Apple was issued a potentially crushing setback in its ongoing legal battle over App Store fees — but players across the subscription creator economy are cheering it as a win.
“This is a huge moment for creators and their businesses,” a Patreon spokesperson told Business Insider in a statement. “The iOS app is the No. 1 platform for fan engagement on Patreon, and we believe this ruling allows creators to get paid without giving Apple 30%.”
Patreon is a platform where creators can build subscription businesses and charge fans for paywalled content, such as podcasts or videos, and other perks.
A judge on Wednesday found Apple had violated a 2021 injunction in its legal fight with Epic Games. The dispute started over the 30% fee Apple collects on in-app purchases.
The 2021 injunction largely favored Apple, but it said the company needed to let developers inform users in their apps about purchase options outside the Apple App Store. Wednesday’s ruling said the company failed to do that. It also said Apple violated the court’s order by charging a 27% fee when links guide users to off-app purchases.
An Apple spokesperson previously told BI that the company “strongly” disagrees with the court’s decision and plans to both comply and appeal — a sentiment echoed by CEO Tim Cook on the company’s earnings call. Apple did not respond to a request for further comment.
Apps that help creators make money from subscriptions, like Patreon, Passes, Kajabi, and Mighty Networks, rejoiced at the changes. If more subscriptions are transacted outside Apple’s ecosystem, it could mean more money for creators and platforms alike.
Patreon said it’s submitting an app update for review that will enable payment options outside of in-app purchases so creators can keep more money.
Last year, the company said it was removing all other billing systems from its iOS app, and advised creators that they could either raise their in-app prices to cover Apple’s fees or eat the fees themselves. Subscribers could also avoid the fees by signing up on Patreon’s website.
While “the dust has yet to settle,” given Apple’s plans to appeal, “this is a good day for creative people,” Patreon CEO Jack Conte said on Instagram.
Passes founder and CEO Lucy Guo told BI in a statement that “companies have had to charge more to creators because of these commissions, so this will put more money in creators’ pockets.”
Mighty Networks CEO Gina Bianchini said, “We are celebrating over here at Mighty Networks.”
‘A more equitable digital marketplace for creators’
The ruling could threaten Apple’s App Store revenue, which is a major money maker for the company.
Last quarter, the company’s services business, which includes its App Store, accounted for $26.6 billion in net sales.
While it’s unclear how many prospective subscribers will forego the convenience of in-app purchases, Kajabi CEO Ahad Khan said the ruling points to a shift toward more creator ownership.
“Creators have long relied on social platforms and tech giants to earn money, and it cuts into their earnings and even limits how they engage with their audiences,” he told BI. “This ruling is another proof point of this shift toward a more equitable digital marketplace for creators.”
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