There won’t be an Xbox Cloud Gaming app on iPhone because Microsoft doesn’t believe there’s enough opportunity for monetization under Apple’s new terms.
Apple is implementing significant changes to its ecosystem in Europe to comply with the Digital Markets Act, including allowing alternative app stores and web payments. This gave hope that cloud-gaming services like Xbox Cloud Gaming would seize an opportunity and bring their offerings to iPhone and iPad.
However, Microsoft Gaming CEO Phil Spencer told The Verge that Apple’s upcoming changes in the European Union don’t “go far enough to open up competition.” That’s a very different take from Spencer’s comment in March 2023 that called the Digital Markets Act “a huge opportunity” for the Windows maker’s gaming ambitions.
Why Microsoft won’t bring Xbox Cloud Gaming to iPhone
Xbox President Sarah Bond recently called Apple’s new policy “a step in the wrong direction.” And now, the Windows maker’s Gaming CEO Phil Spencer has provided additional commentary in an interview with The Verge.
There’s not room for us to monetize Xbox Cloud Gaming on iOS. I think the proposal that Apple put forward—and I thought Sarah Bond’s comments on this were right on—doesn’t go far enough to open up. In fact, you might even say they go the opposite direction in some way, but they definitely don’t go far enough to open up competition on the world’s largest gaming platform.
“The world’s largest gaming platform” is mobile—in other words, iOS.
We will continue to work with regulators, and Apple and Google, to create a space for alternative storefronts. I’m a big fan of how Windows works, and you’ve got a Microsoft Store on Windows, you’ve got Steam, you’ve got the Epic Games Store, you’ve got GOG. You have alternatives, and I think alternative ways for people to buy things creates goodness for consumers and creators. I think the largest platform for gamers, which is mobile, should have the same.
Spencer is worried about Apple’s new Core Development Fee of 0.50 euros per user per year (except for the first one million installs) for apps installed through alternative app stores. It means even developers who distribute apps outside the App Store will owe the Cupertino tech giant money even if they only offer free apps. The more popular their app becomes, the more fees they’ll need to pay Apple.
Epic Games to bring Fortnite to iOS in Europe
Although the economics of Apple’s new rules may not work for Microsoft, Fortnite maker Epic Games has confirmed plans to bring its digital games store to iOS in Europe. This includes Fortnite, which has been unavailable on the App Store in the past few years because Epic Games no longer has a developer account with Apple.
Fortnite will return to iOS in Europe in 2024, distributed by the upcoming @EpicGames Store for iOS. Stay tuned for details as we figure out the regulatory timeline. We'll continue to argue to the courts and regulators that Apple is breaking the law. https://t.co/MHh6EGVinC
— Epic Games Newsroom (@EpicNewsroom) January 25, 2024
But that doesn’t mean Epic is happy with Apple’s changes. Quite the contrary, Epic’s CEO Tim Sweeney publicly called Apple’s new payment structure in the European Union “junk fees,” likening its implementation of the new UE rules to a “devious new instance of malicious compliance.”
Sweeney wrote on X, formerly Twitter, that Apple is forcing developers to “choose between App Store exclusivity and the store terms, which will be illegal under DMA, or accept a new also-illegal anticompetitive scheme rife with new Junk Fees on downloads and new Apple taxes on payments they don’t process.”
Spotify CEO Daniel EK joined Sweeney in criticizing Apple’s latest moves, calling the company’s response to the European Union’s Digital Markets Act in an X post “a complete and total farce” under “the false pretense of compliance and concessions” and the 0.50 euro Core Technology Fee “extortion.”