- DMA is keen to open up the mobile app distribution to more players by enabling alternative app stores to thrive and offer more favourable terms to developers and consumers alike.
- The emergence of new stores might provide new billing models and more incentive for mobile service creation.
Four years after being removed from Apple’s App Store and Google’s Play Store in a high-profile antitrust battle, Fortnite’s comeback marks a victory for Epic Games and a broader shift in the industry.
The dispute, which began when Epic Games bypassed the mandatory in-app billing systems imposed by Apple and Google, highlighted the stranglehold these tech giants have over mobile content distribution and payments.
By offering its own payment systems, Epic aimed to challenge the fees charged by these platforms on digital purchases, considered high at up to 30 per cent of the user transaction value.
The return of Epic Games’ Fortnite to the iOS platform in the European Union and Android devices worldwide is emblematic of this change.
EU leading the way
At the heart of this transformation is the EU’s Digital Markets Act (DMA), legislation aimed at curbing the dominance of Big Tech and fostering competition within the digital marketplace.
This development is particularly significant for mobile payments, as it opens the door to alternative payment systems and app stores, fundamentally altering the ecosystem that has been dominated by Apple and Google given their position on smartphone operating systems.
The introduction of the DMA has forced Apple and Google to reconsider their business models, especially regarding how they manage app stores and payment systems.
Tim Sweeney, CEO of Epic Games, hailed the regulation as a turning point, asserting that “the tide is turning” as these digital gatekeepers face increasing pressure from regulators and courts around the globe.
This sentiment underscores the DMA’s potential to open up the mobile app distribution to more players by enabling alternative app stores to thrive and offer more favourable terms to developers and consumers alike.
With the launch of the Epic Games Store on mobile, alongside other alternative app stores like Aptoide and AltStore, we are witnessing the early stages of a more diverse and competitive app ecosystem.
These platforms not only provide more choice for consumers but also foster a more developer-friendly environment. As Sweeney pointed out, Epic Games is committed to supporting every store that offers fair terms to developers, recognising that “a rising tide lifts all boats.”
Time to consider the future
For the mobile payment industry, it is a time to pause and reflect. The emergence of new stores might provide new billing models and more incentive for mobile service creation.
On the other hand, the Google Play and Apple Store offers have managed to clear up the high level of fraud and unclear customer experiences that were running wild in the industry in the early 2000s. The new stores should come with an enlightened view.
However, the transition is not without challenges. It will take a while to clear up and balance the valid request on each side. Epic and a number of other companies have accused both Apple and Google of creating barriers to the installation of alternative app stores, with reports of cumbersome and confusing processes that deter users from seeking out these options.
Apple, for its part, claims that it has implemented the DMA’s requirements while still prioritising user privacy and security.
As the mobile ecosystem continues to evolve under the influence of the DMA, the implications for mobile payments are profound.
We are likely to see an increase in the variety of payment methods available to consumers, a reduction in transaction fees, and greater innovation in the types of services offered through mobile apps.
Potentially we are going to see an increase in fraud and mis-selling if companies do not adopt a stricter overseeing activity than we saw in the past.
- Anzelle Robertson is the content and advertising director for the Mobile Ecosystem Forum, a global trade body established in 2000 and headquartered in the UK with members across the world.