EU forces Apple to allow competitors apps on its devices, but UK makes no changes
Apple (AAPL) is gearing up to let alternative app stores on to its iPhones and iPads to meet European Union requirements coming into force in 2024, but those in the UK will remain stuck with Apple apps.
Under the EU's new Digital Markets Act (DMA), the rules should allow users to install third-party apps on their iOS devices without using the App Store. In this case, Apple won’t be able to charge its up-to-30% commission on all payments.
The goal is to prevent big platform holders, or the so-called gatekeepers, like Apple, Google, and Meta from abusing their dominant position in the market.
The DMA will take effect from May but the company has until 2024 to make changes to its ecosystem, as Bloomberg first reported.
However, the rules are only valid in Europe, with the UK showing no sign of passing similar laws.
Independent app developers are urging the EU to ensure that under the new rules, the needs of small app developers are not forgotten.
Read more: My first boss: Antony Jenkins, former Barclays CEO on the digitisation of banking
"It is paramount that the implementation of the DMA allows for Europeans to continue to be protected from malware and bad business practices", said Mike Sax, founder of the App Association.
"A decline in customer confidence that installing and buying apps is safe may only have a negligible impact for trusted mega-brands, but it would be devastating for smaller app developers,” he added.
SME app developers, who represent a €210bn annual contribution to the EU economy, are asking Brussels for fair and non-discriminatory terms to app stores.
“Our members don’t have a portfolio of trusted brands or global distribution networks and infrastructure. When our apps are pirated or turned into malware it hurts us directly and can even pose an existential threat to our business,” Sax said.
Read more: Chinese tech-firms explore web3 partnerships with blockchain innovators
“We actually need platforms to spend millions on IP protection, on global market access, and on customer privacy. For us, we need the ‘gate’ in ‘gatekeeper’ to work and keep out the fraudulent products and help us reach customers in an environment they see as safer than the broader internet,” he added.
The European Union believes that strict regulation of big technology companies, the so-called gatekeepers of the digital economy, will lead to more competition and choice, greater innovation, better quality, and lower prices.
Chancellor Jeremy Hunt has confirmed that the government will bring in new legislation to protect consumers from fake reviews and subscription protection and give the Competition and Markets Authority (CMA) new powers to deal with anti-competitive practices in digital markets. However, little to nothing is known regarding limiting Big Tech’s power over the internet.
Watch: The EU's Digital Markets Act: What is it and what will the new law mean for you and Big Tech?
Download the Yahoo Finance app, available for Apple and Android.