Let a Million Fines Bloom
After John Gruber linked to this press release from the EC the other day, it took me a bit of time to figure out that this is actually completely unrelated to the fine they levied on Apple for a DMA breach. To be clear – and yet no less confusing! – the above is about other DMA breaches.
Specifically, Apple's fine was for:
Under the DMA, app developers distributing their apps via Apple's App Store should be able to inform customers, free of charge, of alternative offers outside the App Store, steer them to those offers and allow them to make purchases.
The Commission found that Apple fails to comply with this obligation. Due to a number of restrictions imposed by Apple, app developers cannot fully benefit from the advantages of alternative distribution channels outside the App Store. Similarly, consumers cannot fully benefit from alternative and cheaper offers as Apple prevents app developers from directly informing consumers of such offers. The company has failed to demonstrate that these restrictions are objectively necessary and proportionate.
But the link up top is to another press release, issued on the same day, about two other DMA matters. The first, was good news for Apple, the second, less good, but just "preliminary":
Following a constructive dialogue with Apple, the Commission has decided to close its investigation into Apple's user choice obligations under the Digital Markets Act (DMA). The Commission has also informed Apple of its preliminary view that Apple's contract terms concerning alternative app distribution breach the DMA.
Why the EC couldn't bundle all of these complaints together, I don't know. But why restrict your ability to fine to one all-encompassing violation when you can fine for a hundred different once, no matter how arbitrary, I suppose.
In other words, while the $570M fine is tiny relative to what it could be (and relatively small for Apple overall), the EC could be in the process of fining Apple $500M+ a number of times for different violations. And unless they comply within the (comical) 60 day window, they might be doing so in perpetuity – with escalating fines. This compounding would constitute an actual pounding to Apple's bottom line. And why they need the Trump administration to step in.
Which they clearly will be doing.
One has to wonder if Apple doesn't now regret complying with any of the EC's initial requests here. They gave the mouse the proverbial cookie with the app defaults and browser choice screens. Now they want the glass of milk. Specifically:
Under the DMA, Apple is required to allow for the distribution of apps on its iOS operating system by means other than through the Apple App Store. In practical terms, this means that Apple should allow third party app stores on iOS and apps to be downloaded to the iPhone directly from the web.
Apple, of course, did make some tweaks to technically satisfy both demands. But the EC believes Apple also put in place blockades to make it decidedly unattractive (or impossible) to use such features, in the form of both the Core Technology Fee, but also the rules around who can utilize web distribution (which seemingly locks out 99% of developers from being able to utilize it). I don't think the EC is wrong here to highlight both issues, but they also don't give much of anything in terms of guidance for what Apple should or should not be allowed to do to comply.
Back to Gruber:
So is the entire idea of the Core Technology Fee disallowed? Or is the fee too high? Does Apple need to just make app distribution free and unfettered, no fees, no restrictions?
And with regard to web distribution, is Apple allowed to restrict it in ways which they'll argue is in the name of security? Even if it's only what they do in terms of signing developers on macOS? I'm sort of holding out hope that one of the reasons why Apple made this so comically restrictive to start is that they're working on a better solution – perhaps to be unveiled at WWDC. I mean, I'm not holding my breath there, obviously. But beyond the EC, it sure feels like there's a dam about to burst with regard to developers and Apple...
M.G. Siegler
M.G. Siegler
M.G. Siegler