The European Commission today announced that it has opened two formal antitrust investigations against Apple. This is a great news for individual iOS developers.
The first case is related to App Store rules. The European Commission will be investigating whether Apple’s rules for app developers on the distribution of apps via the App Store violate EU competition rules. The Commission will investigate the following restrictions set by Apple.
- The mandatory use of Apple’s own proprietary in-app purchase system “IAP” for the distribution of paid digital content. Apple charges app developers a 30% commission on all subscription fees through IAP.
- Restrictions on the ability of developers to inform users of alternative purchasing possibilities outside of apps. While Apple allows users to consume content such as music, e-books and audiobooks purchased elsewhere (e.g. on the website of the app developer) also in the app, its rules prevent developers from informing users about such purchasing possibilities, which are usually cheaper.
“Mobile applications have fundamentally changed the way we access content. Apple sets the rules for the distribution of apps to users of iPhones and iPads. It appears that Apple obtained a “gatekeeper” role when it comes to the distribution of apps and content to users of Apple’s popular devices. We need to ensure that Apple’s rules do not distort competition in markets where Apple is competing with other app developers, for example with its music streaming service Apple Music or with Apple Books. I have therefore decided to take a close look at Apple’s App Store rules and their compliance with EU competition rules,” said Margrethe Vestager from European Commission.
The second case is regarding Apple Pay. The commission will be investigating Apple’s terms, conditions and other measures for integrating Apple Pay in merchant apps and websites on iPhones and iPads. Also, Apple limits access to the NFC on iPhones for competitors in the mobile payments industry. The investigation will also focus on alleged restrictions of access to Apple Pay for specific products of rivals on iOS and iPadOS smart mobile devices.
“Mobile payment solutions are rapidly gaining acceptance among users of mobile devices, facilitating payments both online and in physical stores. This growth is accelerated by the coronavirus crisis, with increasing online payments and contactless payments in stores. It appears that Apple sets the conditions on how Apple Pay should be used in merchants’ apps and websites. It also reserves the “tap and go” functionality of iPhones to Apple Pay. It is important that Apple’s measures do not deny consumers the benefits of new payment technologies, including better choice, quality, innovation and competitive prices. I have therefore decided to take a close look at Apple’s practices regarding Apple Pay and their impact on competition,” said Margrethe Vestager from European Commission.