- Apple is replacing the EU Core Technology Fee with a 5 percent commission on digital transactions for apps distributed outside the App Store.
- Developers can use Apple In App Purchase and alternative payment methods together in EU apps, subject to Apple’s rules.
- Apple is adding stronger purchase protections for children, including parental gates and restrictions on website payments.
- More companies, nonprofits, educational institutions and government bodies can qualify for alternative app marketplaces and web distribution.
Apple is changing the way developers can make money from apps in the European Union, introducing a new set of business terms that simplifies its previous approach to alternative payments and app distribution.
The company says the updated rules were developed following close discussions with the European Commission. The biggest change is that developers distributing apps in the EU will now move to a single set of business terms, rather than having to navigate several different arrangements.
The new terms will be available for developers to accept from today, with the changes scheduled to take effect on October 1.
For developers, the most important part of the announcement is the change to Apple’s fee structure. The existing Core Technology Fee will be replaced by a Core Technology Commission. Instead of charging a per install fee to developers whose apps reach very large audiences, Apple will take 5 percent of digital transactions from apps distributed outside the App Store.
Apple is also removing both the initial acquisition fee and the store services fee. That should make the overall cost structure easier to understand, particularly for developers considering alternatives to the traditional App Store model.
Apple changes its App Store commission structure
The new system introduces different commission rates depending on how an app is distributed and how customers pay.
Apps sold through the App Store using Apple’s In App Purchase system will generally be subject to a 26 percent commission. However, many developers will qualify for a lower 15 percent rate. This includes developers participating in Apple’s Small Business Program, Mini Apps Partner Program or Video Partner Program. Auto renewing subscriptions after the first year will also qualify for the 15 percent rate.
Developers that use alternative payment processing inside their App Store apps will pay a 20 percent commission. Eligible developers covered by the reduced rate programs will instead pay 10 percent.
There is also a separate option for apps that send users to a website to complete a purchase. Apple will charge a 15 percent commission in that situation, falling to 10 percent for developers eligible for the reduced rate.
Apps distributed through alternative app marketplaces or directly from the web will face the new 5 percent Core Technology Commission.
The result is a more straightforward framework, although developers will still need to consider which payment and distribution model makes the most financial sense for their business.
Alternative payments can now sit alongside Apple In App Purchase
One of the more notable changes is that developers in the EU can now offer Apple’s payment system alongside alternative payment methods.
Previously, developers using alternative payment options in the EU faced restrictions around offering Apple In App Purchase at the same time. Under the new terms, developers can combine payment options, subject to Apple’s presentation requirements.
Developers will also need to select their preferred payment options and keep those choices in place for 12 months. The available choices include Apple In App Purchase, alternative payment processing within the app, links to a website for payment, or a combination of these options.
For users, Apple says the presentation requirements are intended to create a more consistent and transparent purchasing experience.
For developers, the change could be more significant. It gives them greater flexibility to offer different payment methods while still retaining Apple’s own purchasing system.
Apple adds extra protections for children
Apple is also introducing specific safeguards around alternative payments, particularly for younger users.
Apps in the Kids category will not be allowed to include links to websites where transactions can be completed. The move is designed to reduce the risk of scams and fraudulent activity aimed at children.
For users under 18, App Store apps that use alternative payment processing or send customers to a website for purchases will need to include a parental gate. This requires younger users to involve a parent or guardian before completing a purchase.
The restrictions become tighter for children under 13. Apps cannot send these users to websites to complete transactions.
Apple says the rules will also adapt in EU countries where parental consent requirements apply to children above the age of 13.
More companies can distribute apps outside the App Store
Apple is also widening access to alternative app marketplaces and web distribution in the EU.
Companies will now be able to qualify through several routes. These include meeting a financial stability requirement, being publicly traded or owned by a publicly traded company, receiving investment from an established venture capital firm, or completing a financial audit with a licensed accountant.
Government bodies, educational institutions and nonprofit organisations will also be eligible.
Web distribution remains a particularly important part of Apple’s changes because it allows developers to distribute apps without relying on an alternative marketplace. Apple points out that this model does not provide the same level of ongoing oversight as the App Store.
To address that concern, Apple says every app distributed through the web will still need to pass its Notarization process. The review is intended to provide a basic level of protection against serious security threats and ensure that apps meet Apple’s baseline requirements.
Overall, the changes represent a significant adjustment to Apple’s approach to app distribution in Europe. Developers get more choice over payments and distribution, while Apple retains a commission on digital transactions and continues to apply security and child safety requirements.
The new terms will come into effect on October 1, giving developers time to decide whether the updated structure works for their apps and business models.
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