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Apple Pay and iOS App Store under formal antitrust probe in Europe
Apple is under formal investigation by antitrust regulators in European Union — following a number of complaints related to how it operates the iOS App Store and also its payment offering, Apple Pay.
The Commission said today that it has concerns that conditions and restrictions applied by the tech giant may be distorting competition in a number of areas, following a preliminary probe of the issues.
Back in March 2019, European music streaming service Spotify filed an antitrust complaint against Apple — railing very publicly against what it dubbed an “Apple tax”; aka the 30% tariff the tech giant applies on accepting payments in apps on its App Store. Spotify also accused Apple of impeding its business by applying arbitrary rules — such as making it harder to offer its own users discounts.
The Commission confirmed today that it’s looking formally into whether Apple’s rules for app developers on the distribution of apps via the App Store violate EU competition rules. It said the probe focuses on Apple’s mandatory requirement that app developers use its own proprietary in-app purchase system, as well as restrictions applied on the ability of developers to inform iPhone and iPad users of alternative cheaper purchasing possibilities outside of apps.
As well as the very public complaint from Spotify, the Commission has received a similar complaint from an unnamed e-book/audiobook distributor related to the impact of the App Store rules on competition.
Two specific restrictions imposed by Apple in its agreements with companies that wish to distribute apps to users of Apple devices will be investigated, per the Commission — namely [emphasis its]:
(i) The mandatory use of Apple’s own proprietary in-app purchase system “IAP” for the distribution of paid digital content. Apple charges app developers a 30% commission on all subscription fees through IAP.
(ii) Restrictions on the ability of developers to inform users of alternative purchasing possibilities outside of apps. While Apple allows users to consume content such as music, e-books and audiobooks purchased elsewhere (e.g. on the website of the app developer) also in the app, its rules prevent developers from informing users about such purchasing possibilities, which are usually cheaper.
“Following a preliminary investigation the Commission has concerns that Apple’s restrictions may distort competition for music streaming services on Apple’s devices,” it writes in a press release. “Apple’s competitors have either decided to disable the in-app subscription possibility altogether or have raised their subscription prices in the app and passed on Apple’s fee to consumers.
“In both cases, they were not allowed to inform users about alternative subscription possibilities outside of the app. The IAP obligation also appears to give Apple full control over the relationship with customers of its competitors subscribing in the app, thus dis-intermediating its competitors from important customer data while Apple may obtain valuable data about the activities and offers of its competitors.”
Commenting in a statement, Commission EVP Margrethe Vestager — who heads up competition policy for the bloc — added: “Mobile applications have fundamentally changed the way we access content. Apple sets the rules for the distribution of apps to users of iPhones and iPads. It appears that Apple obtained a ‘gatekeeper’ role when it comes to the distribution of apps and content to users of Apple’s popular devices. We need to ensure that Apple’s rules do not distort competition in markets where Apple is competing with other app developers, for example with its music streaming service Apple Music or with Apple Books. I have therefore decided to take a close look at Apple’s App Store rules and their compliance with EU competition rules.”
Vestager’s reference to a “gatekeeper” role has specific significance as the Commission is currently consulting on updating regulations for digital platforms — including floating the possibility of ex ante regulation for platforms deemed to be gatekeepers vis-a-vis other suppliers. (In parallel, the Commission is consulting on updates to competition law that may allow it to intervene more swiftly in future, in instances where it suspects digital markets have ‘tipped’.)
Spotify welcomed the Commission’s action, writing in a statement:
Today is a good day for consumers, Spotify and other app developers across Europe and around the world. Apple’s anticompetitive behavior has intentionally disadvantaged competitors, created an unlevel playing field, and deprived consumers of meaningful choice for far too long. We welcome the European Commission’s decision to formally investigate Apple, and hope they’ll act with urgency to ensure fair competition on the iOS platform for all participants in the digital economy.
On Apple Pay, the Commission said a formal investigation of how it operates the payment tech will look at the “terms, conditions and other measures” Apple applies for integrating the payment solution in merchant apps and websites on iPhones and iPads; Apple’s limitation of access to the NFC functionality on iPhones for payments in stores; and allegations of “refusals of access to Apple Pay”.
Following a preliminary probe, the Commission said it is concerned Apple’s processes “may distort competition and reduce choice and innovation”.
It also notes that Apple Pay is the only mobile payment solution that is allowed to access NFC technology on iOS devices for making payments in stores.
“The investigation will also focus on alleged restrictions of access to Apple Pay for specific products of rivals on iOS and iPadOS smart mobile devices,” it added.
The Commission said it will carry out the investigations “as a matter of priority”, but there’s no set timeframe for how long this process might take.
EU antitrust investigations have tended to take a number of years from an announcement of a formal probe to a decision being reached. (Although, in an ongoing investigation against Broadcom, Vestager recently dusted off a tool to accelerate regulatory intervention — but as yet there’s no formal ‘statement of objections’ against Apple so it remains to be seen how this case will proceed, and whether regulators may seek to speed up any intervention.)
Reached for comment on the Commission’s announcement of the two antitrust investigations, Apple dubbed the complaints “baseless” — choosing to throw shade on the complainants by claiming these companies are after “a free ride, and don’t want to play by the same rules as everyone else”.
Here’s Apple’s statement on the two investigations in full:
Throughout our history, Apple has created groundbreaking new products and services in some of the most fiercely competitive markets in the world. We follow the law in everything we do and we embrace competition at every stage because we believe it pushes us to deliver even better results.
We developed the App Store with two goals in mind: that it be a safe and trusted place for customers to discover and download apps, and a great business opportunity for entrepreneurs and developers. We’re deeply proud of the countless developers who’ve innovated and found success through our platform. And as we’ve grown together, we’ve continued to deliver innovative new services — like Apple Pay — that provide the very best customer experience while meeting industry-leading standards for privacy and security.
It’s disappointing the European Commission is advancing baseless complaints from a handful of companies who simply want a free ride, and don’t want to play by the same rules as everyone else. We don’t think that’s right — we want to maintain a level playing field where anyone with determination and a great idea can succeed.
At the end of the day, our goal is simple: for our customers to have access to the best app or service of their choice, in a safe and secure environment. We welcome the opportunity to show the European Commission all we’ve done to make that goal a reality.
Apple has had a number of run-ins with EU regulators over the years — including a probe of its acquisition of Shazam (which was later cleared); a major investigation of ebook pricing; and a probe of tax benefits in Ireland which saw it on the hook for $15BN.
French competition regulators also recently fined the tech giant $1.2BN for anti-competitive sales tactics. It’s also been fined $27M by French regulators this year for throttling old iPhones.
This report was updated with comment from Spotify
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This Week in Apps: WWDC goes online, coronavirus leads to more cancellations, sneaky spy apps exposed
Welcome back to This Week in Apps, the Extra Crunch series that recaps the latest OS news, the applications they support and the money that flows through it all.
The app industry is as hot as ever, with a record 204 billion downloads in 2019 and $120 billion in consumer spending in 2019, according to App Annie’s recently released “State of Mobile” annual report. People are now spending 3 hours and 40 minutes per day using apps, rivaling TV. Apps aren’t just a way to pass idle hours — they’re a big business. In 2019, mobile-first companies had a combined $544 billion valuation, 6.5x higher than those without a mobile focus.
In this Extra Crunch series, we help you keep up with the latest news from the world of apps, delivered on a weekly basis.
This week we’re taking a look at several stories related to the coronavirus outbreak, including the cancellation of WWDC in San Jose, as well as other app industry events that are going online. We’re also discussing the iOS 14 leak, the exposure of Sensor Tower’s app network, a potential ban on TikTok for government workers and more.
Coronavirus Special Coverage
The impacts of the COVID-19 pandemic are continuing to play out on app stores and across the industry. This week, we’re leading with these stories followed by the other — and yes, still important — news.
Apple finally cancels its WWDC event in San Jose
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This Week in Apps: Google I/O canceled over coronavirus, App Store gets updated rules, TikTok’s owner launches Spotify rival
Welcome back to This Week in Apps, the Extra Crunch series that recaps the latest OS news, the applications they support and the money that flows through it all.
The app industry is as hot as ever, with a record 204 billion downloads in 2019 and $120 billion in consumer spending in 2019, according to App Annie’s recently released “State of Mobile” annual report. People are now spending 3 hours and 40 minutes per day using apps, rivaling TV. Apps aren’t just a way to pass idle hours — they’re a big business. In 2019, mobile-first companies had a combined $544 billion valuation, 6.5x higher than those without a mobile focus.
In this Extra Crunch series, we help you keep up with the latest news from the world of apps, delivered on a weekly basis.
This week, we’re looking at the further impact of the coronavirus on the app industry, which is now leading to more major event cancellations — including, as of this week, Google I/O and SXSW. That begs the question, will WWDC be next? And what will that mean for developers who rely on the annual event to make those invaluable face-to-face connections? We’re also looking at the revised App Store review guidelines and what that means for developers, as well as Walmart’s plan to dramatically change its app strategy, Robinhood’s bad week, the launch of a new Spotify competitor from the makers of the world’s most viral app, TikTok and much more.
Headlines
Apple changes the rules
Apple this week alerted developers to a new set of App Store review guidelines that detail which apps will be accepted or rejected, and what apps are allowed to do. The changes to the guidelines impact reviews, push notifications, Sign in with Apple, data collection and storage, mobile device management and more, the company says. Some of the more high-profile changes include the ability for apps to now use notifications for ads, stricter rules for dating and fortune-telling apps and a new rule that allows Apple to reject apps that help users evade law enforcement, among other things.
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App Store Guidelines ban police-spotting apps, raise bar on dating apps and more
Apple this week alerted developers to a new set of App Store Review Guidelines that detail which apps will be accepted or rejected, and what apps are allowed to do. The changes to the guidelines impact reviews, push notifications, Sign in with Apple, data collection and storage, mobile device management and more, the company says. Some of the more high-profile changes include the ability for apps to now use notifications for ads, stricter rules for dating and fortune-telling apps and a new rule that allows Apple to reject apps that help users evade law enforcement, among other things.
This latter change to police-spotting apps, surprisingly, didn’t get as much attention as push ads or changes to dating apps — though it’s among the most notable of the new rules.
A previous version of the App Store Review Guidelines (seen in a snapshot here from January 2020) stated that apps could only display DUI checkpoints that were published by law enforcement agencies, and noted that apps shouldn’t encourage activities like “drunk driving” or “excessive speed.” These were reasonable concerns.
The revised rule (section 1.4.4.) now says that Apple will reject apps “used to commit or attempt to commit crimes of any kind by helping users evade law enforcement,” in addition to the existing language.
As you may recall, Apple last year got into hot water over its decision to reject a crowdsourced mapping app, HKmap, that was being used by Hong Kong pro-democracy protestors to evade police. Initially, the app had been approved, but was pulled a day after Apple was criticized by Chinese state media who said the app allowed “rioters…to go on violent acts.”
The app had allowed users to crowdsource information like the location of police, the use of tear gas and other details about the protests, which were added to a regularly updated map. In a statement, Apple said it removed the app when it learned it was used to “target and ambush police.”
Above: Section 1.4.4, before and after
The new App Store Review Guidelines now put into writing Apple’s final decision over this sort of app. Effectively, it bans apps that help users evade law enforcement. Arguably, avoiding police isn’t always about wanting to “commit crimes,” as the guidelines state, however. Amnesty International, for example, documented cases of police brutality, including beatings and torture of people in police detention during the Hong Kong protests. The HKmap may have also allowed users to bypass police for their own safety.
Apple’s rule, therefore, is vague enough that it still allows the company itself to make the ultimate call over how an app is being used before deciding to reject or ban it.
Other worthy-of-note changes to the guidelines include an update (section 4.5.4) that allows app developers to send marketing messages (aka ads) in their push notifications. Before, these were banned. This change was immediately hit with user outcry, but it may not be as bad as it first seems.
Clearly, many apps were already spamming their users with ads, despite the prior ban. Now, they’re being required to get customer consent within their app’s user interface and to provide an opt-out mechanism in their app that lets users turn off the push notification ads. This change will at least force reviewers to look for mechanisms and opt-outs in apps offering in-app purchases or that rely on sales to generate revenues.
“Abuse of these services may result in revocation of your privileges,” Apple also warns.
Another change adds “fortune-telling” and “dating” apps to the list of apps that are considered spam if they’re not providing a “unique, high-quality” experience. The relevant section (4.3) warns developers about the app categories that Apple thinks are oversaturated, and where it will be more critical with its reviews.
The guidelines also now include a section (5.6.1) that instruct developers on how to respond to App Store reviews, reminding them to “treat customers with respect when responding to their comments” and not include irrelevant information, personal information, spam, and marketing in their messages. The section also notes that developers must use Apple’s own API to solicit reviews, instead of other mechanisms. This will allow users to toggle off App Store review prompts across all apps from the iOS settings. This language was in the guidelines before, but was moved to 5.6.1 from 1.1.7.
Finally, Apple reminded developers that all apps going forward, including app updates, will need to use the iOS 13 SDK as of April 30, 2020. Apps will need to support the “Sign in with Apple” login/sign-up option as of that date, too.
Correction, 2/5/20, 3:20 PM ET: Clarified that section 5.6.1 is actually a relocated section 1.1.7, instead of a new addition.
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This Week in Apps: YouTube TV cancels Apple’s rev share, more bad news for mobile voting, WhatsApp hits 2B users
Welcome back to This Week in Apps, the Extra Crunch series that recaps the latest OS news, the applications they support and the money that flows through it all.
The app industry is as hot as ever, with a record 204 billion downloads in 2019 and $120 billion in consumer spending in 2019, according to App Annie’s recently released “State of Mobile” annual report. People are now spending 3 hours and 40 minutes per day using apps, rivaling TV. Apps aren’t just a way to pass idle hours — they’re a big business. In 2019, mobile-first companies had a combined $544 billion valuation, 6.5x higher than those without a mobile focus.
In this Extra Crunch series, we help you keep up with the latest news from the world of apps, delivered on a weekly basis.
This week, we look at YouTube TV’s decision to stop revenue-sharing with Apple, another mobile voting app with serious flaws, new Apple launches in coding and AR, Microsoft’s game-streaming service Project xCloud arrival on iOS and other notable app news and trends, including WhatsApp’s big 2 billion user milestone, and more.
Headlines
YouTube TV fights back against Apple’s cut of in-app subscription revenue
This week, YouTube emailed customers subscribed to its YouTube TV service by way of Apple’s in-app purchases to let them know that this subscription offering will be discontinued starting on March 13, 2020. Current subscribers will have their subscription canceled automatically on their billing date after March 13, the letter said.
This is a pretty severe way for Google to end its subscription revenue-sharing with Apple, however. Most companies that decide to shut off in-app subscriptions still continue to honor those from existing subscribers — they just stop selling to new customers. In YouTube TV’s case, it’s actually ending its relationship with all its customers on Apple devices with the hope they’ll return and resubscribe. That’s quite a risk, given that YouTube TV is not the only streaming TV service out there, and customers getting their subscription canceled may take this opportunity to shop around. The timing is also poorly thought-out, given that YouTube TV just picked up new subs following Sony’s PlayStation Vue shutdown — and now it’s kicking them out.
The move makes Google the latest company to rebel against Apple’s 30% cut of all in-app payments (which drops to 15% in year two). A growing number of app publishers are refusing to share a cut of their revenue with Apple — even saying that Apple’s decision to charge this fee is anti-competitive. For example, Spotify believes Apple’s fee makes it more difficult to compete with Apple’s built-in music service, and has raised the issue repeatedly to regulators. Netflix also stopped paying the “Apple tax” over a year ago.
Mobile voting app Voatz, used by several states, was filled with security flaws
Above: Voatz, via The NYT
Last week, we looked at how a smartphone app meant to tabulate votes from the caucuses really screwed things up in Iowa. This week, MIT researchers took a look at mobile voting app Voatz, which has been used to tally votes for federal elections in parts of West Virginia, Oregon, Utah and Washington as part of various mobile voting pilot programs. The researchers found the app was riddled with security flaws that would let attackers monitor votes or even change ballots or block them without users’ knowledge. Attackers could also create a tainted paper trail, making a reliable audit impossible — despite Voatz’s promise of using blockchain technology to increase security. One security expert, speaking to VICE, called the app “sloppy” and filled with “elementary” mistakes.
Coming on the heels of the Iowa caucus mobile voting disaster, this latest news delivers another huge blow to the promise of mobile voting in the U.S.
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Apple and Google reveal the best apps and games of 2019
Continuing their annual tradition, Apple and Google have released their list of the best apps and games of 2019. Apple, for the first time, held a real-world event to celebrate its winners, where it crowned AI-powered camera app Spectre Camera as its best iPhone app of the year and Sky: Children of the Light as its best game. Google, meanwhile, dubbed video messaging app Ablo as its app winner and Call of Duty: Mobile as its best game.
Apple’s event held in New York put its winning developers in front of media in order to demonstrate their apps and games. The event was less formal than the Apple Design Awards held at the company’s worldwide developer conference each year, and instead focused on private presentations to press.
Apple said its winners this year sit “at the nexus of digital and pop culture,” but its list really better highlights what Apple thinks are the key selling features for its devices. For example, with Spectre Camera by Lux Optics, it’s about the iPhone’s ability to serve as your main camera even for complicated tasks like long-exposure photos.
The iPad app of the year was Flow by Moleskin, an app that already won a 2019 Design Award. In this case, the digital notebook app shows off a top iPad use case of being a device aimed at creative professionals. Users can take advantage of its digital graphite pencils and chisel-tipped markers to draw and sketch as they could in real life.
The Mac app of the year, Affinity Publisher by Serif Labs, allows users to design and publish books, magazines, brochures, posters and more — a task that best lends itself to a larger device with a full-sized keyboard.
Finally, the Apple TV app of the year, The Explorers by The Explorers Network, showcases something that works best on your TV’s larger, high-def screen. The app’s community of photographers and videographers are working together to create a visual inventory of the natural world, which you can enjoy on your big screen.
Apple’s iPhone Game of the Year, Sky: Children of the Light by thatgamecompany (makers of Journey, the 2013 Game of the Year), iPad Game of the Year Hyper Light Drifter by Abylight S.L. and Mac Game of the Year GRIS by Nomada Studio, are all the sort of beautifully designed games that Apple prefers to showcase.
Today’s gaming market has become over-filled with free-to-play titles due to the sort of supported business models that work on the App Store. That’s something Apple Arcade is an attempt to correct, in fact. Apple winners show that even free games can be works of art.
Sky: Children...is a free to play social adventure with in-app purchases, but is also beautiful and creative. Similarly, adventure game Hyper Light was already a visual arts award winner at the Independent Games Festival. And GRIS has been described as one of the most gorgeous games.
The Apple TV Game of the Year, Wonder Boy: The Dragon’s Trap by DotEmu, was developed by LizardCube with the cooperation of series creator Ryuichi Nishizawa to bring an ’80s cult classic back to life. That’s part of one of Apple’s larger App Store gaming trends — a year of “blockbusters reimagined.”
Apple also gave mention of other launches in this space, like Mario Kart Tour, Dr. Mario World, Minecraft Earth, Pokémon Masters, Assassin’s Creed Rebellion, Gears POP!, The Elder Scrolls: Blades, Alien: Blackout and Google’s Game of the Year, Call of Duty: Mobile.
And in what could be the start of a new tradition, Apple also anointed an Apple Arcade Game of the Year with the gorgeous, fast-paced and music-filled Sayonara Wild Hearts developed by Simogo and published by Annapurna Interactive.
Apple’s year-end list also highlighted App Store non-gaming trend of “Storytelling,” which featured a variety of apps to tell stories, including visually, as well as through audio and text. Noted apps here were Anchor, Canva, Unfold, Steller, Spark Camera, Over and Wattpad.
Google doesn’t go all-out as Apple does for its “Best of 2019” picks.
Instead, it simply featured best app Ablo and best game Call of Duty: Mobile as its editorial picks, then leaves the rest to a User’s Choice. Voters selected the same game, but gave the Best App award to a video editor, Glitch Video Effects.
Google’s full list also includes Google Play’s best e-books, audiobooks, TV shows and movies, which you can see here.
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This Week in Apps: Honey’s $4B exit, a new plan for iOS 14, Apple’s new developer resource
Welcome back to This Week in Apps, the Extra Crunch series that recaps the latest OS news, the applications they support, and the money that flows through it all. What are developers talking about? What do app publishers and marketers need to know? How are politics impacting the App Store and app businesses? And which apps are everyone using?
This week, we’re looking at several major stories, including the whopping $4 billion PayPal just spent on browser extension and mobile app maker, Honey, as well as the release of the Apple Developer app, a new plan for iOS 14, Google Stadia’s launch, AR gaming’s next big hit (or flop?), e-commerce app trends, Microsoft’s exit from voice assistant mobile apps, and so much more.
Plus, did you hear the one about the developer who got kicked out from his developer account by Apple, leaving his apps abandoned?
Headlines
Apple to overhaul iOS development strategy after buggy iOS 13 launch
Apple’s iOS 13 release was one of its worst, in terms of bugs and glitches. Now Apple is making an internal change to how it approaches software development in an effort to address the problem. According to Bloomberg, Apple’s Software chief Craig Federighi and other execs announced its plans at an internal meeting. The new process will involve having unfinished and buggy features disabled by default in daily builds. Testers will then have to optionally enable the features in order to try them. While this change focuses on making internal builds of the OS more usable (or “livable”), Apple hopes that over time it will improve the overall quality of its software as it will give testers the ability to really understand what’s supposed to now be working, but isn’t. The testing changes will also apply to iPadOS, watchOS, tvOS, and macOS, the report said.
Apple launches the Apple Developer App
Apple rebranded and expanded its existing WWDC app to become a new Apple Developer app that can stay with its 23 million registered developers year-round. Instead of only including information about the developer event itself, the app will expand to include other relevant resources — like technical and design articles, developer news and updates, videos and more. It also will offer a way for developers to enroll in the Apple Developer program and maintain their membership. Apple says it found many developers were more inclined to open an app than an email, and by centralizing this information in one place, it could more efficiently and seamlessly deliver new information and other resources to its community.
PayPal buys Honey for $4 billion
PayPal has made its biggest-ever acquisition for browser extension and mobile app maker, Honey. TechCrunch exclusively broke the news of the nearly all-cash deal, noting that Honey currently has 17 million monthly actives. But PayPal was interested in more than the user base — it wanted the tech. The company plans to insert itself ahead of the checkout screen by getting involved with the online shopping and research process, where customers visit sites and look for deals. Honey’s offer-finding features from its mobile app will also become part of PayPal and Venmo’s apps in the future.
Cloud gaming expands with Google Stadia launch
Cloud-based gaming could benefit from the growing investment in 5G. Google Stadia, which launched this week, is a big bet on 5G in that regard. Though the early reviews were middling, Google believes the next generation of gaming will involve continuous, cross-device play, including on mobile devices. This trend was already apparent with the successes of cross-platform games like Fortnite, Minecraft, Roblox, and PUBG, for example. Meanwhile, console makers like Microsoft are working to build out their own cloud infrastructure to compete. (Microsoft’s xCloud launches in May 2020.) Google could have a head start, even if Stadia today feels more like a beta than a finished product. But one question that still arises is whether Google is serious about gaming, or only sees Stadia as a content engine for YouTube?
Microsoft kills Cortana mobile apps
Microsoft this week belatedly realized it can’t compete with the built-in advantages that Siri and Google Assistant offer users, like dedicated buttons, hands-free voice commands, workflow building and more. The company decided to shut down its Cortana mobile applications on iOS and Android in a number of markets, including Great Britain, Australia, Germany, Mexico, China, Spain, Canada, and India. Any bets on when the U.S. makes that list?
SF Symbols expands
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This Week in Apps: Apple’s vaping app ban, Disney+ gets installed, apps gear up for Black Friday
Welcome back to This Week in Apps, the Extra Crunch series that recaps the latest OS news, the applications they support, and the money that flows through it all. What are developers talking about? What do app publishers and marketers need to know? How are politics impacting the App Store and app businesses? And which apps are everyone using?
As mid-November rolls around, we’re looking at a few big stories, including Apple’s decision to ban an entire category of apps due to health concerns, the launch of Disney+ from an app perspective, what Black Friday will mean for e-commerce apps, and more.
Fast Facts
With Disney+’s huge launch (10+ million users!) on everyone’s minds, it’s time to think about what these streaming newcomers mean for the overall landscape and the app stores. In this case, it seems that Disney+’s user base was highly mobile. The company itself announced more than 10 million users, while data on the Disney+ app’s first few days indicates it now has over 10 million downloads. It seems like consumers definitely want to take their new streaming service with them everywhere they go.
- In 2020, App Annie forecasts consumers will spend more than 674 billion hours in the Entertainment and Video Player and Editor categories worldwide on Android phones, up from an expected 558 billion hours in 2019. Thanks to Disney+, Apple TV+ and soon, HBO Max, Peacock and Quibi, to making the landscape both richer and more complicated.
- On its launch day, Disney+ hit #1 by iPhone Overall downloads at 8 AM in the U.S. and at 11 AM in Canada — an indication of the ability that strong IP has can really excite consumers to come out in droves. (Unfortunately, that led to some launch day glitches, too.)
- Apptopia estimated Disney+ was downloaded 3.2 million times in its first 24 hours. The firm also estimated users collectively spent 1.3 million hours watching Disney+ on day one — ahead of Amazon Prime Video, but well behind Netflix.
- Sensor Tower waited to collect a little more data instead. It found that the Disney+ app was installed approximately 9.6 million times in all available markets (the U.S., Canada, and the Netherlands), since its U.S. launch on Tuesday, Nov. 12. For comparison’s sake, HBO Now’s U.S. launch only saw 180,000 installs in its first three days — or 2% of the Disney+ total. Combined with the test period installs in the Netherlands, the app has now been installed over 10 million times.
- The hype around Disney+ has had a halo effect. Hulu and ESPN, which were offered in a bundle with Disney+, also grew as a result of the Disney+ launch. Sensor Tower found combined users of the apps in the U.S. and Canada were up 30% in the past week over the week prior.
Headlines
Apple removed all vaping apps from the App Store, citing CDC health concerns
The CDC says 42 people have died due to vaping product use and thousands more cases of lung injuries have been reported from 49 states. Now, Apple has made the controversial decision to remove all 181 vaping-related apps from its App Store — including those with news and information about vaping and even vaping-related games, Axios reported this week.
Some say Apple is helping to protect kids and teens by limiting their exposure to e-cigarette and vaping products, which are being used to addict a younger generation to nicotine and cause serious disease. Others argue that Apple is over-reaching. After all, many of the lung illnesses involve people who were vaping illegally obtained THC, studies indicated.
This isn’t the first time Apple has banned a category of apps because of what appear to be moral concerns. The company in the past had booted apps that promoted weed or depicted gun violence, for example. In the case of vaping apps, Apple cited the public health crisis and youth epidemic as contributing factors, telling Axios that:
We take great care to curate the App Store as a trusted place for customers, particularly youth, to download apps. We’re constantly evaluating apps, and consulting the latest evidence, to determine risks to users’ health and well-being. Recently, experts ranging from the CDC to the American Heart Association have attributed a variety of lung injuries and fatalities to e-cigarette and vaping products, going so far as to call the spread of these devices a public health crisis and a youth epidemic. We agree, and we’ve updated our App Store Review Guidelines to reflect that apps encouraging or facilitating the use of these products are not permitted. As of today, these apps are no longer available to download.
Existing users will still be able to use their apps, but new users will not be able to download the banned apps going forward.
Minecraft Earth arrives
Minecraft Earth launched early last week across 9 countries on both Android and iOS and now it’s come to the U.S., Canada, the U.K., and several other markets. Some expect the app will rival the success of the AR breakout hit, Pokémon Go, which was thought at the time to be the precursor to a new wave of massive AR gaming titles. But in reality, that didn’t happen. The highly anticipated follow-up from Niantic, Harry Potter: Wizards Unite didn’t come close to competing with its predecessor, generating $12 million in its first month, compared with Pokémon Go’s first-month earnings of $300 million. With Minecraft Earth now sitting at No. 2 (c’mon, you can’t unseat Disney+) on the U.S. App Store, it seems there’s potential for another AR kingpin.
App Annie releases a user acquisition playbook
A top name in App Store intelligence, App Annie this week released a new how-to handbook focused on user acquisition strategies on mobile. Sure the free download is just a bit of lead gen for App Annie, but the guide promises to fill you in on all you need to know to be successful in acquiring mobile users. The playbook’s arrival follows App Annie’s acquisition of adtech insights firm Libring this fall, as it expands to cover more aspects of running an app business. Just as important as rankings and downloads are the very real costs associated with running an app business — including the cost of acquiring users.
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GameClub offers mobile gaming’s greatest hits for $5 per month
Apple Arcade introduced the idea of all-you-can-eat subscription-based mobile gaming to the mainstream. Google Play Pass soon followed as a way to subscribe to a sizable collection of both apps and games on Android devices. Today, a startup called GameClub is launching in the U.S. to offer an alternative. For $4.99 per month, mobile consumers will be able to access a library that includes some of the best games to have ever hit the App Store.
To be clear, GameClub is not a cloud gaming platform, like Google Stadia. It’s a way to subscribe to actual App Store games, similar to Arcade. In GameClub’s case, however, the focus is not on new releases but on quality games that already have proven track records and high ratings.
In fact, many GameClub games have made Apple’s own editorially selected “Game of the Year” lists in years past. And like the games offered on Apple Arcade, they don’t have ads or any in-app purchases.
At launch, GameClub’s library includes more than 100 titles, with around half that available for play today. More titles will roll out on a weekly basis in the months ahead. Combined, the games have over 100 million collective downloads, the company says.
On GameClub, you’ll find games like: Super Crate Box, Hook Champ, Mage Gauntlet, Space Miner, Forget-Me-Not, MiniSquadron, Plunderland, Pocket RPG, Sword of Fargoal, Incoboto, Tales of the Adventure Company, Hook Worlds, Orc: Vengeance, Mr. Particle-Man, Legendary Wars, Deathbat, The Path to Luma, Grimm, Zombie Match, Faif, iBlast Moki 2, Kano, Baby Lava Bounce, Run Roo Run, Gears and many others.
It’s a selection that extends across gaming categories, like Action, Arcade, Puzzle, Adventure, Platformer, Retro, Role Playing, Simulation, Strategy and more.
To use the service, you first download the main GameClub app, which becomes the hub for your GameClub activities. You then sign up for the $4.99 per month subscription, which includes a 30-day free trial. Within the main app, you can browse the available titles as well as read editorial content like in-depth overviews and histories, get tips and learn about gaming strategies.
The startup was founded last year by game industry vets Dan Sherman and Oliver Pedersen.
Sherman, GameClub CEO, has worked in the gaming industry for around 17 years, including time spent at EA and his own startup, Tilting Point. His experience has involved, predominantly, signing content partnerships with game creators. Pedersen, meanwhile, built backend systems and platforms for games, including at Yahoo Games.
Though GameClub is seemingly arriving after Apple Arcade’s debut, it actually began before that. The startup was founded in 2018, ahead of any Apple Arcade rumors. It went live on iOS outside the U.S. before Arcade launched.
The founders say they were inspired to address the issues caused by the free-to-play model that has infiltrated the gaming industry. In addition, they had witnessed a decline in consumers’ willingness to purchase content upfront, which was impacting the industry.
“I was seeing all these amazing game developers leave mobile because the types of games they make are not the types of games that monetize through in-app purchases and ads,” Sherman tells TechCrunch. “The free-to-play model actually only works for a handful of genres,” he explains. “A lot of companies make a lot of money through a very small number of genres and game experiences — to the exclusion of a lot of other types of genres that GameClub is bringing back — action, adventures, arcade, tower defense — anything that can be completed.”
With free-to-play, games are built around perpetual retention loops. “And the freemium model comes out of the casino industry, not the premium game industry,” Sherman points out.
But because this is how games could make money, it led to homogeneity in the marketplace, he says.
GameClub aims to offer a subscription to the premium games that got left behind.
They are meant to be wholesome and fun, not overly addictive. They’re not designed to manipulate you into spending money. You simply pay your subscription fee every month to access the catalog, then play unencumbered.
Thanks to Apple Arcade and Google Play Pass, consumers are now comfortable with the idea of the subscription model for mobile games. And other services — like Spotify Netflix, and Xbox Game Pass, for example — have pushed the idea of subscription access to content across platforms and genres.
GameClub is different from Arcade, however, because it’s not funding the development of content upfront — at least, not yet. Instead, it’s forging agreements with largely indie developers to release their existing IP as a GameClub exclusive.
This may include bringing an older game into the 64-bit era — something GameClub handles on their behalf.
“Many of [the GameClub titles] have been gone for many years,” says Sherman. “It’s with our team, our technology and our developers that they’ve been brought back. And they’ve been brought back in a way that is 100% using the original code and the exact same design…but making them look and feel new, with higher resolution, Retina Display assets and by optimizing for the latest screen sizes and configurations,” he adds.
The company doesn’t discuss the business model for GameClub, but it’s not the same as Apple Arcade’s pay-upfront model.
What Sherman could say is that the more important the game is to the GameClub service, the more money the creator makes. Additionally, GameClub says it’s transparent with developers about its subscription revenue, so there’s no question about which games are earning or why.
The same can’t be said for Apple Arcade, which is a total black box to the point that consumers don’t know which Arcade games are most popular, developers can’t see how they’re doing compared with others and third-party measurement firms have no data.
Of course, there could be concerns that GameClub exists in a gray area, with regard to App Store policy. Those with longer memories may recall that Apple banned app-stores-within-a-store starting back in 2012. The company had kicked out apps that recommended other apps like AppHero, FreeAppADay, Daily App Dream, AppShopper and more. It also banned the more popular app recommendation service AppGratis the following year.
But Apple’s concern was that these apps were leveraging their power to manipulate App Store charts and rankings, often charging for that service. GameClub, on the other hand, plays fairly. Its service also benefits Apple, by offering subscription access to quality games that couldn’t thrive as free-to-play titles.
Longer-term, GameClub wants to produce its own original content and offer its service across platforms, starting with Google Play, but eventually tackling PC and console gaming.
The startup is headquartered in New York City, with offices in Copenhagen. In addition to the founders, it includes Eli Hodapp, the former editor-in-chief of the popular game news and review site TouchArcade, and COO Britt Myers, the former chief product officer of subscription-based edtech apps platform Homer.
With the close of a seed round last week, GameClub is backed by $4.6 million in funding.
Investors from a round that closed last year include GC VR Gaming Tracker Fund, CRCM Ventures, Watertower Ventures, Ride Ventures, BreakawayGrowth Fund and others. New investors include GFR Fund, Gramercy Fund, Century Gold and others.
GameClub is available on the App Store.
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Apple’s control over the App Store is no longer sustainable
Last week, Apple caved to the Chinese government and pulled an app called HKmap.live that was being used by Hong Kong protestors to crowdsource the location of police forces.
While Apple CEO Tim Cook defended Apple’s stance, the move is a reminder that Apple is the only judge and jury regarding what’s acceptable in the App Store — but as mobile devices are integrated into more aspects of our lives, it’s getting harder to justify such tight control over their software.
The current state of the App Store is a great example of the risks of running a marketplace that becomes too big. It also shows that we can expect wide-ranging marketplace regulation in the near future.
The App Store as video game console
Before Apple introduced the App Store in 2008, companies could distribute third-party apps and web services without oversight; consumers could buy floppy disks, download software from the internet or connect to any website.
But with the App Store, Apple decided to control the user experience from approval to distribution. And it has been a massive economic success. There are more than 2.2 million apps in the App Store that have generated over 130 billion downloads.
In many ways, the iOS app ecosystem works more like a video game console than a computer — developers submit games and apps to the maker of the platform, which starts a review process to see if third-party content complies with guidelines. If so, developers may list their game or app on the platform.
The PlayStation 4 has been around for six years and Sony has approved 2,294 games in total, around 380 games per year. Due to the sheer size of the App Store, Apple has faced challenges that console manufacturers have never faced.
Review guidelines are poorly enforced
Apple has written the App Store Review Guidelines, a lengthy document intended to answer all questions about what’s acceptable — but those rules are not enforced consistently, and the App Store isn’t a level playing field, discrepancies I’ve pointed out in the past.
As an example: rule 4.3, titled “Spam:”
Don’t create multiple Bundle IDs of the same app. If your app has different versions for specific locations, sports teams, universities, etc., consider submitting a single app and provide the variations using in-app purchase. Also avoid piling on to a category that is already saturated; the App Store has enough fart, burp, flashlight, and Kama Sutra apps already. Spamming the store may lead to your removal from the Developer Program.
And yet, customers can find plenty of categories with app duplicates and companies trying to game the App Store. For example, I found 13 different VoIP apps released by four companies. Each company had multiple versions of the same app in order to pick different names, keywords and categories to optimize search results.
When I pointed this out to Apple, they removed most of the duplicates in less than 24 hours, but it can’t remain the single source of truth if it doesn’t enforce its own rules properly.
Similarly, as Under the Radar recently pointed out, some developers will always find ways to abuse the App Store. For instance, shady developers acquire apps with a lot of positive ratings, transfer those apps to their own developer account, push updates with expensive weekly recurring subscriptions and take advantage of Apple’s obscure process to cancel subscriptions.
Economic interests first
In its most recent earnings release, Apple reported that Greater China represented 17% of the company’s revenue. The company also manufactures the vast majority of its products in Chinese factories. Apple has a lot to lose in China.
That’s why Apple’s actions in China don’t reflect the company’s principles. Cupertino claims to care deeply about privacy, but it uploads iCloud user data to a state-owned mobile operator in China.
The company says that it cares deeply about privacy but uploads iCloud user data to a state-owned mobile operator in China
Apple first removed HKmap.live from the App Store, then authorized the app again before removing it one more time. The only thing that changed between the first second removal is that the Chinese government started openly criticizing Apple about that specific case.
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