Monday, January 24, 2022

Netherlands Rejects StoreKit External Purchase Entitlement Plan

Sami Fathi:

The Dutch Authority for Consumers and Markets (ACM) has ruled that Apple’s plan to allow App Store dating apps to use third-party payment methods for in-app purchases does not sufficiently meet the requirements of a previous ruling. As a result, the ACM has hit Apple with an initial 5 million euro fine as a consequence, and fines will continue to be assessed at 5 million euros per week up to a maximum of 50 million euros until Apple complies.


Apple has failed to satisfy the requirements on several points. The most important one is that Apple has failed to adjust its conditions, as a result of which dating-app providers are still unable to use other payment systems. At the moment, dating-app providers can merely express their ‘interest’. In addition, Apple has raised several barriers for dating-app providers to the use of third-party payment systems. That, too, is at odds with ACM’s requirements. For example, Apple seemingly forces app providers to make a choice: either refer to payment systems outside of the app or to an alternative payment system. That is not allowed. Providers must be able to choose both options.

Francisco Tolmasky:

It must be really frustrating to roll out an entire plan only to be completely at the whim of a reviewer — err, regulator — to find out whether it sufficiently meets a set of vague criteria.

John Gruber:

Apple could just write them a check for €50 million now, from the company’s spare-change-under-the-sofa account. Or they could just pull dating apps from the App Store in the Netherlands.


Update (2022-01-25): David Heinemeier Hansson:

This is the problem with fines. They put a price on criminal behavior, and if the gains from committing those crimes exceed the cost of the fines, there’s a base hyper-rational calculus that says the company should continue to break the law.


What you can’t do is argue these things and then turn around and say that it’s all fine when Apple is doing it to developers. Time after time, Apple has either completely missed or blatantly ignored what makes a sensible application for developers and users, focusing on what draws in more money or tightens the regulatory noose.

A recent installment of the ongoing Floatplane App Review saga is instructive. Floatplane COO Luke Lafreniere has ongoing issues with getting a media network app already on the App Store through review, and time after time struggles despite carbon copying solutions adopted by big and successful apps on the App Store, to the point of copying UI wording verbatim.

13 Comments RSS · Twitter

Old Unix Geek

Yes, Apple could write them a €50 million check. That type of arrogance would be a great way to convince the Netherlands to work with other EU countries to designate Apple a monopoly. I don't think Apple reached a $3 trillion valuation by only thinking one step ahead.

Beatrix Willius

Yes, there is a certain irony. Did Apple talk to the regulators?

Every country in the world right now: "So THAT'S how you make Apple pay some tax!"

From the ACM press release:

"For example, Apple seemingly forces app providers to make a choice: either refer to payment systems outside of the app or to an alternative payment system. That is not allowed. Providers must be able to choose both options."

Am I the only one who does not understand what that sentence means?

@Dan I don’t understand it, either. It seems to be saying that they want Apple to allow in-app payments using alternative systems alongside outside (Web) payments. However, the original ACM decision seemed to make clear that they only required that outside payments be possible—that in-app could continue to be Apple IAP-only.

"Am I the only one who does not understand what that sentence means?"

It's as understandable as what Apple's app reviewers can write. So it should not be an issue for Apple.

What's the reason that the Dutch regulators are focusing ONLY on dating apps? That seems like such a bizarre line to draw.

Kevin Schumacher

They felt that a case for the whole App Store was too risky and that they could prove a limited case more easily.

See the update here:

Reason given for the limited scope (dating apps) is that it allowed them to show specific damage because those apps must be on both Android and iOS to be effective. Apparently they started out more generally but chose this to have more chance of success.

I guess I'm still confused. Are the regulators arguing that dating apps are similar to the other apps that get special exemptions? e.g. because you're paying for an activity that takes place in the real world, like Uber and Airbnb?

@Ben G The Netherlands is a sovereign country and can set whatever rules they want. They don't have to fit into Apples idea of how the world works. Just like Apple can do whatever they feel like on their app store.

Yeah, and? That still doesn't answer my question of why they are fighting only for the very small category of dating apps. I mean come on, how many of them are big money makers on the App Store? Tinder, Bumble, OK Cupid, Match, Hinge, eHarmony and a few others? Why help only them?

I'm guessing it's a trap. Once this goes through they expand. Alternatively, once they've got their €50 million they move on to the next category and collect another €50 million

The ACM initially investigated whether Apple's behavior was an abuse of a dominant market position in general, but reduced the scope to just dating apps to reduce the scope of the investigation, and expedite the process. Presumably, they might extend to other app categories, or to the store in general, once they see how this initial, focused approach plays out.

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