Apple Warns of Major Losses Without App Store Commissions

Overview: The Foundation of User Trust and Platform Integrity

In an emergency motion filed April 30, 2025, Apple told US District Judge Yvonne Gonzalez Rogers that enforcing her recent “extraordinary Order”—which opens the App Store to external payment mechanisms—would cost the company “hundreds of millions to billions” of dollars annually. The tech giant argues these new restrictions are punitive rather than corrective, undermining the integrated iOS ecosystem that underpins App Store security and user trust.

Legal Background and Recent Rulings

• 2021 Injunction: Apple was ordered to allow developers to inform users of alternative purchase options, yet continued to enforce fees and audit requirements on external payments (12–27% commission).
• Epic v. Apple: The Fortnite lawsuit led Judge Gonzalez Rogers to find Apple “willfully” in contempt of the 2021 injunction, citing an “obvious cover-up” of non-compliance and referring Apple for potential criminal charges.
• 2025 Extraordinary Order: Requiring Apple to permit in-app links, buttons, and calls-to-action directing users to purchase flows outside the App Store payment system.

Apple’s Emergency Motion: Key Arguments

Apple’s filing asserts that the new injunction “fundamentally changes Apple’s business and creates destabilizing effects for App Store customers.” Specifically, the company claims:

• The order “permanently precludes Apple from exercising control over core aspects of its business operations, including charging for use of its property and protecting the integrity of its in-app purchase mechanism.”
• Compliance costs—which Apple estimates between $500 million to $2 billion per year—are not grounded in the company’s conduct but in punishment for past non-compliance.
• Any commission or pricing restrictions were not specified in the original injunction; Apple contends that the judge exceeded her authority by dictating terms on link placement, pricing, and commissions.

Developer Response and Market Impact

Several high-profile developers, including Spotify and Amazon’s Kindle Store, have already implemented external payment buttons under the new rules, with middleware providers such as Stripe and Adyen publishing integration guides. However, some mid-sized developers report technical and compliance hurdles:

• Complex auditing requirements to verify transaction integrity outside the App Store sandbox.
• Increased PCI DSS scope for processing payments, raising security and certification costs.
• Potential user confusion as apps now host two parallel purchase flows, risking transaction disputes and support overhead.

Technical Integration Challenges

Implementing external payments on iOS demands significant engineering effort. Developers must integrate third-party SDKs, manage encrypted tokens, and orchestrate server-to-server callbacks. For example:

• Stripe’s iOS SDK v25.1.0 introduces STPPaymentHandler changes to support non-Apple pay flows, requiring updates to encryption ciphers (AES-GCM 256 vs. AES-CBC).
• React Native developers must update modules such as react-native-in-app-payments to at least v3.4.0 to handle Apple’s new URL schemes (applepay:// vs. open-external-purchase://).
• Server infrastructure now needs to satisfy SOC 2 Type II audits and conform to GDPR data residency rules for European sales, raising ops complexity.

Security and Privacy Implications

Apple contends that its closed payment system helps prevent fraud, phishing, and data leaks. Security researchers at Stanford University confirm that third-party payment flows can increase attack surface, especially if callback URLs are not properly validated:

• Cross-site request forgery (CSRF) risks when browsers or WebViews handle external checkouts.
• Possibility of man-in-the-middle attacks if TLS certificate pinning is misconfigured in custom payment modules.
• User privacy concerns as payment metadata may be processed by non-Apple servers, subject to differing privacy policies.

Comparative Regulatory Landscape

Globally, regulators are tightening rules on platform monopolies. The European Union’s Digital Markets Act (DMA), taking full effect in early 2026, mandates gatekeepers like Apple to allow third-party app stores and sideloading in the EU. Meanwhile, South Korea’s Telecommunications Business Act already enforces similar provisions:

• EU DMA: Gatekeepers must open their app stores to competing vendors without commission on payments processed outside native stores.
• South Korea: Enforced since 2021, resulting in Naver and Kakao implementing external billing options, albeit with local compliance complexities.

Expert Opinions

Katy Huberty, Managing Director of Tech Hardware & Semis at Morgan Stanley, notes: “Apple’s Services business generates over $20 billion quarterly. Eroding App Store commissions even by 5% could slash margins by 200-300 basis points over time.”

Gruber & Co. analyst John Martellaro adds: “Allowing external payments is a significant user-experience shift. Apple will need to invest in monitoring tools or risk malware distribution via fraudulent payment flows.”

What’s Next?

Apple has filed to stay the order while its appeal is underway. Oral arguments are expected in June 2025, with the Ninth Circuit’s decision likely to set precedent for other platform operators such as Google, Microsoft, and console makers. In the meantime, developers must decide whether to integrate external payments immediately or await further clarity.