Apple App Store to Fully Allow External Payments

Final Verdict on Apple vs. Epic Games Antitrust Lawsuit
Apple's Restriction to In-App Payment System Deemed Problematic
Increase Expected in Apps Developing Own Payment Methods
Google Recently Lost Similar Lawsuit and Is Appealing

From now on, external payments on the app stores operated by Apple will be fully permitted. Application (app) developers listed on the app store will be able to encourage users to make payments using methods cheaper than the in-app payment system. Until now, Apple has mandated the use of its in-app payment system within the app store and charged a commission of about 30% to app developers.

On the 16th (local time), the U.S. Supreme Court announced that it had dismissed appeals filed by both Apple and Epic Games regarding payment methods on the iPhone app store. As a result, the lower court ruling from April last year remains in effect. The ruling's essence is that while Apple's app store policy does not violate antitrust laws, Apple's refusal to allow other payment methods outside the app store constitutes a violation of fair competition.

The lawsuit between Apple and Epic Games dates back to 2020.

Apple required app developers to adopt the app store's in-app payment system and collected about 30% of transaction amounts as commission. In response, Epic Games built its own payment system to avoid paying the commission, and Apple removed Epic Games' Fortnite from the app store. Subsequently, Epic Games filed an antitrust lawsuit against Apple.

The first and second trials ruled that Apple did not violate antitrust laws but judged that not allowing payment systems outside the app store restricted market competition. Both Apple and Epic Games appealed, but with the Supreme Court's dismissal on this day, other payment systems outside the app store are now possible.

This ruling is expected to lead to an increase in game app developers encouraging users to make content payments at prices much lower than those within the app store. Since 2022, Apple has allowed external link payments only for some subscription-based apps like Netflix and Spotify but did not permit this for highly profitable game apps. Epic Games CEO Tim Sweeney wrote on X (formerly Twitter), "From today, developers can inform U.S. customers of better prices on the web."

According to research firm Sensor Tower, user spending within the app store is estimated to reach $182 billion this year and $207 billion by 2025. Bloomberg News analyzed that this ruling will impact Apple's revenue, which amounts to tens of billions of dollars. On the day of the ruling, Apple's stock closed at 183.63, down 1.23% from the previous day. Apple's stock has fallen 4.6% so far this year.

Meanwhile, Epic Games won the first trial last month in a lawsuit against Google, which operates a payment system similar to Apple's. It was revealed that Google distributed commissions to smartphone manufacturers and major game developers to edge out competing app stores. Google has appealed the first trial ruling and stated it will maintain its business model as is.

The Wall Street Journal (WSJ) reported, "There is debate over the long-term impact on Apple and Google due to changes in app store policies following the court ruling." If app developers within the app store encourage external payments at lower prices, Apple and Google could suffer significant damage, but many users may be more accustomed to the existing app store payment environment.