It was confirmed back in September that Apple will need to comply with antitrust requirements relating to app sales, and it seems most likely this will require the company to allow third-party app stores on iPhones. Microsoft has now indicated its intention to run one of these.
One key driver for the plan is likely Microsoft’s $69 billion acquisition of mobile gaming giant Activision Blizzard …
The App Store is officially a monopoly
Currently, the only place you can buy and download iOS apps is from the App Store. Apple had argued that consumers and developers were free to buy and sell Android versions of apps, therefore it didn’t have a monopoly on mobile apps as a whole – but the European Union rejected this as irrelevant, as Apple has an undeniable monopoly on the sale of iPhone and iPad apps.
Apple eventually conceded the point, and the matter was finally settled in September. The EU named the companies which will be subject to the Digital Markets Act (DMA) antitrust law, with the iPhone maker on the list.
Apple will likely have to allow third-party app stores
We still don’t know for certain what action Apple will have to take to comply with the DMA.
As a minimum, Apple must allow developers to use third-party payment platforms for European app sales, and in-app purchases. However, it seems more likely that it will need to permit third-party app stores to fully comply.
All indications are that Apple has reluctantly accepted this. The company has for some time had a senior team working on permitting third-party app stores.
This work is being spearheaded by Andreas Wendker, a software engineering vice president within Apple. Wendker reports directly to Craig Federighi. In addition to the engineering teams, Apple’s services team is also involved. Jeff Robbin, Apple’s “top engineering manager for its services,” is leading the effort on that side. Robbin reports to Eddy Cue.
Apple has until March 6 2024 to comply.
It’s not known whether the company will limit the changes to EU countries, or make the change globally. Apple faces similar antitrust pressures in the US and elsewhere, so may decide it’s best to bite the bullet and make one change worldwide.
Microsoft plans to offer an app store for games
Bloomberg reports that Microsoft has confirmed reports that it plans to offer an iOS app store for games.
Microsoft Corp. is talking to partners to help launch a mobile gaming store that will take on Apple Inc. and Google’s dominant position in the business, according to Phil Spencer, who leads the company’s Xbox video-game division.
“It’s an important part of our strategy and something we are actively working on today not only alone, but talking to other partners who’d also like to see more choice for how they can monetize on the phone,’’ Spencer said in an interview in Sao Paulo during the CCXP comics and entertainment convention.
Earlier reports said that it plans to launch the store next year, and the company more-or-less confirmed this.
The executive declined to give a specific date for a launch of the online store, which earlier reports suggested could be next year. “I don’t think this is multiple years away, I think this is sooner than that,’’ he said.
What does this mean for iPhone users?
What will likely happen is that you’ll be able to go to Apple’s App Store, and download apps for third-party app stores, like the planned Microsoft one.
If you do, you’ll then be able to choose where to buy your apps – either from the official App Store, or from any of the third-party ones.
You may pay the same price or different ones; that will be up to developers. However, the most likely outcome is that third-party stores will offer lower commissions to developers, and they will pass on at least some of the savings or offer other incentives to encourage you to use the stores which charge them the lowest commissions.
But most iPhone owners likely to stick to Apple
However, while the law will give you the option of buying apps from other stores, the choice will be yours. We’d expect most iPhone owners to stick to Apple’s own store, for three reasons.
First, interia. The average iPhone user probably won’t even know that third-party app stores exist, and even those who do will likely continue to use the App Store out of habit.
Second, comfort with Apple. If you need a refund, or want to cancel a subscription, you know that Apple will take care of that for you. If you buy elsewhere, you’d be dependent on the third-party store to handle those issues.
Third, security. Apple has long argued that it does more than other app stores to exclude scam apps. Even if that might be a somewhat questionable claim, people may be less inclined to trust Microsoft.