http://www.fosspatents.com/2022/02/dutch-antitrust-authority-fines-apple.html skip to main | skip to sidebar FOSS Patents This blog covers software patent news and issues with a particular focus on wireless, mobile devices (smartphones, tablet computers, connected cars) as well as select antitrust matters surrounding those devices. Monday, February 21, 2022 Dutch antitrust authority fines Apple for fifth time (aggregate: EUR25M) over alleged non-compliance with dating-app payment system ruling Dutch tech reporter Nando Kasteleijn of NOS just reported on Twitter that the Authority for Consumers & Markets--the Dutch antitrust authority--has imposed another contempt sanction on Apple of EUR5 million ($5.7 million) for this calendar week, on top of EUR20 million ($22.7 million) imposed over the course of the past four weeks. The competition regulator of the Netherlands claims that Apple's so-called "solutions" still fall short of what the agency believes needed to enable dating-app makers to make use of alternative payment systems to Apple's own IAP: Nieuwe week, nieuwe last onder dwangsom van de ACM voor Apple. Nu totaal EUR25 mln (max is EUR50 mln). "Hun 'oplossingen' blijven te veel drempels opwerpen voor datingapp-aanbieders die een eigen betaalsysteem willen gebruiken." -- Nando Kasteleijn (@nandokasteleijn) February 21, 2022 As I discussed with Tweaker's Arnoud Wokke on Twitter, these fines are levied in advance. They are meant to have a coercive effect: Apple can still avoid them for a new week by bringing its conduct into compliance. Those weekly sanctions can reach--but not exceed--a total of EUR50 million ($56.7 million). The complaint that led to the underlying decision on the merits (which Apple is still appealing) was brought by Match Group, a U.S. company best known for Tinder. Someone claimed on Twitter that Match Group has zero employees in the Netherlands. There may not be a single Dutch app maker that has a substantial benefit from this case. That doesn't deprive the ACM of jurisdiction as its job is to protect the "C" in its name: Dutch consumers. However, it's easy to see that this case only makes sense as a "pilot project" with the objective of expanding the same reasoning to other app categories and to other jurisdictions, particularly other EU member states, as the ACM says it's decision is based not only in Dutch but also EU competition law. While I'm a vocal critic of Apple's App Store terms, the Dutch situation is not a simple one of Apple committing violations and acting as if it were above the law. The situation is rather more nuanced, and on the specific question of whether Apple can reasonably require app makers to submit a new app for the Dutch market, I can see technical reasons--apart from obvious commercial motives--for which Apple has made that choice. Apple is simply trying to capitalize on the fact that the Dutch market is small. If Apple required app makers to submit a new app for the entire EU Single Market, some would also complain that it's a hassle, but if it resulted in major savings for developers, it would be worth the effort. The much bigger issue here is whether Apple can collect a 27% commission on revenues that bypass its IAP system. Considering that certain alternative payment systems have a base transaction fee such as $50, 27% is a prohibitive commission compared to the 30% Apple normally demands (and in any event it's higher than the 15% of Apple's small business program, making it a total non-option for dating-app startups). I don't think Apple would realistically be able to impose a 27% commission as a fair, reasonable and non-discriminatory (FRAND) IP license fee. But the question is whether the ACM can do anything about it in the short term. I have my doubts, let's put it that way. New York University (NYU) professor Scott Galloway calls Apple's cut a "mob-like 30% toll" in a very thought-provoking article on how Apple might hit $1 trillion in revenue by 2030 (from $366 billion last year) leveraging its power and resources. The headline is "Apple: Thief" and I'd like to highlight this tweet by the author on Apple just "stealing markets from incumbents": Getting to a trillion $ in revenue will require stealing markets from incumbents. #nomercynomalice #Apple #Amazon #Meta #Microsoft https://t.co/DvesgueKhX -- Scott Galloway (@profgalloway) February 19, 2022 There are serious issues. I agree with mobile app business guru Eric Seufert that the impact of Apple's ATT (anti-ad-tracking) policy on Shopify's stock price raises concerns about how small and medium-sized businesses (many of which rely on Shopify) suffer under the Apple tyranny. Also, ATT is a total squeeze that makes user acquisition ("UA") more expensive while diminishing the ad-based revenue generation opportunity. I still think the Dutch dating-app case has the potential--if the same reasoning is applied to other app categories and spills over to other (especially European) markets. But it's all taking time, and in some jurisdictions (including the EU) new legislation may make an impact ahead of definitive and tangible results from any enforcement of the existing laws. It's a complex situation. I will continue to criticize Apple, but I strive to be a rational (not rabid) critic. For now, I think Apple's conduct following the ACM decision is above board. Sort of hardball, but not out of line--and not entirely without merit. Follow @FOSSpatents Share with other professionals via LinkedIn: Share| Eingestellt von Florian Mueller um 4:44 PM # # Labels: Antitrust, App Developers, App Store, Apple, iOS, Match Group , The Netherlands Older Post Home CONTACT FORM Follow @FOSSpatents on Twitter Follow @FOSSpatents Email Newsletter Get new posts by email: [ ] Subscribe Blog Archive * V 2022 (60) + V February (27) o Dutch antitrust authority fines Apple for fifth ti... o ITC institutes investigation of Apple's allegation... o Texas court schedules Apple v. Ericsson (FRAND cou... o Texas judge schedules Ericsson v. 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His 30 years of software industry expertise span different market segments (games, education, productivity and infrastructure software), diverse business models, and technical and commercial areas of responsibility. In recent years, Florian advised a diversity of clients on the patent wars surrounding mobile devices, and on their economic and technical implications. (In order to avoid conflicts of interest, Florian does not hold or initiate transactions in any technology stocks or derivatives thereof.) He is now developing games for smartphones and tablet computers. View my complete profile