Apple commission on web purchases: Waved through despite internal concerns

Due to legal and regulatory pressure, Apple now allows app providers and developers to link to the web for digital purchases. However, the company still charges a commission of up to 27 percent for purchases made via the browser.

This fee requirement allegedly also caused concerns internally at Apple: he initially spoke out against the commission on web purchases and wondered whether Apple was even allowed to charge such a commission, explained App Store boss Phil Schiller in a hearing before a US court.

App Store as a “collection agency”

He was also concerned that under the new structure, Apple would now have to actively collect these fees from developers – instead of simply retaining the commission. “What happens if the developer doesn't pay and what procedure is then used?” explained Schiller, according to the AP news agency. The App Store thus becomes a “collection agency”, Techcrunch quotes from the manager's statement. According to Schiller, he also feared that the move would be “damaging” to the relationship between Apple and developers.

Despite the concerns raised, Apple ultimately decided to introduce such a commission on web purchases – not only in the US but also in the EU. This was decided at the highest level by a committee that included Schiller, Apple CEO Tim Cook and former CFO Luca Maestri – as well as in-house lawyers. According to the hearing, Cook also argued for the prominent warning dialog that appears every time users click on such a link in an iOS app.

Apple must allow web purchase links in apps

The hearing was part of the major antitrust lawsuit filed against Apple by gaming giant Epic Games five years ago (Epic Games v. Apple, Case No. 4:20-cv-05640, United States District Court, Northern District Of California, Oakland Division). Apple won the case on virtually all points – in contrast to Google, whose Play Store was classified as an illegal monopoly by a jury following a similar Epic lawsuit.

However, an injunction subsequently forced Apple to allow apps in the USA to point users to shopping opportunities on the web and to place a corresponding link. Apple also had to introduce corresponding options in the EU and the first other regions. Originally, iPhone apps were strictly prohibited from placing such shopping links. All in-app purchases must be processed via Apple's purchase interface, with the company automatically retaining up to 30 percent commission and making billions in revenue every year from this alone.

(lbe)