13 companies merged to protest the 30% tax rate of Apple. 13 companies, including Epic Games, Spotify, Tile, ProtonMail and Basecamp, have just announced the foundation of the “Coalition for App Fairness” (CAF), a non-profit organization and their objective is to protest the 30% rate that Apple and Google impose on purchases made in the apps hosted in their stores.
The Coalition assures that there are currently three major problems with application stores: anti-competitive practices, the 30% rate, and the lack of consumer freedom. Although the companies refer to all application stores, they make a special mention of Apple, which they accuse of charging a rate 600% higher than the rest of payment providers. Their claim is that Apple earned $15,000,000,000+ from their taxing procedure.
The fight against 30% tax rate of Apple and Google continues
CAF affirms that the companies that operate the app stores “must not abuse the control they enjoy and must adhere to supervision”. They believe this way, anti-competitive behavior will not be promoted. They claim that the “excessive fees” they charge to developers give Apple’s own applications “an unfair advantage and block innovative competitors.”
Companies claim that Apple uses its control over iOS to favor itself and forces developers to publish their apps on the App Store. And they say 30% tax rate of Apple is too high and unfair. They even go further and claim that Apple steals ideas from its competitors. Tile accuses Apple of making “changes to iOS that made it difficult for consumers to access the location data necessary for Tile to work, leaving access to the streamlined data from Find My intact.”
They also accuse Apple of not allowing companies like Tile to access UWB technology and they claim that there are “credible reports that Apple is planning to launch Tile-like Bluetooth hardware that will use the UWB chips of the iPhone 11.” They are obviously referring to the rumors which have not been official yet.
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On the other hand, they criticize that the commission of 30% of the App Store “represents a huge portion of the income” of developers and that it makes competing against Apple services, such as Music, Mail or Books, more complicated. They explain that the developers want Apple to open its App Store so that “any company can develop software on its own terms and release it to users freely,” that is, applications from stores other than the App Store can be installed.
Finally, they state that the App Store limits the freedom of choice since applications can only be downloaded or purchased from there. They directly cite the case of ‘Fortnite’, which added its own payment gateway to the game and was subsequently removed from the iOS app store. “Apple specifically tells developers that they are not allowed to inform their customers about cheaper options, or they risk being expelled from the App Store,” they conclude from the CAF.
13 companies merged to protest the 30% tax rate of Apple. Taking advantage of the announcement of this coalition, the companies have published a decalogue of principles of the application stores:
- No developer should be required to use an app store exclusively, or to use ancillary services of the app store owner, including payment systems, or to accept other supplementary obligations in order to have access to the app store.
- No developer should be blocked from the platform or discriminated against based on a developer’s business model, how it delivers content and services, or whether it competes in any way with the app store owner.
- Every developer should have timely access to the same interoperability interfaces and technical information as the app store owner makes available to its own developers.
- Every developer should always have access to app stores as long as its app meets fair, objective and nondiscriminatory standards for security, privacy, quality, content, and digital safety.
- A developer’s data should not be used to compete with the developer.
- Every developer should always have the right to communicate directly with its users through its app for legitimate business purposes.
- No app store owner or its platform should engage in self-preferencing its own apps or services, or interfere with users’ choice of preferences or defaults.
- No developer should be required to pay unfair, unreasonable or discriminatory fees or revenue shares, nor be required to sell within its app anything it doesn’t wish to sell, as a condition to gain access to the app store.
- No app store owner should prohibit third parties from offering competing app stores on the app store owner’s platform, or discourage developers or consumers from using them.
- All app stores will be transparent about their rules and policies and opportunities for promotion and marketing, apply these consistently and objectively, provide notice of changes, and make available a quick, simple and fair process to resolve disputes.
13 companies merged to protest the 30% tax rate of App Store and those companies are: Basecamp, Blix, Blockchain.com, Deezer, Epic Games, European Publishers Council, Match Group, News Media Europe, Prepear, Proton Mail, Sky Demo, Spotify, and Tile.