UPDATED 14:50 EST / AUGUST 28 2020

APPS

Apple blocks Facebook app update amid scrutiny of App Store policies

Facebook Inc. is the latest company locking horns with Apple Inc. over its App Store policies around in-app payments, which have also drawn scrutiny from other software makers and regulators.

Facebook’s dispute with Apple revolves around a feature the social network launched this month to let businesses host paid online events on its platform. Facebook had asked the iPhone maker to waive the 30% fee it normally charges on in-app purchases so that all the earnings from online events can go to businesses.

Apple responded by saying that it would not waive the fee. In response, Facebook sought to update its iOS app with a message informing users that Apple would take a 30% cut from online event ticket sales, but the social network told CNBC today that the update was blocked by the iPhone maker. The rejection of the update was first reported by Reuters.

“Now more than ever, we should have the option to help people understand where money they intend for small businesses actually goes,” a Facebook spokesperson told CNBC. “Unfortunately Apple rejected our transparency notice around their 30% tax but we are still working to make that information available inside the app experience.”

It’s not yet clear how Facebook would make the notice available since Apple reportedly rejected the update because of an App Store rule that prohibits developers from displaying “irrelevant” information. Originally, the social network’s plan was to show a line reading “Apple takes 30% of this purchase” in its iOS app. Facebook had reportedly sought to show a separate message on Android indicating it would not take a fee on event ticket sales, but the text was not displayed either.

Facebook is the latest company to express disagreement with the way Apple levies fees on in-app purchases. Earlier, Spotify Technology SA and video game giant Epic Games Inc. publicly accused Apple of being anticompetitive with its payments policy. Spotify’s concerns reportedly contributed to the European Commission’s recent decision to open a probe into the matter, while Epic Games is currently suing the iPhone maker with Microsoft Corp.’s backing.

But for Facebook, Apple’s planned changes to iOS’ privacy settings may be even more significant than how it enforces in-app payment fees. Apple is preparing to introduce a feature that will require advertisers to ask users’ permission before collecting their unique device identifier for targeting and analytics purposes. The change, Facebook warned recently, could result in a more than 50% revenue drop for publisher partners. 

Image: Unsplash

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