What's Up With Apple: Japan Deal on In-App Links, Apple Car Redux and More

In the past two weeks, Apple Inc. (NASDAQ: AAPL) has loosened its grip (a little) on app developers that sell their products in the App Store. First, the company agreed to allow small app developers to include an email address where customers could get information on making purchases outside the App Store.

Earlier this week, the South Korean parliament approved a law that would force Apple (and Google) to allow customers to pay for apps directly rather than having to go through the App Store. It is this change that led up to a settlement Apple announced on Wednesday between the company and Japan’s Fair Trade Commission.

In a press release, Apple said it will update the App Store to “allow developers of ‘reader’ apps to include an in-app link to their website for users to set up or manage an account.” The change will apply globally, not just in Japan. A reader app, according to Apple, allows people to view “previously purchased content or content subscriptions for digital magazines, newspapers, books, audio, music, and video.”

The first beneficiaries of this change are content providers like Spotify, Netflix and Amazon’s Kindle and Prime Video. Companies that do not benefit from the change are game makers like Epic Games that drive the majority of App Store revenue through in-app purchases that are still subject to Apple’s commission of up to 30%.

Tim Sweeney, CEO of Fortnite developer Epic Games, is not impressed. In a tweet Wednesday night, Sweeney called Apple’s change a “special deal” for reader apps, adding:

Apple should open up iOS on the basis of hardware, stores, payments, and services each competing individually on their merits.

Instead, they’re running a literally day-by-day recalculation of divide-and-conquer in hopes of getting away with most of their tying practices.

Research firm SensorTower in June estimated that Apple realized $41.5 billion in App Store sales in the first half of this year. Of that total, an estimated $26 billion was down to commissions paid on games and in-app purchases by gamers.

So far, Apple has been able to protect that gaming revenue. However, a court decision in a suit filed by Epic Games is due soon and, if that goes against Apple, App Store revenue may not just be nibbled to death by ducks, but wiped out or seriously reduced.

Apple also announced Wednesday that Arizona and Georgia will be the first of eight states to roll out the capability for residents to add their driver’s licenses to their Apple Wallet. The other six are Connecticut, Iowa, Kentucky, Maryland, Oklahoma and Utah.

Citing a report in Taiwan-based Digitimes, 9to5Mac said that Apple is targeting 2024 to begin mass production of an Apple Car: “Digitimes says Apple is in conversations with Asian suppliers, including visits to LG Electronics and SK Group.”

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