Nobody can escape the Apple tax

Hello and welcome to Protocol Entertainment, your guide to the business of the gaming and media industries. This Tuesday, we look at how far Apple has gone past regulatory demands for its App Store payment system, the looming challenges of moderation posed by the metaverse and the conversation about the martial arts-inspired Sifu.

Apple has turned its walled garden into a maze

Apple is waging a political war against regulators around the world to defend the App Store’s 30% commission, and last week it took a particularly ugly turn in the Netherlands. It was Apple’s most brazen attempt to defend against the competition’s challenge to the App Store to date, and it illustrates how far the company will go to defend the iPhone’s walled garden.

This battle is about dating apps, but the implications are global. After the Dutch competition regulator, Consumers and Markets Authority, began levying weekly fines of 5 million euros on Apple for failing to comply with a new law allowing in-app payment alternatives for dating apps, the iPhone maker proposed a new solution.

  • Instead of a 30% commission, Apple would take one 27% commission, but it would make the process of qualifying and implementing that low commission so cumbersome that it would actually cost the app maker as much as the Apple app commitment, if not more. Built-in option.
  • “You can just sense how contemptuous they are to do any of this. They make payments other than the App Store as painful, expensive and worrisome as the regulators will bear,” Written by app developer Marco Armentwho said Apple’s solution here provides a roadmap for how to try to avoid similar regulations in other markets for more than just dating apps.
  • Apple critic and outspoken developer Steve Troughton-Smith called her “Absolutely despicable,” adding, “Everyone on his executive team should feel ashamed, and some of them shouldn’t be here when it’s all over. We all see you.”

Dating apps are profitable, but mobile games are the goldmine. Apple has steadfastly defended its App Store policies and restrictions for years, and has done so publicly most recently in Epic Games’ antitrust case and in the many small concessions it made to keep regulators at bay in the months since the last Fortnite trial could. At stake are App Store revenue, which mostly comes from games.

  • Apple paid developers nearly $60 billion last year after taking between 15% and 30% of all in-app spending on digital goods. According to Sensor Tower, mobile games make up roughly 67% of all in-app spending, with Apple making nearly twice as much as Google in store revenue.
  • Apple has cited security concerns and privacy risks for its rules against sideloading and its limitations on allowing alternative payment options. But Tim Cook, during his Fortnite experience testifying, also described Apple’s approach as a way to recoup investment in research and development and help it maintain control over the iOS app ecosystem.
  • Although Apple largely won its case against Epic, the company has set out to successfully fight a court order forcing it to relax restrictions on alternative payment systems. The matter is now suspended pending ongoing appeals.

Apple may drag App Store battles for years. The Netherlands and South Korea have so far tried to strike direct against the App Store model, and Apple has responded by trying to circumvent regulations and make developers’ lives more difficult.

  • South Korea is still waiting for a proposed solution from Apple, and Dutch regulators said they were “disappointed with Apple’s behavior and actions”. ACM will continue to charge the company a weekly fine until it comes up with a solution that it deems compatible. (In the meantime, Apple is appealing the ACM’s decision.)
  • The US is trying its own form of App Store regulation with the Open App Markets Act and the US Online Innovation and Choice Act, both of which seek to limit Apple and Google’s power of in-app purchasing and other restrictions on third-party developers.
  • Apple responded to the Open Application Markets Act by sending a letter last week to the Senate Judiciary Committee saying that the bill, which would allow sideloading, would allow social media companies to violate user privacy and security.

You might be wondering why a company that made nearly $100 billion in profits last year is fighting so hard for what is one of the small parts of its business. But as the experience of Fortnite has made clear, Apple sees the App Store and its control of the iOS app ecosystem as paramount to the iPhone experience and a vital segment of its services business, which has become one of Apple’s fastest growing and most profitable divisions. Central to those healthy margins is Apple tax, which the company appears more determined than ever to defend to the death.

– Nick Stat

he heard

“We’ve been playing web 2 catch-up for 10 years, cleaning up the fact that there is no child safety in our minds… and it will happen again with web 3 unless we pressure the creators of those environments to do it differently.” —Sarah Gardner, vice president of external affairs for the nonprofit child online safety Thorne, spoke to Will Orems of The Washington Post for a report on the threat of child exploitation at the Meta Horizon Worlds platform, which lacks strict safety systems to protect minors from abuse.

“Don’t believe what you read on the internet. HoloLens are doing a great job and if you look up the internet they also said we have canceled the HoloLens 2… which I recently checked we have shipped.” —Alex Kipman, Microsoft Technical Fellow overseeing the Mixed Reality division, Pay for retreat Against a report from Insider, which cited anonymous employees who expressed concerns about the future of HoloLens. Microsoft has lost nearly 100 employees to the Meta as the AR and VR race heats up.

Message from Samba TV

Samba TV operates the world’s largest independent source of first-party connected TV data to help brands, agencies and content owners plan, buy and measure all in one place. The Viewing Status report provides the industry’s most accurate insights into TV viewing and advertising engagement. Download the report at www.samba.tv

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in other news

GameStop is formalizing its NFT plans. The retailer is launching a token market with blockchain company Immutable X, along with a $100 million crypto fund that the company plans to invest in NFT content creators and technology providers.

Nintendo Switch It became the company’s best-selling home consoleAnd the With over 103 million units sold over the past five years. Nintendo executives also dismissed the idea that it would acquire its own large game maker to compete with Microsoft and Sony.

Dreaming of Sony’s live service. PlayStation said in its earnings call last week that it plans to use its acquisition of developer Destiny Bungie as a springboard to launch more than 10 live service games by 2026.

Google is trying to save Stadia. The search giant’s cloud gaming service has had a rough year, and now the company is trying to transform the platform into an enterprise that offers other companies licensing of the technology, Insider reports. On the other hand, the consumer platform appears to have been left to wither.

Games as a Service may consume the industry. The live service model in the gaming industry is putting pressure on popular single player developers like PlatinumGames. Newly appointed CEO, Atsushi Inaba Famitsu . said The studio now views the model as a survival necessity.

This is what war looks like in augmented reality. A first look at the US Army’s mixed reality helmet.

Firefox Reality has become a wolfk. Mozilla is finalizing browser AR/VR, but the project will continue under Igalia’s direction.

Rockstar has finally confirmed the existence of a new Grand Theft Auto. Rockstar Games announced last week that the next installment of the popular open-world series is “well underway.” There hasn’t been a new GTA game since 2013.

Message from Samba TV

Samba TV operates the world’s largest independent source of first-party connected TV data to help brands, agencies and content owners plan, buy and measure all in one place. The Viewing Status report provides the industry’s most accurate insights into TV viewing and advertising engagement. Download the report at www.samba.tv

learn more

Sifu strikes a chord, in more ways than one

One of the hardest games I’ve played in recent memory is Sifu from French studio Sloclap, a love letter to Chinese martial arts released this weekend. Through excessive repetition, the game forces you to become an expert in a finely tuned combat system until you masterfully dispatch entire hordes of thugs, all with an array of sharp weapons that mine from your surroundings along with reliable fists and feet. It’s beautiful and amazing, when you don’t die over and over for the same opponent.

But Sevo is not without its share of controversy. The game sparks a familiar debate about the accessibility of video games. There are no difficult settings, and large groups of casual players, not to mention those with disabilities, may find the game impossible to complete. It’s also a setting and story that is steeped in Asian metaphors and stereotypes created by an all-white Western team, which has led to some well-deserved and thoughtful criticism.

Sifu is by no means perfect, and many of her flaws wear up her sleeve. But it’s also a rare standalone gem that manages to blend style, substance, and the ups and downs of unique game mechanics in an experience that lives up to the hype. I haven’t been able to beat it yet. But the more I played, the more determined I was to succeed and the more confident I became. So, I’m grateful for games like Sifu.

– Nick Stat

Ideas, questions, tips? Send it to Entertainment@protocol.com. Enjoy your day, see you Thursday.

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