Earlier in the week the European Union launched an investigation into Apple’s restrictive App Store policies and yesterday Microsoft president Brad Smith weighed in on the issue, saying:
“They impose requirements that increasingly say there is only one way to get on to our platform and that is to go through the gate that we ourselves have created. In some cases they create a very high price per toll — in some cases 30% of your revenue has to go to the toll keeper.”
Smith did not name Apple directly, but at this point, it is the only company which takes a 30% cut of sales.
Microsoft itself contributes significantly to Apple’ revenue, with the company needing to pay Apple a vig for Microsoft 365 subscriptions sold via the App Store. The App Store rules reportedly also prevent Microsoft from launching cloud gaming services on iOS.
“The time has come — whether we are talking about D.C. or Brussels — for a much more focused conversation about the nature of app stores, the rules that are being put in place, the prices and the tolls that are being extracted and whether there is really a justification in antitrust law for everything that has been created,” Smith said.
Apple is also felt to unfairly advantage their own services since Apple does not have to pay a 30% cut of their revenue, giving them automatically a large leg-up on competitors such as Spotify and Netflix. Alluding to Microsoft’s own experience with anti-trust regulators, Smith said anti-competitive behaviour was a lot worse now.
“Increasingly you’re seeing app stores that have created higher walls and far more formidable gates to access to other applications than anything that existed in the industry 20 years ago,” said Smith.
Apple, on the other hand, accused companies of wanting to use its services for free, saying:
“It’s disappointing the European Commission is advancing baseless complaints from a handful of companies who simply want a free ride, and don’t want to play by the same rules as everyone else.”
Microsoft, of course, runs its own app store, the Microsoft Store, but at this stage, the project has been completely sidelined, with Microsoft making it increasingly easy for developers to bypass the store, for example largely ending the Windows 10S project and allowing developers to run non-store Win32 apps on Windows 10X.
These moves did not come from a deep well of Microsoft’s ethics, but rather from the complete failure of the Microsoft Store to gain any traction. Given the early policies of the Microsoft Store on Windows Phone, it is pretty clear that Microsoft would have policies very similar to Apple if they had any success, making their current comments sound a lot like simply sour grapes.