In the recent past, Apple has taken heat from many quarters for its high App Store fee. The company currently takes a 30% cut out of developers’ revenue to distribute the app and maintain App Store. However, Adam Mosseri, Instagram CEO, has publicly encouraged creators to avoid Apple’s App Store fees.
Mosseri expressed displeasure over App Store fees in an interview with CNBC.
When there are digital transactions that happen on iOS, Apple insists that they take 30% of that. There’s a very few number of exceptions. For transactions that happen in iOS, we’re going to have to abide by their rules… but in general we’re going to look for other ways to help creators make a living and facilitating transactions that happen in other places.
Instagram CEO says brands and creators can work with each other. They can vet each other and “could make those transactions offline.” He further explains how affiliate marketing transactions will turn into real goods as opposed to digital goods. Facebook intends to help creators “to try and lean in to the places creators can actually make a stable income.”
Apple levies 30% fees for digital goods sold through apps distributed via App Store. In other words, creators will have to share their revenue not only with Facebook but also with Apple. However, Facebook says it will help developers skirt fees by introducing offline transactions. The company is yet to reveal its fees but maintains it is lesser than 30%.
Epic locked horns with Apple after introducing a direct payment system on Fortnite. Soon enough, Apple booted Fortnite from the App Store. Epic and a coalition of its developers have dragged Apple to the court over App Store fees. More recently, Apple introduced a new app tracking feature on iOS 14 that asks users content for cross-app tracking. Facebook is set to lose a major chunk of its ad revenue and launched a tirade against Apple.