Apple’s App Store payment system opportunity

Apple faces a significant amount of antitrust pressure focused on the App Store payment system in many countries around the world, but the company may have a plan for what comes next.

Apple's App Store on iPhone
Apple’s App Store on iPhone

Jonny Evans for Computerworld:

Principally, competitors, developers, and critics want the company to permit customers to purchase digital product using payment systems other than its own.

Apple will want to ensure that given a choice, consumers will still prefer its own payment systems to the alternatives. In this context, the most obvious strategy is to provide a payment system that’s simply better than any alternatives.

The secondary challenge is that in doing so, the company cannot be seen to exploit its control of the software and platform in such a way as to give its payment system a substantial advantage, as that would be anti-competitive.

However, competition law cuts both ways, which also means third-party systems must work hard to become just as seamless as whatever Apple does provide.

After all, simply offering a better service based on the same available opportunity is precisely the advantage of free markets competitors say they want. Apple’s payment system simply pivots to becoming Apple’s payment product.

MacDailyNews Take: Likely, although we wish Apple would be a bit cheeky if no longer be allowed to prohibit developers from providing links or other communications that direct users away from Apple in-app purchasing.

Are Best Buy and Target are forced by judges’s injunctions to place signs next to each product that advertise lower prices for the same items at Walmart?

Of course not, because it’s ludicrous, illogical, and just plan wrong.

Still, if forced to permit developers like Epic Games to advertise lower prices using Apple’s App Store, Apple should simply charge an in-store advertising fee in place of In-App Purchases and In-App Subscriptions.

We suggest it be 15% of third-party sales / subscriptions derived from In-App Advertising for developers making under $1 million per year and 30% for those making $1 million or more annually (in other words, exactly the same as Apple’s current commission rates).

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  1. There is no Best Buy, there is no Target in the iOS app world. Just Apple.
    Hollow bases make for hollow arguments MDN.

    Apple does not own the devices and Apple does not own 3rd Party Apps. This is happening. And more.

    1. Walmart has a monopoly on selling things at Walmart, and Toyota has a monopoly on providing me with drivetrain options in my new Toyota. Why can’t I insist on using my Diner’s Club card at a Costco? Why can’t I order a Big Mac at the my local movie theater? Why can’t I insist on the 7-11 installing three or four cash registers for me to select from?

      1. Walmart cannot prevent you from buying a Nintendo Game or a sweater from Target or anywhere else. Toyota can’t tell you who’s gas to buy or which store to drive to.

        But Apple and it’s sycophants can it seems.

  2. I don’t understand why MDN continues to use the faulty and misleading “place signs next to each product that advertise lower prices for the same items at ” argument. We’re talking about in-app purchases. This would more likely equate to those ad flyers inside the box with the product. Both the flyer and in-app purchasing are not effective without first obtaining the said product.

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