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A court in California has ruled that Apple breached state competition laws by barring app developers from using payment methods other than its own, which charges a 30% commission.
The decision may benefit cryptocurrency and non-fungible token (NFT) projects, as it could enable them to enhance their iOS apps.
The decision was made by the United States Court of Appeals for the Ninth Circuit in the case of Apple vs Epic Games, the creator of the video game Fortnite. The court upheld the lower court's decision from 2021 and said that Apple's anti-steering provision, which prohibits iOS developers from communicating out-of-app payment methods through certain mechanisms such as in-app links, harmed Epic.
Although Apple prevailed on most issues, the court determined that Epic Games could have generated more revenue if it had been allowed to use alternative payment methods since its developer account was terminated in August 2020. The court found Apple's anti-steering provision to be "unfair" under both the competitor-suit "tethering test" and the consumer-suit "balancing test". The court also stated that consumers would have opted for Epic Games over other developers if they had been aware of its lower commission rate of 12% as opposed to Apple's 30%.
The decision could have far-reaching implications for creators of crypto and NFT apps who won't be subject to Apple's 30% commission if Apple doesn't appeal. Uniswap, a decentralized exchange, recently made its way into the App Store despite Apple initially withholding its launch in March. Last December, Apple claimed the right to "collect 30% of the gas fee" through in-app purchases and interfered with NFT transactions sent on Coinbase's self-custody wallet.
The ruling could lead to more competition in the App Store, benefitting developers and consumers alike. Additionally, the European Union recently set new anti-monopolistic rules that require Apple to permit third-party app stores on its devices, which in turn allows consumers to circumvent Apple's 30% commissions. These developments signal a shift towards more open and fair competition in the app marketplace.