While Apple is in the middle of a feud with Epic Games over Fortnite and App Store terms, it seems like top American news publishers are joining in on the fight, too. Newspapers like The New York Times, The Washington Post and the Wall Street Journal have asked Apple for their cut of in-app purchases to be reduced to 15%.
Currently, Apple charges a 30% commission on the first year of an in-app subscription. It then reduces its cut to 15% if the customer continues their subscription beyond that time.
Though it might seem like a “non negotiable term” by Apple, there are court documents that revealed Apple has privately granted 15% commission charge to Amazon to attract the Prime Video app to its platform. So, why is Apple willing to give these terms to Amazon but not to other companies?
The hefty 30% charge for other apps that aren’t Amazon Prime Video is the reason why Epic Games CEO Tim Sweeney publicly criticised Apple. He said that “to say that the fact that they have some costs justifies taking 30% of a company’s revenue and preventing other companies from competing with them is absolutely abhorrent.”
Since then, and Fortnite’s grandeur exit out of the App Store and Google Play Store, more companies are voicing out. Spotify filed a formal complaint in Europe. Their concern is that Apple charges a fee for any subscription music service on their platform, while Apple offers its own competing subscription music service, which pays no fee.
“Apple takes 30% of the sale of, say, a USD25 newspaper subscription. It also takes 30% for the sale of a USD500 newspaper subscription. Thus, the more the publisher is able to charge for its service then the more Apple benefits, despite providing the same service,” wrote Chris Pedigo, SVP Government Affairs at Digital Context Next—the trade association representing the newspapers.
Apple is currently facing investigations from the European competition commission and a US government judiciary committee. They will be questioning whether Apple’s App store monopoly is unfair and illegal.