'Apple's new policy is a step in the wrong direction.' Microsoft, Spotify, decry Apple's 'compliance' with new European app store rules

Apple iPhone in space
(Image credit: Windows Central | Microsoft Copilot)

What you need to know

  • Recently, Apple changed its App Store rules on iOS devices to comply with new EU rules on digital platforms. 
  • Microsoft, Spotify, Epic Games, and others have decried the new policies as a step backwards. 
  • Microsoft is aiming to set up a mobile gaming store on iOS and Android, despite Apple's anti-competitive blocks on Xbox Game Pass. 

Apple's new App Store rules designed to comply with new European legislation are under attack, as the firm seeks to profit from poorly worded clauses in the Digital Markets Act. 

Apple and others have been designated so-called "gatekeeper" companies, which subjects them to rules designed, in theory, to promote competition within digital platforms. However, Apple has managed to skirt the bulk of the new rules, by imposing a new tax on developers who choose to exist on third-party storefronts. 

The new EU rules are essentially forcing Apple to open itself up to side-loading and third-party storefronts, similarly to platforms like Windows 11. On Windows 11, you, I, or anyone can create and sell apps without having to pay a fee to Microsoft. The same is true on Android, however, Google doesn't exactly make it easy for third-party apps and services to be visible, as it aggressively controls default apps and services on its platform. The EU already forced Google to add an search engine choice when setting up a new phone on Android, but we're a long way from educating users on the fact third-party stores potentially exist, such as the Galaxy Store on Samsung phones. 

Apple is a different battleground all together. Apple blocks services like Xbox Game Pass and NVIDIA GeForce Now, since they would have to compete more directly for users' money, if they had a choice where to play games on its platforms. Microsoft has been hoping to grow its own third-party app and mobile game store on iOS and Android, and has been banking on the European Commission to help crack open iOS devices to that end. Sadly, it looks as though Apple has found a way to avoid complying fully.  

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Microsoft Gaming President Sarah Bond called the new rules "a step in the wrong direction," and called on Apple to "listen to feedback" on the new rules. Spotify's Daniel Ek was a little less diplomatic, posting a large blog post calling out Apple for years of "bad behavior." 

"Under the new terms, if we stay in the App Store and want to offer our own in-app payment, we will pay a 17% commission and a 0.50 cent Euro Core Technology Fee per install and year," Ek continued, "this equates for us to being the same or worse as under the old rules. And if we managed to remove our app from the App Store and only existed in the Alternative App Store, that would still not work. With our EU Apple install base in the 100 million user range, this new tax on downloads and updates could skyrocket our customer acquisition costs, potentially increasing them tenfold. This, as we have to pay on every install or update to our free or paid app, even for those who no longer use the service."

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Mozilla, Epic Games, and various other companies have also lined up to attack Apple for its new rules, which create various barriers, hurdles, and hidden taxes for developers who dare to build apps that aren't fully tying themselves to Apple's ecosystem. Apple, for example, is requesting that anyone trying to create a storefront on iOS needs to guarantee a credit line of 1 million euros to "support developers." In Windows 11 terms, it would be like telling companies like Steam, GOG, and Epic Games they can't set up a store on Windows without following a range of arbitrary rules. 

The EU's DMA also stipulates that Apple needs to allow alternative browser engines on iOS. Right now, browser firms are forced to use Apple's despised webkit platform. Apple is trying to make it more difficult for third-party browser engines like Chromium to create offerings on iOS with a range of similar, arbitrary barriers. "Apple’s proposals fail to give consumers viable choices by making it as painful as possible for others to provide competitive alternatives to Safari. This is another example of Apple creating barriers to prevent true browser competition on iOS," Mozilla's Damiano Demonte lamented (via The Verge).

Epic Games' CEO and Fortnite co-owner also lambasted Apple, "Under what possible theory of antitrust regulation is it acceptable for a monopoly to decide what companies are allowed to compete with it, and on what terms they can compete? Apple makes a mockery of free market competition."

Malicious compliance 

Apple's long-standing anti-competitive, anti-consumer stance has made it an incredibly wealthy company over the past few decades, building an ecosystem that hinges entirely offering a sub-par experience while hiding behind excuses like "privacy" while raising the spectre of imaginary viruses or hackers. 

Apple's taxes on developers and compliance burdens make it impossible for even the biggest companies to compete with its default offerings, giving them a wholly unfair advantage that also erodes the experience for users who dare to use competing services. I've seen people unironically praise Apple for giving musicians a better cut than Spotify on its platform, glossing over the fact Apple's tax burden it places on Spotify and other music services is money that could go towards artists instead. If you're a subscriber of NVIDIA GeForce Now or Xbox Game Pass, Apple doesn't want you to have access to those services on its platform, despite not offering a similar service of its own. 

Apple's behavior reduces consumer choice, increases prices, and stunts innovation, and it's about time regulators grew a pair and did something about it. 

Jez Corden
Co-Managing Editor

Jez Corden a Managing Editor at Windows Central, focusing primarily on all things Xbox and gaming. Jez is known for breaking exclusive news and analysis as relates to the Microsoft ecosystem while being powered by caffeine. Follow on Twitter @JezCorden and listen to his Xbox Two podcast, all about, you guessed it, Xbox!

  • fdruid
    Apple never fails to be consistently the bad guy and yet their users and fans put up with anything they do. In fact, Microsoft has more user friendly policies and still is shat on all the time by users and the press. This is bollocks.
    I expect there to be another bout of legal actions against these creeps. They can't win so easily, when other companies get extensively harassed at their every move by regutors internationally.
    Reply
  • fjtorres5591
    Politicians and bureacrats act as if they're smart.
    They're not.
    The constantly forget the Law of Unintended Consequences.
    Apple knows this and uses those loopholes and consequences.
    So it was only to be expected they would do something worse so they can claim they were "forced" and shift the blame.
    So it's back to square one.

    Trust scorpions to be scorpions.
    Reply
  • naddy69
    "Apple never fails to be consistently the bad guy and yet their users and fans put up with anything they do."

    Except for the "bad guy" bit, this is a VERY key point. First, Apple is not a "monopoly", regardless of what some people are claiming. You can't have a monopoly on your own product AND it is impossible to be a monopoly with 25% of the market. Apple is not a "bad guy".

    Second, U.S. anti-trust laws exist to protect consumers. Not competitors. The only people complaining about Apple are competitors. Apple customers are happy. Extremely happy, in fact. And extremely loyal. Therefore, governments have no jurisdiction to force Apple to change anything. Because these changes are only wanted by competitors. These are the true bad guys.

    As the judge said in the silly Epic Games case, "Being successful is not illegal". Competitors can whine all they want, but Apple has every right to do what it does.

    Which the U.S. Supreme Court confirmed by refusing to even hear the case. Do you understand how important that was? That alone should tell you everything you need to know.

    No one is forcing anyone to buy Apple products. There are TONS of choices in the phone/tablet/PC markets. No one is forcing companies to support Apple. If you want to make money by selling software/services/whatever to Apple's users, then you have to follow Apple's rules. If you don't like the rules then too bad. Sell your software/services/whatever to Android users and stop whining about Apple.

    When Apple has 95% of the phone/tablet/PC market, THEN governments can force Apple to change. Until then, everyone just needs to Get Over It. Apple does not owe anyone anything.

    Just because lots of people hate Apple (for whatever bizarre reasons), does not mean governments can force Apple to change so everyone will like Apple.

    Regarding the EU, I love that Apple is giving them a big FU. Socialist countries trying to dictate what a hugely successful American company should do is just great theater. If these useless politicians/bureaucrats knew anything about running a successful company, they would be doing so. Instead of being useless, know-nothing politicians/bureaucrats.
    Reply
  • Ron-F
    I have a very unpopular take. Apple, Google, and all other platform holders should ask whatever they want to allow third party software in their devices. In the same way, Spotify -- that loves to complain against Apple -- can offer some micro pennies to artists for each time a song is played. You take the offer, or not.

    Windows and macOS are open platforms, smartphones are not. It is a tradeoff, you gain security, you lose some openness. I am incredibly happy I convinced my octogenarian mother to give up a PC and use only an iPad. Also, I am worried that opening the platform would only help the big publishers, as it is certainly fair to allow Apple to charge for the use of their APIs, which may be advantageous to the big companies, but not so much to small developers.
    Reply
  • Jez Corden
    Ron-F said:
    I have a very unpopular take. Apple, Google, and all other platform holders should ask whatever they want to allow third party software in their devices. In the same way, Spotify -- that loves to complain against Apple -- can offer some micro pennies to artists for each time a song is played. You take the offer, or not.

    Windows and macOS are open platforms, smartphones are not. It is a tradeoff, you gain security, you lose some openness. I am incredibly happy I convinced my octogenarian mother to give up a PC and use only an iPad. Also, I am worried that opening the platform would only help the big publishers, as it is certainly fair to allow Apple to charge for the use of their APIs, which may be advantageous to the big companies, but not so much to small developers.
    the problem with your argument is that Google does allow third-party stores and side-loading, without compromising "security." a lot of security is on the responsibility on the end user. if you download a random app from some random website it's kinda on you imo.

    the reason spotify offers micropennies to artists is cus of the apple tax apple pays itself, then uses that money to pay artists a better rate on apple music - that's the literal definition of anti-competitive behavior.
    Reply
  • fjtorres5591
    Jez Corden said:
    the problem with your argument is that Google does allow third-party stores and side-loading, without compromising "security." a lot of security is on the responsibility on the end user. if you download a random app from some random website it's kinda on you imo.

    the reason spotify offers micropennies to artists is cus of the apple tax apple pays itself, then uses that money to pay artists a better rate on apple music - that's the literal definition of anti-competitive behavior.
    Correct.
    Monopolies aren't the only kind of illegal anti-competitive behavior...
    ...nor are all monopolies/extreme market share products anti-competitive.

    As an example of the later is the SPACEX launch services business. Over 80% of the competed market in 2023. Not by blocking competitors nor under-cost pricing, but by a superior business/tech model. Context matters, not just raw numbers.

    Apple was told to allow alternate pay systems--they put in a policy to make the alternatives non-viable via per-download charges. That is as much a blocking tactic as a total ban. Six of one, half a dozen of the other.
    Reply
  • naddy69
    "I am incredibly happy I convinced my octogenarian mother to give up a PC and use only an iPad."

    We did exactly the same thing. They had a PC and could not figure it out. We then gave them iPhones. Now they both text us regularly. One is 80 the other is 92!
    Reply