Ahead of an antitrust hearing scheduled for July 27, Apple has released a new study in an effort to prove that the commissions earned from the App Store are in line with those of other App Stores and digital content marketplaces. The company’s effort to prove that its App Store practices are in line with those of other digital marketplaces comes just before a hearing before the Federal Trade Commission’s antitrust panel, where Apple CEO Tim Cook will be questioned about the company’s practices and whether it has stifled competition. Senior executives from Amazon, Facebook, Alphabet and Google will also testify at the antitrust hearing.
The study, conducted by Analysis Group, compared the Apple App Store's commission rate to other digital app marketplaces, including the Google Play Store, Amazon App Store, Samsung Galaxy Store, and Microsoft Store, as well as other marketplaces operated by companies like Airbnb, Uber, and Epic Games.
According to the study, Apple charges a 30% commission when device owners download paid apps and make in-app purchases of digital content, services and subscriptions, leaving developers with 70% of the sales. For in-app subscriptions, Apple charges a 30% commission for the first year, and after that, Apple's commission drops to 15%.
Other major app stores, such as the Google Play Store, Amazon App Store, Samsung Galaxy Store, and Microsoft Store, also charge a 30% commission on app downloads and in-app purchases, but each has its own set of exceptions. For example, Google Play's commission rate for subscriptions is 15% after 12 months, Amazon's commission is 20% for video streaming , and the Galaxy Store charges a standard 30% commission rate, but has stated that this rate is negotiable.
The study also added that stores that are no longer in operation, such as BlackBerry World, Windows Phone Store and Nokia Store, also had similar commission rates of around 30%.
Furthermore, the study said that the fees charged by digital marketplaces are justified as they enable and facilitate transactions, while also making investments that support app downloads and in-app purchases.
The study also noted that Epic Games, maker of the popular video game “Fortnite,” charges only a 12 percent commission. Epic Games CEO Tim Sweeney has tweeted his opposition to Apple’s App Store business model. The study also noted that Apple enforces in-app purchase guidelines that prevent users and developers from “free riding” on Apple’s App Store services and investments. For example, apps cannot explicitly prevent app users from making in-app purchases by providing external links that bypass the app store.
Apple has been under a series of scrutiny by the US since June 2019, when it launched an antitrust investigation into the competitive landscape of technology in the US. And now, it is preparing to testify at the antitrust hearing.
The European Union also launched antitrust investigations last month to determine whether Apple's rules for developers distributing their apps through the company's App Store violate EU competition rules .
