Apple's New EU Rules and the Fifty-Cent Catch

Apple's New EU Rules and the Fifty-Cent Catch

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So Apple finally put out the details on how it's going to comply with the EU's Digital Markets Act, and I've spent most of the last couple days reading through developer forums instead of doing anything productive. The short version: starting with iOS 17.4, EU users get alternative app stores, apps can use payment systems other than Apple's, and browsers can finally ship their own engines instead of being forced to wrap Safari's WebKit. On paper that's everything critics have wanted for a decade. In practice, nobody I follow seems happy about it, and once you read past the press release you start to see why.

The thing everyone's fixated on is the new "Core Technology Fee." If a developer opts into the new terms, Apple charges €0.50 per install, per year, once an app crosses one million annual installs in the EU. It doesn't matter if that install came through the App Store or through a rival storefront Apple has no involvement in whatsoever. Read that again. You could ship your app entirely outside Apple's store, pay them zero commission, and still owe them money for every install past the first million, forever, as long as the app exists. For a free app that blows up, that's not a modest fee, that's an existential threat. Tim Sweeney (Epic, obviously, given his whole crusade against Apple's cut) called it exactly what it looks like — malicious compliance. I don't even like Sweeney's tone half the time but I think he's right on this one.

Do the math on something like a free-to-play game or a messaging app with 10 million EU installs. That's roughly €4.5 million a year owed to Apple for the privilege of not using their payment system. Nobody is going to opt into that unless they're already making serious money off in-app purchases, which means the "alternative app store" freedom is really only usable by a handful of big players who can absorb the cost. Everyone else stays put on the old terms, same 30/15 percent cut as before. Apple gets to say "look, we complied" while making sure almost nobody actually benefits from the compliance.

And then there's the smaller story buried in the same announcement that annoyed me personally more than the fee did: Home Screen web apps are getting killed off in the EU. If you don't know what that is, you know when you go to a site on your iPhone and tap "Add to Home Screen" and it behaves basically like a real app, its own icon, runs in its own window, no browser chrome? Progressive Web Apps. I use exactly one of these daily, a little budgeting tool a friend built that I never bothered downloading as a "real" app because the web version was good enough. Apple's rationale is that supporting home screen apps properly now requires all the new browser engine plumbing they're being forced to allow, and rather than build that out they're just turning the feature off for EU users. It's a tiny feature in the scheme of things but it's the kind of decision that only makes sense if your actual goal is to make compliance annoying enough that the whole conversation focuses on downsides instead of the actual win for competition. The Open Web Advocacy people are (rightly, I think) furious about it.

I don't think Apple is wrong that some of DMA's requirements are genuinely awkward from an engineering standpoint — alternative browser engines on iOS is a real, nontrivial undertaking, not a rubber stamp toggle. But there's a difference between "this is hard" and "we're going to make this so unpleasant that developers choose not to use it." The Core Technology Fee reads like the second thing dressed up as the first.

None of this affects me directly, I'm not shipping an app to a million EU users any time soon (or ever, let's be honest), but I've been running this blog since 2011 mostly because I like watching how companies respond when regulation actually has teeth for once, and this is a genuinely interesting case study in how much daylight there is between "following the letter of a law" and "following the point of it." Worth keeping an eye on what the European Commission says once they've had time to actually look at the fee structure. My guess is this isn't the final version of these terms, not by a long shot.