Is Apple's dominance of the App Store under threat?

Apple has long maintained a tight grip on its iPhone ecosystem. And in Europe, that control is beginning to weaken. “Fortnite” maker Epic Games said Friday it will launch an alternative app store for iPhone users in Europe.

Spotify this week began directing Europeans via its iOS music streaming app to the company's website to sign up for subscriptions, something it had not allowed before.

Apple said separately on Wednesday that it plans to enable developers in the United States and many other countries to offer secure contactless payments through their own apps on iPhones. Apple had previously committed to opening up contactless payments technology in Europe to resolve an antitrust case in the European Union (EU).

The changes open Apple’s devices to outside developers in new ways, allowing third parties to bypass its controls and, in some cases, its fees. They show how a wave of new regulations, enforcement and antitrust rulings, many in Europe, are destroying Apple’s “walled garden” of hardware and software.

Apple has long argued that its approach supports users’ privacy and security. It’s also become a lucrative part of the company’s business model. Apple’s services unit, which includes the App Store, generated $85.2 billion in sales in fiscal 2023, accounting for about 22% of total revenue.

Legendary Games Store

Epic Games said Friday that its new app store for iPhone users in Europe will initially offer three games: “Fortnite,” “Fall Guys” and “Rocket League Sideswipe.” Epic said those games will also be available through other alternative app stores in Europe, starting with one called AltStore.

The move builds on a recent European Union law called the Digital Markets Act, which requires tech companies to adhere to rules to increase competition in digital advertising, online search and app ecosystems. Apple is also facing pressure in the US, where it is being forced to allow developers to process purchases outside the App Store after a ruling in a lawsuit brought by Epic.

Spotify Initiative

Spotify said it was unhappy with the changes Apple has made so far. Spotify began publishing subscription pricing information in its iOS app on Wednesday after the company opted into a new program that allows music streaming apps to tell European users about other ways to make purchases.

However, users still can’t sign up directly for Spotify through the company’s iOS app or click an in-app link to purchase a subscription because Spotify doesn’t want to pay a commission to Apple, which it considers unfair. Apple declined to comment on Spotify’s changes this week.

With information from Economic value