It’s been a year of change for Microsoft. After spending several years telling us that Windows 10 is the final form of their flagship operating software and that any future updates will come as amendments to the existing OS, Windows 11 is now upon us. Unlike almost every Windows upgrade of the past, though, Windows 11 will come at no cost to the user. Microsoft used to have a reputation for commercialism and profiteering, but the company seems determined to change that perception in the 2020s – and the free OS upgrade is just the tip of the iceberg. Suddenly – not to mention shockingly – its app store is now open to third parties.
App stores have been a sore point for many a tech company in the past 24 months, and none more so than Apple and Google. The policies set by both companies have landed them in court with Epic Games, who’ve accused them of discriminatory practices. The crux of the matter is that Epic – along with several other companies who support Epic’s stance – believe that Apple and Google charge too much for doing too little when it comes to listing apps and games on their stores. In some cases, they also believe that both companies give preferential treatment to their products while simultaneously putting barriers in the way of competing products, thus effectively creating monopolies. Courts are due to rule on these matters within the next few months.
While both companies have revised their terms within the past year, there was a time when Apple and Google both charged a 30% rate of commission for any purchases made through their app stores. Apple’s terms were even tighter than Google’s, as they didn’t allow app makers to direct users to third party payment methods or alternative means of downloading apps. The situation was somewhat unfavourably compared to how online slots are listed on casino websites. Within that industry, the sheer amount of choice leads to favourable terms for game developers. If one online slots website wants too big a slice of the pie, developers have hundreds of alternatives they could go to with their wares. That level of competition means that the companies that make online slots tend to get good deals. Apple and Google have both been accused of conspiring to make sure that the same level of competition can never exist among app stores.
It’s into this whirling maelstrom that Microsoft wades, seemingly bringing good news with them in the process. In most cases, Microsoft intends to allow app developers to keep one hundred per cent of the revenue generated by their apps so long as they use alternative payment platforms. They’re welcome to use Microsoft’s payment platform if they wish – for which a fee will be charged – but there will be no attempt to force them to do so. Tellingly, Epic Games has already confirmed that it will jump aboard the Microsoft App Store platform in the near future. Amazon also intends to fully integrate its digital products and services with the store in what must surely be seen as another huge vote of confidence and support.
The only potential wrinkle in the new arrangement is that Microsoft has already said that its “one hundred per cent revenue” offer won’t apply to games. The company is yet to publicly confirm how much money it expects game development companies to hand over, although it’s to be assumed that Epic must already be aware and happy with the price. This stipulation seems to be destined for trouble, not least because there isn’t a clear legal definition of what does or doesn’t constitute a game. Something like Epic’s flagship product Fortnite is clearly a game, but would a crossword app be considered a game? Would a Sudoku app be considered a game? In both cases, the answer might be “yes,” but they’re not games that are designed to make huge amounts of money in the same way as Fortnite, Call of Duty, or Rage: Shadow Legends. Until such a definition is agreed between developers and app store hosts, debates like this one will inevitably come up again in the future.
By opening up its store and offering such favourable terms, Microsoft is hoping that an increasing number of developers will now come to Microsoft rather than relying on Apple or Google when trying to shift its apps. Panos Panay, Microsoft’s current head of Windows, has openly admitted that he’d like to see Steam build a presence within the platform. The increasingly popular Discord app is already listed, as is 2020’s standout app Zoom. TeamViewer has become available through the store, as have the apps of Wikipedia, Tumblr, and TikTok. The more household names become available through Microsoft, the greater the expectation among customers will be that every app they might be interested in should be there. If they’re not, the companies that are holding out will look inferior by their absence. This could be a major power shift in the popularity of app stores, and it couldn’t come at a worse time for Apple or Google. Both companies are already likely to find that the courts in the United States of America are willing to erode their powers. Now there’s a new pretender to the throne.
Such is the amount of market share commanded by Apple and Google that there’s still time for them to change their ways and keep the majority of their customer base. Further relaxations in app store policies are likely from both companies, and further new measures are likely to be announced in the future. With Windows 11 set to be one of the biggest tech events of the year, though, and with the app store changes coming as part of that upgrade, this is all happening at a time when all eyes are on Microsoft. For the first time in a long time, it feels like all eyes are on the old industry titans. Whether they can take advantage of that and turn this into a platform for significant growth remains to be seen, but this is undoubtedly a step in the right direction.
