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May 19, 2024

Apple Agrees to App Store Changes in Europe to Comply with Antitrust Rules

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Jan 17, 2024

Apple has agreed to make major changes to the App Store in Europe by March 2024 to comply with new EU antitrust rules. The company will introduce sideloading and alternate app stores for iPhones and iPads, while splitting the existing App Store into separate stores for Europe and the rest of the world.

Background on EU Antitrust Investigation

The EU has been investigating Apple over anti-competitive practices with the App Store for several years. A key complaint was that Apple forces developers to use the App Store to distribute iOS apps, taking a 30% commission on sales.

In December 2022, the EU’s Digital Markets Act (DMA) was approved, with rules targeting big tech companies like Apple. The DMA designated the App Store as a “core platform service”, meaning Apple would have to open iOS up to alternative stores and sideloading.

Initially, Apple disputed these rules, claiming it runs five different App Stores across platforms. However, EU antitrust chief Margrethe Vestager insisted the iOS App Store specifically counts under the new regulations.

Move to Enable Sideloading in Europe

With a deadline of March 7th 2024 to comply with the DMA, Apple has decided to make changes to allow sideloading on iPhones and iPads for users in Europe.

Sideloading means allowing apps to be installed outside the official App Store via third party stores or directly downloading files. This gives users and developers more choice in how apps are obtained.

Specifically, reports indicate that in the “coming weeks” Apple will:

  • Split the iOS App Store into two versions – one for Europe subject to DMA rules, and a global store.
  • Enable sideloading on the European App Store before the March 7th deadline.
  • Implement an alternate “StoreKit” API to allow third party payment systems.

This will likely occur in March with the release of iOS 17.1, according to insider sources.

The move shows Apple acquiescing to EU demands after fighting them for so long. Allowing sideloading has been seen as opening a “Pandora’s box” that could impact iPhone security and user privacy.

But with fines of up to 10% of annual turnover possible for DMA violations, Apple had little choice other than making App Store concessions.

What Sideloading Means for Users

Once implemented, the changes will allow European iOS users to install apps from third party app stores, bypassing Apple’s review process and payment system.

Apple will still take its standard 30% commission from apps downloaded from the official App Store. But developers can avoid this by using alternate payment systems in their own or third party app stores accessible via sideloading.

The company has reportedly tried to limit sideloading to specifically approved app stores rather than allowing direct file downloads. However, this may fall foul of EU expectations.

Sideloading brings both benefits and risks to users:

Potential Benefits

  • More app choices beyond the App Store
  • Potentially cheaper apps without Apple’s commission
  • Innovation in areas banned by App Store rules

Potential Risks

  • Security issues if apps don’t go through App Store review
  • Quality control concerns with less oversight
  • Scams, malware and pirated IP in unchecked stores

Currently Apple only plans to make these changes in Europe to meet EU requirements. It’s unwilling to compromise the App Store model further than necessary.

But if the moves prove successful, expanded sideloading could happen in other markets like the US and Asia down the track.

What Happens Next

With Apple likely enabling sideloading imminent, developers are preparing third party app stores specifically for iOS. These will take advantage of the DMA rules to avoid Apple’s fees and restrictions.

For example, popular game storefront Steam announced back in 2020 it would launch on iOS with sideloading enabled. Epic Games also intends to revive Fortnite on iPhones using its own store when alternative payment systems are available.

In response, Apple is shoring up iOS security to protect users in this more open landscape. Updates like asking permission before allowing sideloaded apps to access personal data will be crucial.

Longer term, Apple needs to adapt its services revenue as commissions fall. It may expand offerings for users and developers to incentivise staying in the main App Store. Succeeding in both EU and global app markets simultaneously will be a challenge.

Competitors like Google and Microsoft face similar sideloading decisions in Europe. How Apple fares may dictate the direction they take. Either way, the days of walled gardens dominating mobile ecosystems look to be ending.

Apple and EU Antitrust Timeline

Below is a timeline of key events in Apple’s antitrust issues with the EU regarding the App Store:

Date Event
June 2020 EU begins formal antitrust investigation into App Store rules
December 2022 EU Digital Markets Act introduced designating App Store as core service
January 2023 Apple appeals designation, claims operates 5 separate stores
Mid January 2024 Reports emerge of plans to split App Store and allow sideloading complying with DMA
March 2024 Expected iOS 17.1 update enables sideloading in Europe before March 7 deadline

This story shows how Apple is being forced to make concessions on its closed iOS ecosystem under pressure from EU antitrust regulators. Allowing sideloading and alternate app stores in Europe represents a seismic shift in Apple’s business model. There are still questions around how exactly the changes will work and their impact. But they underline how big tech power is being reined in by governments to promote competition. We’re set for a very different app landscape for iPhones and iPads in Europe as a result.

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AiBot scans breaking news and distills multiple news articles into a concise, easy-to-understand summary which reads just like a news story, saving users time while keeping them well-informed.

To err is human, but AI does it too. Whilst factual data is used in the production of these articles, the content is written entirely by AI. Double check any facts you intend to rely on with another source.

By AiBot

AiBot scans breaking news and distills multiple news articles into a concise, easy-to-understand summary which reads just like a news story, saving users time while keeping them well-informed.

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