June 13, 2024


Unlimited Technology

Apple halved its App Store fees for Amazon’s Prime Video app

Apple offered Amazon lower App Store fees to convince the e-commerce giant to launch its full Prime Video app on the iPhone App Store, newly-released documents have revealed.

An email sent by senior Apple executive Eddy Cue to Amazon chief executive Jeff Bezos in 2016 shows Apple took a 15pc cut of people signing up for streaming services through Amazon’s Prime Video app when that customer originally signed up through an Apple device.

Apple typically charges a 30pc cut of all subscriptions made in the first year of an app being available in its App Store, a fee which has frustrated app developers in recent years.

The email was released ahead of a multi-hour Congress hearing into alleged antitrust abuses by technology companies. Apple chief executive Tim Cook gave evidence in the hearing, as did Mr Bezos.

The reduced App Store fees for Amazon’s Prime Video app appear to have been part of a longstanding programme run by to provide better fees for what it calls “premium subscription video entertainment providers”.

Apps including Prime Video, Altice One and Canal+ are all given preferential App Store rates for purchases as long as the apps have direct integration into Apple services such as Siri or its AirPlay 2 wireless speaker technology.

Other emails released on Wednesday included a 2011 email sent by Mr Cue to other Apple employees in which he suggested taking a 40pc cut of App Store purchases, a higher fee than the company’s current 30pc cut.

His colleague Jai Chulani replied to say that Apple “may be leaving money on the table if we just asked for about 30pc of the first year” of subscriptions in iPhone apps.

During the hearing, Representative Hank Johnson, a Democrat from Georgia, suggested that Apple’s App Store review guidelines are changed on a whim to benefit the company and shut out smaller developers.

“That is not correct,” Mr Cook said. “We treat every developer the same.” An Apple spokesman declined to comment.

On Thursday, Telegram, the messaging app, filed formal antitrust complaint to the EU over Apple’s App Store.

In its complaint Telegram said Apple must “allow users to have the opportunity of downloading software outside of the App Store”.

Spotify and Rakuten have previously complained to the EU that the App Store’s a 30pc fee on its smartphone store constitutes an unfair “app tax” that stifles competition.

Apple has repeatedly denied that it engages in anti-competitive behaviour. 

Source News