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Illustration: Aïda Amer/Axios

While many developers will benefit from Apple's move Wednesday to cut commissions for companies earning less than $1 million per year in App Store revenue, the company's critics derided the move as a cynical attempt to distract from what they see as Apple's broader anticompetitive business practices.

Why it matters: Apple's move appears designed to appease concerns from critics and regulators, but it's unclear how far it will go to assuage them. Thus far, not very.

Between the lines: The vast majority of developers make less than $1 million per year and will benefit from the change. But most of Apple's revenue comes from a small number of large developers.

  • That means most consumers will still be absorbing Apple's higher 30% rate for the vast majority of paid downloads and in-app purchases.
  • Loup Ventures' Gene Munster estimates that the move will cut Apple's commission revenue for fiscal 2021 from $15.8 billion to $14.2 billion, about 0.5% of the company's total estimated revenue.

The big picture: Most of those who spoke out Wednesday have previously criticized Apple over its App Store practices, including Spotify, Match Group, Basecamp — and of course Fortnite creator Epic Games, which is suing Apple (and Google) over mobile app store commissions.

  • Speaking at the New York Times' DealBook online summit, Epic CEO Tim Sweeney called his company's effort an act of civil disobedience: "When a contract goes outside the bounds of the law, as Apple is doing, and has such a negative and pervasive impact on society, it's everybody's duty to fight."
  • As for Apple's rate cut, Sweeney said it was "a fantastic change" for many small developers. "Who it's not awesome for is consumers," he said.

What they're saying:

  • Basecamp CTO David Heinemeier Hansson: "Trying to split the App Store opposition with conditional charity concessions, they — a $2T conglomerate — get to paint any developer making more than $1m as greedy, always wanting more. As clever as it's sick."
  • Coalition for App Fairness: "Apple's announcement doesn't even begin to rectify the abuse and monopoly behavior developers have to endure in the App Store. We need fundamental change."

The other side: "The reduced commission for small businesses will allow them to put additional resources towards scaling up and innovating new products and services," said ACT — The App Association president Morgan Reed.

Go deeper

Ina Fried, author of Login
Updated Jan 27, 2021 - Technology

Apple's quarterly sales top $100 billion for first time

Credit: Apple

Spurred by strong sales of the latest iPhones, Apple reported it took in a record $111 billion in revenue for the three months ended Dec. 31, as the company crushed expectations.

Why it matters: The move showed even a pandemic didn't dull demand for Apple's latest smartphones.

Dion Rabouin, author of Markets
Jan 28, 2021 - Economy & Business

Apple raked in $111 billion in revenue in a single quarter

Expand chart
Data: FactSet; Chart: Axios Visuals

Big Tech had a strong start to earnings season, as the S&P 500's heavy hitters reported Wednesday after market close.

What happened: Spurred by strong sales of the latest iPhones, Apple had its strongest quarter ever, raking in $111.4 billion in revenue for the three months ended Dec. 31, far outpacing expectations.

Cuomo says words may have been "misinterpreted" following allegations of harassment

New York Gov. Andrew Cuomo at a Feb. 22 news conference. Photo: Seth Wenig/pool/AF via Getty Images

New York Gov. Andrew Cuomo issued a lengthy statement on Sunday saying he " never inappropriately touched anybody" but acknowledged that "some of the things I have said have been misinterpreted as an unwanted flirtation," after two of his former aides accused him of sexual harassment.

Why it matters: Prior to Cuomo's statement, in which he adds that he "never inappropriately touched anybody" or meant to make anyone uncomfortable, the governor's office and the state attorney general went back and forth in a public disagreement about how to investigate the allegations.