The popular mini-game became the fuse of Apple VS Tencent

Geek Park

2024-08-09 08:51Posted on the official account of Beijing Geek Park

The war of the "Apple Tax" has been rekindled in China.

On August 2, according to foreign media reports, Apple has put pressure on Tencent and Byte in the past few months, asking the two companies to "close the loophole", because the platform developers of WeChat and Douyin are directing users to external payment systems, so as to avoid the 30% "Apple tax". Apple has warned that it will refuse to allow WeChat and Douyin to be updated on the App Store if the vulnerability is not patched.

According to Apple's developer terms, users must pay for content consumed within the app through Apple's "in-app purchase" (IAP) channel, and Apple will take a cut of the turnover. Including game recharge, live tipping, paid courses, monthly memberships, etc., must comply with similar regulations.

This is not the first time that Apple and Tencent have gone to war over the "Apple Tax". In 2017, Apple asked the WeChat official account to access the reward function to IAP, but Tencent refused to access it, and once removed the tip function. Later, Apple made concessions on this issue and specifically modified the terms of the development contract to allow Official Accounts to use WeChat Pay for tips.

The reason for the resumption of the "war" between Apple and Tencent this time is another reason - mini games.

Mini games have long been not the leisure and entertainment topics of the time of "synthesizing big watermelons" and "sheep are sheep", and now it is a track of tens of billions of yuan, and it has not yet seen the ceiling. This WeChat mini-game has become a big cake. Neither Apple nor Tencent wants to make concessions on this issue. WeChat's user base, its important position in the domestic Internet ecosystem, and possible regulatory intervention have added more uncertainty to this problem.

Apple VS Tencent, came to the more severe "Round 2".

WeChat loophole of "Apple Tax".

The "vulnerability" discovered by Apple this time refers to the fact that when WeChat Mini Game players recharge, the system will direct the user to a "customer service chat" interface, and after the user sends a recharge instruction to the customer service, the customer service returns a payment link, and then the user can complete the recharge through WeChat Pay. On Douyin, a similar situation exists.

For bytes, it is relatively difficult to complete the relevant rectification, because Douyin has been connected to Apple's IAP system since the beginning of its launch, and in-app consumption such as "Douyin coin" recharge and live broadcast rewards are originally IAP, and it is only necessary to standardize the relevant recharge functions of mini games, and Bytes has dealt too much with "Apple tax" in the development process.

But for WeChat, things are much more complicated, because WeChat has always maintained a high level of "resistance" in IAP access, and even gave up a lot of business in order not to access IAP.

In 2017, WeChat launched the official account tipping function, which allows readers to use WeChat Pay to tip creators directly, just like "sending red envelopes". At that time, Apple said that users reading articles on the official account and giving tips are a kind of "content consumption" behavior, which needs to be accessed to IAP according to Apple's regulations.

However, Tencent said that WeChat did not take a cut from the tipping, and this function was only to increase the activity of the platform, and then the tipping function was taken offline for a time. After more than a year of communication between the two parties, Apple finally made a concession and added a clause that "users can give gifts to other users without passing IAP", and then the official account tip function was re-launched based on this clause.

The same clause is also applied to the "paid appreciation" function of WeChat stickers.

If the official account tipping is still on the edge of "content consumption and gift giving", Apple and Tencent have room for negotiation, and WeChat Mini Games undoubtedly violate the core rules of Apple's App Store and involve Apple's core interests.

In fact, the WeChat mini-program and the mini-game itself alone have stepped on Apple's sensitive area. Apple's developer terms stipulate that the app itself cannot be made into an "application platform", and Apple has ruthlessly "punched hard" when Microsoft, Google, and Meta launched their own cloud gaming platforms. For WeChat, Apple has adopted a "turn a blind eye" attitude, basically regarding the WeChat Mini Program as an extension of the function of the Official Account. Later, other cloud gaming platforms were also loosened.

However, Apple has little room for compromise on the issue of whether mobile game recharge is connected to IAP, which is the key lifeblood of Apple's software service revenue. Once the transaction and top-up model of WeChat Mini Games "runs through", more game developers may follow this method to bypass the Apple tax.

This is absolutely unacceptable for Apple.

The big cake of the "mini-game".

Prior to this, whether it was an official account, an emoji tip, or a mini program, the conflict between Tencent and Apple was at most a "friction", which was a technical issue, and there was no actual dispute of interest.

In terms of business model, WeChat almost perfectly bypassed the "commission model" that Apple had set for the App Store in the first place. From the very beginning, the commercialization of WeChat did not rely on the direct payment of users, but through advertising and drainage. Since its launch in 2011, the vast majority of WeChat users' consumption behaviors have been achieved through WeChat Pay, bypassing Apple's restrictions.

Until today, only the live broadcast tipping function of the video account is connected to IAP according to Apple's regulations, and users need to recharge "WeChat beans" to give tips, but this function is still relatively "marginal" in WeChat.

At the beginning of the launch of WeChat Mini Games, they also wandered on the edge of the WeChat platform. But with the development of the platform, mini games are becoming a big cake that cannot be ignored on the WeChat platform.

At the WeChat Mini Game Developer Conference in July this year, WeChat officially revealed that the current mini game users have reached 1 billion, with a monthly active user of 500 million, and there have been more than 240 games with a quarterly turnover of more than 10 million, and the top mini games such as "King of Salted Fish" and "Seeking Dao Daqian" can even reach billions of levels.

According to market research data, it is estimated that the annual turnover of WeChat Mini Games will be about 24.2 billion yuan in 2023, and the turnover of the iOS platform is likely to be tens of billions. According to Apple's 30% commission, Apple can get billions of potential revenue just by getting WeChat.

For Apple, this is an increment that cannot be ignored. According to Apple's just-released financial report for the third quarter of 2024, software services revenue has become the only growth engine, accounting for 28% of Apple's entire revenue structure.

Moreover, the market volume of Mini Games is growing rapidly. The investment in the development of mini games is very low, the gross profit is extremely high, and it only takes a small team to make a mini game in a very short time, and the revenue conversion can be quickly generated after the investment. According to industry insiders, the gross profit margin of mini game development can even reach about 95% at the highest.

At present, Tencent will take a 40% commission for the recharge of mini games on the Android platform, and will not take a commission for the iOS platform for the time being. Obviously, WeChat hopes to ease the situation through this attitude, and it must be communicating and negotiating with Apple on related issues.

The issue is relatively complex. Because Apple has an "Apple tax" discount for small and medium-sized developers. Developers with an annual turnover of less than $1 million can apply a preferential rate of 15%. However, on the issue of WeChat Mini Games, Apple only has a "developer agreement" with Tencent, and all the turnover of Mini Game developers must be counted on Tencent's head, so no discounts can be applied.

The soft underbelly of apples

After Bloomberg released the report, Apple, Byte, and Tencent did not respond to the report.

It is not difficult to judge that Apple also most likely does not want the contradiction to expand, and if the incident enters the field of public opinion, it may eventually lead to it being put on the desk of regulators. Previously, the European Union has launched a regulatory review of Apple through the DMA (Digital Markets Act), requiring iOS to open third-party App Stores and not force developers to use IAPs as a payment channel.

Apple ostensibly cooperated with EU laws and carried out compliance rectification, allowing third-party app stores and payment channels. Most developers said that under Apple's new rules, there is no room for any third-party app stores and payment channels, because developers still have to pay a lot of money to Apple.

The issue of Apple's tax has not yet settled in Europe, and if Apple goes to war with the giants on a large scale in China, the problem could become even more complex and uncontrollable. Given the importance of software services to Apple, this dispute could even determine the fate of Apple's business for the next decade.

It was previously reported that Huawei exempted all commissions on WeChat's HarmonyOS system without charging any fees, and set a 20% commission for other developers, lower than Apple's 30%.

But for a global company like Apple, the crux of the problem is not WeChat. Rather, it "privately signs a contract" with any company, which will be seen as setting an unfair playing field and causing more trouble. Previous disputes with Amazon, Netflix, Spotify and Epic have been based on Apple's unwillingness to shake the 15-year-old App Store rules.

It's just that now, for Apple, the problem is becoming more complex and more difficult to deal with.

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