What happens to my money if I buy something in the app?
If you have an iPhone, you‘ll need to download apps from the App Store. Sometimes you have to pay for an app, if you buy it, or if you still make purchases in the app. If you want a better outfit for your character or want to play an extra level, for example. That payment is made through the App Store. And 70 of them goes to the playmaker, the rest to Apple.
Why Apple asks for that money? Because companies reach a large audience through the App Store, they say. And because they make sure that all payments are secure. They can control criminal appmakers.
The App Store has hundreds of millions of users in 200 countries, and has 1.8 million apps. Last year Apple earned 64 billion dollars with the App Store, which investigated the American television channel CNBC.
What’s Epic mad about?
When Epic Games had created its own payment system, Apple threw their main app Fortnite from the App Store. Epic Games could not offer this game through any other way for the iPhone and so Apple has far too much power, they think. They don‘t like Apple being able to decide who or who doesn’t enter the App Store. That‘s why they’re taking Apple to court.
They want two things: that something is done about the percentage that Apple demands and that companies like Epic Games can start their own App Store. “If everyone could start an App Store later, it would be groundbreaking,” says tech expert Nando Kasteleijn. “The question is whether the masses will actually make use of that. Android phones have more possibilities for this, but also the Play Store is by far the most important.”
What does this mean for Apple?
There has been much longer discussion about Apple‘s power and the money the company is asking for from appmakers. Spotify also accused Apple of abuse of power earlier. They therefore knocked on the European Commission. Spotify believes that Apple is advaning its own music service Apple Music. It costs Spotify money to be in the App Store and Apple Music doesn’t. So Apple Music has an advantage, they say.
The European Commission agrees with that. They are now going to investigate Apple, and Apple may be fined up to 10 percent of their annual sales. That turnover has been converted to EUR 230 billion, so that could amount to EUR 23 billion.
If Epic Games wins the trial, it could also affect other app makers. It becomes easier for them to win a case against Apple, or the ruling has to change things that affect the entire app world. The European Commission can also enforce changes. “A fine wouldn‘t be so bad for Apple, that’s a one-time issue. But those changes do,” says Nando.
And what does all this mean to me?
The judge could therefore decide that playmakers will no longer have to pay money to Apple. “If it makes apps more profitable, chances are they lower their prices,” says Nando.
Apple may also need to allow you to download apps from other places. On the other hand, if Apple wins, it will be harder for other app developers to make a fist against the company.
The substantive consideration of the case between Epic and Apple takes about three weeks, when the court gives judgment is still unknown. According to Nando, this could be a long legal struggle. “For both parties this is so important that one of two will probably appeal if the other wins.”