Apple’s proposal to comply with the DMA is facing a range of criticisms, being called everything from a ‘step in the wrong direction’ to ‘extortion’.
Sarah Bond, the president of Microsoft’s Xbox business, has spoken out against Apple’s new App Store plan to comply with EU regulations.
The president called Apple’s policy adjustments “a step in the wrong direction” and said she hopes the company will listen to feedback on their proposed plan and “work towards a more inclusive future for all”. The statement follows similar criticisms from companies such as Epic Games and Spotify.
Apple revealed a set of major changes to its EU services last week to comply with the Digital Markets Act (DMA), which was introduced in 2022 to crack down on anticompetitive behaviour among Big Tech companies.
The proposed changes include letting EU users download apps from competing app stores on iOS. But the proposal will also introduce a “core technology fee” of €0.50 for “each first annual install per year” for developers whose apps have more than 1m downloads. This fee will apply to both apps that switch to their own marketplaces or remain on the App Store.
Additionally, developers who continue to use the App Store will see their commission rate drop from 30pc to 17pc, while the discounted rate for certain developers will drop from 15pc to 10pc.
In a statement on X, Spotify CEO Daniel Ek said Apple’s proposal is a “new low, even for them”. He also shared a statement from Spotify that calls the core technology fee “extortion, plain and simple”.
“Sadly this is a classic move of an old, dominant company that believes the rules don’t apply to them,” Ek said on X. “Instead of adapting and innovating, they’re twisting the situation, making it seem like the regulators are at fault.
“Or even worse, pretending this has to do with security when it’s clearly a ploy to drive their own profits.”
Ek said Spotify is in an “untenable situation” as its EU Apple install base is in the 100m range and that the new fee could make customer acquisition costs skyrocket, “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,” Ek said.
Epic Games CEO Tim Sweeney also labelled Apple’s proposal as an “anticompetitive scheme rife with junk fees” and called it an example of “malicious compliance” with the DMA.
The gaming company was involved in a dramatic court battle with Apple last year around its App Store policies. A US appeals court upheld a 2021 ruling between Epic and Apple last March, and largely rejected claims by Epic that App Store policies violated antitrust rules.
European commissioner for the internal market Thierry Breton told Reuters that company proposals around the DMA will be assessed from 7 March and that “strong action” will be taken if any proposals are not good enough.
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