Even though the Epic vs. Apple case is likely far from over, software revenue platform Paddle is looking to get in on the fallout early. Following Judge Yvonne Gonzalez Rogers’ ruling last month that Apple must allow App Store developers to redirect users to other payment systems, Paddle has announced what it is marketing as “the industry’s first alternative In-App Purchasing system for iOS.”
Background
First and foremost, it’s important to note that Paddle is relatively early with this announcement. Judge Rogers has given Apple until December to update its App Store guidelines to accommodate the injunction. As a reminder, here is the exact wording from the ruling:
Apple Inc. and its officers, agents, servants, employees, and any person in active concert or participation with them (“Apple”), are hereby permanently restrained and enjoined from prohibiting developers from (i) including in their apps and their metadata buttons, external links, or other calls to action that direct customers to purchasing mechanisms, in addition to In-App Purchasing and (ii) communicating with customers through points of contact obtained voluntarily from customers through account registration within the app.
Furthermore, there has been quite a bit of debate about what exactly Apple will be required to do to satisfy the ruling. So between the lack of clarity around the requirements and Epic’s appeal of the ruling, it’s possible – or even likely – that the December deadline gets extended.
Regardless, here’s what Paddle is announcing today.
The announcement
Paddle says that its “Paddle In-App Purchase” system is the “industry’s first alternative In-App Purchasing system for iOS.” It reportedly offers “all the same benefits of the App Store, without the hefty price tag, and with greater control over the user experience.
The company explains that fees for the platform will be identical to what it charges for its other revenue platform offerings: 10% for transactions under $10 and 5% for transactions over $10:
Paddle In-App Purchase is a true like-for-like, drop-in replacement for Apple’s IAP, allowing developers to maintain a seamless user experience, without having to pay Apple 30% of every sale. Paddle has a highly competitive fee structure, charging just 10% for transactions under $10, and just 5% on transactions over $10. This means that developers earn more from every purchase.
Paddle touts a handful of other benefits over Apple’s IAP system:
- Greater control over customer relationships: By removing Apple as the middleman. Paddle can give sellers far greater access to data on each customer throughout their lifecycle, allowing developers to better understand and optimise the user experience at every stage.
- Flexible subscription options and retention tools: Direct subscription management and the ability to pause subscriptions, gives the developer more power to support their users directly, more choice of billing models and the option to offer additional payment methods such as PayPal (alongside Apple Pay)
- Direct customer service: by putting the developer in control, Paddle IAP gives sellers the ability to to deliver high-quality customer service without having to go through Apple every time. Until now, developers have had to rely on Apple to pay refunds or collect payments on their behalf. This is not only inefficient, it means the developer has no control over a key aspect of the customer experience.
- Apple’s business model + greater freedom: Like Apple, Paddle also takes responsibility for the time consuming purchase admin, from global sales taxes to customer support. While other payment companies shift these responsibilities on to the seller to handler, with Paddle there’s nothing new for developers to worry about.
On Paddle’s website, you can see a short demo video showing how this will theoretically work (but the implementation could change based on Apple’s interpretation of Judge Rogers’ ruling). The demo shows an “Upgrade Now” button in-app, which bounces users out to Safari when tapped. From there, users complete their purchase in Safari using Apple Pay, and are then taken back to the initial app.
Paddle says that the new platform will go live on December 7, which is a date based on the 90-day terms of the court ruling from Judge Rogers. The full press release is below and interested developers can join the waitlist here.
Paddle launches In-App Purchase offering in response to Apple vs Epic ruling, bringing innovation and choice to iOS developers for the first time
- Paddle In-App Purchase is the industry’s first alternative In-app Purchasing system for iOS, offering all the same benefits of the App Store, without the hefty price tag, and with greater control over the user experience
- In line with the recent Apple vs Epic court ruling, Paddle’s IAP will be available from the 7th December 2021
London, 7th October: Paddle, the global revenue platform for software companies, today announces the first alternative In-App Purchasing (IAP) system for iOS developers. Designed to bring innovation, competition and choice to iOS in-app payments for the first time, Paddle’s new offering is a direct response to the recent ruling in the Apple vs Epic lawsuit. Developers can register their interest in Paddle In-App Purchase from today, with the new service going live on 7th December 2021, in line with the terms of the court ruling. .
Founded in 2012, Paddle’s mission is to help developers and software sellers grow their businesses as quickly and efficiently as possible. More than 2,000 software sellers rely on Paddle’s platform to sell into over 200 markets globally. However, until now, Apple’s strict policies have prevented any innovation or competition within a huge part of the software market: the App Store.
As soon as the Apple vs Epic ruling was announced, Paddle began work building a better, cheaper alternative for iOS developers; one that would give them greater control over how they sell their products, while freeing them from the high commission fees – the so-called ‘Apple Tax’ levied on all App Store transactions.
Paddle In-App Purchase is a true like-for-like, drop-in replacement for Apple’s IAP, allowing developers to maintain a seamless user experience, without having to pay Apple 30% of every sale. Paddle has a highly competitive fee structure, charging just 10% for transactions under $10, and just 5% on transactions over $10. This means that developers earn more from every purchase.
Other benefits of using Paddle In-App Purchase include:
- Greater control over customer relationships: By removing Apple as the middleman. Paddle can give sellers far greater access to data on each customer throughout their lifecycle, allowing developers to better understand and optimise the user experience at every stage.
- Flexible subscription options and retention tools: Direct subscription management and the ability to pause subscriptions, gives the developer more power to support their users directly, more choice of billing models and the option to offer additional payment methods such as PayPal (alongside Apple Pay)
- Direct customer service: by putting the developer in control, Paddle IAP gives sellers the ability to to deliver high-quality customer service without having to go through Apple every time. Until now, developers have had to rely on Apple to pay refunds or collect payments on their behalf. This is not only inefficient, it means the developer has no control over a key aspect of the customer experience.
- Apple’s business model + greater freedom: Like Apple, Paddle also takes responsibility for the time consuming purchase admin, from global sales taxes to customer support. While other payment companies shift these responsibilities on to the seller to handler, with Paddle there’s nothing new for developers to worry about.
Christian Owens, Founder and CEO of Paddle, said: “An estimated $30bn is spent on non-gaming apps on iOS per year. This is a huge part of the software market that, until now, has been closed off from competition and innovation. When we saw that the Apple vs Epic ruling might change that, we knew we had to get involved. Our mission has always been to help software makers and sellers achieve their growth potential but up until now, we’ve never been able to help customers do this within the App Store itself. Our alternative In-App Purchase offering gives developers the chance to retain all the things they like about the App Store, while also giving them greater control and lower costs. We’re incredibly excited to be rolling this out and look forward to helping customers get set up and ready for the switchover in December.”
About Paddle
The Paddle Revenue Platform for SaaS companies powers hyper-scale growth across acquisition, renewals and expansion. With Paddle, companies are finally able to transform their revenue infrastructure into a strategic growth lever to respond faster and more precisely to every growth opportunity. Paddle has 140 employees serving over 2,000 software sellers in 245 countries and territories globally. Backed by investors including FTV Capital, Kindred, Notion, and 83North, Paddle aims to define the next wave of SaaS leaders. Visit www.paddle.com or www.twitter.com/PaddleHQ for more information.
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