Apple Defends IAP from Japanese Government App Store Report

Apple Store in Japan

Apple has defended its in-app payments policy to the Japanese government, insisting it is more than just a payment processing feature, and that its App Store fees are “reasonable.”

Japan's Diet's Digital Market Competition Council in June produced a competition assessment of the mobile ecosystem, discussing how tech companies such as Apple and Google could impact the country's sensitive market. That same month, the government announced that it intended to force Apple to allow users to install apps from places other than the official App Store.

On October 12, Apple published its response to the report, in which the iPhone maker disagreed with some of its conclusions.

In its response, Apple insists that its current processes are already sufficient to ensure transparency and procedural fairness, according to Macotakara. Apple has also already made changes to its operating systems and Safari in response to “hypothetical concerns raised” in the report.

In-app purchases “are not a payment processing service,” according to Apple in a translated note. He adds that IAP's success is driven by significant investments in technology that enable strong customer relationships and high levels of engagement.

“So IAP is more than just a payment processing service,” Apple continued, suggesting that IAP gives developers the ability to monetize apps with a simple, lightweight feature. In exchange, Apple charges a “reasonable fee” to cover the cost of the technology and innovation that makes the IAP work in the first place.

IAP cannot be compared to regular payment processing because Apple's fees are “based on the tools, technologies and other resources that developers use to create, test and distribute applications and services.” It also allows Apple to maintain and continually improve the quality of service that users expect.

Justifying the cost

As for the cost of the transaction, Apple's fee is described by the company as “reasonable considering what Apple spends billions of dollars to develop and operate the iOS platform, including the App Store.

Providing tools, technical and marketing assistance, Apple IP licensing, iOS user acquisition and other integrated benefits are some of the reasons why developers agree to pay a commission of 15% to 30% for the service. continued note.

Apple also notes that its fees are no higher than those of other companies in the industry, including Google, Amazon and Samsung stores, as well as Sony and Nintendo game console stores.

Lastly, Apple raises the issue of security, citing centralized app distribution as a cornerstone of its layered approach. Changes to this central app distribution system, such as sideloading or the inclusion of third-party app stores, could put users at “great risk.”

Apple's comments echo similar comments in other areas where Apple's App Store empire is under threat from increased government oversight.

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