Apple today added two additional conditions for developers in the EU, where the Core Technology Fee (CTF) is not required.
Developers of free apps without monetization won’t have to pay the new fee and Apple won’t charge the small developer the CTF even if they hit 1 million annual installs in the three-year window and continue to exceed it.
Apple say the CTF is an element of the alternative business terms in the EU that reflects the value Apple provides developers through tools, technologies, and services that enable them to build and share innovative apps.
We believe anyone with a good idea and the ingenuity to bring it to life should have the opportunity to offer their app to the world. Only developers who reach significant scale (more than one million first annual installs per year in the EU) pay the CTF.
Nonprofit organizations, government entities, and educational institutions approved for a fee waiver don’t pay the CTF. Today, Apple implemented two additional conditions in which the CTF is not required.
First, no CTF is required if a developer has no revenue whatsoever. This includes creating a free app without monetization that is not related to revenue of any kind (physical, digital, advertising, or otherwise). This condition is intended to give students, hobbyists, and other non-commercial developers an opportunity to create a popular app without paying the CTF.
Second, small developers (less than €10 million in global annual business revenue*) that adopt the alternative business terms receive a 3-year free on-ramp to the CTF to help them create innovative apps and rapidly grow their business.
Within this 3-year period, if a small developer that hasn’t previously exceeded one million first annual installs crosses the threshold for the first time, they won’t pay the CTF, even if they continue to exceed one million first annual installs during that time.
If a small developer grows to earn global revenue between €10 million and €50 million within the 3-year on-ramp period, they’ll start to pay the CTF after one million first annual installs up to a cap of €1 million per year.
iPadOS
This week, the European Commission designated iPadOS a gatekeeper platform under the Digital Markets Act. Apple will now bring their recent iOS changes for apps in the European Union (EU)Â to iPadOS later this fall, as required.
Developers can choose to adopt the Alternative Business Terms for Apps in the EU that will include these additional capabilities and options on iPadOS, or stay on Apple’s existing terms.
Once these changes are publicly available to users in the EU, the CTF will also apply to iPadOS apps downloaded through the App Store, Web Distribution, and/or alternative marketplaces.
Users who install the same app on both iOS and iPadOS within a 12-month period will only generate one first annual install for that app.
To help developers estimate any potential impact on their app businesses under the Alternative Terms Addendum for Apps in the EU, Apple has updated the App Install reports in App Store Connect that can be used with the fee calculator.
