Cornered by the European Commission, Apple had to open the doors of iOS to alternative marketplaces. She did it by introducing though a fee of 0.50 eurosthe Core Technology Fee (CTF), which must be paid for each single installation of an application after the latter has reached a certain number of downloads. The novelty was greeted with enormous enthusiasm disappointment because it is understood as one strategynot even very veiled, however convince developers to “stay” on the App Store. Especially the smaller ones, even independent ones, which don’t have very strong companies behind them.
After much criticism, however, some good news arrives. The Cupertino company has in fact announced important measures that will protect developers in the event that a certain application unexpectedly becomes viral and, consequently, generate taxes that are impossible to pay.
How Apple’s CTF changes for the EU: measures to protect developers and avoid bankruptcy
First, the small and/or independent developers who do not receive revenue from their applications they do not have to pay the CTF. In this case these developers must declare every year what is called a “non-commercial status”. The company specifies, however, that this status is canceled if an app is free but requires a subscription (therefore a revenue for the developer) to be subscribed to via a related website.
The second novelty is a process spread over three years which, if accepted, will give developers the necessary time to to adapt to an app that unexpectedly became hugely successful. In summary, always thinking in three years, if the application goes “viral” and exceeds one million downloads (limit which automatically activates the CTF), the tax is not charged if the revenue for the developer is less than 10 million euros. If the revenue is between 10 and 50 million euros, the CTF must be paid but cannot exceed one million euros. If the revenue exceeds 50 million euros, the “protection” is canceled and the developer must pay the entire CTF.
Apple’s adaptation plan has a very specific purpose: to help developers by giving them time to study and apply the necessary changes so that the viral app becomes so profitable that it can also cover the costs of the CTF.