App Store: Apple strikes $100 million deal with US developers

The contents of the agreement A fund of 100 million dollars Authorized communication on payments A global agreementComments

It was through a press release on Thursday evening that Apple announced that it had reached an agreement with American developers to put an end to a class action launched in 2016. This has resulted in some changes in the rules of the 'App Store, but also the creation of a fund to help small developers of nearly 100 million dollars.

Source: Unsplash / Laurenz Heymann

The shadow of the lawsuit against Epic Games is never far away when you hear about Apple and the negotiations around its App Store. Thursday evening, the Cupertino company announced in a press release that it had reached an agreement with American application developers. The potential end of a protest movement around the practices of the store and a procedure launched in 2016 in the form of a class action.

The court has yet to validate the various measures of the agreement whose "terms will help make the App Store an even better business opportunity for developers", argued the company, which does not fail to specify the interest also for its users.

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A few weeks after the criticism of several American senators who wanted to legislate against "the excessive control" of Apple and Google over their application stores, forcing the managers of these two companies in particular to have to testify before Congress, the first is trying to make a gesture towards the developers. And more specifically, the "small developers", those who total less than a million dollars in annual revenue and who represent 99% of American companies paying commission fees to Apple (15% for them, 30% for those with biggest revenue from the App Store).

An agreement to confirm more than revolutionized

The Californian company has thus detailed a few points of the agreement which the company reached after discussions with the plaintiffs. We note in particular the maintenance in the state for three years of the App Store Small Business program to help developers launch their app. A program that has had some success and allows small developers to see their commission costs on in-app purchases and payments reduced to 15% in particular.

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From a functional point of view and in agreement with the developers, Apple retains the "App Store Search" system which provides users with results based on the number of downloads, stars obtained and various behavior signals.

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The App Store Transparency Report, which indicates each year the number of new applications, expelled from the Store, the number of developers, revenues... and thus gives an overview to both developers and users, will continue to be be published. It even adds new data at the request of app creators such as more meaningful statistics on searches and results, review of apps and reasons for rejections, number of deactivated accounts, and more. This will make it easier for developers to appeal if their app is rejected.

$100 million for compensation

Among the announcements, the most striking is the creation of a compensation fund for small developers who have felt harmed by Apple's billing system. A global endowment of 100 million dollars which will be distributed among the manufacturers of applications who request it.

At the moment, Apple has indicated amounts ranging from $250 to $30,000 depending on the number of complainants. The amount will be calculated based on revenue from the App Store and the proportional amount donated. But it is not impossible that these sums evolve if some forget to claim their due, we are told on the side of Cupertino.

The ability to offer out-of-app purchase options

This is a point that has often been debated and on which Apple had so far been extremely recalcitrant: payment outside the application. Only, for Netflix or Spotify, the company had always shown great leniency by letting them use their own payment method and not that of Apple, to the chagrin of those who had to pay the commission fees. via the app when the giants were thus exempted.

“The agreement clarifies that developers can share purchase options with users outside of their iOS app,” Apple explains. In other words, each developer is free to send an email to a user to offer to pay for the service… as long as it is done online or by any other means of their choice, but not through the application, obviously the most natural channel for an iPhone owner.

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Another condition required by Apple: that the targeted users have given their consent for direct communication and can easily withdraw. For several months, the Apple brand has made the transparency of information collected by apps a necessity and this will fall even more into this imposed field.

As early as June, Apple had somewhat revised its rules and released some ballast on communication to users from a developer. If within the firm, we do not want to talk about concessions, we explain that we have rather “formalised” an authorized practice.

The firm will also review its price list and increase the number of prices available for paid subscriptions from less than 100 to more than 500. Each developer will be able to continue to set their prices.

An agreement applied to all developers

Where Apple has played it fine is that this agreement clarifies many points and measures that will be applied to all developers around the world, not only to American developers or those who pay development fees. commission (which represent only 15% of the more than 30 million developers worldwide). All without really upsetting the deal for the apple brand.

Because Apple does not respond to certain requests from developers concerning the obligation in particular to use its in-app payment system and therefore to pay the commission. "This offering does nothing to address the structural and fundamental issues faced by all developers, big and small, undermining innovation and competition in the app ecosystem," writes the Coalition for App Fairness, a stakeholder in the case and quoted by Bloomberg. “Allowing developers to communicate with their customers about lower prices outside of their apps is not a concession and highlights Apple's complete control of the app market. »

And when we ask Apple if all this will end up convincing the developers to abandon their request for an alternative store under iOS in particular, the answer is quite scathing: it is above all the concern of the big developers, not the small ones.

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Note that all these measures which will come into force as soon as validated by the court – also led in this case by judge Yvonne Gonzalez Rogers in charge of the Epic trial – will apply to the vast majority of developers, but to all. On the Apple side, it is clear that the fund, for example, only concerns “small developers” and not “companies that make billions in profits”, such as Epic Games. By seeking to put an end to the American class action, Tim Cook and his family show above all their intention to pursue healthy exchanges with small developers, those who ultimately represent the bulk of his financial windfall. A sort of legal battle for “child custody” with Epic, which would have liked to rally them to its cause too…

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