Alternative App Store payment service in holding pattern, waiting for Apple to change

A company aiming to take a share of Apple's App Store payments has signed up 1,500 developers for the service, but the founder believes that Apple is dragging out the process of allowing the payments unnecessarily.

Paddle aims to provide developers with an alternative to the existing App Store in-app purchases system. While it waits for Apple to open up to third-party payments generally, it has managed to get a fairly sizable following already.

Approximately 1,500 developers have signed up for Paddle, with the group accounting for over $1 billion in App Store in-app payments, reports Business Insider. CEO Christian Owens says this demonstrates there is a demand from developers to work with customers away from Apple's ecosystem.

But, Paddle is in a holding pattern. App Store policies nearly everywhere do not allow for alternate in-app payment systems.

ForIn the Netherlands, where Apple has been ordered by a regulator to allow dating apps to accept third-party payment systems, Apple has so far taken the 5 million euro ($5.6 million) weekly fine instead of complying with the order.

According to Owens, Apple's reluctance to play ball with the regulator is "a joke," and one made at the expense of developers.

"Apple is to some extent really digging their heels in to try and eke this process out as long as possible, because obviously, the largest company in the world can probably afford to," said Owens. "I don't think Apple or the iPhone would be anywhere near as successful as it is if it wasn't for those developers and the rich ecosystem of things that they are building."

Despite surfacing as an iOS IAP alternative in the wake of the Epic-Apple lawsuit, Apple has so far only referenced Paddle in a legal filing, as part of an example of how the App Store could be misused once opened up. Owens disagreed, as Paddle's current status shows competition could thrive with alternative payments enabled.

"We don't want to be brazen with releasing things that maybe harms developers or gets them into trouble," the CEO said, as Paddle waits for Apple to change its policies. "We absolutely want to comply with however Apple decides to implement this stuff."

Owens also says that developers want a cross-platform payment system, but that there is an inconsistency of billing services across multiple platforms. "A lot of our Mac customers are also iPhone customers, but they have to have a completely different experience of how they buy the product in those two different places," he mused.

"At some point the scales will tip," the CEO adds, hoping that Apple "will embrace the change as opposed to continuing to fight it."

Outside of dutch dating apps and the Epic lawsuit, Apple is seeing continued pressure to comply and provide access to alternate payments.

The U.S. Senate Judiciary is pushing forward with the Open Markets Act that would force Apple to allow side-loading on iOS. Meanwhile, in South Korea, regulators have pushed back against an alternative payments plan by Apple due to it lacking detail.

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8 Comments

foregoneconclusion

said about 2 years ago

"I don't think Apple or the iPhone would be anywhere near as successful as it is if it wasn't for those developers and the rich ecosystem of things that they are building."

As others have mentioned before, the iPhone and iOS came first. There is no "chicken/egg" argument to be made. None of the $$ from apps and the ecosystem happen without the iPhone/iOS happening first. After all, the guy from Paddle would be creating his own OS and phone instead of an alternate payment app if it were easier to do than creating the apps.

rwes

said about 2 years ago

foregoneconclusion said:

"I don't think Apple or the iPhone would be anywhere near as successful as it is if it wasn't for those developers and the rich ecosystem of things that they are building."

As others have mentioned before, the iPhone and iOS came first. There is no "chicken/egg" argument to be made. None of the $$ from apps and the ecosystem happen without the iPhone/iOS happening first. After all, the guy from Paddle would be creating his own OS and phone instead of an alternate payment app if it were easier to do than creating the apps.

It's a lot of people trying to bite the hand that feeds them, and I think mainly because of Apples size (now). When most of these same people were saying/sure, Apples lock-in + keep it simple strategy was going to fail, they couldn't care less. Now that Apple has succeeded (where they were expected to fail, and they continue to succeed), goal posts are being moved and apple is being called unfair for only continuing to do exactly what it has since day 1 of the App Store? It's ridiculous. It's the bad part of capitalism. Everyone wants a piece of their success based off the hard-work they did, and their strategy (which again would fail), and is saying they're the bad actor...

Maybe we're in our own echo chamber perhaps (after all, this is AI, but I know not even one one this forum agrees (#flameSuit?) 😅), but I dont think so. People are just greedy.

AND! Separate from there being "no chicken/egg", it's they way Apple has executed (which people complain about) that has made them successful! The ease and security of the platform is *why* this all works (not saying it's perfect). People trusting the platform, ... I could go on. Anyway, we'll see how this all shakes out.

purplepear

said about 2 years ago

There may well be ‘a demand from developers to work with customers away from Apple's ecosystem‘ but there is next to zero demand from Apple’s customers for this.

We appreciate things like all subscriptions in one place, Apple’s dedication to improving privacy, not selling our data to all potential buyers, etc., etc.

And those that do not already have a choice to get a phone with access to multiple app stores (and thereby alternative payment systems).

All agreeable comments so far, (wonder where the trolls are hiding) this is indeed a parasite trying to make money of the hard work of others for doing very little themselves. And biting the hand that feeds is a fitting description for these devs that make money from the App Store but think they shouldn’t need to pay Apple - they apparently have no idea how things worked before iPhone and App Store.

FileMakerFeller

said about 2 years ago

purplepear said:

There may well be ‘a demand from developers to work with customers away from Apple's ecosystem‘ but there is next to zero demand from Apple’s customers for this.

We appreciate things like all subscriptions in one place, Apple’s dedication to improving privacy, not selling our data to all potential buyers, etc., etc.

And those that do not already have a choice to get a phone with access to multiple app stores (and thereby alternative payment systems).

All agreeable comments so far, (wonder where the trolls are hiding) this is indeed a parasite trying to make money of the hard work of others for doing very little themselves. And biting the hand that feeds is a fitting description for these devs that make money from the App Store but think they shouldn’t need to pay Apple - they apparently have no idea how things worked before iPhone and App Store.

Well... shouldn't the developers clamouring for this be allowed to experiment with alternatives to prove to themselves that Apple's approach is best for their business?

Oh, that's right, they already can! On Android! Which is obviously not the same as Apple's smartphone in this context because mumble mumble hand-wavy blah blah blah.

The only point on which I disagree with you is the assertion that Paddle is a parasite, because from what little I've read I see them as trying to fulfill a business need rather than being the instigators of that demand.

And I understand the reasons behind the demand: you don't sow your seed on fallow ground, you plant where the soil is fertile, but if the owner of the fertile ground wants payment for access to it, you analyse the costs and benefits and make a business decision. Maybe all this effort in complaining at Apple's policies should instead be directed to making truly awesome Android-only apps so that the power of developers to influence a platform can be properly demonstrated.

badmonk

said about 2 years ago

I still don’t understand the regulatory interest in the App Store duopoly & their closed payment systems in the grand order of things.

Anyone that has had to cancel a service or dispute payments with Dish, their cable company, their ISP, their telcos, their alarm company, their insurance companies, airlines, random websites, their credit card companies know the outrageous waste of time these businesses place on their customers and Covid-19 has worsened this. I have been put on hold for over an hour on occasion. Thanks to my AirPods I can just keep on with my day while waiting for someone from an overseas call center to pick up and not fix my issue.

This issue is being pushed by software developers, the politicians they have influenced through PR operations and european regulators. Those of us in the real world want the ability to click off a subscription without wasting time and are more than happy to give Apple and Alphabet an ounce of flesh for this convenience.