Major U.S. News Outlets Join Coalition Challenging Apple’s 30% App Store Fee

Major U.S. News Outlets Join Coalition Challenging Apple’s 30% App Store Fee


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Topline

A group representing major U.S. new publishers including the New York Times, Washington Post, News Corp. and Associated Press has joined a coalition of app makers who are calling for increased regulation of mobile app stores, including a look into the so-called ‘Apple Tax’ in which the iPhone maker charges a 30% commission.

Key Facts

The publishers are arguing that Apple “severely impacts” their subscription-based business model by serving as an intermediary between them and readers who use Apple devices.

Since Apple forces all apps to use its own payment system and then keeps a 30% cut of sales, the publishers said that some of them have been compelled to raise their subscription prices.

Key Background

Last month, Apple announced that it will halve its commission rate to 15% for small developers who generate less than $1 million in revenue from all their apps on Apple’s store. Apple’s steep commission has been at the center of multiple controversies this year including a high-profile legal battle with video game developer Epic Games. Epic’s video game Fortnite was knocked off Apple’s digital store after it introduced its own payment system within the game that allowed it to briefly circumvent Apple’s levy. While Google also charges a similar fee on its Play Store, the more open nature of Android phones means that publishers can circumvent this easily.

Tangent

While Apple’s CEO Tim Cook has argued that the policy is applied evenly to all developers, internal emails released by the U.S. House antitrust subcommittee earlier this year showed the company gave preferential treatment to Amazon. The e-commerce giant had to only pay a 15% share of the revenue it generated through Apple’s storefront. The 30% fee and other App Store practices are now facing antitrust scrutiny from the U.S. Congress, the European Union, the Justice Department, and the Federal Trade Commission.

Further Reading

Major U.S. news publishers join the Coalition for App Fairness advocacy group to fight the ‘Apple tax’ (TechCrunch)

Apple Halves App Store Commission For Small Developers Amidst Antitrust Scrutiny (Forbes)



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