Apple swaps a per-install EU fee for a 5% cut, and the math on leaving the App Store changes

Apple announced on Tuesday a revised EU commission structure that it says resolves its disagreements with the European Commission over business terms and alternative distribution ^[1][18]. The per-install Core Technology Fee is gone, replaced by a flat 5 percent Core Technology Commission on digital transactions in apps distributed through alternative marketplaces or the web ^[2], which turns the main fixed cost of leaving the App Store into a variable one.

The old fee was 50 euro cents per download for every annual install above one million, and Apple is also dropping the initial acquisition fee and the store services fee ^[3][4]. The arithmetic is simple: 50 cents per install equals 5 percent of transactions at 10 euros of digital revenue per install ^[22]. Below that figure the new terms cost less, above it they cost more. The sharper change is for apps that monetise thinly or not at all through digital goods. Under the fee, an app crossing a million installs owed money whether or not it sold anything; under the commission, no digital transactions means nothing to commission ^[25]. That was the case that killed alternative distribution for free apps with real install volume, and it has stopped being a reason not to model it.

Inside the App Store the ladder is now 26 percent for Apple in-app purchase, 20 percent for in-app alternative payments and 15 percent for link-outs, falling to 15, 10 and 10 percent for developers in the Small Business, Mini Apps Partner and Video Partner programs, and for auto-renewing subscriptions after the first year ^[6][8][9]. Apple sets the 26 percent rate against 30 percent under its traditional terms, a four point cut ^[7][24]. The number that matters for a distribution decision is the gap between a link-out at 15 percent and distribution outside the store at 5 percent: ten points, or five points for a developer already in one of the programs ^[23].

The costs that are not on the rate card have moved less. Every app in an alternative channel still goes through Notarization ^[12]. Payment options must be chosen and held for twelve months before changing, though Apple will now allow its own in-app purchase to sit alongside alternative payments, which it previously did not ^[10][11]. Link-outs are barred from Kids category apps and for users under 13, and any App Store app using alternative payments or link-outs needs a parental gate for users under 18 ^[19]. Web distribution remains EU-only ^[20], and Apple says it lacks the ongoing oversight a marketplace operator provides, which can let bad actors run for a long time before anyone notices ^[21].

For teams considering running a marketplace, the door is wider. Apple previously required a one million euro standby letter of credit from an A-rated financial institution, or two years in the Developer Program plus an app with more than a million first annual installs in the EU in the prior year ^[13][14]. The new bar is a moderate Dun and Bradstreet financial stability score, public company status or ownership, venture funding from an established firm, a completed audit by a licensed accountant, or status as a government entity, educational institution or nonprofit ^[15].

The backdrop is enforcement, not goodwill: the Commission fined Apple 500 million euros last year over DMA noncompliance, and critics called the structure that followed an example of "malicious compliance" ^[16]. Apple lost its bid to exclude the App Store and iOS from the DMA last month ^[17].

Developers can sign the new terms now, and they take effect on October 1 ^[5]. Two things to watch: whether the Commission states publicly that this closes the matter, and whether the relaxed eligibility rules produce marketplace operators who were previously priced out of applying.