September 04, 2024 – The Competition and Markets Authority (CMA) in the UK has recently released responses received from various technology companies following its market investigation into the supply of mobile browsers and cloud gaming in the country. Among these responses, Microsoft has strongly criticized Apple for charging a 30% fee on in-app purchases made by users.
Apple has long defended its practice of taking a 30% cut from apps and in-app purchases, arguing that it is necessary to maintain infrastructure and enhance the discoverability of developers’ apps. However, Microsoft has taken a dim view of this approach, stating that Apple contributes nothing to app purchases, discoverability, or accessibility when it comes to in-app transactions.
According to Microsoft, Apple’s in-app purchase commission is “both economically unsustainable and unreasonable.” The company claims that due to Apple’s rules, which prohibit charging iPhone users additional fees to offset the 30% commission, its cloud gaming service cannot achieve profitability on iOS.
It’s worth noting that Microsoft has also cited findings from the CMA’s Mobile Ecosystem Market Study (page 82), which suggest that Apple’s 30% fee is a result of the lack of competition in native iOS app distribution. In most markets, Apple does not allow sideloading of apps or installations from third-party app stores, which contrasts sharply with Google’s approach that enables users to utilize third-party app stores and sideload apps.
The next deadline for the investigation is set for November, when the CMA is expected to release an interim decision report. Before the final report is published in March 2025, interested parties will have the opportunity to respond to the interim findings.
