Apple Wants Rules on Side-Loaded Apps

Apple is side-stepping the new side-loading rules. 

The European Union is set to blow the doors off the tech giant’s single-app store dominance by demanding “side-loading” compatibility, allowing users to download apps directly off the web or competing app stores. But Apple, according to a Wall Street Journal report, has other plans — namely, imposing fees and rules on side-loaded apps. 

Secondary Market Power

The EU’s war against Apple’s App Store is pretty simple: the tech giant had total control over the app store on Apple devices, and therefore could unfairly use its market power to demand commissions, impose rules and restrictions, or bury apps that may compete with first-party offerings of its own (Google’s Android Play Store is similarly targeted, but the company has been slightly more flexible about allowing third-party app stores on its devices). The issue came to fruition when tech players like Spotify and Fortnite-maker Epic Games grew sick of sending Apple a cut of each sale or subscription renewal completed on its devices, and sought the ability to let users make payments directly via the web.

After a lengthy legal battle, the EU’s competition court sided with the third-party platforms last year, demanding that both Apple and Google open their devices to side-loading. The new, wild, wild west is coming in March, and it’s safe to say Apple — which has an App Store operating margin potentially as high as 80%, one analyst told the WSJ — is trying to finagle its way back to being the sheriff of its own devices:

• Apple, which has long argued its walled garden approach keeps its devices safe from malware and other security concerns, plans to still review each app that will be downloaded outside of the App Store, sources told the WSJ.
• The company is also planning to impose fees on developers who make apps available outside the App Store, sources told the WSJ.

The legality of it all is still murky. Apple is due to present its new side-loading plans and policies to the EU soon, after which the European Commission will rule whether it complies with its new laws.

Epic Fail: Similar change is afoot in the US. With its legal battle with Epic finally over, Apple now must allow third-party developers to direct users to theoretically cheaper payment options outside the App Store. In response, Apple updated its policies on Tuesday, stipulating that third-party developers that circumvent the 30% cut will still have to pay a commission… of 27%. Something tells us this is far from settled.