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You can’t have missed it, surely. Fortnite is back on the US App Store, and it’s got Apple tax-dodging payment systems built right into the IAP flow.
For some, this moment represents a tipping point for the mobile game business – a liberation from Apple’s infamous 30% IAP commission. But this shift perhaps won’t be as dramatic as Tim Sweeney is making out. It’ll likely be a slow-burner – and only benefit those already operating at scale.
The likes of Scopely and Supercell already have their webstores up and running anyway, and will now get bolder in terms of pushing their high spenders into them. But we’ve yet to see the likes of Microsoft, Tencent, Dream and Playrix really pull the trigger on this stuff, and I can see why.
Often, players of more casual fare like Candy Crush, Royal Match or Gardenscapes just want familiarity and routine. A new web pop-up asking you for money may break the zen-like flow these games are often built on. Also: practically everyone using the modern internet is sick of adding details into a webform, even if it will save them 20% on in-game currency.
For this Apple tax dodge to work at scale, the user flow needs to be effortless and the benefits for changing long term habits need to be very, very clear. We’ll see this ironed out and perfected over time, i’m sure, but for now this is really a win for the companies already succeeding anyway, particularly with established midcore games.
As I noted last week, the next big player to make its move here is Microsoft. The owner of Candy Crush Saga, Call of Duty: Mobile, Diablo Immortal and Minecraft has been talking about its own app store for years now, but it’s still not here. And it may never exist at all after this US app store ruling.
In a recent newsletter I noted that launching a new app store, like Epic has, maybe isn’t the move to make now – it’s cleaner and easier to keep building your business on Apple and Google’s existing stores while adopting these newfound freedoms as effectively as you can.
The platform business, a bit like social media, is winner takes all. On PC, the Epic Games Store has been trying to steal business away from Steam for years now. Even with regular free game giveaways and the biggest game on the planet in its armoury, Epic has only had mixed success so far.
The App Store and Google Play will continue to be the de facto mobile game stores. No amount of marketing or freebies from Epic or an Xbox app store will make people move over to those storefronts, I think, even if they are vastly superior experiences. The Microsoft solution, like Epic’s, will likely be simpler. A web pop-up gets you the Apple tax dodge you wanted with a fraction of the effort. So just do that, right?
It’s also worth remembering these freedoms are still US-only for now. There may still be movement elsewhere as the EU, South Korea and Japan’s legislators are emboldened by the US’ approach to Apple’s IAP shenanigans. So really, there’s just more messiness to come, probably – and more damaging headlines for Apple if it continues to fight for its 30% every step of the way.
In two weeks time – a fortnight, in fact! – Apple holds its annual developer conference, WWDC. This particular elephant in the room simply has to be addressed, surely. Apple can fix this mess by just reducing its commission and playing fair, before all of that IAP revenue disappears completely through webshops.
I have no doubt there are bean-counters within Apple working on this right now. There must be. Where is the sweet spot between reducing its IAP cut and retaining as much cash as possible, taking the potential losses from web payments into account? 20%? 15%?
Apple has to figure this out, and by Monday June 9 at 10am Pacific time. If the iPhone maker somehow does a two hour WWDC keynote without mentioning or addressing this crisis at all, then we know for sure Apple has completely lost the plot.
