Apple, the company famous for its less than liberal App Store rules, has agreed to shift ground. It will now allow third-party payment options in iOS apps, but only in South Korea.
It is a new era in the Apple App Store experience as the company will allow app developers to use payment options apart from the one built into the operating system. This concession is limited to Apple customers in South Korea only.
This stance is different from Apple’s earlier communication in that its store policies were already in compliance with South Korean laws.
The South Korean government has been targeting Apple for alleged monopolistic practices through the Korea Communications Commission (KCC).
Apple takes a 30 percent share from developers from any transaction made through its app store. There has only been one method of accepting payments, which Apple controls fiercely. The fee has been a source of pain for developers that feel overcharged but fear reprisal from speaking out. Apple, though, maintains the fee is necessary to maintain the high quality of the App Store.
However, Epic Games, one of the biggest names in gaming and the producer of the hit Fortnite franchise, was bold enough to sue Apple after getting kicked out from Apple’s ecosystem. Epic had forced a third-party payment option in its game to the ire of Apple. Even before the court case produced a judgment, it led to increasing scrutiny on Apple’s App Store practices globally.
Epic’s lawsuit ended with a ruling that forces Apple to allow apps to include links to third-party payment options, but Apple does not have to implement it yet because there is a stay of the ruling as Apple is appealing.
Concessions like this in South Korea will undoubtedly make it a bit harder to defend its stand in court.
The South Korean government made new laws for app store operations after considering complaints from developers. Apple agreed to abide by the rules to be allowed to continue its business in the country. In a statement to the Yonhap News Agency, the company said, “Apple has a great deal of respect for Korea’s laws and a strong history of collaboration with the country’s talented app developers. Our work will always be guided by keeping the App Store a safe and trusted place for our users to download the apps they love. We look forward to working with the KCC and our developer community on a solution that benefits our Korean users.”
While Apple has not released details of how it will fully implement the ruling, it has said it would charge developers implementing third-party payment options less. What remains to be seen is how Apple will enforce its fees when app users go to an external platform to make payments.
Whatever the case, this development in South Korea means a massive change to how Apple runs its business.
Apple is facing similar pressure in the Netherlands, where the country’s Authority for Consumers and Markets agency has ordered Apple to allow apps to include external payment options. The company has until January 15th to comply before it starts paying a 5 million euros per week fine. However, the order only applies to dating apps.
Google, Apple’s main rival in phone OS, had also announced it would comply with the same order in South Korea. It has revealed that developers using their own payment system will pay 4 percent less than the 15 percent Google charges typically (as opposed to Apple’s 30 percent).