Apple on Thursday announced settlement consisting of a number of changes coming to the App Store that, pending court approval, will resolve a class-action suit from U.S. developers.
Apple and the plaintiffs in the Cameron et al v. Apple Inc. developer suit reached an agreement that identifies seven key priorities shared by Apple and small developers, which has been submitted to the judge presiding over the case for her approval.
• In a validation of the App Store Small Business Program’s success, Apple and the developers agreed to maintain the program in its current structure for at least the next three years. Businesses earning less than $1 million annually will continue to benefit from the reduced commission, while larger developers pay the App Store’s standard commission on app purchases and in-app payments.
• App Store Search has always been about making it easy for users to find the apps they’re looking for. At the request of developers, Apple has agreed that its Search results will continue to be based on objective characteristics like downloads, star ratings, text relevance, and user behavior signals. The agreement will keep the current App Store Search system in place for at least the next three years.
• To give developers even more flexibility to reach their customers, Apple is also clarifying that developers can use communications, such as email, to share information about payment methods outside of their iOS app. As always, developers will not pay Apple a commission on any purchases taking place outside of their app or the App Store. Users must consent to the communication and have the right to opt out.
• Apple will also expand the number of price points available to developers for subscriptions, in-app purchases, and paid apps from fewer than 100 to more than 500. Developers will continue to set their own prices.
• Apple will maintain the option for developers to appeal the rejection of an app based on perceived unfair treatment, a process that continues to prove successful. Apple has agreed to add content to the App Review website to help developers understand how the appeals process works.
• Over the last several years, Apple has provided a great deal of new information about the App Store on apple.com. Apple agreed to create an annual transparency report based on that data, which will share meaningful statistics about the app review process, including the number of apps rejected for different reasons, the number of customer and developer accounts deactivated, objective data regarding search queries and results, and the number of apps removed from the App Store.
• Apple will also establish a fund to assist small U.S. developers, particularly as the world continues to suffer from the effects of COVID-19. Eligible developers must have earned $1 million or less through the U.S. storefront for all of their apps in every calendar year in which the developers had an account between June 4, 2015, and April 26, 2021 — encompassing 99 percent of developers in the US. Details will be available at a later date.
Does this change anything? Perhaps little for developers, but for Apple it might be a lot. Developers had already been pushing their customers to circumvent Apple’s commissions, and the settlement officially blesses that arrangement. Seen through the lens of Apple’s other legal troubles, the settlement could be strategically shrewd, easing the threat of more government action, and shifting Washington’s focus to other tech giants who have been less willing to make similar concessions.
Apple still faces a broader lawsuit about its App Store from Epic Games (the maker of Fortnite), with both companies awaiting a decision from a federal judge. The Supreme Court has also allowed other antitrust class actions against Apple to move forward. Notably, yesterday’s settlement is subject to approval by the same judge who is presiding over the Epic Games and consumer suits against Apple.
MacDailyNews Take: As we wrote last night:
Let’s see if this is enough to take the Congressional heat off (words, perhaps exactly, we’d bet were uttered in Apple C-Suite just prior to the publication of this press release).
If the court approves, Apple will have “won” this settlement, that’s for sure.
They should reject the deal.