overhauls to its store.

The not so good guys from Cupertino

When it comes to the tech giants, Apple has a somewhat different model which is all about control. They control almost everything and anything about their products and with each successive quarter, it seems they gain more control. They have always controlled the software and much of the hardware. With Apple Silicon, they control even more stuff.

One area of control however has sparked controversy. While control means well-designed and tightly integrated ecosystems they also run the risk of breaching monopoly rules that can be detrimental to small businesses that rely depend on you. Nowhere is this more apparent than in Apple’s App store.

You cannot sideload anything in iOS without jumping through hoops. The company has absolute control over who can upload an app and what type of apps they accept. They even demanded a cut from your sales if you made in-app sales. They took as much as 30% of developers’ sales revenue and most importantly made it all but impossible for developers to use other methods of accepting payments. If you wanted your App in the Apple App store you had to use Apple Pay.

Apple makes such big changes but

The settlement with developers is a big win for developers who played hardball with Apple. Not only will some of them actually receive payments ranging from US$250 to US$30 000, but Apple also promised some extensive changes to the way it does things:

  • Apple now explicitly admits and permits developers to communicate with their customers telling them about alternative ways they can pay outside the ecosystem. This means for example you can email your customers telling them to make purchases through your website instead of from your Apple App.
  • Direct purchases from your site need not include Apple Pay. This means for example, if a user installs Netflix on their iOS device they can then head to Netflix.com and make the payment there, comeback, login and enjoy their subscription. Prior to this Apple often found a way to penalise developers who did this.
  • The company promised to make sure that search results returned by it’s App Store will be based on objective data such as ratings, downloads and other ranking factors. Some people have always felt that the results are not fair. Spotify for example thinks Apple favours it’s own Music App.
  • Apple reduced it’s cut to 15% for all those developers who earn less than US$1 million per year.

Despite all these concessions Apple still needs to do more. The biggest concession I would like to see is them accepting third party stores and sideloading to their platform. I am not saying they should make it easy or allow it to be done in an insecure way. They can say provide a code upon request that allows power users to install third-party stores or apps to their phones.

It would be a process where the power user has to take deliberate steps to achieve this kind of like the infamous 7 taps in Android.


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