WWDC20 Preview: Apple’s Chance to Start Addressing Antitrust Concerns

WWDC20 Preview: Apple’s Chance Start Addressing
Cheyne Gateley/VIP

An entirely virtual audience isn’t the only thing different about WWDC20, the 31st iteration of Apple’s annual developer’s conference that kicks off Monday.

In addition to the looming presence of COVID-19, the weeklong conference will play out under the shadow of controversy, as Apple fends off fresh developer rage and an antitrust probe. Both speak to the company’s role as a gatekeeper to the massive iOS user base. 

As always, WWDC will be dedicated to offering engineers guidance on building apps and implementing new features. But on Monday Apple should give consumers more than enough to chew on with its “Platforms State of the Union,” where we’ll get the latest updates coming to Apple’s services.

Big changes may be coming for the next iOS (14), which rumors suggest could allow users to set third-party apps like Spotify or Google Maps as defaults over Apple Music and Apple Maps, according to CNET.

By allowing for third-party apps to be defaulted, Apple can argue that it’s taking steps to even the playing field. And European competition commissioner Margrethe Vestager has mentioned the EC was focused on ensuring Apple’s rules are not distorting competition in markets where it’s competing with app developers.

Still, that would be far from enough to remedy Apple’s headaches, which are specifically concerned with its requirement of App Store apps to use its own payment tech for in-app purchases (IAPs) and subscriptions, from which it could take a 15%-30% cut.

The issue with Apple’s digital goods tax is twofold. For one, it’s extremely difficult for smaller apps like e-book seller Kobo to operate in the green while giving up 30% of each sale. Second, the tax appears to be applied almost arbitrarily at times, with certain apps like Prime Video and Canal+ being able to avoid it. 

Since Apple is providing iOS developers with access to a large consumer base in a cleanly curated App Store, an immediate compromise/way to address the issue would be to apply some sort of sliding scale on the cut it takes from IAPs, based on the size of an app. 

Sure, this would mean Apple gets less from the massive revenue pot of the app store, which totaled $55 billion in revenue and supported $519 billion in billings and sales 2019. But it would also probably mean less grief from developers and regulators, which both don’t appear ready to ease up off the gas pedal any time soon. 

Moreover, increased uptake of its own services, like Apple TV+, could make up for some of the revenue lost via in-app purchases. iOS14 code suggests there may be a new Siri remote for Apple TV, according to 9to5Mac, and a new cheaper version of the remote (it’s currently $60 on Apple’s website) could make purchasing an Apple TV box more appealing to some.

Meanwhile, a bundle of Apple’s various services has been rumored to be in the works for a while, and announcing that at WWDC could be a boon for TV+. The service only had about 5 million active users as of February, but discounted access to the service, which is set to get big movies like “Greyhound” and Scorsece’s next mega-movie “Killers of the Flower Moon,” would likely drive some to sign-up.