Technology

What's Up With Apple: Another App Store Challenge, Facebook's Smartwatch and More

What’s known as the creator economy currently includes about 50 million people who are trying to build businesses as content creators or curators. Social media influencers may be the best known, but bloggers, videographers and even software and financial tool developers are included.

One such software platform developer, Fanhouse, has run afoul of Apple Inc. (NASDAQ: AAPL) and the company’s requirement that App Store apps pay Apple a 30% commission on downloads and in-app sales. Fanhouse, which The Verge describes as “basically OnlyFans with the nudity,” takes a 10% cut of content posted on its platform and, so far at least, has not paid Apple anything. Fanhouse says it will be kicked out of the App Store in August unless it begins to pay Apple’s 30% cut.

A co-founder of Fanhouse and a content creator herself, Jasmine Rice, told The Verge that “she would be okay with handing Apple a 30 percent cut of Fanhouse’s own profits. But once that 30 percent has to cut into creators’ profits, it starts to hurt people, not just the platform.” Apple replied to a query from The Verge that it was “working with Fanhouse to bring the app into compliance with its rules.”

While Apple seems to be taking a hardline with the creator economy, Facebook is taking a different tack. Instagram head, Adam Mosseri, told CNBC on Wednesday that the social media platform is going to help content creators avoid Apple’s 30% commission:

For transactions that happen in iOS, we’re going to have to abide by their rules… but in general we’re going to look for other ways to help creators make a living and facilitating transactions that happen in other places …

So, for instance, if we could help brands and creators vet each other and find each other, they could make those transactions happen offline. For affiliate marketing, it’s real goods, not digital goods. So we’re going to try and lean in to the places creators can actually make a stable living

Neither Facebook nor Instagram has said how much of a cut it plans to take but did say that it would be less than 30%.

Facebook also has been developing a smartwatch that the company plans to introduce next summer. According to a report in The Verge, the device is expected to feature two detachable cameras that will enable people to share photos and videos across Facebook, Instagram and other Facebook-owned apps. The device is also expected to include a fitness and heart rate monitor.

Apple’s new app tracking transparency feature is expected to cut into Facebook’s revenue stream, and a Facebook-branded smartwatch aimed at content creators may be the company’s way of fighting back. The problem Facebook has to overcome is its reputation (deserved or not) for playing fast and loose with people’s data.

Finally, Apple has begun testing a new iCloud Keychain passkey feature, a pair of public and private keys that work like a hardware security key (think, dongle). The passkeys could eventually replace passwords, requiring people to use only Face ID to log in on all their devices.