Apple was yesterday fined €500M ($570M) by the EU for its App Store policies. Apple has now responded, stating that it is being unfairly targeted, with the White House also weighing in to describe fines levied against Apple and Meta as “extortion.”
Update: While there had earlier appeared some softenting in position on both sides of the antitrust dispute, Apple has now told us that it will appeal the ruling – see the end of the piece …
The EU fine
EU law requires free and fair competition. Large companies are not allowed to use their size and financial resources to put artificial barriers in the way of smaller businesses seeking to compete with them.
Apple was deemed to be breaking the law in two ways. First, it forced developers to sell their apps and in-app purchases only through the App Store, with Apple taking a 15% or 30% cut. It didn’t allow a developer to point to their own website as a place to buy a subscription, for example.
Second, Apple didn’t permit iPhone apps to be sold anywhere else. Nobody else was allowed to open a competing app store.
Apple made changes to both policies, though anyone wanting to sell an app via a third-party app store had to pay Apple a Core Technology Fee for the privilege of doing so. While very small (€0.50 per install per year), that could still prove very problematic for free apps, especially those created by indie developers.
Apple says the fine is unfair
Apple has responded, in a statement sent to Reuters.
Today’s announcements are yet another example of the European Commission unfairly targeting Apple in a series of decisions that are bad for the privacy and security of our users, bad for products, and force us to give away our technology for free.
White House calls it extortion
Top comment by Hudson Gouge (Hg0428)
Polarized discussions.
As for me, as a developer and user, I’m for openness and customizability and freedom. I wish I could do whatever I want with my devices.
But even if I was in charge I would not force Apple to make those changes. It is their company and their business choice.
Sure, you can argue it is anticompetitive, but in reality this isn’t a monopoly. The way to make change is not by forcing others to do what you think it right but by supporting those who do what you think it right.
We need to support platforms that are open and support innovation in these fields.
Thus, I disagree with the EU’s actions just as much as I disagree with Apple’s.
In my mind, the end does not justify the means in this case.
Meta was also fined. Its offence was charging EU users a subscription fee for Facebook if they wanted to opt out of personalized ads.
Reuters reports that the White House strongly objected to both fines.
“This novel form of economic extortion will not be tolerated by the United States,” a White House spokesperson said.
9to5Mac’s Take
Initially it appeared that there might be a softening of position on both sides. While $570M is a large sum of money in most contexts, it’s much smaller than the law permits. On Apple’s side, the company said the ruling was unfair, but the Reuters quote didn’t include an intention to appeal. However, the company told us that was always the plan:
We have spent hundreds of thousands of engineering hours and made dozens of changes to comply with this law, none of which our users have asked for. Despite countless meetings, the Commission continues to move the goal posts every step of the way. We will appeal and continue engaging with the Commission in service of our European customers.
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