Apple’s Controversial “Core Technology Fee” Stays for EU Developers Opting into New Business Terms
Apple’s new “Core Technology Fee” is stirring up controversy among EU app developers who decide to opt into the tech giant’s new business terms developed to comply with the Digital Markets Act in the region. Despite feedback from the developer community, Apple is making smaller concessions today.
Notably, corporate entities will no longer need to sign up for the new DMA terms along with all their sub-accounts. Apple is also eliminating the requirement for a stand-by letter of credit. Additionally, developers will now have the option for a one-time switch back to the existing terms under certain circumstances, rather than being locked into the reduced commission rates imposed by the new rules.
However, these changes do not address the major complaints surrounding Apple’s DMA rules, particularly the introduction of the “Core Technology Fee.” This fee demands that developers pay Apple €0.50 for each first annual install per year over a 1 million threshold for apps distributed outside of the App Store.
Tech giants like Spotify and Epic Games have criticized Apple’s plan to comply with the DMA, labeling it as “extortion and “bad-faith” compliance. The backlash has prompted other companies including Meta, Mozilla, and Microsoft to condemn Apple’s DMA rules. Meta CEO Mark Zuckerberg questioned the feasibility of the requirements, while a consortium led by Epic and Spotify wrote an open letter to the European Commission, urging for action against Apple.
Apple has adjusted certain terms within the DMA rules in response to criticism, such as removing the requirement for marketplace app developers to provide a €1,000,000 letter of credit. The tech company has also allowed larger corporate entities to selectively opt into DMA rules at the developer account level.
While these changes may seem accommodating, developers still face hurdles in testing DMA rules and switching back to the previous terms. Apple stipulates that developers can only terminate the DMA Addendum once under specific conditions, and termination incurs a Core Technology Fee that must be paid within 30 days.
In conjunction with the rule adjustments, Apple has launched Xcode 15.3 and updated SDKs for various operating systems. Developers can now submit apps under the DMA terms and monitor the number of first annual installs.
Furthermore, Apple revised its App Review Guidelines to align with the DMA rules, emphasizing restrictions on copying names, icons, or imagery from other platforms. Alternative app marketplaces are prohibited from collecting user information without consent or using public databases for data collection. Non-compliant apps risk being blocked from installation, even through alternative platforms.
In conclusion, Apple’s modifications to its DMA rules aim to address developer concerns, though challenges persist in navigating the complex fee structures and compliance requirements set forth by the tech giant.
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