Last month, Facebook launched a new paid events option in order to provide another way for businesses to generate income amid the COVID-19 crisis, and in replacement of IRL functions.
At the time, Facebook highlighted its opposition to Apple’s revenue approach, which meant that it would need to pay 30% of any funds raised through the option to Apple for any event on an iOS device.
“For transactions on the web, and on Android in countries where we have rolled out Facebook Pay, small businesses will keep 100% of the revenue they generate from paid online events. We asked Apple to reduce its 30% App Store tax or allow us to offer Facebook Pay so we could absorb all costs for businesses struggling during COVID-19. Unfortunately, they dismissed both our requests and SMBs will only be paid 70% of their hard-earned revenue.”
This is just one of several criticisms Facebook has shared publicly in regards to Apple’s 30% in-app charge – but in this instance, Apple has actually decided to change its stance and give Facebook more leeway to help struggling businesses.
As reported by TechCrunch:
“Today, Facebook is announcing a reversal on Apple’s part: Online event fees will be processed through Facebook Pay, without Apple collecting its 30% cut, meaning businesses will receive all of the earnings from their online events, minus taxes.”
That may be a bigger win than it initially appears.
Various companies have joined in the recent criticism of Apple over its in-app fee structure, the most high-profile of which being Epic Games, which has decided to take its fight against Apple to court over its 30% fee being applied to in-app purchases in its popular game Fortnite.
Apple has suspended Fortnite from The App Store, and is investigating further penalties, after Epic refused to keep paying, instead opting to charge its users less for in-app purchases on other platforms.
Epic’s argument is that Apple has no stake in such purchases once the app has been downloaded, with The App Store no longer playing a role in the transaction. With the 30% fee removed, Epic argues that it can better serve its audience with lower charges, facilitating business growth and expansion, which is being limited by Apple’s policies.
As noted, Facebook has also aired its grievances about Apple’s approach on several fronts.
Last month, Facebook also released a new version of its Facebook Gaming app, which it was forced to revise on iOS due to Apple’s classification of in-app functions. Facebook has also clashed with Apple over in-app notifications, through which it sought to alert users to Apple’s 30% fee. Apple refused any such notification, standing form on its long-held position on its process.
Given this, Apple’s decision in the case of Facebook’s paid events option is a significant step, and shows that Apple may have at least some flexibility in how its regulations may be applied. Though it’s only temporary – Apple has said that the events fee removal will only be in place till December 31st, and it won’t apply to gaming creators.
Still, maybe it’s a sign that Apple is reconsidering such, which could bode well for Epic Games in its ongoing battle with the company. But probably not. Any ground Apple gives up in any isolated case will have potential implications for other apps looking to implement similar, and Apple could lose billions in fees if it cedes too much to pressure on this front.
As such, it may be up to a court to finally decide whether Apple’s charges are anti-competitive – but still, from right now, people running paid events on Facebook can generate more income from such via iOS.
Worth noting in your planning.