Japan antitrust regulator to increase scrutiny of Apple's App Store

Posted:
in General Discussion edited September 2020
Japan's antitrust authority this week said it will keep a watchful eye over Apple's App Store practices, a decision reportedly prompted by the tech giant's high-profile battle with Epic Games.

Apple Marunouchi
Apple's Marunouchi store in Tokyo, Japan.


While the Japan Fair Trade Commission failed to go so far as to launch an official investigation into App Store guidelines, the body said it will pay closer attention to Apple's business, reports Bloomberg. What processes and oversight measures that level of scrutiny entails is unknown.

Alongside government pressure, a handful of game makers in the region are speaking out against Apple's management of the App Store, though the movement appears to be more about communication and developer relations than compulsory fees.

"Apple's app review is often ambiguous, subjective and irrational. Apple's response to developers is often curt and boilerplate, but even with that, you must be polite on many occasions, like a servant asking the master what he wants next," Makoto Shoji told Bloomberg. Shoji is founder of PrimeTheory Inc., a company that markets a service called iOS Reject Rescue to help developers navigate the App Store approval process.

Japan is home to some of the gaming industry's biggest names, including Square Enix, Bandai Namco and Sony. Square Enix, known for its "Final Fantasy" series, sees 40% of its group revenue generated by smartphone app sales, according to the report.

Developers in Japan are familiar with Apple's revenue sharing model, which takes a 30% slice of in-app purchases, as a similar practice was adopted by Nintendo in the 1980s. Most app makers do not mind the fee, but expect better service from a company of Apple's caliber, the report said.

Some app firms find Apple's App Store procedures opaque and problematic, especially when compared to Google's Android Play Store. Compared to Apple, Google's approval process is "smoother" and the search giant better communicates what is needed. Some complain of weeks-long review periods, a delay that can be costly for apps promoting seasonal events.

"While Apple will never admit it, I think there are times when they simply forget an item's in the review queue or they intentionally keep it untouched as a sanction to a developer giving them the wrong attitude," said Shoji.

Others note uneven and, in some cases, contradictory application and enforcement of App Store rules.

For its part, Apple said it works to provide the high-quality support to the Japanese development community through some 1,400 advisers and customer service employees based in the country. Further, the company's app review team operates across two time zones and makes Japanese-speaking representatives available by phone.

The efforts are not enough for some. Developers in the region decry Apple's handling of the App Store as the iPhone maker wades through a high-profile legal fight with Epic Games.

Epic in August baited Apple into removing popular battle royale title "Fortnite" from the App Store by implementing a direct payment feature that violated App Store guidelines. After the game's removal, Epic launched a lawsuit and marketing campaign in protest of Apple's 30% cut of in-app purchases and restrictions against third-party app stores.

Apple terminated Epic's developer account last week while the parties await a hearing scheduled for September.

Epic's actions have emboldened Japanese developers. As noted by Bloomberg, founder and chairman of Gumi Inc., Hironao Kunimitsu, risked retribution in a Facebook post, saying, "I want from the bottom of my heart Epic to win."

Comments

  • Reply 1 of 14
    Sounds like Epic has found a way to tighten the screws on Apple. Stupid really given they knew Apple’s terms before signing up in the AppStore.
    Beatsdewme
  • Reply 2 of 14
    FatmanFatman Posts: 513member
    Retail store landlords and shopping malls often charge high rents to companies to setup a storefront in high traffic, premium locations. Companies are not forced to lease a spot, they have choices to sell their goods elsewhere. Some companies feel that they benefit from that relationship and pay high rents to get in front of the audience they want to. The App Store is a digital mall that caters to many shoppers, companies can choose to participate if they pay ‘rent’ but these companies have other options, They can sell through Google, Xbox, PlayStation, their own online store and even physical retail stores. So again why is Apple the bad guy? For creating a great ‘virtual mall’ that took billions to develop and maintain - now companies like Epic and cash poor countries want to take that away?
    sully54christophb
  • Reply 3 of 14
    I've said this before. Apple should shut down the app store in any country that seriously questions its legitimacy or fairness. Apple's explanation should be, "We are shutting it down as a courtesy to the authorities in this jurisdiction until they give us the all-clear to turn it back on." But Apple seems to have a non-confrontational approach. I would ask Apple to show some pugnacity, gumption and perspicacity. "Who Dares Wins."
    Dogpersonchristophb
  • Reply 4 of 14
    BeatsBeats Posts: 2,292member
    So stupid to punish Apple for being too successful. Who's next? Netflix looks like a good target. They should allow others in their app because it's just not fair that they have that much users.
    matrix077
  • Reply 5 of 14
    BeatsBeats Posts: 2,292member
    I've said this before. Apple should shut down the app store in any country that seriously questions its legitimacy or fairness. Apple's explanation should be, "We are shutting it down as a courtesy to the authorities in this jurisdiction until they give us the all-clear to turn it back on." But Apple seems to have a non-confrontational approach. I would ask Apple to show some pugnacity, gumption and perspicacity. "Who Dares Wins."

    Knockoff iPhones exist. That's the problem. People will just flock to stolen technology.
    edited September 2020
  • Reply 6 of 14
    Beats said:
    I've said this before. Apple should shut down the app store in any country that seriously questions its legitimacy or fairness. Apple's explanation should be, "We are shutting it down as a courtesy to the authorities in this jurisdiction until they give us the all-clear to turn it back on." But Apple seems to have a non-confrontational approach. I would ask Apple to show some pugnacity, gumption and perspicacity. "Who Dares Wins."

    Knockoff iPhones exist. That's the problem. People will just flock to stolen technology.
    I didn't say stop selling iPhones. And knockoff iPhones don't have the Apple App store (or popular apps like iMessage) so why would someone switch to knockoffs? The point is that some people will actually miss the App Store and they will put pressure on the jurisdiction to resolve this quickly. Apple should choose to fight back rather than just sit back and take all the punches.
    Dogperson
  • Reply 7 of 14
    kbeekbee Posts: 23member
    I've said this before. Apple should shut down the app store in any country that seriously questions its legitimacy or fairness. Apple's explanation should be, "We are shutting it down as a courtesy to the authorities in this jurisdiction until they give us the all-clear to turn it back on." But Apple seems to have a non-confrontational approach. I would ask Apple to show some pugnacity, gumption and perspicacity. "Who Dares Wins."
    You should tell Apple about this cool idea. As a revenge for being criticized they should just shut down their own business. Guess you have a PhD in economics? But wait a second ....
    elijahgCloudTalkin
  • Reply 8 of 14
    Developers always want maximum access to data and OS functions, and minimum resistance to publishing. The App Store however, is not only for the developers but also for the consumers. And consumers basically want the opposite; data integrity and quality control of all apps. So there is a delicate balance Apple needs to uphold here.

    The big problem with Epic, and a few other dev companies, is that they are trying to brain wash the consumers into believing that what’s best for the devs is also best for the consumers. And since dev companies now unite around a common cause, while all consumers are still scattered individuals, the pressure to tilt the App Store balance is now in an unhealthy favor to the devs.

    I think it’s time somebody not from the dev industry began uniting consumers around the question of App Store, so we get a healthy debate on the topic — not just babies crying for more money.
    edited September 2020
  • Reply 9 of 14
    kbee said:
    I've said this before. Apple should shut down the app store in any country that seriously questions its legitimacy or fairness. Apple's explanation should be, "We are shutting it down as a courtesy to the authorities in this jurisdiction until they give us the all-clear to turn it back on." But Apple seems to have a non-confrontational approach. I would ask Apple to show some pugnacity, gumption and perspicacity. "Who Dares Wins."
    You should tell Apple about this cool idea. As a revenge for being criticized they should just shut down their own business. Guess you have a PhD in economics? But wait a second ....
    Your argument is a great example of "reductio ad absurdum." In English that means "appeal to extremes". I was talking only about Apple shutting down its App Store in a single jurisdiction (eg, maybe Russia). That could mean a 1% loss in sales, on a temporary basis, until that jurisdiction decides they want the App Store back, not 100%. Is that more clear now? What part of this do you not understand?
    Dogperson
  • Reply 10 of 14
    dewmedewme Posts: 3,608member
    kbee said:
    I've said this before. Apple should shut down the app store in any country that seriously questions its legitimacy or fairness. Apple's explanation should be, "We are shutting it down as a courtesy to the authorities in this jurisdiction until they give us the all-clear to turn it back on." But Apple seems to have a non-confrontational approach. I would ask Apple to show some pugnacity, gumption and perspicacity. "Who Dares Wins."
    You should tell Apple about this cool idea. As a revenge for being criticized they should just shut down their own business. Guess you have a PhD in economics? But wait a second ....
    Your argument is a great example of "reductio ad absurdum." In English that means "appeal to extremes". I was talking only about Apple shutting down its App Store in a single jurisdiction (eg, maybe Russia). That could mean a 1% loss in sales, on a temporary basis, until that jurisdiction decides they want the App Store back, not 100%. Is that more clear now? What part of this do you not understand?
    I understand what you're saying. It's like setting a small fire in one strategic spot to prevent a larger fire from spreading or flooding a compartment on a ship to prevent a fire or damage from spreading to the entire ship. It's a fully viable tactic for damage control. It's not totally unreasonable. Whether it applies to Apple's case is a matter of debate.

    The one thing that always makes me shake my head in these scenarios is the hypocrisy and jettisoning of so-called values and ideologies that always occurs when individuals and groups are faced with a dominant entity who has learned how to exploit the very same values and ideologies that these same individual and groups purport to be essential. For example, the very same folks who cry for a free market and an opportunity for a winner-take-all reward for those who risk it all suddenly backtrack when an actual big-time winner, like Apple or Google, emerges and gains a dominant position and reaps its bounty. The same goes for those who rail against government "handouts" but are totally cool about handouts that are placed into their own hands.

    Ideology provides plenty of fodder for bloviated posturing, but pragmatism is a the neutralizer that strips it all away and exposes our true human selves. We should all just fess up to our human frailties and admit that, at some level, we're all just in it for ourselves and that most our ideologies and values just cannot hold up to the pressure of either personal sacrifice or personal reward. 
    gatorguyDetnator
  • Reply 11 of 14
    gatorguygatorguy Posts: 22,879member
    dewme said:
    kbee said:
    I've said this before. Apple should shut down the app store in any country that seriously questions its legitimacy or fairness. Apple's explanation should be, "We are shutting it down as a courtesy to the authorities in this jurisdiction until they give us the all-clear to turn it back on." But Apple seems to have a non-confrontational approach. I would ask Apple to show some pugnacity, gumption and perspicacity. "Who Dares Wins."
    You should tell Apple about this cool idea. As a revenge for being criticized they should just shut down their own business. Guess you have a PhD in economics? But wait a second ....
    Your argument is a great example of "reductio ad absurdum." In English that means "appeal to extremes". I was talking only about Apple shutting down its App Store in a single jurisdiction (eg, maybe Russia). That could mean a 1% loss in sales, on a temporary basis, until that jurisdiction decides they want the App Store back, not 100%. Is that more clear now? What part of this do you not understand?
    I understand what you're saying. It's like setting a small fire in one strategic spot to prevent a larger fire from spreading or flooding a compartment on a ship to prevent a fire or damage from spreading to the entire ship. It's a fully viable tactic for damage control. It's not totally unreasonable. Whether it applies to Apple's case is a matter of debate.

    The one thing that always makes me shake my head in these scenarios is the hypocrisy and jettisoning of so-called values and ideologies that always occurs when individuals and groups are faced with a dominant entity who has learned how to exploit the very same values and ideologies that these same individual and groups purport to be essential. For example, the very same folks who cry for a free market and an opportunity for a winner-take-all reward for those who risk it all suddenly backtrack when an actual big-time winner, like Apple or Google, emerges and gains a dominant position and reaps its bounty. The same goes for those who rail against government "handouts" but are totally cool about handouts that are placed into their own hands.

    Ideology provides plenty of fodder for bloviated posturing, but pragmatism is a the neutralizer that strips it all away and exposes our true human selves. We should all just fess up to our human frailties and admit that, at some level, we're all just in it for ourselves and that most our ideologies and values just cannot hold up to the pressure of either personal sacrifice or personal reward. 
    Nicely worded.
    Detnator
  • Reply 12 of 14
    Nothing will happen. Japan is home to Nintendo who literally invented the model that Apple uses for its App Store.
  • Reply 13 of 14
    saareksaarek Posts: 1,307member
    Personally I think Apple is making a huge mistake here. They make unprecedented margins on the hardware that they sell and have no need to gouge their developer community by such an amount. The fact is that the iPhone is "all about the apps' and as good as the platform is for developers its even better for Apple themselves.

    Had they reduced their cut during WWDC this year, even if just by 10%, they'd have likely offset the near universal condemnation and negative press that they have received and are going to continue to receive.

    I do not feel for Epic one bit in this and do not see them as some white knight. In this fight, both exemplify corporate greed at its finest.
  • Reply 14 of 14
    Fatman said:
    Retail store landlords and shopping malls often charge high rents to companies to setup a storefront in high traffic, premium locations. Companies are not forced to lease a spot, they have choices to sell their goods elsewhere. Some companies feel that they benefit from that relationship and pay high rents to get in front of the audience they want to. The App Store is a digital mall that caters to many shoppers, companies can choose to participate if they pay ‘rent’ but these companies have other options, They can sell through Google, Xbox, PlayStation, their own online store and even physical retail stores. So again why is Apple the bad guy? For creating a great ‘virtual mall’ that took billions to develop and maintain - now companies like Epic and cash poor countries want to take that away?
    This is such a good analogy. 
    christophb
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