January 26, 2024 – In a recent commentary, J.P. Morgan has stated that Apple’s newly implemented fee structure in Europe is unlikely to have a significant impact on the overall revenue of the App Store.
To comply with the Digital Market Act (DMA), Apple has altered its business practices in the European Union, reducing its overall commission from 30% to 17%. However, for applications with over 1 million installations, the company will now charge an additional fee of 0.5 euros per “first-time installation.”
In an investment memo, J.P. Morgan noted that the revenue impact of these new regulations on Apple is minimal. Europe only accounts for approximately 6% of the App Store’s income, and the additional 0.5 euros charged per first-time installation is expected to offset the reduction in commission rates.
It’s important to note that Apple has emphasized that these new regulations are exclusive to the European market. Nevertheless, regulatory bodies worldwide may follow the EU’s lead and mandate similar arrangements. For instance, the United States has already ramped up its efforts, planning an antitrust investigation into Apple’s App Store practices.