A hot potato: Epic’s fight with Apple to force it to use its payment system is basically about getting out of paying App Store commissions. As such, the case has prompted several regulators to pass laws that force Big Tech giants like Apple and Google to allow payments outside of the platform. The problem is, efforts have only pushed up prices for consumers and haven’t stopped Apple or Google from collecting their dues.
On Thursday, Apple announced that it would allow South Korean app makers to use third-party payment platforms. The move complies with the recently introduced and swiftly passed legislation in the country. Google also changed its payment guidelines after Korean officials passed the law last November. However, the changes come with some caveats that are likely to affect both customers and developers.
First, third-party payment platforms must be approved by Apple. There are currently only four service providers that developers can use: KCP, Inicis, Toss, and NICE. Apple has set up an approval request page on its developer website. Cupertino will review and authorize the services on a case-by-case basis.
South Korea ignored all the noise about the Apple-Google duopoly that is overwhelmingly powerful, passed a law and now people can buy things in apps without having to pay app store taxes.https://t.co/xPvez47uv4
— Vlad Savov (@vladsavov) June 30, 2022
Second, Apple takes no responsibility for any issues, refunds, or other issues related to the use of any third-party service. If customers have to resolve an issue, it’s left between them, the developer, and the payment provider, which can be a pain for everyone involved. Customers also won’t be able to use Apple-focused services like Family Sharing and Ask to Buy for parental controls.
Finally, while lawmakers intended to untie developers from Big Tech’s payment ecosystems, this comes at a price. The rule does not exempt the developer from paying the Apple Tax. Instead, Apple charges a reduced rate of 26 percent on all transactions. The reduced rate is in line with what Google did with the Play Store, the ramifications of which have already been revealed.
Developers using payment methods outside of Google Play have passed on the additional costs for apps and subscriptions to Korean Android consumers. Dutch dating app makers discovered the same situation with a similar Dutch law. There is no logical reason to believe that this will be any different for Korean Apple users.