Apple’s policy of not allowing app developers to integrate third-party payment methods into their services was upheld as “illegal” by a California appeals court earlier this week. The iPhone maker takes a 30 percent discount on all in-app purchases and enforces strict App Store rules. The court ruling could bring changes to Apple’s App Store payment practices and also allow Web3 apps to add more functionality to their iOS apps. Web3 apps include new technical elements such as cryptocurrencies, metaverse and non-fungible tokens (NFTs).
Apple’s strict App Store rules have been challenged by Epic Games, the maker of the Fortnite, in a long-running antitrust suit, with the latest ruling upholding a 2021 injunction.
The U.S. Court of Appeals for the Ninth Circuit said Apple’s restrictive payment rules for iOS app developers hurt their businesses, including Epic Games. The rules have been called out because they also interfere with consumer engagement with these apps.
The development was confirmed by Tim Sweeney, the founder and CEO of Epic Games.
“The court upheld the ruling that Apple’s restrictions have ‘a substantial anti-competitive effect that harms consumers,'” Sweeney wrote in his tweet.
Fortunately, the court’s affirmative decision rejecting Apple’s anti-steering provisions gives iOS developers the freedom to direct consumers to the web to do business with them directly. We are working on next steps.
— Tim Sweeney (@TimSweeneyEpic) April 24, 2023
The digital asset sector has a notorious reputation for being volatile. To prevent iOS users from exposing themselves to the financial risks of dealing with crypto, Apple enforces strict rules on the platform.
Last April, Coinbase CEO Brian Armstrong expressed his disappointment with Apple’s App Store’s existing rules, which he said hindered the ease of integrating new payment options other than Apple Pay for pro-Web3 developers.
Currently, Apple Pay does not support cryptocurrency transactions. Crypto payments are not accepted for iPhones and other Apple products, and as noted by Armstrong, the App Store is also resistant to supporting crypto apps. However, crypto wallet apps are available on the App Store.
“Apple hasn’t really played nice with crypto so far; they actually banned a lot of features that we would like to have in the app, but they just don’t allow it – so there are potential antitrust issues,” the 39-year-old Coinbase chief said at the time.
Apple plans to appeal the latest ruling. “We respectfully disagree with the court’s ruling on the only remaining claim under state law and are considering further review,” the tech giant said in a statement.
