Apple app ecosystem changes in Europe: Why app developers are unhappy?

New Delhi: Apple has announced major changes to the Apple Store and the iOS operating system in Europe in response to the European Union’s Digital Markets Act, allowing users within the EU to download apps and make purchases outside of the App Store from March. The company will also allow software developers to distribute their apps via alternate stores, and opt out of using Apple’s in-app payment system.

While the changes should ideally be welcomed by app makers who have been demanding for the same for long, many of them now call the changes vague and misleading, even farcical and falling far short of meeting the EU regulations. ET explains what the standoff is all about…

What changes for app developers and users in the EU?
In what is being dubbed as the most major shake up to how Apple’s app ecosystem has been working since its inception, users can install apps from third-party app stores. Apple will conduct baseline reviews of all apps regardless of their distribution for malware and platform integrity, using automated and human intervention. Developers can either choose Apple’s in-app payment system or integrate a third-party system for payments.


The iPhone maker has also announced changes to its fee structures. Under the new terms, apps distributed through the App Store but using an alternate payment system will pay a 17% commission (instead of the earlier 30%), and a 3% additional fee if developers choose Apple’s own payment system.

More importantly, the company has introduced a new type of fee called “core technology fee” that will largely impact the most popular apps on the platform. Apple will charge developers €0.50 (about Rs 45) per annual app install, applicable after an app crosses a million annual installs in the EU.

A fair warning…
Apple, however, said the change can expose users to apps that contain scams, fraud, and harmful content, adding that despite the constraints imposed by the regulations, Apple is committed to protecting user privacy.

“The changes we’re announcing today comply with the Digital Markets Act’s requirements in the European Union, while helping to protect EU users from the unavoidable increased privacy and security threats this regulation brings,” said Phil Schiller, an Apple fellow.

The company has also put in place processes that will require disclosures when using third-party payment systems, malware checks, and additional authorisations for alternate app stores.

Why are app developers lashing out?
App developers, especially those who have protested against Apple’s ‘walled garden’ policy, alleged the changes are not enough to abide by the EU regulations.

Spotify founder Daniel Ek wrote on X that by inventing a new tax system to replace the old, Apple mocks the spirit of the law and the lawmakers who wrote it. The music streaming platform called it a “complete and total farce”.

Epic Games CEO Tim Sweeney said the changes are a “devious new instance of malicious compliance”, terming them as “hot garbage”, although he remained keen on launching the video game store as a third-party app store on iOS.

Mozilla, which owns the Firefox web browser, said the changes are “extremely disappointing” because they are limited to the EU, adding that the changes will force the company to maintain two separate instances of their apps.

India impact, if any?
While the changes are currently restricted to Apple users in the European Union, the company is under an investigation by the competition regulator in India regarding anti-competitive practices. Some say the Competition Commission of India’s findings against Apple could be similar to its findings after a probe against search giant Google and may result in Apple being forced to make similar changes to its app store billing and commission policies as it has in Europe. Apple has a minority share of the market in India that is dominated by Google’s Android operating system with over 95% share.