The controversy emerges at a time when Apple’s App Store policies are under fire from CEOs of other major technology companies.
Add Coinbase to the list of companies recently expressing frustration with Apple’s (AAPL) – Get Free Report App Store policies.
Spotify (SPOT) – Get Free Report CEO Daniel Ek, Facebook (META) – Get Free Report CEO Mark Zuckerberg, and Twitter CEO Elon Musk have all made critical statements about the policies during the past week.
Ek says the App Store is a threat to the Internet’s future because it denies users choice.
“Apple offers the illusion of choice and gives developers the illusion of control,” Ek wrote on Twitter.
“How many more consumers will be denied choice?” he asked. “There’s been a lot of talk. Talk is helpful but we need action.”
Zuckerberg expressed frustration that Apple limits the apps in its App Store.
Musk’s complaints specifically refer to the 30% fee that Apple applies to in-app sales and in-app purchases.
“Did you know Apple puts a secret 30% tax on everything you buy through their App Store?” he asked on Twitter. “Apple has also threatened to withhold Twitter from its App Store, but won’t tell us why.”
“Apple takes a 30% tax from app developers who make over $1 million through the App Store on an annual basis,” replied @WatcherGuru. “Apple’s App Store is the equivalent to a 30% tax on the Internet.”
Apple Requires Coinbase to Disable NFT Trading
Coinbase said on the morning of Dec. 1 that Coinbase Wallet users using iOS will find they are unable to send non-fungible tokens (NFTs).
The company announced this news in a series of tweets.
“You might have noticed you can’t send NFTs on Coinbase Wallet iOS anymore,” it said on Twitter using @CoinbaseWallet. “This is because Apple blocked our last app release until we disabled the feature.”
The rest of the statements posted to Twitter by @CoinbaseWallet are as follows:
“Apple’s claim is that the gas fees required to send NFTs need to be paid through their In-App Purchase system, so that they can collect 30% of the gas fee.” (A gas fee, or transaction fee, is simply what a user is required to pay for using the blockchain. Once the gas fee is paid, users can transfer cryptos from one address to another.)
“For anyone who understands how NFTs and blockchains work, this is clearly not possible. Apple’s proprietary In-App Purchase system does not support crypto so we couldn’t comply even if we tried.”
“This is akin to Apple trying to take a cut of fees for every email that gets sent over open Internet protocols.”
“The biggest impact from this policy change is on iPhone users that own NFTs — if you hold an NFT in a wallet on an iPhone, Apple just made it a lot harder to transfer that NFT to other wallets, or gift it to friends or family.”
“Simply put, Apple has introduced new policies to protect their profits at the expense of consumer investment in NFTs and developer innovation across the crypto ecosystem.”
“We hope this is an oversight on Apple’s behalf and an inflection point for further conversations with the ecosystem.”
Apple Defends its 30% fee
In 2020, a study funded by Apple defended the fee that is currently under scrutiny.
“Our study shows that Apple’s App Store commission rate is similar in magnitude to the commission rates charged by many other app stores and digital content marketplaces,” the study argued at the time. “The commission rates charged by digital marketplaces most similar to the App Store, such as other app stores and video game digital marketplaces, are generally around 30%.”
“Marketplaces that distribute digital content such as videos, podcasts, eBooks, and audiobooks generally charge commission rates of 30% or more. Commission rates charged by e-commerce marketplaces vary by industry but sometimes exceed 30%,” it continued. “Many sellers currently sell (or previously sold) their goods through brick-and-mortar stores and marketplaces. We find that sellers generally earn a substantially lower share of total revenue from the distribution through brick-and-mortar stores and marketplaces than through digital marketplaces such as the Apple App Store.”
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