Developer welcomes alternative App Store payments, but not without caution

“There will be significant difficulties for any developer who will want to use third-party payment options if they are not Epic or Steam.”

What you need to know

  • Apple is under more and more pressure to allow third-party alternative payments in the App Store.
  • The founder of MacPaw and Setapp, Oleksandr Kosovan has welcomed the prospect.
  • However, Kosovan also says that third-party options must be transparent about data use, and might not benefit smaller developers.

With the prospect of Apple being forced to allow alternative in-app payments options in its iOS ecosystem, one developer has welcomed the change, but cautions against the use of user data and the limited benefit it might give to small developers.

Speaking to iMore, Founder & CEO at MacPaw and Setapp Oleksandr Kosovan says that there are advantages to using in-app alternative payment options, but that they might not be all things to all developers.

Kosovan’s comments come following the Epic Games vs Apple verdict, now under appeal by both parties, prohibiting Apple from stopping developers from adding links and buttons to payment options outside of the App Store when paying for goods. Seizing on an opportunity, payment platform Paddle announced a new alternative in-app payment system for iOS which has raised some eyebrows. From our report:

Paddle says the system is a “true like-for-like, drop-in replacement for Apple’s IAP, allowing developers to maintain a seamless user experience, without having to pay Apple 30% of every sale”. Commission is charged at just 10% on transactions of less than $10 and only 5% on those of more than $10. It also features subscription control tools.

At the time we reported that, according to one expert, the tool was likely to see developers have their apps banned. Away from the specifics of Paddle, Kosovan believes that developers should have more control over their apps. “For developers, having full control over the way they sell their apps means that they can offer more flexible and user-friendly business models compared to what is currently allowed by Apple on the App Store, like in-app purchases or Apple subscriptions,” Kosovan said. He believes that Apple’s current offerings “lead to a subpar user experience for the majority of the apps nowadays.”

This isn’t just bad for users, says Kosovan, whose MacPaw suite has over 30 million users worldwide. He further says that for some developers Apple “is charging too much for the App Store”, and that by providing more custom payment options, developers will be able to offer more affordable prices or invest more money in making their products better.

Kosovan’s enthusiasm for alternative payments doesn’t come without warning, however. Touching on concerns raised by Apple both at the Epic Games trial and elsewhere, he noted that “it is vital for payment processing companies to be transparent about how they use the data” to address concerns over privacy. This privacy has been at the heart of some of Apple’s messaging over alternative payments on iOS, and Apple warned the court of concerns about the privacy of Paddle’s payment solution in its appeal of the verdict in the Epic Games trial.

Another concern raised is just who all of this is for. Epic Games has painted itself as a crusader for downtrodden developers of the App Store, but CEO Tim Sweeney admitted during the trial it would have taken a special deal from Apple not available to any other developer, and that Epic had not thought about the impact of its push for alternative payments beyond gaming.

“There will be significant difficulties for any developer who will want to use third-party payment options if they are not Epic or Steam,” said Kosovan, hinting at the sentiment that small developers stand to benefit little from the changes called for. “Apple made it very simple to have one account with all the payment details shared across all services,” he continued, before admitting that “only aggregators and services like Setapp will have any chance to compete with Apple in providing a seamless user experience.”

Alternative payments on iOS continue to be a big bone of contention in antitrust probes, and Apple has previously warned that allowing them would see it give up its entire return on the App Store as a product. Elsewhere, CEO Tim Cook has said that without Apple’s in-app payment method the company would have to find another way to collect its commission from developers. A bold move the court seemingly backed when it ordered Epic Games to pay Apple commission on all the money it had taken through Epic direct payments on Fortnite as a result of the hotfix that kick-started Project Liberty.

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