Apple rejects HEY appeal, noting email apps must work without paid subscription; Apple suggests offering in-app sub or to reconfigure app as IMAP and POP client

In a brief call today about Basecamp's Hay email app from the iOS App Store, Apple's Phil Schiller told me that there would currently …

TechCrunch 2020-06-19 Matthew Panzarino

Context & Ripple Effects

Basecamp's new email service HEY hit Apple's wall within days of launch: its next iOS update was rejected because Apple wasn't taking a cut of subscription revenue, even though HEY sells subscriptions only on its own website. Basecamp CEO Jason Fried escalated publicly, framing the fight as Apple forcibly inserting itself between developers and their customers rather than a dispute over money.

Apple's answer came through Phil Schiller on a brief call to TechCrunch: email apps must work without a paid subscription, so HEY either adds an in-app purchase or reconfigures as an ordinary IMAP/POP client. Two days later Apple granted a temporary approval giving Basecamp time to comply, before ultimately approving an update that opened HEY to everyone with proposed guideline changes.

First-order effects

HEY's iOS distribution hangs on choosing one of Apple's two compliance paths — an in-app subscription paying Apple's cut, or a rebuild as an IMAP/POP client that sidesteps App Store billing entirely.
Schiller's stated rule creates an immediate category test: any subscription-first app whose core function requires payment now faces rejection unless it offers free functionality or IAPs.

Second-order effects

Jason Fried's public framing turns the dispute into a developer-relations liability for Apple, pressuring it to grant case-by-case extensions like the temporary approval rather than enforce uniformly.
Other subscription-first developers watching this case gain a playbook: route signups through the web, keep the iOS app functional without purchase, and negotiate from public pressure rather than private appeals.

Third-order effects

If web-signup apps can hold out by offering minimal free tiers, Apple's 30% commission erodes at the edges while its review process becomes a negotiation layer — pushing the platform toward explicit rules about what must be free versus paid.
The IMAP/POP option Apple itself suggested legitimizes protocol-level clients as an escape hatch from App Store billing, reinforcing open-protocol interoperability as structural leverage against platform gatekeeping.

The trend: App Store commission enforcement is colliding with subscription-first software sold directly on the web, forcing platform owners to codify where their billing cut applies — one early skirmish in the broader fight over who owns the developer-customer relationship.

Discussion

@markgurman Mark Gurman on x
Apple's rejection letter to Hey attached. Company also says Basecamp hasn't generated revenue for the App Store in 8 years. https://twitter.com/... https://twitter.com/...
@marcoarment Marco Arment on x
Whoever at Apple wrote this — a few days before WWDC! — should never be allowed to communicate with developers again. Let's be clear, Apple: in addition to the $100/year developer fees and any search ads we buy, we add value to your highly profitable hardware FAR beyond the 30%. …
@marcedwards Marc Edwards on x
A few days out from WWDC, and this is Apple's message to developers. It reads as “you have no value to us unless you're earning us tons of cash”. https://techcrunch.com/... https://twitter.com/...
@mgsiegler M.G. Siegler on x
We're getting too far into the weeds with all this. It seems pretty simple at a higher level: App Store rules and policies were created for the world as it was a decade ago. The world is not as it was a decade ago. Apple should create new guidelines for the world as it is now.
@siracusa John Siracusa on x
Wow, this is extremely flimsy. Who is Apple protecting with this stance? The poor iOS user who might download the *free* Hey app and be shocked to learn that it doesn't function without an account? ...or maybe it's about that 30% cut of in-app purchases? Yep, a real stumper. http…
@panzer Matthew Panzarino on x
Apple sent a letter to press (and to @dhh and @jasonfried) about Hey's rejection. I also spoke to Apple's Phil Schiller about the issue. Schiller (and Apple) has not changed stance. https://techcrunch.com/...
@chriswelch Chris Welch on x
What a random mix of shit to string together. For every example, you can name a giant company with an app that Apple can't really afford to lose. And all companies that Apple wouldn't want complaining to regulators. https://twitter.com/...
@dhh @dhh on x
Apple doubles down on their rejection of HEY in the App Store, but adds some spice to it at the end: YOU UNGRATEFUL PEASANTS! No mention of how Basecamp differs, how Gmail differs, how Outlook differs, how Fastmail differs. Just more edicts from the monopoly king! https://twitter…
@harrymccracken Harry McCracken on x
The fact that Apple has trouble following its own rules (it accidentally approved Hey at first) may suggest there's an issue here. https://techcrunch.com/...
@rustyshelf Russell Ivanovic on x
This whole “has generated no revenue for the App Store” line holds no water. If Apple removed all third party apps from their iOS store today, what would iPhone sales look like for the next 2 years? The abundance of apps makes Apple's phones sell. Without them they'd be dead. htt…
@polarbearfarm Layton Duncan on x
Haven't followed the details of the latest App Store controversy, but the vibe of this isn't pleasant. iOS wouldn't be what it is without devs producing apps. Apple couldn't have done it alone. Cash isn't the only value Apple extracts from the App Store. https://twitter.com/...
@dhh @dhh on x
And another. Maybe Apple wants a cut of all banking too? #YouDownloadTheAppAndItDoesntWork https://twitter.com/...
@stroughtonsmith Steve Troughton-Smith on x
🙅‍♂️ The app is only crippled on the App Store because that's what they had to do to fit Apple's written and unwritten rules. By the book. It's not ‘an email app’, it's the Hey app; Apple's framing is BS, and it's disappointing to see people fall for it https://t.co/ONJjr0uzTA
@eugenewei Eugene Wei on x
Per the Apple App Store debate, it's worth remembering that Amazon and Facebook burned crazy resources trying to build mobile phones—their own phones!—just to hedge the mobile platform risk. As world shifted to mobile both companies considered it an existential risk.
@dhh @dhh on x
Here's another “You download the app and it doesn't work, that's not what we want on the store”. https://twitter.com/...
@danieleran Daniel Eran Dilger on x
@appleinsider @Apple The definition of insanity is submitting a game platform to the App Store repeatedly and expecting a different result. Why does Facebook have time to submit a shit package of web games five times but not Instagram for iPad? Must be some real good surveillance…
@stroughtonsmith Steve Troughton-Smith on x
...and Apple didn't just send it to the developer, they shared it with the press. A middle finger to everybody just before WWDC — who thought that paragraph was a good idea? Come on https://twitter.com/...
@backlon Dieter Bohn on x
At the height of its mad powers in the 90s Microsoft wasn't this tone deaf. https://www.theverge.com/...
@nealkhosla Neal Khosla on x
“Large company w/ unrecognized monopoly unwilling to relinquish major revenue source” https://twitter.com/...
@philmctimoney Phil McTimoney on x
@theloop What would a free version of Hey look like? They're hosting your email account - how can that be free if they are making a stand against ads and everything that comes with them? Why doesn't Apple just sell a free version of the iPhone while we're at it? Ad supported!
@denzhadanov @denzhadanov on x
Very solid response by @pschiller. From this perspective Hey does vialote the rules. Our Spark, provides the service for free to users, businesses can pay on the website and access extra features. https://twitter.com/...
@ws Will on x
I thought DHH was being a whiney little baby and overreacting about this whole thing, but the level of gal here is staggering. Trying to armchair quarterback a business model around your cut is not a good look. https://techcrunch.com/... https://twitter.com/...
@dhh @dhh on x
And another #YouDownloadTheAppAndItDoesntWork. https://twitter.com/...
@mehedih_ Mehedi Hassan on x
Make no mistake, if it wasn't for the apps and the high quality of apps iOS developers churn out on a regular basis, I would be using a Pixel right now. https://twitter.com/...
@tomwarren Tom Warren on x
Apple's arrogance knows no bounds 🙄 https://twitter.com/...
@benedictevans Benedict Evans on x
The basecamp founders spent a decade marketing themselves by deliberately insulting their peers, employees & half the tech industry. That's their brand - a cool app run by trolls. Apple still needs to rewrite its payment policies. If it doesn't the EU will, and no-one wants that.
@beirutspring Mustapha Hamoui on x
To borrow @dhh's phrase, I think @apple is the one playing 4D chess here and fanning the flames. This storm may end in a good news climax on Monday when apple announces some kind of dev-friendly changes to the rules in WWDC and Jujitsu its way out of all anti-trust action. https:…
@bjtitus Brandon Titus on x
@theloop @jdalrymple Why is it ok for whole categories of apps ("Readers") to be broken but not others? This reeks of concessions made for large VOD services and others to allow them to selectively apply this rule.
@benthompson Ben Thompson on x
Generous of Apple to not claim responsibility for Basecamp's 1999-2012 revenue.
@kylealden Kyle Pflug on x
As a Windows Phone veteran, I sympathize with Apple's position here. There's absolutely no value to a rich ecosystem of high quality apps like Basecamp if they are not directly monetized. Who needs 'em! (Apple does.) https://twitter.com/...
@charlesarthur Charles Arthur on x
@siracusa this is going to get Apple slaughtered in EU antitrust. Look at what happened with Google and Android sideloading. This will be way bigger.
@stroughtonsmith Steve Troughton-Smith on x
For sure, I'm worried about retaliation for mentioning anything to do with App Store & antitrust. Last time I did, Phil blocked me. Apple have threatened my livelihood on App Store more than once, and know they could snuff me out in an instant. Just like they could for any of us
@wongmjane Jane Manchun Wong on x
I afraid the Hey-Apple controversy will be drown out in 3 days when WWDC comes, everyone will move on to the next big tech and forget about it https://twitter.com/...
@lucvandal Luc Vandal on x
I don't mind the 30% cut but that last sentence sounds like apps that do not benefit @Apple financially are useless. They created amazing platforms for us to take advantage of but our apps also made those platforms thrive. This is insulting to all developers. https://twitter.com/…
@steipete Peter Steinberger on x
So, add a super basic IMAP client and everything is fine? 😶 https://twitter.com/...
@jmccarley John S. McCarley on x
#Apple is like the opposite of the Supreme Court this week - All Bad News... @Apple https://twitter.com/...
@stroughtonsmith Steve Troughton-Smith on x
This ‘the App Store is a business, they can do what they want’ thing is nonsense. The App Store is a utility. It defines the future of software. If you're not on it as a developer, you don't exist. If you don't have access to apps, as a user, you're excluded from the modern world
@wongmjane Jane Manchun Wong on x
Not that I agree with Apple's attitude on their policy, but I like how they gave a shout-out to the open email protocol standards like IMAP and POP https://twitter.com/... https://twitter.com/...
@barakgila Barak Gila on x
idea for https://hey.com/: allow iOS users to subscribe but charge an insane, specific number like $9,138,452 per fortnight, for which the first search result is an anti-Apple screed & regular payment page. Apple lets developers charge a markup, so this should be kosher?
@danielpunkass Daniel Jalkut on x
If I worked in Apple Developer Relations, engineering, product marketing, or App Store editorial, I'd be FURIOUS at whoever in the company is fomenting a developer-hostile public image the week before WWDC.
@reckless Nilay Patel on x
Good interview from @panzer with Schiller here on the Hey controversy. In my conversations with Apple people today, a repeated theme was definitely “if we change the rule for Hey, what's next?” — eventually the entire IAP services revenue strat falls down. https://techcrunch.com/…
@slasher @slasher on x
gatekeepers Apple have now rejected Facebook Gaming from the App Store 5 times, which would be a big deal if anyone used Facebook Gaming https://www.nytimes.com/...
@alexhern Alex Hern on x
Has anyone heard a single reason from Apple as to why this policy doesn't apply to @superhuman? https://twitter.com/...
@stroughtonsmith Steve Troughton-Smith on x
I'll miss Phil; this antitrust action is a self-inflicted wound, and was completely avoidable for Apple if it were not for the continued prevalence of a Jobs-era mindset that has already seen Apple hit for illegal wage-fixing and eBook price-fixing https://twitter.com/...
@mgsiegler M.G. Siegler on x
This isn't the Constitution. Apple holds the unilateral ability to change what it wants. They've been doing it in piecemeal fashion — Amendments? And worse, seemingly for preferred partners/deals, which has just pissed people off more over time. Rewrite the whole thing for 2020.
@karissabe Karissa Bell on x
Wow, definitely not passive aggressive at all! Really struggling to see the wisdom of picking a fight with a developer literally *days* before WWDC https://twitter.com/...
@edbott Ed Bott on x
Like a rejected Sopranos scene: “Basecamp, you come to us asking for a favor, but how long since you've given us a taste?” https://twitter.com/...
@somospostpc Alex Barredo on x
the last paragraph isn't illegal or anything but the snark is utterly unwarranted and would fall flat in Brussels. Apple is playing a political game and should treat this issue as such instead of punching down Basecamp for distributing the app in the only way available to them ht…
@rileytestut @rileytestut on x
the fact that the world's most valuable company sent this email with such a condescending last paragraph is absolutely bonkers https://twitter.com/...
@film_girl Christina Warren on x
This is just tripling down right now and honestly, it's painful to see this sort of thing. https://twitter.com/...
@dhh @dhh on x
@pierce @jasonfried Isn't it amazing that Apple, of all companies, is telling us that we can't integrate a service and a product? This has literally been their playbook for the last twenty years!!
@dhh @dhh on x
@TimSweeneyEpic We should talk!
@sarthakgh Sar Haribhakti on x
“The HEY Email app is marketed as an email app on the App Store, but when users download your app, it does not work.” https://twitter.com/... https://twitter.com/...
@nmasc_ Natasha Mascarenhas on x
*the plot thickens and triples down* https://twitter.com/...
@caseynewton Casey Newton on x
Apple has $192.8 billion in cash on hand https://twitter.com/...
@stroughtonsmith Steve Troughton-Smith on x
That passive-aggressive bullshit 'you're not worth anything to us' paragraph in writing, from Apple. Oof https://twitter.com/...
@mylesudland Myles Udland on x
The App Store definitely operates in the background of most public investors' consciousness, but the Apple v. Hey thing — if not resolved cleanly — has some “a butterfly flaps its wings” risk for Apple. https://stratechery.com/... https://twitter.com/...
@davidu @davidu on x
I'm not a fan of Jason Fried or DHH's content marketing strategy of trashing entrepreneurs, VCs, and even their own employees and investors, but I am very much into their fight with Apple and the App Store policies.
@counternotions Kontra on x
Geez, I wonder why Apple wouldn't want Facebook to set up a mini-app store inside Apple's App Store. (Remember Steve Jobs's “onerous [Facebook] terms [for Ping] that we could not agree to” comment 10 years ago?) https://www.nytimes.com/...
@dinabass Dina Bass on x
Shots Fired: Microsoft President Brad Smith says US and EU antitrust regulators should be looking at app stores, citing behavior he says is worse than what Windows did when it was found guilty: https://www.bloomberg.com/...
@stevesi Steven Sinofsky on x
This makes me sad. https://twitter.com/...
@vladsavov Vlad Savov on x
Real momentum building against Apple's App Store practices and arbitrary 30% revenue cut. Spotify, Epic Games, Rakuten, Match Group and now Microsoft all voicing opposition. https://www.bloomberg.com/... https://twitter.com/...
@hhariri Hadi Hariri on x
They should also be looking at Microsoft Windows recommending Edge when you want to run Chrome. This is hilarious. Microsoft calling out for antitrust regulation. https://twitter.com/...
@robinberjon Robin Berjon on x
🍿🍿🍿 I have several issues with app stores (on both platforms) but if we only get one thing out of this I hope it is support for web apps in iOS. Forcing people into the app store when superior distribution methods are possible is quite problematic. https://twitter.com/...
@mgsiegler M.G. Siegler on x
Microsoft says something they would never have said had Windows Phone not failed so spectacularly. https://twitter.com/...
@stroughtonsmith Steve Troughton-Smith on x
I've enjoyed the App Store immensely, & built a career out of it. I've shipped over a dozen apps since 2008. I've also had two apps killed outright by App Review, & plenty more that I just haven't bothered to make because I know they'll never be allowed on iOS. This stuff matters
@matt_cagle Matt Cagle on x
Microsoft pivots to lecturing experts on a topic it actually understands. https://twitter.com/...
@davidjoachim David S. Joachim on x
For Microsoft, the antitrust shoe is now on the other foot as it calls out app stores as anticompetitive https://www.bloomberg.com/... @dinabass @markgurman @business https://twitter.com/...
@dinabass Dina Bass on x
A Microsoft spokesperson has now told us that Smith's comments referred to Apple's App store (though Smith himself did not specify when he spoke to Politico's @viaCristiano earlier today) https://twitter.com/...
@howardfineman @howardfineman on x
Of course @Microsoft bought or destroyed every competing app in its way, back when it had the market clout to do so. They're ALL too big and predatory. https://twitter.com/...
@stevesi Steven Sinofsky on x
Old enough to remember “Freedom to Innovate” in 1998 https://news.microsoft.com/... https://twitter.com/...
@sushubh @sushubh on x
do remember that microsoft wants to make money from their own app store. they have been slowly pushing developers to list their windows apps on the microsoft store. just like what apple did with macos. https://twitter.com/...
@campuscodi Catalin Cimpanu on x
Shots fired... https://twitter.com/...
@mattzeitlin Matthew Zeitlin on x
what's an apple-y version of “scroogled” https://twitter.com/...
@modestproposal1 Modest Proposal on x
Ahahaha. No surprise Brad Smith is a @stratechery subscriber. “Worse than we ever were” is an amazing accusation. https://twitter.com/...
@rohit29_ @rohit29_ on x
Microsoft drooping a diss track aimed at apple 🤣 https://twitter.com/...
@gaborfari @gaborfari on x
Been saying for a long time that it's a farce that the government wanted to break up MS for monopolistic behavior, but not even a slap on the wrist for goog or apple. https://twitter.com/...
@shiraovide Shira Ovide on x
RUBS HANDS TOGETHER IN HILARITY. https://twitter.com/...
@reckless Nilay Patel on x
Exclusive! Apple's App Store fees are “highway robbery” and “unconscionable,” House antitrust committee chairman @davidcicilline tells me in a Vergecast conversation with @dhh: https://www.theverge.com/...
@dhh @dhh on x
It was an absolute honor to discuss Apple's App Store abuses and antitrust violations with @RepCicilline on @verge's podcast this morning. Thank you so much to @reckless, @caseynewton, and @backlon for hosting, and the great questions. This episode is going to be 🔥🔥🔥
@backlon Dieter Bohn on x
It's no surprise to see 🔥 from @dhh, but @davidcicilline is also very 🔥 in this interview with @reckless . Straight up calls Apple a “monopolist” several times: https://www.theverge.com/... https://twitter.com/...
@reckless Nilay Patel on x
Here's the clip of @davidcicilline telling me the App Store fees are so high they constitute “highway robbery”, full transcript and podcast here: https://www.theverge.com/... https://twitter.com/...
@chillmage @chillmage on x
One problem with flat rates for platform access, whether it's Apple's App Store, or Steam, is that they imply the absence of a market. There's no way Apple is providing value to developers equal to a 30% fee of revenue in every case. https://www.theverge.com/...
@reckless Nilay Patel on x
I'm looking at Apple's letter rejecting Hey and what the head of the House antitrust committee is saying about Apple and... you can see why Tim Cook isn't eager to testify. https://twitter.com/...
@lutherlowe Luther Lowe on x
👀👀👀 It appears @davidcicilline the Chairman of the House Antitrust Subcommittee may be into the idea of sending a subpoena to Larry Page https://www.theverge.com/... https://twitter.com/...
@rsg Bobby Goodlatte on x
Prediction: Apple caves on this, possibly within the month. Kudos to Basecamp for fighting this battle. Victory would help thousands of startups. https://twitter.com/...
@markhurst Mark Hurst on x
This is a fantastic interview by @reckless on @verge. I experienced my own shakedown from Apple years ago, for my @good_todo app, which forced me to raise prices on users in order to pay Apple's 30% ransom. Apple has contempt for users AND developers. https://www.theverge.com/...
@dhh @dhh on x
You really need to listen to @RepCicilline on this firestorm of a @verge podcast. I really hope that @apple is listening as well. https://www.theverge.com/...
@drbarnard David Barnard on x
🤦🏼‍♂ ️ This kind of hyperbolic coverage is muddling the conversation. It's not “highway robbery” for Apple to profit from a platform they built and nurtured for over a decade now. Developers aren't entitled to free, easy access to ~1B consumers. https://twitter.com/...
@stroughtonsmith Steve Troughton-Smith on x
You could see this antitrust stuff coming from a mile away, but not only did Apple sleepwalk towards it, they doubled down on making sure there would be a mountain of evidence to bury them with. It's going to hurt them so much more than doing the right thing in the first place ht…
@backlon Dieter Bohn on x
If the chair of the House Antitrust Committee calls you a bully and compares you to a railroad robber baron, well, then you are having the same kind of day that Apple is right now. Vergecast bonus episode: https://www.theverge.com/... https://twitter.com/...
@benedictevans Benedict Evans on x
The funny thing about this App Store thing is that absolutely nobody has said anything that people didn't say a decade ago. The only thing that's changed is that Apple is now big enough to be firmly in the anti-trust crosshairs

Chronicles