Thanks to Twitter CEO Elon Musk, Apple is facing fresh criticism over App Store fees and whether its insistence on content moderation somehow suppresses free speech. It's not entirely true either.
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App Store Fees: An Ongoing Negotiation
Let's start with the App Store fees. Currently, some developers must pay Apple 30% of their software sales or subscription revenue. Not all developers do this: in the second year, the subscription fee is reduced to 15% of the take, while developers worth less than €1 million also pay only 15%. (Developers who don't charge for their apps don't pay any fees.)
In return, developers get access to the world's most secure app store, industry-leading development tools, and the least fragmented mobile platform. Note: Developers must use Apple's own payment processing systems.
Now, it can be argued that the fees themselves are no longer appropriate. While 30% has pretty much become an industry standard, it's been a while since costs have been weighed against economies of scale.
At the same time, it seems perfectly appropriate that Apple has the right to make the App Store a viable business. This means that the argument around fees will inevitably (as I repeat) become a decision about how much they should be, not whether they should exist.
It is a fee, not a tax.
Regulators around the world are looking at these fees and I think a compromise is likely, but calling them an "Apple tax" is a misnomer. It is no more a tax than any retailer's markup on any store, including car dealerships or tunnel construction projects.
But when a company proposing to charge users for the right to share their own content for viewing starts claiming that Apple's fee is a tax on free speech, it's hard not to see a massive moral conflict.
How can talk be free if it costs €8 a month? And when a company evicts most of its staff without notice, what is the cost? Interest charges? Unemployment? Legal fees to justify non-compliance with labor laws?
… Which brings us to content moderation
Everyone who has ever visited a website has encountered the GDPR. It is a European set of legal requirements for the digital age. They extend to websites, platform providers like Apple or Google, and content companies like Twitter.
While there are many requirements in the GDPR, one restriction is the need to control certain forms of discussion, such as the promotion of hate crimes, MASI content, etc. With that in mind, it's not at all reassuring that one of the world's largest social media companies has reduced its MASI content management team to just one person.
Billion-dollar companies often have teams in place to maintain GDPR compliance, though most at Twitter have already been fired or resigned.
This reduction in content moderation is already affecting advertisers on this platform, who are finding that their branded posts are placed next to deeply offensive posts, including some from the CEO. The risk to advertisers is clear. Furthermore, the company does not appear to be in compliance with FTC regulations, as some journalists claim.
Beyond Europe and the United States, there are other nations with strict moderation requirements, some even more demanding.
Any platform that distributes a poorly moderated app risks falling into a legal minefield. It's just prudent business practice to avoid questionable environments. For Apple, you need to make sure that the software you distribute also meets these needs. We know you will kick an app that doesn't maintain such moderation. It already has.
No one is forced to take (or click) an ad
Apple, a company I find more sincere than most with its focus on business values in an increasingly murky world, will not spend money advertising on a platform that distributes questionable content.
That's remarkable, considering Apple brings in perhaps at least 4% of Twitter's revenue.
Remember those little animations around your WWDC or Take Note tweets? Apple paid for them. He paid a lot.
I look at it this way: if Steve Jobs were to place Apple's famous "Crazy Ones" ad, he would not place it on a site that is failing in its responsibility to moderate content. An ad campaign featuring Albert Einstein, Gandhi, Martin Luther King and Muhammed Ali would be very out of place on a platform where hate speech is considered acceptable.
These risks—of litigation, brand damage, and more—mean that many advertisers (not just Apple) have stopped spending on Twitter's platform. This is not an argument against free speech; is an argument in favor of trademark protection and collective responsibility.
So what is going on?
Apple is in a difficult situation. It seems that he quietly tried to convince one of his higher profile developers to better stick to the different laws and regulations related to content moderation. The reaction was a critical tirade, which cannot hide the fact that free speech also requires personal responsibility and a supportive environment in which conversations can take place. Someone will have to think differently or face significant consequences.
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