Apple Allegedly Offered to Reduce App Store Fee to Get Amazon Prime Video on Devices

The US House antitrust subcommittee has revealed that Apple offered a lower 15 per cent subscription fee to Amazon for bringing its Prime Video app on the Apple TV set-top box. Apple normally charges 30 per cent fee for most in-app purchases but in the case of Amazon, it allegedly offered 15 per cent fee on subscriptions that signed up through the Prime Video app, according to an email exchange released by the US Congress panel during the testimony on Wednesday.

The US Congressional hearing over anti-competition practices of the global tech giants was also attended via video conference by Amazon’s Jeff Bezos, Sundar Pichai of Google and Facebook’s Mark Zuckerberg. “Apple executive Eddy Cue emailed Amazon CEO Jeff Bezos in 2016 suggesting Apple would take a 15% fee on subscriptions that signed up through the app, which is lower than Apple’s customary 30% fee for most in-app purchases,” reports CNBC. The approach showed that “big players can negotiate for better business terms” on Apple’s App Store. Cook, however, testified on Wednesday that “We apply the rules to all developers evenly”. In 2017, Cook announced that Amazon’s Prime Video service would be launching on the Apple TV set-top box.

Apple generally takes 30 per cent of the initial purchase price, including 30 per cent from the first year of subscription services that customers buy through the app, then drops the fee to 15% in the second year of a subscription. Swedish music streaming service last year lodged an antitrust complaint with the EU regulators, saying iOS App Store rules are unfair. Spotify said that Apple requires it and other digital services to pay a 30 per cent tax on purchases made through Apple’s payment system, including upgrading from a free to a premium subscription. Apple slammed Spotify for wanting “all the benefits of a free app without being free”.