Apple App Store Japan: Now Open to Competition

Apple Adapts to Regulatory Pressure in Japan

Apple has declared it will permit alternative application distribution platforms within Japan, alongside allowing developers to utilize payment processing systems for digital products and services that operate independently of Apple’s established in-app purchase framework on iOS. This shift isn't driven by a voluntary embrace of openness, but rather by legal obligation – specifically, adherence to Japan’s recently enacted Mobile Software Competition Act (MSCA).

Impact on Apple's Revenue Streams

This regulatory change is poised to affect Apple’s App Store earnings in a significant market, mirroring the impact of similar antitrust laws and regulations elsewhere. The company is already navigating compliance with Europe’s Digital Markets Act (DMA), which previously mandated allowances for alternative app stores and related modifications.

Legal Precedents in the United States

Within the United States, Apple was compelled to alter its in-payment procedures through legal proceedings, stemming from a lawsuit initiated by Epic Games, the creators of Fortnite. While not officially designated a monopoly, the court determined Apple must grant developers the option to process payments outside of its system, should they choose to do so. The precise details of this directive are still being refined following a partial reversal of the initial ruling on appeal.

Security Concerns and Mitigation Strategies

Accompanying its announcement regarding the changes in Japan, Apple cautioned that alternative app marketplaces and payment methods could introduce “new avenues for malware, fraud, scams, and privacy and security risks.” To address these potential vulnerabilities, the company stated it collaborated with Japanese regulators to implement an authorization process for app marketplaces – termed “Notarization” – specifically designed to safeguard children from unsuitable content and deceptive practices.

A Technical Solution to Balance Openness and Security

Apple’s development of a risk mitigation process for alternative app stores suggests that a technical solution to reconcile openness with security concerns has always been feasible.

Complex Fee Structures for Revenue Preservation

Similar to its approach in the EU, Apple has devised a complex fee structure intended to minimize any potential loss of App Store revenue while appearing to adhere to the stipulations of the law.

Epic Games' Response

Tim Sweeney, CEO of Epic Games, voiced his dissatisfaction, stating that Fortnite will not be reinstated on iOS in Japan due to Apple’s imposition of a 21% fee on third-party in-app purchases.

In a statement posted on X, he asserted, “Apple was required to open up iOS to competing stores today, and instead of doing so honestly, they have launched another travesty of obstruction and lawbreaking in gross disrespect to the government and people of Japan. Apple chose poorly. Again.”

Comparison to Other Platforms

Sweeney further highlighted the contrast between Apple’s practices and those of other game store providers, such as Microsoft, posing the question: “Can you imagine the gamer and regulator uproar that would ensue if Microsoft required all games from Steam and Epic Games Store to call its commerce surveillance API and report all transactions back to Microsoft?”

He added, “That’s what Apple just announced in Japan.”

Developer Program Agreement Update

Apple has stipulated that developers must accept the latest version of the Apple Developer Program License Agreement, incorporating these new options for Japan, by March 17, 2026.