Publishers have welcomed a ruling that should make it easier for them to make money from apps when operating in EU countries.
Apple has 60 days to comply with a ruling under the EU Digital Markets Act which was accompanied with a €500m fine for abusing its dominant market position when it comes to the distribution and monetisation of apps in its store.
It remains to be seen whether Apple will also change the terms for publishers operating in the UK as a result of the ruling, or wait for regulatory action under Britain’s Digital Markets, Competition and Consumers Act.
European Publishers Council executive director Angela Mills said: “What’s important for us is not the fine but the changes that Apple will need to make within two months to comply with the DMA. Apple has long frustrated greater competition in app distribution and in payment solutions via a combination of friction and excessive fees.
“The European Commission has rightly used its new powers under the Digital Markets Act to challenge these anti-competitive behaviours that majorly impact publishers’ ability to deliver professional editorial media to Europe’s consumers.”
The EPC noted: “Apple has now no other choice but to revise its non-compliant App Store terms within two months and remove the technical and commercial restrictions currently in place in the App Store to ensure that: app developers, like publishers, can send their consumers offers from outside the Apple platform, eg from publisher websites, and allow consumers to download apps directly to their devices from the web.
“This means that publishers can now offer their subscribers promotions and deals in their own apps enabling them to build better customer relationships with their subscribers (currently prohibited by Apple).”
It notes that the ruling also finds that “publishers’ customers must be able to buy subscriptions via the App Store, without publishers being subject to a disproportionate tax from Apple (currently 30%)”.
It said the commission on subscriptions in the App and Play Stores should drop to 3-5% for publishers operating in EU countries.
The EPC said: “Publishers should be able to offer their customers using the App Store alternative payment systems (currently only Apple’s is available) and subscriber data from App Store purchased subscriptions must belong to the publisher.
“Currently, Apple refuses to share this with publishers which means when consumers are on publishers’ websites, publishers have no way of knowing they have paid for a subscription on the App Store.”
The ruling should make it easier for publishers operating in the EU to steer readers outside the Apple App Store in order to make purchases.
A second ruling saw Meta fined €200m over its deployment of a “consent or pay” advertising model for EU users of Facebook and Instagram.
Under this model EU users were given a choice of either consenting to sharing their personal data in order to receive more personalised advertising or paying a monthly subscription for an ad-free service.
This model has been widely adopted by publishers in the UK and in Europe.
The Commission “found that this model is not compliant with the DMA, as it did not give users the required specific choice to opt for a service that uses less of their personal data but is otherwise equivalent to the ‘personalised ads’ service.
“Meta’s model also did not allow users to exercise their right to freely consent to the combination of their personal data.”
It remains to be seen whether the latest EU ruling also impacts the Commission’s enforcement of data rules. Under the EU Digital Markets Act companies like Apple and Meta are subject to bespoke regulation because of their dominant market positions.
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