Apple is apparently planning a major overhaul of its software for iPhones and iPads. In the future, at least in Europe, users should also be able to download apps outside of the Apple-operated app store on the devices, reports the Bloomberg news agency citing insiders. Apple had long resisted allowing other providers. Why Apple is doing this after all and what it means for users.
Why is Apple changing its corporate policy?
The group is forced to do so by the EU. The Digital Markets Act (DMA) requires companies of a certain size to provide access to third parties. This applies to downloading apps as well as accessing central functions, such as the payment function. The DMA will come into force as early as 2023, but there will be a transitional period until 2024. If Apple does not comply, the company could face penalties in the tens of billions.
Why has Apple resisted this for so long?
The main reason is money. Apple charges app developers a fee of 15 to 30 percent of revenue for running the App Store, checking submitted apps for security flaws and handling billing. You are also not allowed to offer so-called in-app sales outside of the Apple Store. This is often the case with apps whose basic functions can be used free of charge. On the other hand, if you want to use advanced functions, you have to pay for them.
What speaks for Apple’s control over the App Store?
Apple reviews all programs that manufacturers submit to the App Store for security vulnerabilities. Like everything in IT security, this does not work 100 percent, but Apple has so far only had a few major cases of apps with security gaps. It cannot be ruled out that Apple will retain this security control in the future and demand a fee from the providers for it – even if these are not offered in Apple’s App Store, but are available for download from a competitor.
What speaks against Apple’s gatekeeper function?
First, there are financial reasons: The 15 to 30 percent of the revenue that Apple collects from app developers is quite a chunk. This makes it difficult for smaller providers to gain a foothold. Many, even large ones, don’t see why they should also pay the fee for in-app purchases. But since Apple is the only app store provider for Apple devices so far, they have no choice. So you either have to accept Apple’s conditions or you won’t get your apps on Apple’s devices.
On the other hand, Apple can also control which apps it wants to allow or not. In authoritarian states like China, certain apps do not appear in the App Store or disappear from the app store if they displease the regime. But there are also discussions in democratic countries, for example Apple’s concerns about the Twitter app have recently become known because the new owner Elon Musk has allowed many previously blocked users, especially from the right-wing camp, to use it again.
What will change for users?
If the plans are implemented, users will be able to download apps from other providers in the future. Since the providers will probably no longer have to pay such a high fee, apps could also become a little cheaper. Nothing is known about plans for which alternative stores could be approved. It would be conceivable, for example, for game manufacturers to join forces.
How about Google’s Android?
Google operates the only app store that is pre-installed on Android smartphones – along with many other Google apps. However, there are alternative stores such as F-Droid or manufacturers offer installation files for download directly from the web. To install such apps, you have to open a security barrier in Android. However, this is automatically displayed if you want to install an app outside of the Google Play Store and can be limited to a one-time installation so that the security risk remains manageable. However, most users use Google’s Play Store because they don’t know any other options or want to save themselves the effort.
What does the change mean for Apple?
Apple has to change its software quite fundamentally to accommodate the DMA. As Bloomberg reports, the changes will initially only take effect in the EU, but there are also efforts in the home market of the USA to break Apple’s dominance over the App Store. Financially, Apple should be able to cope with the matter, according to Bloomberg, app store revenue from the EU accounts for only two percent of total sales. With total sales of almost $400 billion in the 2022 fiscal year, that would always be just under $8 billion.