The author does not seem to understand the difference between Apple Pay (incorrectly spelled as "ApplePay") and in-app purchases, or at least incorrectly assumes both to be called "Apple Pay". This makes the article basically impossible to understand to anyone not noticing that subtlety.
In fact, the actual Apple Pay is considered by Apple to be just another form of third-party payments for apps that sell "in-app-purchase like things" (i.e. prohibited by default, begrudgingly allowed where local law prohibits that limitation).
Apple Pay is Apple's payment card wallet, with Apple completely out of the loop for the actual payment, and there's no extra cost on top of the card payment to the merchant.
"In-app purchases" are a "merchant of record" solution where Apple acts as an intermediary between app vendor and buyer. They handle taxation, refunds, promotion etc., and take a generous cut for that service.
Merchant-of-record solutions have their use case (not everybody wants to deal with local taxation, for example!); what many people are mad about is that Apple generally has a rule that says "you must use ours if you're selling "digital goods" unless you're on a short list of exemptions".
This article, as far as I can tell, is trying to make the argument that Apple ought to allow competition between their merchant-of-record solution, other merchant-of-record solutions, and apps directly acting as the merchant, and I largely agree; I just wish it made that point more legibly.
> Would the EU allow Visa or Mastercard to impose such exclusion rules on merchants who want to accept their credit cards? Definitely not.
I mean Costco has been doing this for many years and people seem ok with it? It's somewhat annoying but I get enough value out of Costco that myself and I think many are happy with the tradeoff.
I am the author of the article.
The EU wanted to increase competition by allowing Alternative Payments, thus Apple had to change its rules.
I shortened the term "App Store In‑App Purchase system" for "purchase of digital goods or services" for "developers with apps in the European Union" (==> doesn't apply to the rest of the world, and it doesn't apply when you sell physical goods) to `ApplePay`, because nobody except developers has ever heard of the long term.
If Apple's new rules would be accepted by the EU, the result is that the EU consumer either can (continue to) use the payment system linked to their Apple account to pay for e.g. some outfit in a game like they did the last 15 years, or they can't anymore because the developer chose a 3rd party payment system (e.g. Taler) and is no longer allowed to offer that.
If you think the use of "ApplePay" is confusing, please suggest another short term we should use in the article instead. What about "Apple payments"?
(Demanding all shops in the mall use only 1 payment card (e.g. Costco) is illegal in the EU - except if you don't pay individually in the shops but only once when you leave the mall, since then you are (legally) paying a single merchant (Costco) who of course can decide which cards to accept. But for my airport analogy the customer is paying in the shop/app and not in the mall/AppStore.)
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[ 3.4 ms ] story [ 25.4 ms ] threadBasically every app I have on my phone that takes payments from me accepts ApplePay and also credit cards.
In fact, the actual Apple Pay is considered by Apple to be just another form of third-party payments for apps that sell "in-app-purchase like things" (i.e. prohibited by default, begrudgingly allowed where local law prohibits that limitation).
Apple Pay is Apple's payment card wallet, with Apple completely out of the loop for the actual payment, and there's no extra cost on top of the card payment to the merchant.
"In-app purchases" are a "merchant of record" solution where Apple acts as an intermediary between app vendor and buyer. They handle taxation, refunds, promotion etc., and take a generous cut for that service.
Merchant-of-record solutions have their use case (not everybody wants to deal with local taxation, for example!); what many people are mad about is that Apple generally has a rule that says "you must use ours if you're selling "digital goods" unless you're on a short list of exemptions".
This article, as far as I can tell, is trying to make the argument that Apple ought to allow competition between their merchant-of-record solution, other merchant-of-record solutions, and apps directly acting as the merchant, and I largely agree; I just wish it made that point more legibly.
I mean Costco has been doing this for many years and people seem ok with it? It's somewhat annoying but I get enough value out of Costco that myself and I think many are happy with the tradeoff.
- $ from hardware sales
- $ from developer(s) per year
- % cut from App Store listing
- % cut from IAPs
- very small % cut/recapture from web of fees imposed by banks/cc/debit networks via Apple Pay
They are very motivated to keep all parties within their Apple wall.
If Apple's new rules would be accepted by the EU, the result is that the EU consumer either can (continue to) use the payment system linked to their Apple account to pay for e.g. some outfit in a game like they did the last 15 years, or they can't anymore because the developer chose a 3rd party payment system (e.g. Taler) and is no longer allowed to offer that.
If you think the use of "ApplePay" is confusing, please suggest another short term we should use in the article instead. What about "Apple payments"?
(Demanding all shops in the mall use only 1 payment card (e.g. Costco) is illegal in the EU - except if you don't pay individually in the shops but only once when you leave the mall, since then you are (legally) paying a single merchant (Costco) who of course can decide which cards to accept. But for my airport analogy the customer is paying in the shop/app and not in the mall/AppStore.)