Netflix and Others Move Against App Store Taxes
Netflix and Epic Games are the latest companies to take a stand against the ‘tax’ imposed by Apple and Google on their app stores.
There are millions of apps on Apple’s App Store and the Google Play Store, and the tech giants are taking up to 30% of the revenue that consumers pay the app developers.
A number of independent developers have grown tired of handing over such a large portion of their profits. As a result, they’ve been working on ways to get around the toll.
Ben Schachter, an analyst with Macquarie Group, told Bloomberg: “It feels like something bubbling up here. The dollars are just getting so big. They just don’t want to be paying Apple and Google billions.”
In May, Netflix made it impossible for new or rejoining customers to pay for the video streaming service with Google Play billing.
At the moment, Apple is taking 15% of Netflix’s subscription fees, that are paid for via the App Store’s in-app purchasing system. However, the streaming company announced earlier this week that it was working on a way to bypass in-app subscriptions. Instead, users will be sent to the Netflix website to pay for subscriptions.
Epic Games recently decided to pull Fortnite, one of the most popular video games of 2018, from the Google Play Store. It cited the 30% ‘tax’ as the reason behind this decision.
Steam is the world’s largest distributor of video games for PC, and it planned to release a free iPhone app to allow users to continue to play and purchase games on the move. However, Apple blocked the app and stated that any products that looked like an app store would continue to be banned.
Alex Austin, a co-founder of the Branch mobile network, said to Bloomberg: “[Apple and Google are] very aggressive about making sure companies aren’t trying to work around their billing. They have whole teams reviewing these flows to ensure they get their tax.”
In the first half of 2018, Apple’s App Store received almost double the revenue of the Google Play Store.
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