Apple finally allows owners of digital content consumption applications to direct subscription payments to an external website outside the AppStore. It is a revolutionary change since at last, it will be possible to avoid the 15% of Apple's commission. If you are the owner of an App and want to know how you can avoid said commission... this interests you!
The origin of the problem
Apple's case litigation against Epic Games brought Apple CEO Tim Cook to court in 2021. The dispute arose over the 30% App Store fees and Apple's decision to kick Fortnite out of the app store when the popular game attempted to use its own payment system. The commission that Apple charges the owners of the Apps has also led Spotify to file a complaint with the European Commission.
Epic Games defended its argument that if developers do not want to pay, in practice they have no way to offer their applications. That is, all installed iOS applications have to go yes or yes through the AppStore. There was no other method of payment.
The European Commission accused Apple of a dominant position, agreeing with Spotify. Even in 2016, Spotify launched a promotion that offered 3 months of premium subscription for €0.99 only if it was contracted outside the AppStore. This did not please Apple, which threatened to remove the application from the AppStore if it followed this promotion.
In conclusion, the dispute, in general, was summarized in: several companies affected by the same matter; App Store fees and the inability to offer alternative payments. Last September 2020, 13 companies came together to create the "Coalition for App Fairness" (CAF), a coalition to try to put an end to "anti-competitive practices, the 30% rate and the lack of consumer freedom".
Until now, Apple took a commission from the App Store of 15% for SMEs that invoiced less than 1 million dollars. This commission rate was reduced as of January 1, 2021, thanks to the App Store Small Business Program, which allowed smaller developers to pay half of the commissions, reducing the usual rate from 30% to 15%. . And a standard 30% commission for apps that sell digital goods and services and earn more than $1 million in revenue from the App Store.
What has changed?
The update of Apple's app publication policies for this month of March 2022, takes a giant step since it is allowed that through a link, the payment can be derived to a website and in this way, the owners of the application in question may save the commission. To put it in some way, Apple makes the payment method more flexible. Although it is true that it is convenient to be able to make payments by unlocking by PIN, FaceID, or TouchID, thanks to this new update, the creators of Apps will be able to avoid paying that percentage of commission for making the payment through the App Store, indicating a link that will lead to the web page to finish making the payment.
However, it is important to note that this great change is only available for digital content consumption applications, that is, magazines, newspapers, books, audio, music or video. Although it is true that it is a very positive advance, it is also important that it seems that it still has to be applied in the rest of the apps.
Who wins with this great novelty?
If we have highlighted something in this article, it is that the owner of the App in question is the main beneficiary of this modification. Until now, the 15% commission that Apple pocketed for subscribing to the App through the AppStore could mean a big cut in benefits for app owners.
It is said quickly that if with our application we invoiced 1 million euros, Apple kept €150,000 for the simple fact that users subscribed through the AppStore.
Thus, by incorporating an external link within the App you will be able to avoid the damage caused by said commission. That is why, at Doonamis, as connoisseurs of mobile applications, we invite you and recommend that you add the external link.
How to apply for external link account entitlement
At Doonamis we are specialists in the development of Apps, and we know that this great novelty can help you to avoid that commission, which until now could harm you. Our team of professionals will serve as your guide and will remain by your side to be able to adapt to this change.
The steps that we will follow to obtain the external link will be the following: first, we will help you request the external link account right by filling out a mandatory form. In order to apply, you'll need to have your Apple Developer Program credentials handy.
Afterwards, you will have to answer some questions about your application and accept the terms and conditions of the rights.
For the application to be eligible it must:
- Fulfil the main function of the application, that is, to provide one or more types of digital content; like Netflix or Spotify. That is, the application must contain videos or other types of content that can be "consumed" by the user. For example; an application that offers videos or tutorials on sports.
- Allow people to sign in to an account.
- Allow people to access previously purchased content or services outside of the app when they sign in, such as on your website.
- Do not offer in-app purchases on iOS or iPadOS while using the external link account entitlement, or provide real-time personal services (such as medical consultations).
This change has benefited mobile application owners since this commission expense has become a thing of the past.