Apple agreed to pay $100 million and tweak one of its App Store rules to settle a lawsuit with app developers on Thursday, eliminating another legal issue for the company around rights control mobile applications.
As part of the deal, Apple said it would create a $100 million fund to pay developers of small apps and allow developers to instruct customers via email how to pay for third-party services. outside of Apple’s payment system; that way, developers can avoid Apple’s commission for selling apps. Apple also agreed not to increase its commission rate for small developers, which fell last year from 30% to 15% for at least three years.
The deal appears to be a small price to pay for the world’s richest company to avoid another protracted legal battle that could pose a huge risk to their business by targeting iPhone App. Store.
Apple is awaiting a ruling from a federal judge in a separate lawsuit by Epic Games, maker of the popular Fortnite game, that seeks to force Apple to allow app developers to avoid App Store commissions entirely. . Consumers have also sued Apple over their app commissions, in a case that the US Supreme Court has allowed to move to federal court and is seeking class action status.
In a press conference with reporters, an Apple executive said Thursday’s deal shows that small app developers are mostly fine with maintaining the current App Store policies, including commission reduction. However, larger developers, paying higher rates, continue to complain.
She also said that Apple’s willingness to allow developers to tell customers about alternative payment methods via email and other channels is a big concession. App developers will still be prohibited from telling customers inside their iPhone apps about other ways of paying.
Apple has restricted reporters from naming the Apple executive or citing her directly.
Steve Berman, the attorney for the plaintiffs in the lawsuit, who requested class-action status, said, “We are truly proud that a lawsuit brought by two developers, stands on behalf of tens of thousands of people. US iOS developer, launched, can help bring about a lot of important changes. “
In the agreement, Apple also agreed to publish an annual report on the number of apps it rejects or removes from the App Store, as well as data on its search results. The New York Times reported in 2019 that Apple was prioritizing its own apps over competitors in search results. Apple agreed in the deal to ensure that its search results “will continue to be based on objective characteristics” for at least another three years.
The settlement must be approved by judge Yvonne Gonzalez Rogers of California’s Northern District Court, the same judge who is presiding over Epic Games and the consumer lawsuits against Apple.
Developers earning less than $1 million per year in the App Store between June 2015 and April 2021 are eligible to receive payments of $250 to $30,000 each from the $100 million fund. proposed by Apple, according to the plaintiff’s attorney.
Separately on Thursday, Apple said it would also allow news organizations to pay a 15% reduced commission on subscriptions sold through their iPhone apps, but only if they participate in the service. Apple’s news service, Apple News. The Times and several other news organizations have pulled out of Apple News in recent years because they say it has controlled their relationships with readers and potential subscribers.