Apple has confirmed that changes introduced for the iPhone in response to the European Union’s Digital Markets Act will also apply to the iPad this fall. The changes allow for alternative app marketplaces, different browsers, default search engines, and more contactless payment options. Developers can choose to adopt these new terms or remain on Apple’s existing terms. The Core Technology Fee, which requires developers to pay for installs after the first million, will not apply to free apps with no revenue or to small developers with less than €10 million in global annual revenue.
Apple has announced additional details regarding the Core Technology Fee, including exemptions for free apps with no revenue and a three-year free on-ramp for small developers. Small developers who exceed one million first annual installs within the three-year period will not have to pay the fee, regardless of continued success. For developers with global revenue between €10 million and €50 million, the fee will be capped at €1 million per year. These changes aim to help small developers innovate and grow their business while also ensuring the security of the Apple ecosystem.
The Core Technology Fee has been a controversial aspect of Apple’s response to the Digital Markets Act, as it reflects the company’s investments in keeping users safe. Apple has justified the fee by stating that alternative app marketplaces are less secure than its own App Store, hence the need for additional safeguards. Small developers will now have more protection from the fee through exemptions and caps, providing them with opportunities to create popular apps without incurring significant costs.
The changes introduced for the iPhone and now the iPad in the European Union are part of a broader effort to prevent monopoly abuses by tech platforms. Other governments around the world are closely monitoring these developments and may consider implementing similar legal changes in their countries. The impact of these changes on developers, consumers, and the tech industry as a whole remains to be seen, but it is clear that the landscape of app distribution and monetization is evolving rapidly.
By the end of 2024, significant transformations in the operation of Apple devices in the European Union will have taken place. The implementation of alternative app marketplaces, different browser options, and diversified payment methods will have a lasting impact on how users interact with their devices. The willingness of developers to adapt to these changes and the response of other countries to similar regulations will shape the future of digital markets worldwide. The question now is not if, but when, other governments will follow the EU’s lead in regulating tech platforms to prevent monopolistic practices.
