Abang Tech: Facebook puts blame on Apple for lost events revenue during COVID-19

Saturday, 15 August 2020

Facebook puts blame on Apple for lost events revenue during COVID-19

This afternoon Facebook has criticized Apple over how it runs its App Store regarding a new events streaming service on the social media platform. Facebook’s comments today suggested that Apple’s 30% App Store commission is hurting small businesses during the pandemic.

The criticism from Facebook came today as it launched a new service that hosts paid livestreamed events like fitness classes or seminars (via Bloomberg). Facebook says it asked Apple to skip taking a cut of App Store purchases for the new service to help small businesses and creators but it declined.

Notably, Facebook isn’t taking a cut of the fees from the events it’s hosting “for at least the next year.” While Google agreed to waive the fees for Android devices, Apple decided to stick with its normal 30% commission for the App Store putting it in a tough spot amid rising antitrust tensions.

To support small businesses and creators, Facebook will not collect any fees from paid online events for at least the next year. For transactions on the web, and on Android in countries where we have rolled out Facebook Pay, small businesses will keep 100% of the revenue they generate from paid online events.

We asked Apple to reduce its 30% App Store tax or allow us to offer Facebook Pay so we could absorb all costs for businesses struggling during COVID-19. Unfortunately, they dismissed both our requests and SMBs will only be paid 70% of their hard-earned revenue. Because this is complicated, as long as Facebook is waiving its fees, we will make all fees clear in our products.

If Apple would have said yes, it would no doubt open itself up to a wave of requests for App Store policy exceptions and criticism, including bending the rules for a fellow tech giant but not thousands of small and medium-sized developers (Apple is already under pressure for doing that with Amazon and its reduced 15% commission rate).

But with Apple saying no, Facebook is using the opportunity to put more pressure on the company to change its App Store policies amid the legal battle with Epic Games. Like Epic, Facebook certainly knew Apple would be in a lose-lose situation with this latest App Store commission waiver request. And the fact that Google agreed to waive its Play Store fees made this particular situation more precarious for Apple.

This latest squabble comes after Facebook launched its new gaming service without any games on its iOS app and criticized Apple over it just last week. And another point of contention is Apple’s more strict privacy features in iOS 14 which Facebook is concerned about.

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