Apple's App Store Subscription Policies Raise Antitrust Issues as Content Providers Fume

100956 in app purchase icon

With Apple's announcement yesterday of new App Store subscription offerings and policies requiring all content providers to offer at least the option of in-app subscriptions at the same prices as external options, questions have been raised about how providers will respond to the likelihood that significant numbers of customers will likely choose options that require them to hand over 30% of their revenue to Apple.

The Wall Street Journal explores possible antitrust issues, with experts noting that any such case would hinge on the definition of the market, as that would determine how dominant Apple's position is in it.

"My inclination is to be suspect" about Apple's new service, said Shubha Ghosh, an antitrust professor at the University of Wisconsin Law School. Two key questions in Mr. Ghosh's mind: Whether Apple owns enough of a dominant position in the market to keep competitors out, and whether it is exerting "anticompetitive pressures on price."

Experts note that publishers might be able to argue that tablet devices constitute the market for their offerings, and Apple's dominance in that market could subject it to antitrust investigation. But a broader market encompassing the entire App Store ecosystem and thus smartphones and tablets in their entirety would likely not raise red flags due to Apple's much smaller share of that larger market.

"Millions will be spent litigating how broad the market is," said Herbert Hovenkamp, an antitrust professor at the University of Iowa College of Law.

Mr. Hovenkamp said digital media is the most plausible market. He said he doubted that Apple, currently, has a sufficiently dominant position in that market to warrant antitrust scrutiny.

All eyes are of course also on the content providers themselves, who would have to raise prices by 43% in order to provide Apple with a 30% cut and still maintain their existing income, should all transactions shift to in-app subscriptions.

While many content providers have yet to respond publicly to Apple's announcement as they weigh their options, music streaming service Rhapsody spoke out yesterday, noting that it will be talking with other companies in its same position in "determining an appropriate legal and business response to this latest development."

Our philosophy is simple too - an Apple-imposed arrangement that requires us to pay 30 percent of our revenue to Apple, in addition to content fees that we pay to the music labels, publishers and artists, is economically untenable. The bottom line is we would not be able to offer our service through the iTunes store if subjected to Apple's 30 percent monthly fee vs. a typical 2.5 percent credit card fee.

Publishers of existing App Store applications have until June 30th to comply with Apple's new policies.

Popular Stories

maxresdefault

Five Features Coming to AirPods Pro 3

Friday June 27, 2025 10:52 am PDT by
Apple hasn't updated the AirPods Pro since 2022, and the earbuds are due for a refresh. We're counting on a new model this year, and we've seen several hints of new AirPods tucked away in Apple's code. Rumors suggest that Apple has some exciting new features planned that will make it worthwhile to upgrade to the latest model. Subscribe to the MacRumors YouTube channel for more videos. Heal...
iPhone Car Key WWDC 2025

Apple Announces 13 Automakers Planning to Offer iPhone Car Keys

Friday June 27, 2025 11:42 am PDT by
In 2020, Apple added a digital car key feature to its Wallet app, allowing users to lock, unlock, and start a compatible vehicle with an iPhone or Apple Watch. The feature is currently offered by select automakers, including Audi, BMW, Hyundai, Kia, Genesis, Mercedes-Benz, Volvo, and a handful of others, and it is set to expand further. During its WWDC 2025 keynote, Apple said that 13...
anker power bank recall

PSA: Anker Recalls Multiple Power Banks Due to Fire Risk

Friday June 27, 2025 4:16 pm PDT by
Popular accessory maker Anker this month launched two separate recalls for its power banks, some of which may be a fire risk. The first recall affects Anker PowerCore 10000 Power Banks sold between June 1, 2016 and December 31, 2022 in the United States. Anker says that these power banks have a "potential issue" with the battery inside, which can lead to overheating, melting of plastic...
Chase Sapphire Reserve Apple Perk Feature

Chase Sapphire Reserve Card Introduces New Perk for Apple Customers

Wednesday June 25, 2025 2:08 pm PDT by
Chase this week announced a series of new perks for its premium Sapphire Reserve credit card, and one of them is for a pair of Apple services. Specifically, the credit card now offers complimentary annual subscriptions to Apple TV+ and Apple Music, a value of up to $250 per year. If you are already paying for Apple TV+ and/or Apple Music directly through Apple, those subscriptions will...
iPhone 17 Pro Blue Feature Tighter Crop

iPhone 17 Pro Launching in a Few Months With These 12 New Features

Thursday June 26, 2025 2:00 am PDT by
Apple's next-generation iPhone 17 Pro and iPhone 17 Pro Max are around three months away, and there are plenty of rumors about the devices. Apple is expected to launch the iPhone 17, iPhone 17 Air, iPhone 17 Pro, and iPhone 17 Pro Max in September this year. Below, we recap key changes rumored for the iPhone 17 Pro models:Aluminum frame: iPhone 17 Pro models are rumored to have an...
A18 Pro Chip

New MacBook With A18 Pro Chip Spotted in Apple Code

Monday June 30, 2025 8:05 am PDT by
Apple is developing a MacBook with the A18 Pro chip, according to findings in backend code uncovered by MacRumors. Earlier today, Apple analyst Ming-Chi Kuo reported that Apple is planning to launch a low-cost MacBook powered by an iPhone chip. The machine is expected to feature a 13-inch display, the A18 Pro chip, and color options that include silver, blue, pink, and yellow. MacRumors...
macbook air spacegray purple

Apple Planning to Launch Low-Cost MacBook Powered By iPhone Chip

Monday June 30, 2025 3:20 am PDT by
Apple is planning to launch a low-cost MacBook powered by an iPhone chip, according to Apple analyst Ming-Chi Kuo. In an article published on X, Kuo explained that the device will feature a 13-inch display and the A18 Pro chip, making it the first Mac powered by an iPhone chip. The A18 Pro chip debuted in the iPhone 16 Pro last year. To date, all Apple silicon Macs have contained M-series...
CarPlay Ultra Climate Controls

Here's Which Vehicle Brands Will and Won't Offer Apple's CarPlay Ultra

Friday June 27, 2025 9:52 am PDT by
Apple last month announced the launch of CarPlay Ultra, the long-awaited next-generation version of its CarPlay software system for vehicles. There was news this week about which automakers will and won't offer CarPlay Ultra, and we have provided an updated list below. CarPlay Ultra is currently limited to newer Aston Martin vehicles in the U.S. and Canada. Fortunately, if you cannot...
apple watch ultra 2 new black

Apple Watch Ultra 3 Finally Coming After Two-Year Hiatus

Tuesday June 24, 2025 3:40 am PDT by
Apple will finally deliver the Apple Watch Ultra 3 sometime this year, according to analyst Jeff Pu of GF Securities Hong Kong (via @jukanlosreve). The analyst expects both the Apple Watch Series 11 and Apple Watch Ultra 3 to arrive this year (likely alongside the new iPhone 17 lineup, if previous launches are anything to go by), according to his latest product roadmap shared with...