Apple is hoping to avoid a massive fine from the European Union (EU) as it awaits a major decision from the European Commission (EC) regarding recent changes to its App Store.
Last month, Apple revised its controversial fees for processing in-app payments and subscriptions, and the EC is now reviewing the changes for final approval.
In June, Apple announced that it would lower the processing fee to 20% for most developers, with the possibility of it dropping to as low as 13% for those participating in Apple’s small-business program. The changes aim to alleviate the pressure from EU regulators, but one major request from app developers is still pending approval: the ability to direct customers to third-party payment platforms, bypassing Apple’s fees.
Under the new fee structure, developers who choose to redirect their customers to external payment services will pay a fee ranging from 5% to 15%. Moreover, developers will not face any restrictions on the number of links they can include to non-Apple payment platforms.
Apple has faced multiple fines in recent months due to violations of the Digital Markets Act (DMA), an EU law aimed at ensuring fair competition among tech companies. In April, Apple was hit with a €500 million fine for violating the DMA, with the company blaming technical issues for the failure to allow developers to offer cheaper prices outside the App Store.
Apple has since appealed the fine but has also made these fee changes to avoid daily penalties from the EC. The EU set a 60-day deadline for Apple to comply with the DMA, with potential daily fines of up to 5% of Apple’s global revenue, which could reach €50 million per day ($58.5 million).
Although the EC is still reviewing the changes, a report suggests that approval is imminent. However, the EC has stated that “all options remain on the table” and is continuing its assessment of Apple’s proposed adjustments.
Spotify, one of the App Store’s loudest critics, has been vocal about Apple’s fees for years. Spotify CEO Daniel Ek filed a complaint with the EC in 2019, arguing that the 30% fee charged to developers gave Apple Music an unfair advantage over Spotify. The dispute between the two companies has only intensified, with Spotify accusing Apple of restricting iPhone functionality to limit Spotify’s user experience.
Other companies, such as Netflix, have also pushed back against Apple’s “Apple Tax.” In 2018, Netflix stopped allowing new subscribers to sign up through the App Store, and in 2024, it eliminated the option for existing users to pay through Apple. Instead, Netflix now requires users to pay directly to the service, bypassing Apple’s fees altogether.
While Apple’s fee changes are partly a response to EU regulations and the threat of heavy fines, companies like Spotify and Netflix have also played a significant role in pushing Apple to revise its policies. These ongoing battles between Apple and its competitors highlight the growing pressure on tech giants to adjust their practices in response to both regulatory scrutiny and market competition.