Apple will allow app store competitors onto their products to comply with the new EU law coming into effect in 2024. 

The news comes after a long battle by the company to maintain their current policies, which forced third parties to go through Apple’s own app store to market their products and takes up to 30% in commission for payments. 

Essentially, the Digital Markets Act targets a company’s device monopolies by ensuring that all devices allow third party app stores and default settings can be easily changed. Outside developers must also get equal access to the core features on devices. 

Technology companies with at least £64 billion in their market valuations and a minimum of 45 million monthly users within the EU must comply to the legislation. 

Apple has had many accusations that it forms a monopoly by not allowing competing app stores on their devices. 

In the UK, the CMA found Apple to be guilty of abusing its power after it developed its own music application, which it could freely promote on its own platforms in competition with huge rivals like Spotify, which would also have to lose a commission to Apple for in-app purchases.

In a report, the CMA also stated that Apple, as well as Google and Facebook, has created barriers to competition and therefore innovation by prohibiting App Store alternatives. 

The EU law has caused a major shift in Apple’s policies, and the move has already raised stock prices for several major apps including Bumble Inc and Match.Com, which will no longer lose commission to Apple for in-app purchases of their premium services. 

In-app purchases on Apple devices have long been fought by different companies, and Netflix specifically does not allow users to purchase the streaming service on the app on Apple devices because of the commission charge. 

While Apple is planning on complying with the majority of the law, they are still in discussions regarding the aspect of third party payment systems within apps. The company may not allow developers to install their own payment systems within their apps without involving Apple, potentially for security reasons. If they do comply with this, it could remove any commission they make on in-app purchases. 

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Similar regulations have already been applied to Apple in Japan, which allows apps to direct users to the web for payment. 

For security purposes, Apple may also require certain vetting requirements for third party applications to be on Apple devices, which may require a fee. 

To allow for a more competitive marketplace, Apple is also working on sharing some of their application frameworks to third parties. 

Whether the legislation would have a major impact on the use of the App store is debatable, as Apple users would already be used to the interface. 

Removing Apple’s ability to take commission from different application’s purchases, however, should level the playing field and allow more apps to enter the market place. 

If other governments do not produce similar laws, their own apps may not benefit as greatly as European developers.

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