A federal judge has questioned whether Apple’s recent changes to its App Store payment system actually address concerns about anti-competitive practices.
The changes allow app developers to include links to external payment methods for in-app purchases. However, a key sticking point is the fees associated with this option. Apple still charges a 27% commission to developers who use these external links, which can be even higher when combined with processing fees from other payment providers.
This has resulted in a lack of interest from major app developers. Out of an estimated 65,000 developers offering in-app purchases, only 38 have applied to use the external payment link program.
During a court hearing, US District Judge Yvonne Gonzalez Rogers expressed skepticism about Apple’s motives. She questioned why, with a committee including CEO Tim Cook involved in approving the fees, no one considered the potential financial burden it would place on developers.
“You’re telling me a thousand people were involved and not one of them said maybe we should consider the cost to the developers? Not a single person raised that issue of the thousand that were involved?”
the judge said
Bloomberg reported that
“None of the 38 applications for the new outside payments program came from developers of major apps, said Apple’s vice president of finance, Alex Roman.”
The judge also pointed out that Apple did not analyze the potential costs associated with alternative payment solutions for developers. This lack of data, she argued, raised concerns about whether Apple’s claims of lower prices for consumers actually hold weight. This comes after, according to the reports, Apple announced that it will be making changes to the iPad app ecosystem in the European Union this fall.
I’m looking for data and it sounds like you all made lots of decisions without data.
The hearing is ongoing, and it remains to be seen if Apple will be forced to make further changes to its App Store payment system.