Microsoft Says Apple Still Charges Too Much in Mobile Store

Microsoft has submitted a filing with the UK Competition and Markets Authority (CMA) explaining why Apple’s mobile app store fees are still far too high despite several rounds of changes this year alone. As the software giant explains, this onerous fee structure and other convoluted Apple policies explain why it and Nvidia haven’t brought their cloud game streaming services to Apple’s devices.

“Apple’s [in-app purchase] IAP commission fee is set at a level that is neither economically sustainable nor justifiable,” Microsoft argues in the filing. “The 30 percent commission fee makes it impossible for Microsoft to effectively monetize its cloud gaming service offering … As observed by the CMA in its Mobile Ecosystem market study, the 30 percent fee imposed by Apple on IAPs is the result of a lack of competition in the distribution of native iOS apps.”

Microsoft also takes aim at Apple’s bogus claims that the fees are somehow justified by services the App Store provides to app makers. Not true, Microsoft notes: “Apple contributes nothing to the [in-app] purchase, not even on discoverability and accessibility.”

Microsoft first made this complaint in January, and it’s related to issues regulators are now raising in the EU as well, thanks to Apple’s ongoing malicious compliance with the European Union’s Digital Markets Act (DMA). Since then, Apple has made multiple changes to its policies for complying with the DMA, and it has been working with the CMA to avoid similar repercussions in the UK.

“Apple applies the IAP requirement uniformly to all apps for any purchases of digital goods and services,” the firm argues in its own filing with the CMA. “There is no basis for treating cloud gaming apps differently from other apps, even if the developer of the cloud gaming app sources some or all of the games from other developers.” That’s a specious argument and easily debunked: Apple doesn’t charge per-stream IAP fees on videos users watch on Netflix or other services.

And it’s not just the fees, Microsoft notes.

“Apple’s App Store policies do not allow the development of distribution channels outside the App Store which could facilitate access to and take-up of [cloud gaming services] CGSs,” the Microsoft filing explains. “In particular, given the discoverability and accessibility limitations of web apps, the prohibition of alternative iOS app stores represents a major barrier to take-up.”