Since 2008,
Apple
has maintained tight control over the iPhone's app ecosystem. But about one and a half decades later, the iPhone maker is forced to bring down the walls of its "
walled garden
" as the
European Union
's Digital Markets Act goes into effect this March.
Apple is making some changes to the
App Store
and other parts of
iOS
to comply with the European Union’s competition law that will take effect on March 7 across 27 nations.
iPhone (and iPad) users in the bloc can use alternative app stores to download apps for the first time. Developers can offer third-party payment methods within their apps for the first time. And for the first time, iPhone users will have the choice between
Safari
or any other alternative browser.
Sideload apps on iPhones with “alternative marketplaces”
One of the biggest changes that will affect the users most is the option to sideload apps. If you are in any of the 27 European Union nations and using iOS 17.4, you can now download what Apple calls “alternative marketplaces” from their websites. However, to use them on an iPhone, they must be approved by Apple, and you need to give permission for apps to be downloaded to iPhone or iPad. Once approved and downloaded, you can get any app you want, even if it violates App Store guidelines. You can also set a non-App Store marketplace as your default.
Although sideloading is allowed, Apple imposes "notarization" for all iOS apps, and third-party marketplaces will still be managed by Apple’s system. This involves automated checks and human review to ensure that the app meets all the security requirements and malware protections. Developers can only release one app version across app stores and must comply with basic platform requirements.
Apple says that additional malware protections will be put in place with the iOS 17.4 update that will prevent apps from launching if they are found to contain malware.
Safari and Apple Pay to loosen up
The iOS 17.4 update in the European Union will also let users choose their preferred browser when opening Safari. They can choose among Safari or alternative browsers such as Chrome, Firefox, or others. Additionally, developers can use engines other than Apple's WebKit.
Complying with the DMA, Apple is sharing new APIs for NFC technology with banking and wallet apps across the European Economic Area. Furthermore, new controls for users are being introduced to set a third-party contactless payment app as their default in the EU.
New ‘terms’ of doing business with Apple
In the European Union, Apple is offering developers the option to either stick with the current commission terms or adopt a new fee structure. The new structure aims to address concerns raised by developers and includes a reduced commission rate of up to 17% for digital goods and services. However, an additional 3% fee will be charged for making use of Apple's payment system.
The move could impact Apple's significant App Store revenue, which majorly accounts for the 30% commission it takes from developers and has been a crucial part of its $400 billion business.
It is also introducing a
Core Technology Fee
of €0.50 per annual app install for highly popular apps, but only after a million annual installs in the EU, no matter if the app is being distributed through its App Store or
alternative marketplaces
.
Apple expects that over 99% of developers will either reduce or maintain their fees under the new business terms. Meanwhile, less than 1% of developers are expected to be paying the core technology fee.
European Union’s DMA brings “complexities” for users, says Apple
The changes come under the purview of the EU’s Digital Markets Act. This act passed in 2022, is the EU's most robust attempt to regulate these big tech corporations and curb anticompetitive practices. In September, Apple was identified as a gatekeeper, and its App Store, Safari browser, and iOS operating system were categorised as "core platform services" that must comply with the DMA's regulations.
It's not surprising that Apple is unhappy about losing control over iOS apps. According to the company, the Digital Markets Act (DMA) could threaten user privacy and security. Apple has opposed these changes for a while now, arguing that they could leave users susceptible to scams, malware, and other privacy and security issues.
Phil Schiller
, who leads the App Store at Apple, has echoed the sentiment again.
“The changes we’re announcing today comply with the Digital Markets Act’s requirements in the European Union while helping to protect EU users from the unavoidable increased privacy and security threats this regulation brings. Our priority remains creating the best, most secure possible experience for our users in the EU and around the world,” said Schiller.
Apple says the laws bring some “complexities,” including a less intuitive user experience, which will help its users navigate. And, as usual, there is a risk for users if they download apps and make payments outside of the App Store, and again, Apple will help users understand how to approach this with resources coming in March.
English (US) ·