New iPhone Software Update May Allow More Third-Party Apps and Change in App Commission
The next major iOS release, iOS 17.4, is expected in early March. It offers many new features, including an update to the recently released Stolen Device Protection. The new update may also open up iPhones to third-party influences creating a more open ecosystem and also alters commission fees for developers. Although the changes are targeted to EU users for now, it raises questions about the implications and whether users outside the EU will also be affected.
According to Mark Gurman's Power On newsletter on Bloomberg, the upcoming update represents a sweeping overhaul of the iPhone's software. While the impact is currently limited to iOS, the App Store, and the Safari browser in the EU, Gurman believes that this is just the beginning. He states, "It's a peek at the future of the platform and one that the company will likely have to adopt globally."
Essentially, these changes pave the way for rival app marketplaces to coexist and alter Apple's commission fees for app developers. While some users may welcome the increased variety in app providers and web browsers, Apple has expressed concerns about potential security risks associated with the new system.
Gurman highlights that these changes will not only impact Apple's bottom line but also raise questions about iPhone security and privacy – two aspects that Apple takes very seriously. In response, Apple is introducing a range of new anti-malware tools and warnings for consumers and developers. Additionally, apps downloaded from outside the App Store will undergo a light review process and notarisation.
For developers considering a move from the App Store to rival marketplaces, Apple has outlined a deal that offers significant cost savings by reducing commission levels. However, for those who choose an alternative route, Apple will experience reduced revenue and plans to offset this with new fees, such as the Core Technology Fee, which requires payments for each app installation.
While the individual fee may seem low at US$0.54 or 0.5€, and only applies after the first million installations, it can add up over time. Gurman points out that this fee seems specifically designed to target large developers like Spotify and Meta, who offer their apps for free.
The new EU's Digital Marketplace Act has forces Apple to open up it's IOS ecosystem, and this shift could potentially impact iPhone users, not just in the EU but worldwide.
EU users will experience a more open iPhone ecosystem
Rival app marketplaces and altered commission fees for developers
Changes may affect worldwide users
Source: FORBES