Facebook Strikes Deal to Skirt Apple's App Store Commission -- Update
September 25 2020 - 12:44PM
Dow Jones News
By Sarah E. Needleman
Facebook Inc. said Apple Inc. approved a request to give
businesses a temporary reprieve from paying a 30% commission on
paid online events, a special arrangement that comes as the App
Store owner faces criticism over how its digital marketplace
operates.
The agreement, which runs through the rest of this year, allows
Facebook to use its own payment system to process transactions for
the live events.
Apple doesn't normally allow app developers to process payments
for in-app purchases themselves or through third parties, as it has
said that external services could pose security risks.
The technology giant instead makes developers use its own
payment system and takes a 30% cut of sales from paid apps and
in-app purchases as well as from digital subscriptions in the first
year. Apple has said that amount is in line with what most other
app marketplaces charge and helps cover the cost of store services
it provides such as user privacy.
Facebook last month introduced a way for businesses to host paid
events through its live-streaming platform, a move the social-media
company said was aimed at helping those struggling during the
pandemic to switch from selling real-world goods to online
experiences. At the time, Facebook said it asked for but didn't get
an exemption from Apple.
Facebook on Friday said Apple reversed course, allowing
businesses that host paid events such as cooking lessons or musical
performances through its app to skirt the App Store commission.
However, the deal excludes businesses that make videogames or do
game-related streaming on Facebook. Facebook also said it wouldn't
collect any fees from paid-event hosts until at least August
2021.
"This is a difficult time for small businesses and creators,"
said a Facebook spokesperson in a statement.
Write to Sarah E. Needleman at sarah.needleman@wsj.com
(END) Dow Jones Newswires
September 25, 2020 12:29 ET (16:29 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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