or Who’s going to pay more for what?
The Developers Alliance participated in the 3rd technical workshop organized by the European Commission for the implementation of the Digital markets Act (DMA). While the two previous workshops were focused on self-preferencing and interoperability, this one was dedicated to the app stores related provisions.
The workshop gathered a variety of stakeholders – from future-to-be-designated ‘gatekeepers’ to various companies and associations – to discuss in-app payment systems, steering, consumption-only apps, web-based apps, sideloading, alternative app stores and FRAND conditions of access to app stores. Developers Alliance presented its perspective in the panel “Giving a choice to app developers: how to implement the rules relating to in-app payment systems, steering and consumption-only apps?”.
Developers have diverse opinions and commercial interests. Our mission obliges us to see what is optimal for the large majority of devs, to anticipate impacts on the digital ecosystems they rely on and to draw a common denominator. We take the same approach when it comes to the upcoming changes for app ecosystems driven by the DMA.
Therefore we called for the following:
- The changes should benefit all app developers and not only narrow business interests.
- Gatekeepers’ compliance solutions should be tested beforehand with developers and consumers.
- The DMA should enhance and not degrade the current app ecosystems.
The expectation is that developers will benefit from enhanced flexibility to promote their offers and transact with users, including via alternative billing systems. Other DMA articles add up with smooth user access to 3rd party apps, app stores, and s web browsers of their choice. The DMA also provides that developers should be able to have “fair, reasonable, and non-discriminatory general conditions of access to app stores” (FRAND terms).
We take a holistic view of all of these, as the soon-to-be-designated gatekeepers will make significant changes, not only at a technical level but also to app ecosystems’ business models, to comply with all these obligations at once. We also take a pragmatic perspective in anticipating the upcoming changes and the optimal solutions. Besides the technical details of the future compliance solutions, the critical issue is the change of the business models, for both app stores and developers. One needs to keep in mind that gatekeepers will make business decisions to maintain profitability.
The app stores are providing a mixture of services that are currently quite accessible to developers in terms of costs, from distribution and payments to technical support, tools, guidelines, and best practices to free training. The current fee structures were conceived with the aim to provide stable and attractive app ecosystems, a fertile ground incentivizing developers to innovate and grow. Offering more choices to developers by implementing the DMA obligations should translate only into an improvement of their situation. Higher fees, more expensive access to different developer services, will represent the contrary.
Those contemplating the possibility of free-riding (a mandated option to let users link out completely outside the app store) are ignoring the fact that the consequence will be a major change in the structure of fees. Of course, brands don’t care that the freemium model won’t be sustainable anymore; they don’t care about developers that just want to enter the market, like they did some time ago. They have already achieved success and no longer want to contribute to the ecosystem that helped them thrive. So, we heard during the workshop even a concrete, self-serving proposal, which raises the legitimate question: do the large majority of developers want to pay a 20% “match.com tax” to these successful developers? Or do they expect that the fee structure would continue supporting new entrants?
The optimal solution is a balanced approach, making the best of the opportunities provided by the DMA for all developers, while avoiding unintended consequences of changes driven by narrow business interests seeking regulatory capture. No developers should emerge from this worse off than before.
Testing the changes beforehand (like, for example, Android developers can currently do for alternative billing), is the best way to avoid taking developers by surprise and to include them (all of them!) in the process. Changes should also be tested with consumers, to ensure that they really benefit from more choice and a safe, secure and enjoyable experience, and very important, at an affordable price. Ultimately, if consumers are happy, developers will be happy too.
Of course, it’s up to the gatekeepers to decide how they want to comply with the DMA obligations and to the European Commission, to the national competition authorities, and in the end, to the courts, to assess their compliance. Nevertheless, the beneficiaries of the regulation – business users/developers and consumers – should have their say. We are encouraged by the European Commission showing consideration to stakeholders’ input, and we’ll continue to do so.
Dear devs, let us know what you think about all of this by emailing firstname.lastname@example.org