2024 has kicked off with a bang, especially for mobile game publishers and developers. Apple has responded to two major anti-competitive regulations in the United States and the European Union, ushering in a new era of possibilities. These policy changes, while complex, offer exciting opportunities for the gaming industry. In this article, we’ll explore what’s changed and why mobile game publishers should consider implementing Fungies.io Web Store technology.
What Actually Happened?
In the United States, on January 16th, 2024, the US Supreme Court decided not to hear appeals following the Apple vs. Epic court case. This effectively ruled against Apple’s anti-steering policies, which had previously banned apps from informing users about or linking to alternative payment methods like web stores. This decision was a pivotal moment as it found Apple’s policies to be in violation of competition law.
Subsequently, on January 17th, Apple issued updated App Store Review policies, introducing a new “link-out” policy. This change allows developers to include links to out-of-app payment options within their apps. However, there’s a catch – any items purchased through these links are subject to a 27% fee. This is only slightly lower than the original 30% in-store fee that sparked the Epic vs. Apple legal battle. Developers are also required to gain approval for link-outs, adhere to specific presentation guidelines, and include a disclaimer screen before redirecting users to alternative payment providers. More of Apple’s new policy in the US is here.
In the European Union, Apple faces a deadline of March 6th, 2024, to comply with the Digital Markets Act (DMA). On January 25th, 2024, Apple released revised policies designed to align with the DMA, but these policies only apply to EU users. Importantly, Apple now offers two sets of terms for developers to choose from, depending on their game’s profile:
- Existing terms: Distribute apps exclusively via the App Store and pay a 30% fee on in-app purchases (IAPs).
- Alternative terms: Distribute through alternative app stores (sideloading), use alternative payment providers, and link to web stores. This option comes with reduced 10% or 17% fees on IAPs, along with a “core technology fee” of €0.50 for each install exceeding 1 million annually, including updates and reinstalls.
So, What’s the Impact for Game Developers?
Despite the initial frustration caused by these changes, game developers should recognize the significant opportunities that have emerged:
- Removing Anti-Steering Opens New Possibilities: Apple’s removal of anti-steering provisions grants developers more freedom to inform users about out-of-app sales channels, such as web stores. This newfound flexibility can greatly increase traffic to your web stores, which was a challenge in the past. Importantly, as long as you don’t directly link to your web store from the app, purchases made there are not subject to Apple’s fees, potentially saving you over 30% of your revenue.
- New Fee Options in Europe Can Lead to Savings: The revised terms in Europe offer two cost components – a reduced commission and a flat €0.50 fee on App Store installs above 1 million each year. If your game’s revenue per install (RPI/LTV) exceeds €5, you can generate more revenue under Apple’s alternative terms, even if you exclusively distribute through the App Store. By shifting some installs to alternative distribution channels, you can significantly reduce the fees you pay to Apple.
- Distributing Outside the App Store Boosts High LTV Potential: Apple’s concessions on distribution open up new possibilities for developers. For games relying on in-app purchases (IAPs), the new terms can be exciting. Shifting a portion of installs to alternative channels can substantially reduce fees. For instance, if your game generates €25 million annually from 5 million iOS installs and you redirect 50% of them to alternative channels, you can cut your expenses in half.
- Direct-to-Consumer Benefits: Beyond cost savings, direct-to-consumer web shops offer numerous advantages, including improved user acquisition through email collection, more effective retargeting, and the ability to build lookalike audiences. These web shops enable advanced engagement features, loyalty programs, dynamic pricing, bundling, personalization, and more. This direct approach enhances the overall game experience and monetization potential.
- New Opportunities for Competition and Innovation: These regulatory changes signify a major shift in the industry’s landscape. Apple’s forced openness to sideloading and the elimination of anti-steering provisions provide developers with greater freedom in app design. This level of flexibility was once unimaginable and invites innovation from potential competitors in alternative payments and app stores.
This Is Just the Beginning
Apple’s compliance journey is far from over. EU regulators may push for further changes, and other regulatory actions are ongoing. The proposed 27% fee on linked-out web stores remains under government review in the US and Europe. More on Apple’s policy changes in Europe is here.
With Google’s sideloading UX advancements and settlements with State Attorneys General, it’s likely that Apple will face additional pressure to make further concessions. This evolving landscape is set to open up even more opportunities for developers and foster competition.
Why Fungies.io Web Store Technology Matters
In this evolving ecosystem, Fungies.io Web Store technology stands out as a key player. These changes highlight the importance of alternative payment channels and web stores that can provide a seamless experience while ensuring compliance. Fungies.io offers an ideal solution, with user-friendly interfaces, loyalty programs, and integration options that align with your in-app purchase configurations.
As a mobile game publisher or developer, embracing Fungies.io Web Store technology can empower you to navigate this new landscape effectively, capitalize on emerging opportunities, and provide a superior commerce experience for your players.
The year 2024 marks a turning point for mobile game publishers and developers, with regulatory changes creating a wealth of possibilities. By understanding and strategically implementing Fungies.io Web Store technology, you can not only comply with new regulations but also thrive in this dynamic environment. Embrace the future and position your games for success in this new era of mobile gaming.