Apple is changing its App Store fee structure in the European Union, replacing its controversial per-install Core Technology Fee with a simplified 5% commission on digital transactions for apps distributed outside the App Store. The changes, announced on August 18, are part of Apple’s latest effort to resolve disagreements with the European Commission over its compliance with the bloc’s Digital Markets Act (DMA). The new business terms will take effect on October 1, 2026.
The changes go beyond alternative app stores. Apple will move developers in the EU to a single set of business terms and adjust several commissions for apps distributed through the App Store. The company will charge 26% for transactions using Apple’s in-app purchase system, 20% for transactions using alternative payment processing inside the App Store and 15% for transactions involving external links, with lower rates available for certain eligible developers and programmes.
Apple Replaces Core Technology Fee With 5% Commission
The biggest change concerns apps distributed through alternative marketplaces or directly from developers’ websites.
Apple’s previous EU system included a Core Technology Fee of €0.50 for each first annual installation above one million installs for many apps. The fee was one of the main points of contention because developers could face payments to Apple even when they distributed their apps outside the App Store.
Under the new structure, Apple is replacing that system with a 5% Core Technology Commission on digital transactions for apps distributed outside Apple’s App Store in the EU. The change is intended to make the system simpler and more closely align Apple’s fee structure with the economics of alternative distribution.
Apple’s New EU Fee Structure
| Distribution / Payment Method | New Apple Fee |
|---|---|
| Alternative app stores / web distribution | 5% Core Technology Commission |
| App Store + Apple In-App Purchase | 26% |
| App Store + alternative payment processing | 20% |
| App Store + external purchase link | 15% |
| Eligible reduced-rate transactions | Lower rates may apply |
| Effective date | October 1, 2026 |
The new structure replaces several separate charges with a more straightforward commission-based model. Apple says the changes will also reduce complexity by placing developers distributing apps in the EU under a single set of business terms.
How Apple’s EU Fees Are Changing
The changes represent a significant shift from the fee system Apple introduced after the EU’s Digital Markets Act forced changes to iOS distribution.
Previously, developers using Apple’s alternative EU business terms could face a combination of charges. Apple’s 2025 documentation described a €0.50 Core Technology Fee for first annual installs above the one-million threshold, along with other commissions and payment-processing charges.
The new system removes that complicated combination for the relevant transactions and introduces clearer percentage-based charges.
Apple EU Fee Comparison
APPLE'S NEW EU COMMISSION STRUCTURE
Alternative App Stores / Web
5% █████
External Purchase Links
15% ███████████████
Alternative Payment Processing
20% ████████████████████
Apple In-App Purchase
26% ██████████████████████████
The biggest potential benefit is for developers that generate significant digital sales outside Apple’s App Store. Instead of dealing with a per-install charge alongside other fees, they will face a percentage commission tied directly to transaction value.
Apple Is Also Changing App Store Commissions
Apple’s changes are not limited to alternative marketplaces.
For transactions completed through Apple’s App Store using Apple’s in-app purchase system, the standard commission under the new terms will be 26%. Developers using alternative payment processing within the App Store will face a 20% commission, while transactions originating through external purchase links will carry a 15% commission.
Certain developers and programmes can qualify for lower rates.
Potential Rates Under The New Model
| Transaction Type | Standard Rate | Potential Reduced Rate |
|---|---|---|
| Apple In-App Purchase | 26% | 15% for eligible programmes |
| Alternative payment processing | 20% | 10% for certain eligible developers |
| External purchase links | 15% | 10% for certain eligible developers |
| Alternative app stores / web | 5% | — |
The changes mean developers will have several different economic paths depending on how they distribute their apps and process payments.
Why The EU Forced Apple To Change Its Approach
The changes are linked to the European Union’s Digital Markets Act, which requires designated gatekeepers to provide greater opportunities for competition.
The European Commission designated Apple’s App Store and iOS among the company’s core platform services under the DMA. The rules require Apple to effectively allow alternative app distribution through third-party marketplaces and the web, while also allowing developers to steer users toward alternative ways of purchasing digital content.
The European Commission has also criticised Apple’s previous approach to alternative distribution and payment systems, arguing that Apple’s fee structure could discourage developers from using channels outside the App Store.
Apple’s latest changes are therefore an attempt to address both the economics and complexity surrounding alternative distribution.
Apple Will Use One Set Of Business Terms
Another major change is the consolidation of Apple’s EU developer agreements.
Apple said developers that distribute apps in the EU will move to a single set of business terms. Developers can sign the new terms immediately, while the revised rules will become effective on October 1.
This is designed to reduce the number of different fee combinations developers have to navigate.
New EU App Distribution Model
APPLE EU APP DISTRIBUTION
iPhone / iPad
│
┌───────────────────┼───────────────────┐
│ │ │
App Store Alternative Store Web
│ │ │
Apple IAP 5% commission 5%
26% on digital sales
│
Alternative payment
20%
│
External purchase
link
15%
The result is a more explicit separation between Apple’s traditional App Store services and alternative distribution channels.
What It Means For Alternative App Stores
Alternative app stores have been one of the most important elements of the EU’s attempt to introduce competition into Apple’s mobile ecosystem.
Under the DMA, developers can operate alternative marketplaces on iPhones and iPads, reducing their dependence on Apple’s App Store. Developers can also distribute apps directly from their websites in the EU, subject to Apple’s requirements.
The 5% commission could make those options more commercially predictable.
For example, an alternative marketplace generating €10 million in eligible digital transactions would face a theoretical Apple commission of €500,000 under a 5% rate. At €100 million in transactions, the same percentage would amount to €5 million.
Illustrative Impact Of 5% Commission
| Eligible Digital Transactions | 5% Commission |
|---|---|
| €1 million | €50,000 |
| €10 million | €500,000 |
| €50 million | €2.5 million |
| €100 million | €5 million |
| €1 billion | €50 million |
These are simple illustrations of the 5% rate and do not represent Apple’s forecast revenue or any particular developer’s actual fees.
Apple’s Previous €0.50 Install Fee Was More Complex
The previous Core Technology Fee worked differently from a conventional sales commission.
Apple’s developer terms described a €0.50 fee for each first annual install beyond one million installs in a rolling 12-month period for many apps. The calculation could therefore depend on installation volume rather than the amount of money generated by the application.
That created a particular challenge for free apps with large user bases.
A developer could have millions of installations but relatively little revenue, creating a potential mismatch between the fee and the application’s ability to generate income.
The new 5% model links Apple’s charge more directly to digital transaction value for apps distributed outside the App Store.
Developers Get More Choice — But Apple Still Collects Fees
The new system does not mean developers can distribute apps in the EU completely free of Apple’s charges.
Instead, Apple is changing how it monetises transactions outside its traditional App Store model.
The 5% Core Technology Commission means Apple will continue to receive revenue when eligible digital transactions occur through alternative distribution channels.
This is important because Apple’s App Store is a major component of its broader services business. Regulatory changes affecting App Store commissions therefore have implications beyond individual developers.
EU Regulatory Pressure Has Been Building
Apple’s latest move follows years of regulatory scrutiny of its App Store practices in Europe.
The European Commission has used the DMA to challenge the business models of major technology platforms designated as gatekeepers. The Commission has said that developers should be able to use alternative distribution channels and payment systems, while consumers should be able to access potentially cheaper offers outside traditional app-store systems.
The Commission welcomed Apple’s latest changes and said it would continue monitoring implementation.
The regulatory process therefore does not necessarily end with Apple’s announcement. The effectiveness of the new system will depend on how developers experience the rules once they take effect.
Apple Faces Criticism From Epic Games
Not everyone sees the revised structure as sufficient.
Epic Games, which has been involved in a long-running legal dispute with Apple over App Store policies, criticised the new fees and argued that they do not go far enough to meet the goals of the DMA. Reuters reported that Epic described the new fees negatively, while Apple maintains that the changes resolve its disagreements with the European Commission.
The disagreement illustrates the wider debate over what constitutes meaningful competition in digital marketplaces.
Regulators may consider whether alternative stores and payment systems are technically available, while developers may focus more heavily on whether those alternatives are financially attractive after Apple’s fees and compliance requirements.
Apple Services Revenue Faces A Wider Regulatory Challenge
The EU changes come as Apple’s highly profitable services business faces increasing regulatory pressure in several markets.
The App Store forms part of Apple’s broader services ecosystem, which includes advertising, cloud services, subscriptions and other digital offerings. Changes to App Store commissions could therefore affect the economics of an important part of Apple’s services model.
The Financial Times reported that Apple has acknowledged regulatory changes could negatively affect parts of its services business, including situations where the company may not earn a commission from some transactions.
For Apple, the challenge is to comply with competition rules while preserving as much of the economics of its services ecosystem as possible.
The Bigger Picture
Apple’s latest EU fee changes represent a significant shift in the economics of iPhone app distribution. The company is replacing the previous per-install Core Technology Fee for alternative distribution with a 5% commission on eligible digital transactions, while also reducing and simplifying several App Store-related fees. The changes are intended to address the European Commission’s concerns under the Digital Markets Act and will take effect on October 1, 2026.
The bigger question is whether the new structure will make alternative app stores and web distribution genuinely competitive with Apple’s App Store. A 5% transaction fee is considerably easier to understand than a complicated installation-based system, but developers will still have to weigh Apple’s charges against the benefits of reaching users outside the App Store. The outcome could influence not only Apple’s European business model but also how regulators in other countries approach app-store competition.
Looking Ahead
The next major test will come after the new terms take effect in October. Developers and alternative marketplace operators will be able to assess whether the 5% commission makes independent distribution economically viable at scale. The European Commission is expected to monitor implementation closely, meaning Apple could face additional scrutiny if developers continue to report barriers or costs that make alternative channels impractical.
For Apple, the changes could establish a new template for operating under stricter digital-market regulation while preserving part of its App Store economics. For developers, the significance will depend on actual costs, user adoption and the ability of alternative marketplaces to attract meaningful traffic. If those channels gain traction, Apple’s control over iOS distribution could weaken further, potentially changing the economics of the mobile software industry in Europe.
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