Opinion | Is It Finally Hammer Time for Apple and Its App Store?

Apple executives had told me and others earlier this week that it erred in its original approval of Hey.com, since the email service, which costs $99 per year, did not include the Apple-friendly in-app payment system as required by its rules.

The payment system, the only one available to developers when using Apple’s App Store, means Apple gets a huge cut when a customer buys digital goods like an app subscription (30 percent for the first year and 15 percent thereafter). Apple does not get a fee when customers sign up through the app’s company website, and it’s worth noting that 84 percent of apps are free, and developers pay nothing to Apple.

There is no doubt that Apple’s payment system is convenient for some developers. And Apple correctly touts that it has created a lucrative business platform for many companies ($519 billion in overall revenue in 2019). But because of Apple’s cut, some companies try to minimize in-app transactions, either by avoiding offering in-app subscriptions at all (Netflix) or charging more for that particular sign-up (Spotify). Hey.com did not include Apple’s payment tech in its app.

Apple has made exceptions for some services that fall into what it calls a “reader” category and has given other services a pass for a variety of reasons; it has even struck individual deals to bypass grabbing a cut. Still, Apple has decided thus far that Hey.com does not merit special treatment, even though there are also some subscription email apps that don’t offer in-app purchase technology and are allowed to operate on Apple’s platform (for now).

Apple’s approach can be confusing — and definitely irritating. It hasn’t sat well with Basecamp, as evidenced in a tweetstorm by Mr. Heinemeier Hansson. While he has a reputation for speaking out, this time Mr. Heinemeier Hansson has ended up in one of the more epic App Store controversies (best boiled down to his accusation that Apple was acting like “gangsters”). He likened Apple’s actions to smashing windows and burning down stores.

“They count on developers to stay quiet,” he said in an agitated interview this week, referring to Apple executives. “We thought they were fighting an email market dominated by Google, but these were the real heavies.”

Apple obviously does not agree with this assessment.

“These rules have been around the App Store since the day we started,” said Phil Schiller, who is in charge of the App Store and noted that the company reviews over 100,000 apps every week. “There is no perfection here. We will admit it when we make a mistake and acknowledge that we also need to learn and grow,” he said. “But this was rejected for a good reason.”