Apple has handled its response, including its proposed App Store changes, to the EU's DMA with aplomb, despite the law being an assault on Apple's brand promise

An essay on the EU Digital Markets Act and Apple's “Update on apps distributed in the European Union” (and some personal history)

Hardcore Software 2024-01-28 Steven Sinofsky

Context & Ripple Effects

Apple’s EU response sits at the intersection of a regulatory mandate and a platform model built around control of iOS distribution. Related coverage characterized the proposed rules as an effort to preserve as much control over iOS as possible while complying with the DMA’s terms.

The immediate debate was not whether Apple would change its EU distribution rules, but whether the new terms offered developers meaningful economic and practical alternatives. A contemporaneous critique argued that the commissions were not fair or reasonable, setting up an enforcement question rather than ending the dispute.

First-order effects

Apple must operate EU-specific App Store and iOS distribution arrangements, while attempting to keep its existing control model intact.
EU developers and would-be alternative distributors must assess the new terms, fees, and operating constraints before deciding whether the available options are commercially viable.

Second-order effects

The changes shift the contest from a binary App Store-access dispute to competition over the conditions of distribution, putting developer economics and switching friction at the center.
The European Commission becomes the key arbiter of whether Apple’s implementation delivers practical openness; later coverage of preliminary concerns over anti-steering rules and developer fees shows why the initial response did not settle that question.

Third-order effects

If enforcement evaluates outcomes rather than formal rule changes alone, regulated platforms will have less room to preserve gatekeeper economics through redesigned terms and processes.
The DMA could establish a durable pattern of region-specific platform governance, with Apple and other gatekeepers adapting access rules market by market rather than abandoning centralized control globally.

The trend: Platform regulation is moving from mandates to implementation battles over whether alternative access is genuinely usable, affordable, and competitive.

Discussion

@gruber John Gruber on x
@stevesi The browser ballot thing is so ridiculous. But even worse, they should have learned from forcing it on Windows, that it's just a goddamn annoyance.
@stevesi Steven Sinofsky on x
@gruber They are very proud of it.
@pencoyd John B. Roberts on x
Excellent essay from @stevesi - long Saturday night read, but coming from someone with history and depth on the subject. https://hardcoresoftware.learningbyship ping.com/ ...
@stevesi Steven Sinofsky on x
Of note regarding this, the regulation in the EU Digital Markets Act applies to no European companies because the thresholds are (mysteriously) revenue of EUR 7.5 billion for three years, EUR 7.5 billion market cap, or 45 million MAU.
@stevesi Steven Sinofsky on x
Building Under Regulation // An in-depth essay on the EU Digital Markets Act focusing on Apple and compliance, supported by some history I experienced being regulated. Once reading there was a “browser ballot” I admit I was triggered into writing lots. https://hardcoresoftware.le…
@benedictevans Benedict Evans on threads
The funny thing about Spotify's iPhone complaint is that it's almost the exception that proves the rule. It's very obvious that Apple's payment rules as applied to Spotify and e-books are anti-competitive and anti user, but hard to think of other examples. …
@parkert Parker Thompson on threads
Spotify pays out more than 70% of gross revenue in royalties. They can't double payouts. Apple is happy to lose money on Music to stifle competition. When they say “pay artists more” it's not about artists, they DGAF, it's about trying to make independent music streaming busin…
@jimmylittle Jimmy Little on threads
Apple should tell Spotify that if they agree to pay artists at the same rate as Apple Music, they'll waive the fees. Would Spotify rather double their artist payouts, or pay Apple? “We should be the only ones fleecing our content creators” is not a strong argument, Mr. Ek. …
@jimmylittle Jimmy Little on threads
I think Benedict Evans generally has great insight, but he kinda missed this one. Spotify is no different than any other company. Spotify: 70% to creators (well, the creator's record labels) Google Play: 70% to creators App Store: 70% to creators Game consoles: 70% to creators …
@iainharper Iain Harper on threads
Spotify can keep the Status Quo and continue to pay Apple nothing. What they want is to have their cake and eat it - to have their app within the iOS ecosystem refer a ton of subscription customers to them but pay nothing for those direct referrals. That's not how business work…
@chancehmiller Chance Miller on threads
In a statement to me, Apple fires back at Spotify's ciritcisim of this weeks App Store news: “We're happy to support the success of all developers - including Spotify...The changes we're sharing in the European Union give developers choice...Every developer can choose to stay on …
@daveleebbg Dave Lee on threads
Getting ugly real quick
@documentingmeta @documentingmeta on threads
sure Apple this wouldn't be a problem at all if only you didn't have a competing product of your own called Apple Music
@frankreiff@mastodon.social Frank Reiff on mastodon
This is as close to a “we are not amused” as the EU commission ever comes. — Google was fined 2.42B euros; Meta 1.2B.. — As an EU citizen I find it shocking that US companies simply believe themselves to be above the law.. and even more shocking that so many otherwise sane Am…
@eldsjal Daniel Ek on x
After sitting with our legal team to parse through the fine print of Apple's DMA announcement (that took a while), which is, at best vague and misleading, I wanted to share my thoughts. While Apple has behaved badly for years, what they did yesterday represents a new low, even f…
@sriramk Sriram Krishnan on x
It is often popular here to say “EU = bureaucratic regulations + decel”. In my experience with EU policy makers, it is more complicated and surprisingly often the reverse. below is a classic narrative violation. You have the EU pushing for what is undeniably “good” and a...
@elonmusk Elon Musk on x
@eldsjal Very concerning
@kwekuoa Kweku Opoku-Agyemang, Ph.D on x
It's definitely a strong approach, if not rather extreme. I'm not sure how sustainable it is, though. It's basically Epic's argument in broad daylight—but for developers—and on steroids. Hopefully cool heads will prevail.
@kwekuoa Kweku Opoku-Agyemang, Ph.D on x
I'm actually not surprised. Epic was speaking to the switching costs argument: that Apple's walled garden locks users into iOS and may harm competition by not allowing consumers very easy access to alternative platforms if they're dissatisfied by high prices or locked out.
@elchefe @elchefe on x
Bro you take half of the revenue from ads, pay your artists half as much as Apple and laid off a bunch of people for no reason, so you can, with every ounce of disrespect owed to a billionaire whining about unfair treatment, fuck all the way off into space.
@simmenfl Florian Simmendinger on x
@eldsjal You don't have a right to do business on Apple's platform on your terms. You didn't build it. I also don't get to decide under which conditions I can publish my music on Spotify.
@joecarlsonshow Joseph Carlson on x
@eldsjal Apple's 15% cut is too much, but you take a 50% cut from advertiser revenue on Spotify. [image]
@eldsjal Daniel Ek on x
Sadly this is a classic move of an old, dominant company that believes the rules don't apply to them. Instead of adapting and innovating, they're twisting the situation, making it seem like the regulators are at fault. Or even worse, pretending this has to do with security when..…
@eldsjal Daniel Ek on x
But of course, I was skeptical of Apple's intentions to comply after years of watching them get away with such extreme abuse with all the ways they skirt regulations around the world. Who wouldn't be? But the law is the law, right? Not if you are Apple...
@eldsjal Daniel Ek on x
So where does that leave us? Under the new terms, we cannot afford these fees if we want to be a profitable company, so our only option is to stick with the status quo. The very thing we've been fighting against for five years.
@eldsjal Daniel Ek on x
Their reaction to the DMA is a masterclass in distortion. They present a ‘simple’ choice: Stick with their current terms or switch to a convoluted new model that looks attractive on the surface but has potentially even higher fees. Reality check: Apple's alternative is no alter…
@mdudas Mike Dudas on x
Apple are bad people. Their uncle created the recipe. They milk it, refuse to share and hold the best people hostage with"non-competes." It's like the Mafia serving the best pizza and Italian food in Little Italy. No one else can compete because they need to pay 30% to play...
@carnage4life Dare Obasanjo on x
“A completely new 0.50 cent Euro fee per download, every year, in perpetuity, to Apple for just allowing developers to exist on iOS - This is extortion, plain and simple.” - Spotify press release https://newsroom.spotify.com/ ...
@patrickmoorhead Patrick Moorhead on x
As discussed in the @TheSixFiveMedia Weekly podcast, @Apple is putting up smaller walls to circumvent the EC's DMA. Usually Apple is compliant, but it seems like the company is going to fight this tooth and nail. That 30% app and service payment for storing & security scanning...
@stevemoser Steve Moser on x
Interesting but not surprising that Spotify is sticking with the status quo given the large fees they would incur for the free downloads of their app.
@film_girl Christina Warren on x
The girls are fighting!!!!
@eldsjal Daniel Ek on x
For almost five years - 1,782 days - we have been asking the European Commission to take action against Apple. You can imagine my excitement when the DMA was created and passed into law because it was such a progressive step against Apple's App Store monopoly.
r/Fauxmoi r on reddit
Spotify accuses Apple of ‘extortion’ with new App Store tax: Spotify CEO Daniel Ek says Apple's new rules represent “a monopoly under a different mask.”
r/popculturechat r on reddit
Spotify accuses Apple of ‘extortion’ with new App Store tax: Spotify CEO Daniel Ek says Apple's new rules represent “a monopoly under a different mask.”

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