What Is the Digital Markets Act?
The Digital Markets Act (DMA) is a European Union regulation that targets large technology companies designated as "gatekeepers" of digital platforms. It entered into force in 2023 and has been fully enforced since March 2024. Both Apple and Google are designated gatekeepers for their mobile operating systems and app stores.
The DMA aims to create fairer and more contestable digital markets by requiring gatekeepers to allow more competition and user choice on their platforms.
How the DMA Affects Mobile App Developers
Alternative App Stores (Sideloading)
The DMA requires Apple to allow alternative app marketplaces on iOS in the EU. This means:
- Third-party app stores can now operate on iPhone and iPad in EU countries
- Developers can distribute apps outside the App Store
- Apple has implemented this through "alternative marketplace" provisions with specific technical and business requirements
Alternative Payment Systems
Developers can now offer alternative payment methods for in-app purchases in the EU:
- Apps in the EU can link to external websites for payment
- Apps can use third-party payment processors instead of Apple's IAP
- Google Play already allows limited alternative billing in the EU and other select regions
- Platform commissions for apps using alternative payments are reduced but not eliminated
Browser Engine Choice
The DMA requires Apple to allow third-party browser engines on iOS in the EU:
- Browsers are no longer forced to use WebKit
- Firefox, Chrome, and others can use their own engines
- This affects PWA (Progressive Web App) capabilities
Apple's DMA Compliance: The Details
Apple has introduced several changes specifically for the EU:
Core Technology Fee (CTF)
For developers using alternative distribution or payment methods:
- 0.50 EUR per first annual install beyond 1 million installs
- Applies per install, per year, for apps distributed outside the App Store or using alternative payments
- Small developers (under 1 million installs) are exempt
- The fee applies regardless of whether the developer charges users
Alternative App Marketplace Requirements
To operate an alternative marketplace on iOS:
- Must provide a letter of credit for 1 million EUR
- Must meet Apple's notarization requirements
- Must comply with content and safety standards
- Apps from alternative marketplaces are still subject to Apple's notarization process
Link-Out Entitlement
Developers can apply for the "External Link Account Entitlement" to:
- Link users to their website to complete purchases
- Inform users about alternative purchasing options
- Apple charges a reduced commission on transactions that originate from these links
Google's DMA Compliance
Google has made its own changes:
- Alternative billing is available in the EU with a reduced service fee
- User choice billing lets users pick between Google Play Billing and a developer's payment system
- Sideloading was already possible on Android; DMA reinforces this right
- Default browser/search choice screens are presented to EU users
Practical Considerations for Developers
Should You Use Alternative Distribution?
- EU-only - These changes only apply in the EU; your worldwide strategy is unaffected
- Discovery - The App Store provides massive discovery; alternative stores are still unproven
- Trust - Users trust established stores; new marketplaces must earn that trust
- Compliance burden - You handle more of the security and payment processing yourself
- Small developers (under 1M installs) are exempt from Apple's CTF, making the risk low
Should You Use Alternative Payments?
- Apple reduces commission from 30% to 17% for alternative payments, plus the CTF
- Google reduces commission when alternative billing is used
- Payment processing through your own provider costs 2-5%
- You gain more control over the customer relationship
Regulatory Uncertainty
The DMA landscape is still evolving. Apple and Google are challenging aspects of enforcement, the European Commission has opened proceedings against both companies, and rules may change. Other regions (Japan, South Korea, India) are considering similar regulations.
What to Watch
- European Commission decisions on Apple and Google compliance
- Alternative marketplace adoption rates in the EU
- Consumer behavior regarding sideloading and alternative payments
- Similar regulations emerging in other markets (Japan, Brazil, India)
- Apple and Google fee structure changes in response to regulatory pressure