The game developer’s guide to app store regulations 

Archie Stonehill
Head of Product
Mar 28, 2024

We’re in an unprecedented era of antitrust regulations getting (or about to be) passed - transforming gaming as we know it. From studios filing their own lawsuits to top-down regulatory action, all signs point to an era of deplatformization as Apple and Google get put under the legal microscope. 

These policies are ever-changing and constantly evolving, so we put together this database of the most important regulations across the globe as your cheat-sheet to stay up to date.

Tap on a regulation below to jump to the corresponding summary.

App store regulation Region Year
DOJ lawsuit USA 2024
Digital Markets Act European Union 2024
Epic Games vs. Apple USA 2020
Epic Games vs. Google USA 2020
Telecommunications Business Act South Korea 2021
Digital Markets, Competition, and Consumers Bill UK Pending
Open Markets Act USA Pending

Department of Justice lawsuit (USA)

On March 21, 2024, the US Department of Justice filed a landmark antitrust lawsuit against Apple alongside the attorneys general from 16 states and Washington, DC. The 88-page document represents the most significant federal antitrust action against Apple - and arguably, against any Big Tech company, ever. 

In fact, the only comparable action in recent history is United States vs Microsoft Corp, in which the government accused Microsoft of illegally favoring its own software by tying Internet Explorer to the Windows operating system. The DOJ has the ability under law to request a breakup of a company, a threat that ultimately led Microsoft to settle in 2001 and agree to a consent decree that prohibited a long list of anti-competitive business practices.

This parallel isn’t lost on the DOJ, who argue in their 2024 lawsuit that Apple’s own success is largely possible because of that Microsoft settlement: “The iPod did not achieve widespread adoption until Apple developed a cross-platform version of the iPod and iTunes for Microsoft’s Windows… In the absence of the consent decree in United States v. Microsoft, it would have been more difficult for Apple to achieve this success and ultimately launch the iPhone.”

The DOJ’s case against Apple is built on a similar argument that self-preferencing undermines competition and innovation. However, the strong language used both in the lawsuit and by DOJ officials like AG Garland indicate an even more ambitious and aggressive case than Microsoft’s: “Each step in Apple’s course of conduct built and reinforced the moat around its smartphone monopoly.”  

"Each step in Apple’s course of conduct built and reinforced the moat around its smartphone monopoly" - AG Garland

Watch the full video of U.S. Attorney General Merrick Garland’s press conference after announcing the lawsuit: 

What it means: It could be years until a decision is made, and it remains to be seen whether this case will succeed - so far, Apple has been highly successful in court. Unlike other regions like the EU or UK, this case is not built on “new” legislation passed to specifically regulate digital markets, like the DMA. But a federal antitrust lawsuit like this is definitely the most likely path to serious changes in America's digital markets - unless something bizarre happens, like the Open Apps Market Act gets passed. 

Digital Markets Act (EU) 

The Digital Markets Act (DMA) in the European Union was passed in 2022, but went into effect on March 6, 2024. First thing to know: the DMA designated a handful of companies as “gatekeepers” - including Alphabet, Apple, Bytedance, and Microsoft - meaning they’ll have to follow certain anticompetition and compliance rules meant to curb their dominance and open up the ecosystem. The DMA is basically designed to let developers use third-party services outside the gatekeepers’ own tools, like payment systems, identification services, and web browser engines. 

Apple and the DMA

Apple followed suit with their own response to the DMA. On January 25th, they rolled out new App Store policies that gave developers two options: 

  • Keep the existing terms and distribute exclusively on the store for a 30% commission fee
  • Adopt alternative terms that allow you to distribute apps outside the App Store, use alternative payment solutions, and direct users to your web shop from the app. Instead of 30%, developers pay a reduced 10% or 17% fee on IAPs and a €0.50 fee per install over 1 million each year (including reinstalls and updates).

Quick cheat code: If your revenue per install/LTV is greater than €5, you’re better off with the alternative option. You can dive into the math and get a full explanation here. 

But on March 4th, Apple was hit with a big €1.8+ billion fine from the European Commission for anticompetitive practices specifically relating to music streaming apps. The 5-year investigation started with Spotify filing a complaint with the EU Commission that Apple was treating competition unfairly, including preventing Spotify (and other streaming apps) from communicating to users about subscription offers. Apple also required other music streaming apps to pay the 15-30% in-app commissions fee, while its proprietary streaming service - Apple Music - was spared the fee. The fine, which was levied just two days before the DMA passed, is meant to proactively address any of Apple’s objections to the law - it makes it clear that the EU courts will uphold the DMA and penalize any violatars. The fine is also seen as a deterrence tool to dissuade Apple from monopolistic behavior and give more freedom to both users and developers to seek options outside of the Apple ecosystem.

The next day on March 5th, Apple terminated Epic’s EU developer account after the studio threatened to start its own app store. But just a couple of days later, it reversed course and reinstated the account. The reversal (which came shortly after the DMA went into effect) suggests the new law will be effective in deterring some of Apple’s anticompetitive practices. Epic CEO Tim Sweeney sums it up on X: “The DMA went through its first major challenge with Apple banning Epic Games Sweden from competing with the App Store, and the DMA just had its first major victory.” This also means Epic can launch its store on iPhones in the EU, introducing one of the first instances of a competing app store since the DMA was passed.  

Then on March 12th, Apple made another major concession for developers who adopt the alternative terms of their App Store policy - enabling them to distribute apps directly on their websites. Read Apple’s first DMA compliance report here

Google and the DMA

On March 5th, Google shared its response to the DMA, noting that much of their ecosystem already complies with the DMA - for example, it’s always allowed sideloading. Here’s how else Google is complying: 

  • User choice billing: Developers can offer users a choice between an additional billing option next to Google Play’s billing system for a reduced 26% commission 
  • Developer choice billing: Developers can choose to only offer an alternative to Google Play's billing system for a 27% commission. Previously, this was not an option for game developers. 
  • External offers program: Developers can directly lead users outside the app, including to promote offers - but also with a fee attached.
    • An initial acquisition fee for two years of 10% for IAPs or 5% for subscriptions 
    • After two years, developers can pay an ongoing Google Play services fee of 17% for IAPs and 7% for subscriptions – or opt out to stop paying fees entirely

Read Google’s first compliance report with the DMA here

The DMA strikes back

On March 25th, the EU launched an investigation into Apple and Google’s compliance with the DMA. The investigation’s focus is on some of the companies’ most controversial new policies, which are also the most relevant areas for game developers. Specifically, the Commission will look into the continued existence of “anti-steering” policies and the new fee structures and processes for side loading apps. 

The speed and scope of these investigations, less than a month into DMA enforcement, indicate that the EU’s approach to DMA enforcement is likely to be much more aggressive than any previous governmental interventions into digital competition regulation. Margrethe Vestager, EU’s competition chief, said, “the way that Apple and Alphabet’s implemented the DMA rules on anti-steering seems to be at odds with the letter of the law. Apple and Alphabet will still charge various recurring fees, and still limit steering.” 

"The way that Apple and Alphabet’s implemented the DMA rules on anti-steering seems to be at odds with the letter of the law" - DMA

The commission plans to conclude their investigation within one year - which is basically hyperspeed in the regulatory world. If the EU finds that these policies are not compliant with their gatekeeper obligations, Apple and Google could face fines of up to 10% of global turnover - and that increases to 20% if they keep repeating the infractions. We're already getting our first peek into how the investigation is going: on June 24, 2024, the European Union Commission issued a preliminary ruling that Apple violated the anti-steering provisions in the DMA. The final ruling is still set for March 2025, but if this initial decision holds, Apple could be looking at a penalty of up to $38 billion (10% of global revenue in 2023).

What you need to know: There’s definitely more to come on this - greater concessions from Apple and Google, the advent of widespread sideloading, and an overall opening of the app ecosystem are all factors we’re watching. We’ll see soon how the DMA responds to the compliance reports. 

Epic Games vs. Apple and Google (USA) 

In 2020, Epic sued Apple and Google for violating antitrust laws. Their case against Apple was brought in front of a judge on 10 claims of antitrust violations, including the fact that Apple prevents sideloading. The Google case’s 11 counts were brought in front of a jury and didn’t include the accusation that there’s no other way to download apps on Android devices (since Google allows sideloading). But both lawsuits are similar in that the focus was largely on anticompetitive practices - particularly relating to in-app payment processing and unfair developer agreements preventing off-app distribution. 

Epic and Apple

The initial decision in the Apple case came in 2021 from a California judge, who dismissed almost all of Epic’s 10 counts of Apple monopolizing the market. The fact that this was a judge trial was incredibly significant, since a judge’s sole responsibility is to to prove consumer harm by reviewing legal precedence. Ultimately, the judge found that Apple wasn’t harming consumers, except in the case of violating California competition law with its anti-steering policy. The judge recognized that app developers had the right to communicate alternative payments to users from inside their games - effectively ending Apple’s anti-steering provisions in the US. 

Both Apple and Epic filed appeals shortly after, taking the case up with the federal court of appeals. The appeals court reaffirmed the initial decision, solidifying the anti-steering parts of the ruling, too. Since Epic once again was left wanting more, they appealed the decision from the appeals court until it finally reached the Supreme Court in 2023. In January 2024, they heard back: the Supreme Court declined to hear it

Deferring to the appeals court ruling that basically banned Apple’s anti-steering rules, developers are now free to establish D2C relationships with US users. In the immediate wake of the news, Apple’s stock dipped 2.5%, a telling sign that developers can - and will - capitalize on the freedom to redirect player purchases to their web shops.

Apple has since responded to the Supreme Court decision, releasing an update to the App Store Review policy replacing anti-steering with a “link-out” policy in the US. Now, developers can link out to alternative payment options. However, they still need to get permission from Apple to do this, and when a purchase is completed through that direct link, it’s subject to a 27% fee. 

That 27% fee became the focus of a recent court filing from Epic - and other tech giants, including Meta, X, and Microsoft. They’re claiming that Apple is still circumventing the court order to amend their anticompetitive app store policies. The arguments include that Apple is continuing to maintain anti-steering policies, preventing external links to lower-cost options, and continuing to harm both users and developers.

What you need to know: Despite the 27% link-out fee, the fact is, Apple’s policy is still drawing attention to alternate payment options, like web stores. Thanks to this Apple vs Epic Games court case, studios have the freedom (and implied permission) to let US users know they have other payment options. 

Epic and Google 

Just before the Google vs Epic Games ruling (December 19, to be exact), Google paid out $700 million to Google Play customers as part of a different antitrust lawsuit filed by the attorneys general of 36 states, and $40 million dollars to The Match Group as part of yet another antitrust lawsuit. In addition to the settlement money, Google agreed to make sideloading easier and to offer “user choice billing” (third-party payment processing) at a lower commission fee of 11%-26%.

On December 23, 2023, the jury’s ruling was announced: Epic won. And big time - on all 11 counts, thanks to compelling evidence from the Epic legal team, like Google deleting sensitive internal texts and emails, and Project Hug, which paid out hundreds of millions of dollars in sweetheart deals with developers to have them distribute exclusively on the Google Play Store. It’s often cited that the fact that this was a jury trial meant the court was more open to interpreting the arguments presented, rather than a judge who is looking only at previous legal precedents.

In February 2024, Google responded by filing a request with the US District judge that was overseeing the proceedings to throw out the ruling or grant a new trial. Unfortunately (for Google), the judge - James Donato - already had some negative things to say about the company from the initial trial: “this conduct is a frontal assault on the fair administration of justice. It undercuts due process. It calls into question just resolution of legal disputes. It is antithetical to our system.”

"This conduct is a frontal assault on the fair administration of justice. It undercuts due process." - Judge James Donato

Just like the Apple saga, this could go as high as the federal court of appeals - or even the Supreme Court - if both sides continue to push for legal action. But 2024 is another big year for Google as it deals with antitrust lawsuits against both its search engine services and online ad business

Judge Donato, the judge overseeing the case, has yet to determine the remedy - but that hasn't stopped Epic from proposing several injunctions on what they think exactly Google should do. Naturally, Google opposed with a 90 page document.

What you need to know: We wouldn’t be surprised if Google continues to make concessions that make it easier for developers to offer alternative payment solutions and distribute their apps outside of Google Play. We’re still waiting to see how this turns out since Google’s latest appeal. But if the other judgements against Google are any indication, we won’t be shocked to see the initial ruling holding up. 

Telecommunications Business Act (South Korea) 

In August 2021, the South Korean government passed an amendment to their Telecommunications Business Act that prevented developers from having to use Google or Apple’s payment systems - opening the doors for third-party payment gateways. By 2022, Apple allowed developers on the South Korean App Store to use an alternative payment provider. However, developers still need to pay a 26% commission fee to Apple when it presents users with an option to purchase off-app. This becomes a 27% commission when the choice isn’t even offered, and the developer automatically links out to a third-party payment gateway for every purchase.

The first test of enforcing the amendment came in August 2022 when the Korea Communications Commission (KCC) launched an investigation into Apple and Google over suspected violations. By October 2023, they found the platform giants were guilty of abusing their dominance in the market to force developers to use their in-app payment gateways, rather than the third-parties they claimed to allow. As a result, the KCC is planning to fine Apple and Google up to $50.5 million total. 

What you need to know: South Korea’s quick enforcement of these regulations is largely due to the fact that they’re home to major mobile original equipment manufacturers (OEMs), like Samsung and LG. With the core of the mobile industry in their backyard, the country is poised to set a precedent for anticompetition and regulations, signaling to developers that their ability to use third-party payments will be protected. 

Digital Markets, Competition and Consumers Bill (UK) 

The Digital Markets, Competition and Consumers Bill (DMCC) in the UK is meant to encourage fair trading, open choice, trust, and transparency in digital markets. It was officially passed through the House of Lords in May 2024 - and it looks like the DMCC may even surpass the DMA in its ambitions and impact. 

Like the DMA’s designation of “gatekeepers” with “core platform services,” the DMCC designates a “small number of firms which exert significant control over digital markets” - like Apple and Google - as having “strategic market status” (SMS) in specific activities like app distribution. The current criteria for SMS designation are that a firm has:

  1. Substantial and entrenched market power in a digital activity which is linked to the United Kingdom.
  2. A position of strategic significance.
  3. Global turnover of more than £25 billion or UK turnover of more than £1 billion.

What sets the DMCC apart from other legislation is its enforcement strategy, which provides a more flexible approach to interventions and regulations. While the DMA provides a broad and uniform set of rules it can strongly enforce across the EU, it’s limited in how many levers it can pull - largely due to it being an EU-wide measure. In contrast, the Digital Markets Unit’s (DMU) position within the broader UK’s Competition & Markets Authority (CMA) broadens its mandate. As a result, the DMU has more flexibility in what Pro-Competition Interventions (PCIs) it adopts and how to enforce these. It also allows the DMU to take actions unavailable to the DMA, like blocking mergers and acquisitions. 

What you need to know: When the DMCC passes, the DMU can intervene proactively and quickly when there are concerns about competition. And like the DMA, we’re predicting the DMCC will mean more opportunities for developers to launch direct-to-consumer offers to their UK players.

Digital Antitrust Law (Japan) 

At the very end of 2023, Japan’s government began preparing new antitrust legislation that would focus on four areas:

  1. App stores and payment processing
  2. Search platforms
  3. Browsers
  4. Operating systems

The new regulations would require platforms like Apple and Google to allow third-party app stores and payment processors to run on their operating systems. It addresses the concern that these tech giants have a monopoly over the app stores and payments that prevents competition and keeps users within their proprietary ecosystem. As a result (and something addressed by the DMA, too), users often end up paying more to purchase content or services on mobile, compared to the same purchase on desktop. Violators of the new law could face a 6% penalty on all revenues “earned from the problematic activities”. 

The other parts of the regulation - like addressing anti-competition concerns regarding search platforms and browsers - are par for the course with Google’s other antitrust lawsuits in the US. With this Japan legislation set to reach Parliament and pass in early Spring, it’s another indication that the app ecosystem is opening up globally and third-party apps and payments are soon to be the norm.

Open Apps Market Act (USA)

This US based antitrust bill was introduced on August 11, 2021 into the Senate - and a companion bill was brought to the House of Representatives just 2 days later. Named the Open Apps Market Act, the legislation targets the anticompetitive practices of the Apple and Google app stores. The goal - similar to the other antitrust regulations in this list - is to protect competition within the app markets and enhance consumer protection. As put by Senator Marsha Blackburn, one of the three co-authors of the bill: “Apple and Google want to prevent developers and consumers from using third-party app stores that would threaten their bottom line. Their anticompetitive conduct is a direct affront to a free and fair marketplace.”

The Open Apps Market Act gained support outside of the government. The CEOs of 20 tech companies including Spotify and Basecap sent a written letter of support, and a survey from the Coalition for App Fairness found that over 80% of app developers support the legislation. In February 2022, the Senate Judiciary Committee passed the bill, with only two votes against it - a clear demonstration of bipartisan support. 

ICYMI, the US is in an election year in 2024 - both the presidential seat and Congress are getting voted on. This could have serious consequences for the Open Apps Market Act. Currently, the Senate and House are split, with the Democrats as Senate majority and Republicans as House majority. But if during the fall elections, one party was to take control of both parts of Congress (ie, there was no longer a party split), the act could have a high chance of passing.

What it means: We’re holding our breath until the election, but if passed, the Open Apps Market Act would allow for a lot of what we’re seeing already with the DMA. Sideloading would be allowed, and a more free and fair app market would be enforced - this time in the United States, specifically.

About the Author

Archie Stonehill

Head of Product
Archie Stonehill is the Head of Product at Stash, collaborating with top game studios to build a first of its kind direct-to-consumer platform for games. Previously, he was Engagement Manager and Senior Expert Advisor in Games at McKinsey, and following that, was a Principal at Makers Fund, working closely with founders and investing in the next big studios. As a hardcore gamer himself, Archie is deeply passionate about the impact D2C will have on player experiences and industry innovation.
More caSh witH sTash