Apple and Google are about to face their first major test under a law targeting their controversial app-store fees — and the result could be a battle in South Korea with the company that owns Tinder.
Match Group — which also owns dating apps like Hinge, OkCupid and PlentyOfFish — is angling to capitalize on a recently passed South Korean law that targets Apple and Google’s punishing fees, which can amount to as much as 30 percent of an app’s revenue.
Match — a vocal critic of the fees alongside developers like Spotify and Epic Games, the maker of Fortnite — bought Seoul-based dating app Hyperconnect in June for $1.73 billion. Now, the Dallas-based company plans to submit updates to its apps before the end of October allowing South Korean customers to sidestep Apple and Google’s payments systems, The Post has learned.
While the updates look straightforward and in line with the new legislation, some sources close to Match are bracing for a possible dustup. They’re betting that either Apple, or Google or both may drag their feet or reject the updates altogether. That, in turn, could lead to a drawn-out appeals process with regulators, who have threatened to fine companies up to 3 percent of their total South Korean revenue if they don’t comply.
The first-of-its-kind law barring Apple and Google from requiring app developers use their payments systems was pushed through the South Korean parliament by President Moon Jae-in’s party. AP
The stakes are high for Match, which expects to fork over $500 million in such fees globally this year alone, representing about 20 percent of the company’s global revenue.
Apple and Google both charge payments fees of up to 30 percent and bar developers from using other payments processors. AP
South Korea passed a law in August that bans Apple and Google from requiring app developers to use their payments systems. Meanwhile, bills introduced in the US House and Senate in August would also ban Apple and Google from requiring app developers use their payments systems. EU antitrust regulators said last year that they are probing whether Apple’s payments requirement violates the bloc’s competition laws.
In September, a California judge in a dispute between Apple and Epic Games ordered Apple to let developers who use its app store offer customers payments systems besides Apple Pay. But the judge also sided against Epic on several counts and the video game maker appealed the ruling. It’s unclear when or if Apple will be forced to let Californians use alternative payments systems.
On Sept. 16, Match Chief Financial Officer Gary Swidler told the Wall Street Journal that the company was considering offering alternative payments systems to California customers at some point in the future.
The Journal also reported that updates to the company’s Korean apps would be submitted “in the coming months” — but Tuesday’s news shows Match is moving more quickly than expected.
Apple and Google did not immediately reply to requests for comment.
Match Group bought Seoul startup Hyperconnect for $1.73 billion in June.Hyperconnect/Facebook