Apple Faces Backlash Over New Smartphone Law Compliance as App Developers Cry Double Standards + Video

🎯 Introduction

As Japan prepares to fully enforce its new Smartphone Software Competition Act in December 2025, the spotlight is firmly on Apple and Google. The law was designed to curb the overwhelming market power of dominant app platform operators and restore fairness to the mobile ecosystem. However, what was meant to be a step toward competition is now triggering fresh controversy. App developers argue that Apple’s response to the law replaces one form of control with another, preserving profits while undermining the spirit of reform.

the Original

The Mobile Content Forum (MCF), an industry group representing app developers and related companies, released a formal opinion criticizing Apple and Google over their compliance measures with Japan’s upcoming smartphone competition law. While both companies have announced changes allowing developers to link to external payment systems, MCF claims these measures still constitute an abuse of dominant market position.

Historically, Apple and Google required developers to use their in-app payment systems, charging commissions of up to 30 percent. Under the new law, developers are now allowed to direct users to their own payment websites, which typically offer lower fees. MCF acknowledges this as a positive shift, noting that developers can now promote the existence and pricing of their own websites within apps without cost.

However, the group strongly opposes the continued imposition of fees when purchases are made via external links. Apple and Google plan to charge commissions of up to 15 to 20 percent when users complete purchases after being redirected from an app. MCF argues that the basis for these fees is unclear and that they effectively discourage developers from using external payment options. The group insists that, as in the United States, such external links should be commission-free.

MCF also criticizes Apple’s so-called seven-day rule. Under this policy, Apple tracks user purchases for seven days after a user clicks an external link from an app. If a user makes additional purchases on the same website during that period, Apple may still claim a commission, even if the later purchase is unrelated to the app interaction. According to MCF, this creates excessive monitoring and unfair financial burdens on developers.

The forum accuses Apple of forcing unacceptable transaction terms by exploiting its dominant position. It further highlights what it calls a double standard, pointing out that Apple promotes strict user privacy protections and severely limits tracking for advertising purposes on apps and its Safari browser, while simultaneously tracking purchase behavior to secure commissions.

The Smartphone Software Competition Act aims to restrain the market dominance of Apple and Google and foster fair competition. Japan’s Fair Trade Commission is expected to release the compliance reports submitted by both companies in December, a move that could shape future enforcement and potential penalties.

What Undercode Say:

Apple’s response to Japan’s smartphone law reveals a familiar pattern. The company adapts just enough to meet regulatory requirements while preserving the economic structure that made its App Store so profitable. On paper, allowing external payment links looks like progress. In practice, the surrounding conditions severely limit the benefit for developers.

The 15 to 20 percent commission on external purchases raises serious questions about justification. Apple positions these fees as compensation for platform value, security, and user access. Yet when the transaction happens entirely outside Apple’s infrastructure, the argument weakens. Developers handle hosting, payment processing, customer support, and fraud prevention on their own platforms, while Apple still demands a cut.

The seven-day tracking rule is even more controversial. It extends Apple’s reach beyond the app itself and into the broader digital commerce behavior of users. This blurs the line between platform facilitation and direct transaction involvement. From a competition standpoint, it reinforces Apple’s gatekeeper role rather than reducing it.

There is also a credibility problem. Apple has built its public image around privacy, often framing itself as the antithesis to data-driven advertising giants. Strict limits on ad tracking are promoted as consumer protection. However, tracking purchases for commission purposes introduces a contradiction that regulators are unlikely to ignore.

For developers, the message is clear. The freedom to use alternative payments exists, but it comes with friction, complexity, and financial penalties. Smaller studios may find the compliance burden and reduced margins outweigh the benefits, effectively keeping them locked into Apple’s ecosystem.

From a regulatory perspective, this case will likely test how aggressively Japan enforces not just the letter but the intent of its new law. If partial compliance with restrictive conditions is allowed, the law risks becoming symbolic rather than transformative.

Globally, this debate mirrors similar conflicts in the European Union and the United States. Japan’s decisions could influence international regulatory strategies, especially in how dominant platforms are allowed to monetize access while claiming openness.

Fact Checker Results

✅ Apple and Google announced external payment link support under the new law.
✅ Commissions of 15 to 20 percent on external purchases are part of Apple’s policy.
❌ Claims of consumer protection alignment remain inconsistent with tracking practices.

Prediction

📊 Japanese regulators are likely to intensify scrutiny of commission structures and tracking rules.
📊 Apple may face pressure to further reduce or eliminate fees on external payments.
📊 The outcome could accelerate global alignment toward stricter platform competition rules.

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