September 22, 2020

Soldering Point

Tech Update

News publishers ‘pulling a Fortnite’ and asking Apple to lower fees

A silhouette next to an Apple during the sale start of the new iPhone X...

A silhouette next to an Apple during the sale start of the new iPhone X at the Apple store Grosse Bockenheimer Strasse in Frankfurt, Germany (Credits: EPA)

Some of the biggest news publishers in the US are pushing tech giant Apple to lower the fees associated with its App Store.

The likes of the Washington Post and New York Times are petitioning the company to drop the commission it takes on subscriptions from the App Store.

They want it dropped from 30% down to 15%.

Unsurprisingly, the move comes hot on the heels of software company Epic Games going to war with Apple for the very same reason.

Epic wants its popular game Fortnite to be out from under the thumb of Apple’s corporate commission rates.

And in an open letter to Apple CEO Tim Cook, Digital Content Next (DNC) – a trade organisation which represents publishers – demanded the same.

They pointed out that Apple does knock down the commission fee to 15% for one other entity – fellow tech giant Amazon for it’s Prime Video service.

‘We would like to know what conditions our members — high quality digital content companies — would need to meet in order to qualify for the arrangement Amazon is receiving for its Amazon Prime Video app in the Apple App Store,’ Jason Kint, CEO of DNC, wrote in the letter to Cook.

A young man looks at Apple's iPhone 8 Plus at the Apple Store of Omotesando shopping district in Tokyo, Japan (Credits: EPA)

Apple takes a 30% cut of all subscription purchased through the App Store (Credits: EPA)

‘The terms of Apple’s unique marketplace greatly impact the ability to continue to invest in high-quality, trusted news and entertainment particularly in competition with other larger firms. In keeping with your statement to the Committee, I ask that you clearly define the conditions that Amazon satisfied for its arrangement so that DCN’s member companies meeting those conditions can be offered the same agreement.’

At present, Apple’s App Store conditions mean nearly a third of any newspaper subscription purchased through an iPhone or iPad goes to the tech giant.

Apple hasn’t commented on the publishers’ requests yet, but it certainly seems like Epic Games has started the snowball rolling.

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