The release of Apple’s new AR/VR headset, the Apple Vision Pro, may be making headlines this week, but the company is also facing sharp criticism from some of the other biggest companies in the tech space.
Meta’s Mark Zuckerberg is the latest big tech CEO to speak out against Apple’s new App Store policies. Zuckerberg joins heads of Spotify, Xbox, Epic Games, and many other app developers in knocking Apple for these moves over the past week.
A new EU law called the Digital Markets Act (DMA) will soon go into effect. Under the mandate, companies like Apple cannot bar alternative marketplaces from distributing apps on their consumer devices. For Apple, this means allowing users to download unapproved apps through these App Store alternatives.
For many developers, this could’ve been a huge new opportunity. For example, Epic Games announced shortly after Apple announced these rules that Fortnite would return to the iPhone in the EU due to the DMA. Apple previously pulled Fortnite from its App Store in 2020 after Epic Games implemented a workaround for users to buy Fortnite’s in-game currency without paying the usual in-app purchase revenue share to Apple.
Under the DMA, Epic Games could distribute Fortnite on iPhones without going through the App Store and without giving a cut of revenue to Apple.
However, Apple has implemented a new system for developers looking to take advantage of these DMA changes, which charges them for every app download over one million installs each year.
In addition, other new policies also make it restrictive for developers wanting to utilize the alternative marketplaces. For example, to launch an alternative marketplace, Apple requires a “letter of credit from an A-rated financial Institution of €1,000,000 to establish adequate financial means in order to guarantee support for your developers and users.”
Zuckerberg criticizes Apple
Unless a developer already has massive revenue, and a need to circumvent Apple’s App Store review process, such as Epic Games and Fortnite, there’s a good chance the company will make less with their apps under Apple’s new system.
Meta founder and CEO Mark Zuckerberg acknowledged this in a call this week going over the company’s Q4 2023 earnings. And he didn’t mince words when discussing how he felt about Apple’s new DMA-based policies.
“I don’t think that the Apple thing is going to have any difference for us because I think that the way that they’ve implemented it, I would be very surprised if any developer chose to go into the alternative app stores that they have,” Zuckerberg said. “They’ve made it so onerous, and, I think, so at odds with the intent of what the EU regulation was that I think it’s just going to be very difficult for anyone, including ourselves, to really seriously entertain what they’re doing there.”
As Zuckerberg points out, the EU law was meant to combat anti-competitive practices from companies like Apple. Yet, Apple is using the law to institute policies that will end up being even more costly for developers, who the DMA was meant to benefit.
Facebook Messenger, Instagram, Threads, and WhatsApp are all currently available on Apple’s official App Store. Some of Meta’s apps, like Facebook and Instagram, do offer in-app purchases, meaning that Apple takes a cut of up to 30 percent from those transactions.
But unlike Fortnite, which wanted to avoid Apple’s revenue cut in order to pass the discount to its users, Meta simply charges users more for purchasing products like Meta Verified through the app to cover Apple’s share. With that model, as Zuckerberg states, it makes no sense to move its apps off the App Store and pay Apple for each user that downloads its free iOS apps.
Still, being that Apple’s new policy isn’t going to affect Meta, it’s interesting to hear Zuckerberg join the chorus of voices coming out against it.
