Facebook Strikes Deal to Skirt Apple's App Store Commission -- Update

By Sarah E. Needleman 

Apple Inc. said it is giving some businesses a reprieve from paying a 30% commission on paid events and experiences through mobile apps, a move that comes as the App Store owner faces scrutiny from software developers and regulators over how its digital marketplace operates.

The announcement Friday follows Facebook Inc. confirming that Apple approved its request to exempt businesses hosting live online events through its app from being required to pay a cut of sales to Apple.

Apple's exemption, which will last until the end of the year, is significant because it doesn't normally allow app developers to process payments for in-app purchases themselves or use third-party services, saying those alternative platforms could pose security risks.

The technology company instead makes developers use its own payment system and takes a 30% cut of sales from paid apps and in-app purchases, as well as from digital subscriptions in the first year. Apple has said that amount is in line with what most other app marketplaces charge and helps cover the cost of store services it provides, such as user privacy.

An Apple spokesman said the move is a recognition that some app developers, including home-rental company Airbnb Inc., have expressed interest in selling online experiences as the pandemic halted many in-person gatherings and events. He said Apple will closely monitor any customer issues and contact developers to quickly and decisively resolve any that arise.

"To ensure every developer can create and grow a successful business, Apple maintains a clear, consistent set of guidelines that apply equally to everyone," the company said.

Write to Sarah E. Needleman at [e-mail]

(END) Dow Jones Newswires

September 25, 2020 14:17 ET (18:17 GMT)

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