Apple complies with Dutch ruling, lets dating apps use other payment systems

https://nltimes.nl/2022/01/15/apple-complies-dutch-regulators-ruling-allowing-apps-use-payment-systems

by sAbakumoff • 5 years ago

148 61 5 years ago

nltimes.nl

tinus_hn• 5 years ago

Allowing dating apps to use other payment systems.

londons_explore• 5 years ago

So theoretically a dating app could today add a PayPal button or stripe pay box.

They don't even need to go through appstore review if they add it to a webview server side.

So... Have any apps done this yet? Seems like the kind of thing that could be pushed out in a few hours by some teams.

supreme_berry2• 5 years ago

They still are going to pay a fee to Apple.

kotaKat• 5 years ago

Apple will pull it for not going through the StoreKit entitlement process.

my123• 5 years ago

Using StoreKit allows Apple to measure the number of purchases done, to take their cut.

wdb• 5 years ago

Nice, so they going to lower the subscription prices now that they don't need to pay the 30% cut from Apple?

cute_boi2• 5 years ago

"The ruling allows dating app developers to avoid the commission fee between 15 to 30 percent Apple charges. "

Looks like everybody gangsta till regulator steps in.

gonzo41• 5 years ago

Apple is/was just making hay whilst the sun shined. I know many on this site would disagree, but regulation generally is for everyone's benefit. Just like a healthy progressive taxation system.

the_other• 5 years ago

Not if you believe the complaints that 30% is too much “Apple Tax”. No, they’ll keep the price the same and use the profit to improve their apps and business model.

(Can you see my crossed fingers?)

axlee• 5 years ago

It's already the case: if you buy your subscription on tinder.com rather than within the app itself, it is noticeably cheaper.

echelon• 5 years ago

Not necessarily. Now smaller software shops can now make a healthy margin to pay their engineers and grow their product. This will result in higher quality software and services.

bradly• 5 years ago

They have now seen consumers are willing to pay the higher price with the 30%, so it would seem unlikely to me.

olliej2• 5 years ago

No.

The commission charged by apple is not a payment processing fee. It's a platform licensing fee, as has been common practice in the industry since day 1.

What this means is that the companies are allowed to use a separate company to charge users, and now they are required to manage refunds, etc themselves in line with local laws and the apple license.

Now they also have to manually track everything and pay apple the appropriate 15-30% licensing fee.

informationslob• 5 years ago

So what does this mean store Epic Games and fortnite? Well it be coming back to the app store?

cute_boi2• 5 years ago

I don't think so but the title seems to be generalized too much.

"The ruling allows dating app developers to avoid the commission fee ..."

It says dating apps so I don't think apple allowed other app to bypass the rule. But good thing is it sets a precedence.

bekantan• 5 years ago

According to Dutch authorities, dating apps were first on the list because they generated the most complaints. They don't confirm or deny that this will continue with other apps.

saagarjha4• 5 years ago

To provide more insight, this is what the process is:

* There are two new entitlements related to this, which you ask Apple to give you if you're a dating app.

* Once you get the entitlements, you need to create a new version of your app (it cannot be the same as your international one) that will ship exclusively in the Netherlands with that entitlement.

* Details of how this entitlement work will come at a later date.

* Apple will still charge a commission on these purchases, the details of which will also come at a later date.

* It is your privilege/responsibility to conflict resolution with regards to refunds and such.

In essence, Apple complied with the law in the narrowest terms they could, but they did indeed change things and I suspect many companies will go through this process even if it's made somewhat inconvenient. I guess what remains to be seen is if these entitlements slowly get rolled out in other countries as they also enact legislation to require it.

imchillyb• 5 years ago

...Apple complied with the law...

This is the only part that matters here. Doesn't matter how narrowly the law was complied with. Laws are the purview of lawmakers. If the lawmakers leave loopholes in their legislation all companies that can will avail themselves of these loopholes.

Blame the legislators. Those assholes left barn-door sized loopholes in their legal requirements for Apple's compliance.

solarkraft• 5 years ago

You can be pretty sure that Apple lobbied hard to leave these holes. The legislators are happy they can tell their voters they finally did something and that they found a compromise.

It's a bit on us, the public, to not accept those alibi-type compromises.

Maarten882• 5 years ago

Blame the legislators. Those assholes left barn-door sized loopholes in their legal requirements for Apple's compliance.

Well that remains to be seen. The court just applied existing law for this specific conflict. Apple was found not complying, which is why the court issued this ruling. After implementing this narrow change they probably still do not comply. It would surprise me if dating apps would somehow be legally different from any other app. Apple is just stalling here. The next court case is going to cost money in addition to broadening the requirements on Apple, I think.

saagarjha4• 5 years ago

I think they did a rather good job and personally expected almost exactly this outcome given Apple’s position, to be honest. I was concerned that we’d get some sort of weird “you’re making these rules about us but we actually follow the rules” that they did elsewhere that was a real headscratcher.

HWR_14• 5 years ago

I'm not sure it makes sense to blame legislators for loopholes. Bugs exist all the time in a variety of products. And few have to withstand the scrutiny of trillion dollar companies paying experts to pour over every aspect to find them.

maccard7• 5 years ago

It is your privilege/responsibility to conflict resolution with regards to refunds and such.

Every time the apple fee comes up, this part of the discussion rarely comes up. This is a huge part of what you pay Apple/Google for. Lets say you roll your own on top of stripe [0]; each dispute/chargeback costs you $15 on top of the transaction cost. On an app with $0.99 purchases, each dispute will undo 15 purchases. If you get enough of these you _will_ be banned, quickly and with very little warning. I'm not going to claim that this on it's own is worth the full 30% whack but it does neet to be taken into consideration.

[0] https://stripe.com/docs/disputes

ericpauley• 5 years ago

I would imagine all purchases to be a low dispute risk, as the merchant can simply offer refunds to all no questions asked. After all the marginal cost of goods sold for an app is probably effectively 0.

That being said, a $1 purchase through stripe likely has an effective fee higher than 30%, so this would only make sense for larger purchases.

smoldesu5• 5 years ago

I dunno, traditional payment processors have gotten away with 1-2% charges in order to mitigate that kind of problem. I think Apple/Google are entitled to up-to a 5% cut to keep the lights on, but everything after that... it's a stretch. The big issue though (as many others have noted) is that there is no alternative. You have no opportunity to compete with Apple in this space, and that's what pisses off a lot of people. Normally, a competitive market is what ensures that those kinds of taxes stay reasonably low. Without anyone to compete with, Apple can set their own prices.

saagarjha4• 5 years ago

Generally, developers I have seen that seem to want their own payment solution (which is not all developers, but the ones that matter here obviously) this is a good thing, because it lets them be in control of when refunds are done. Until now all app developers had to throw up their hands and put up a line on their website asking customers to contact Apple, which was obviously a poor experience and increased friction even in cases where a refund was desired by both the developer and user.

gruez2• 5 years ago

The ruling allows dating app developers to avoid the commission fee between 15 to 30 percent Apple charges

Was this actually confirmed? I remember in the epic vs apple lawsuit (in the US), the media reported something similar, but if you read the decision more carefully, it explicitly says that apple was still entitled to their 30%/15% cut. The logic was that the 30%/15% cut wasn't the fee paid for processing payments, it was also the fee paid for access to the ecosystem, SDK, and placement on the app store.

smoldesu5• 5 years ago

IIRC, the loophole gave Apple the right to bill you afterwards for the use of their services. I don't know if that means they tally the 30% and come back to collect later, or just pass the direct charges of hosting onto you, but in any case I doubt Apple would be ballsy enough to try that outside the United States.

supreme_berry2• 5 years ago

That’s not loophole. That’s common sense.

einarfd• 5 years ago

I wonder if this law is similar with legislation in other EU countries? My impression is that consumer legislation usually is. If it is. This might end up being EU wide in the future.

toyg• 5 years ago

Even if it isn't, because of the Common Market any EU company can just open an entity in the Netherlands and start using this trick.

The next step is for somebody else to sue to remove the limit to dating apps, which is obviously ridiculous (and likely still not compliant with NL law). After that, the door is effectively opened for the whole Union. I expect at that point Apple will just allow it for all EU countries, with much fanfare, trying to spin it as them doing good for us plebs.

arbirk• 5 years ago

Developers still have to pay Apple a commission on transactions. https://developer.apple.com/support/storekit-external-entitl...

As in the Epic case, this interestingly expands the number of transactions that apple could potentially claim commissions for (in-app and out-of-app) depending on the specific definition of a transaction. In the case of dating apps nearly all user-activity is within the app, so Apple could claim that all transactions for iOS uses are within scope.

This will of course be negotiated and settled in some way, but as long as the 30% cut has not been deemed illegal, Apple can still demand the cut on relevant transactions.

Jnr• 5 years ago

EU should follow.

cronix• 5 years ago

And the mighty walled garden breaks into smaller walled gardens. Eventually each country will have its own version of each app to comply with local laws.

olliej2• 5 years ago

Everyone is quoting 30%.

For the majority of apps it's 15%.

That commission is not a payment processing fee, it's very clearly a platform commission as has been common in the industry for 30-40 years at this point.

All this (and the similar rulings elsewhere) seem to confirm is that

* A developer can use their own preferred payment processor

* A developer still has to pay the platform commission

Finally, no one in their right mind should think that even if there was a reduction in commission that prices would decrease. We already have direct evidence: Both Google and Apple dropped platform commission to 15% for the vast majority of apps and there was no reduction in app prices. Additionally it is common sense: app devs already know that you will pay X for an app, if they get an arbitrary reduction in expenses through any mechanism why would they reduce their prices? This is the same flaw present in trickle-down economics. The price for anything is determined by what the market will bare, not the cost of production - this is as true for an app, as it is for an NFT, as it is for a banana.

bagacrap• 5 years ago

my economics 101 teacher would argue that a reduction in cost would encourage certain app makers to seek greater market share by undercutting their competitors. Unless competing app makers collude, prices should be loosely based on cost.

Apple complies with Dutch ruling, lets dating apps use other payment systems

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