Apple Working on Solution for EU Core Technology Fee Possibly Bankrupting Apps That Go Unexpectedly Viral

Since Apple announced plans for the 0.50 euro Core Technology Fee that apps distributed using the new EU App Store business terms must pay, there have been ongoing concerns about what that fee might mean for a developer that suddenly has a free app go viral.

App Store vs EU Feature 2
Apple's VP of regulatory law Kyle Andeers today met with developers during a workshop on Apple's Digital Markets Act compliance. iOS developer Riley Testut, best known for Game Boy Advance emulator GBA4iOS, asked what Apple would do if a young developer unwittingly racked up millions in fees.

Testut explained that when he was younger, that exact situation happened to him. Back in 2014 as an 18-year-old high school student, he released GBA4iOS outside of the ‌App Store‌ using an enterprise certificate. The app was unexpectedly downloaded more than 10 million times, and under Apple's new rules with Core Technology Fee, Testut said that would have cost $5 million euros, bankrupting his family. He asked whether Apple would actually collect that fee in a similar situation, charging the high price even though it could financially ruin a family.


In response, Andeers said that Apple is working on figuring out a solution, but has not done so yet. He said Apple does not want to stifle innovation and wants to figure out how to keep young app makers and their parents from feeling scared to release an app. Andeers told Testut to "stay tuned" for an answer.

What we are trying to do is tear apart a model that has been integrated for 15 years. And so for 15 years, the way we've monetized everything was through the commission. It covered everything from technology to distribution to payment processing, and the beauty of that model is that it allowed developers to take risks. Apple only got paid if the developer got paid, and that was an incredible engine for innovation over the last 15 years. We've seen it go from 500 apps to more than 1.5 million.

To your point, we've seen kids everywhere from 8-year-olds, 9-year-olds, 10-year-olds, to teenagers come up with some amazing applications and it's been one of the great success stories of the App Store. In terms of the Core Technology Fee and our business model, we had to change. The mandates of the DMA forced us to tear apart what we had built and price each component individually. And so we now have a fee associated with technology, tools, and services, we now have a fee associated with distribution and the services we provide through the App Store, and then we have a separate fee for payment processing if a developer wants to use it.

To your point - what is the impact on the dreamer, the kid who is just getting started. It could be a kid, it could be an adult, it could be a grandparent. We want to continue to encourage those sorts of developers. We build a store based on individual entrepreneurs, not so much catering to large corporate interests. And so we really wanted to figure out how do we solve for that.

We haven't figured out that solution here. I fully appreciate that. We looked at the data. We didn't see many examples of where you had that viral app or an app just took off that incurred huge costs. That said, I don't care what the data said. We don't care what the data said. We want people to continue to feel... and not be scared... some parents... hey, I've got four kids who play around with this stuff. I don't have five million euros to pay. This is something we need to figure out, and it is something we're working on. So I would say on that one, stay tuned.

It is not clear when Apple might come up with a solution or what that solution might be, but it sounds like the company might soon have some kind of option for these rare fringe cases when an app goes unexpectedly viral.

The 0.50 euro Core Technology Fee (CTF) that Apple is charging applies to all apps created under Apple's new business terms, both those distributed in the ‌App Store‌ and those distributed outside of the ‌App Store‌ in the European Union. The CTF must be paid for every "first" app install over one million installs.

A free app that is distributed outside of the ‌App Store‌ and downloaded over a million times will owe 0.50 euros for every subsequent "first" install, aka the first time a customer downloads an app on a device each year. The fee is incurred whether or not an app charges, creating a situation where an app developer could owe Apple money without ever making a dime.

As it stands, the CTF is a major unknown for any kind of freemium or free app built under the new business terms that might go viral, effectively making it very risky to develop a free or freemium app outside of the ‌App Store‌. A free or freemium app that gets two million annual "first installs" would need to pay an estimated $45,290 in fees per month, or more than half a million dollars per year, even with no money earned. That's not a sustainable model for free apps, and freemium apps would need to earn at least 0.50 euros per user to break even.

App developers are able to continue to use Apple's current ‌App Store‌ business terms instead of adopting the new terms, paying just 15 to 30 percent commission to Apple with no change. That prevents distribution outside of the ‌App Store‌, and it prevents developers from using third-party alternative payment solutions in the ‌App Store‌. Adopting any of the new features that Apple has implemented because of the Digital Markets Act requires opting in to the updated business terms.

Apple has been tweaking the app ecosystem rules that it introduced in the European Union based on developer feedback. Developers can now opt back in to the current App Store rules after trying out the new rules, though this is only available one time. Apple also recently did away with an app marketplace restriction that required alternative marketplaces to offer apps from any third-party developer that wanted to participate.

Third-party app stores are now able to offer apps only from their own catalog, and developers will soon be able to distribute apps directly from their websites as long as they meet Apple's requirements. Note that all of these changes are limited to the European Union, and the ‌App Store‌ is operating as before in the United States and other countries.

Popular Stories

iPhone 17 Pro Blue Feature Tighter Crop

iPhone 17 Pro Launching in Three Months With These 12 New Features

Saturday June 21, 2025 2:45 pm PDT by
The iPhone 17 Pro and iPhone 17 Pro Max are around three months away, and there are plenty of rumors about the devices from credible sources. Below, we recap key changes rumored for the iPhone 17 Pro models as of June 2025:Aluminum frame: iPhone 17 Pro models are rumored to have an aluminum frame, whereas the iPhone 15 Pro and iPhone 16 Pro models have a titanium frame, and the iPhone X...
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...
ios 26 control center b2

Everything New in iOS 26 Beta 2

Monday June 23, 2025 2:57 pm PDT by
Apple provided developers with the second beta of iOS 26, introducing the first changes and refinements to the new operating system since it debuted after the WWDC keynote. Because we're early in the beta testing process, there are quite a few tweaks to iOS 26, which we've rounded up below. Subscribe to the MacRumors YouTube channel for more videos. Control Center The background behind the...
Apple CarPlay Ultra cluster Now Playing

These Apple CarPlay Ultra Partners Now Say They Won't Support It

Wednesday June 25, 2025 5:03 am PDT by
Apple is facing mounting resistance from automakers over CarPlay Ultra, the next-generation version of its CarPlay software system for vehicles that was announced last month. A new (paywalled) Financial Times report claims several major brands are walking back their earlier commitments to support the upgraded dashboard software. German luxury manufacturers Mercedes-Benz and Audi have both...
All Screen iPhone 2027 Feature 1

iPhone Reportedly Moving to All-Screen Design in Two Stages

Sunday June 22, 2025 3:58 pm PDT by
Apple has long been working towards an iPhone with an all-screen design, and it might finally achieve the feat in a few more years from now. In his Power On newsletter today, Bloomberg's Mark Gurman said that Apple will shrink the size of the Dynamic Island on new iPhone models released next year. A year after that, he expects Apple to release a redesigned 20th-anniversary iPhone model....
ios 26 control center b2

iOS 26 Beta 2 Fixes Control Center Design

Monday June 23, 2025 10:58 am PDT by
With the second beta of iOS 26 that Apple provided to developers today, Apple addressed one of the major complaints that people have had with Liquid Glass. iOS 26 beta 1 on left, iOS 26 beta 2 on right The Control Center buttons are now slightly more opaque, making it easier to see the different control options even on a multicolored background. The new, more opaque look is apparent with the ...
Apple Watch Ultra 2 Complications

watchOS 26 Adding a Smaller Yet Useful New Watch Face Setting

Monday June 23, 2025 9:39 am PDT by
watchOS 26 is adding a new "Show Data When Locked" setting to the Apple Watch. MacRumors contributor Steve Moser discovered the new setting within the code for the first watchOS 26 beta, and a Reddit user has seemingly found it in action, but we have yet to figure out where it is exactly. Leave a comment if you know. The new privacy setting allows you to toggle on or off the ability to...
iPhone 18 Punch Hole Feature

Here's What Next Year's iPhone 18 Pro Display Could Look Like

Wednesday June 25, 2025 12:07 am PDT by
If you've been following iPhone 18 Pro reports recently, you'll know that there are two competing rumors from usually reliable sources about how Apple plans to integrate Face ID into the display, and both of them likely affect the fate of the Dynamic Island – and in turn the overall look of the display itself. Last month, The Information's Wayne Ma said that the iPhone 18 Pro and iPhone 18...
iPhone 16 Battery Life Feature

iOS 26's New Battery Life Mode Available Only on These iPhone Models

Saturday June 21, 2025 9:02 am PDT by
Last week, we reported that iOS 26 introduces an opt-in Adaptive Power Mode on the iPhone, alongside the existing Low Power Mode. Apple says that Adaptive Power Mode can make "small performance adjustments" when necessary to extend an iPhone's battery life, including slightly lowering the display brightness or allowing some activities to "take a little longer." The full description of...

Top Rated Comments

9059737 Avatar
17 months ago
The only acceptable solution is to completely remove this anti-competitive junk fee.
Score: 74 Votes (Like | Disagree)
User 6502 Avatar
17 months ago

So you think Apple should just allow everyone to distribute their apps on the App Store for free?
You seem to fail to understand that this fee is applied to apps that are NOT on the App Store and to developers who chose to NOT use the App Store. So yeah, Apple should NOT charge them any fee, other than the developer fee of $99 per year they already pay and that is meant to cover the cost of using Xcode and the APIs.
Score: 52 Votes (Like | Disagree)
Mrkevinfinnerty Avatar
17 months ago
So generous of them. Apple is the peoples monopolist.
Score: 30 Votes (Like | Disagree)
till Avatar
17 months ago
I honestly take this as a sign that they know regulators won't accept the CTF, because it's incredibly late in the game to not have an answer to such an obvious question.
Score: 28 Votes (Like | Disagree)
AppleTO Avatar
17 months ago

One possible solution is to get rid of free apps. They were necessary in the beginning, so Apple could build its catalog of apps on the AppStore, but they just devalue people's work.
Would you pay to download your banking apps, food delivery apps, Amazon, Google Maps, YouTube?
Score: 26 Votes (Like | Disagree)
AppleTO Avatar
17 months ago

The only acceptable solution is to completely remove this anti-competitive junk fee.
No, it's not. Apple is not required to give a free all access pass to their platform. It costs money to develop a platform and SDKs.
Score: 23 Votes (Like | Disagree)