Mark Zuckerberg Criticizes Apple's App Store Policies

Meta's Zuckerberg Criticizes App Ecosystems and Outlines Metaverse Plans

Mark Zuckerberg, CEO of Facebook (now Meta), recently voiced criticisms directed at Apple and the broader app ecosystem during his keynote address at Facebook Connect 2021. His statements centered on the company’s vision for the metaverse and its future revenue streams.

Concerns Over App Platform Fees

Zuckerberg specifically highlighted what he perceives as the detrimental impact of app platform fees on innovation. He argued that these fees are “stifling innovation” and hindering the growth of the internet economy.

This critique arrives following recent privacy changes implemented by Apple, which have negatively affected Facebook’s advertising revenue. Apple’s App Tracking Transparency feature empowers users to restrict app tracking across different platforms.

Building a New Revenue Stream with Oculus

Facebook is now focusing on developing its own app platform through Oculus, aiming to establish a new source of income. The goal is to position Facebook as the primary beneficiary of platform profits, rather than developers being subject to commission payments.

Zuckerberg emphasized that simply “building products isn’t enough,” and that fostering an ecosystem where creators and developers can thrive is crucial.

The Impact of Platform Dependence

He acknowledged the lessons learned from building for other platforms and operating under their regulations. Zuckerberg stated that this experience has significantly influenced his perspective on the technology industry.

He further elaborated that the “lack of choice and high fees” are actively impeding progress and hindering the overall internet economy.

Directly Addressing Apple and Google

These remarks are widely interpreted as a direct challenge to Apple and Google, the dominant platforms hosting Facebook’s core products. Facebook currently incurs fees on in-app purchases, including subscriptions and virtual gifts.

While both Apple and Google have reduced commissions for smaller businesses and subscription-based apps, the standard revenue split remains at 70/30 in favor of the platform.

Restrictions on Facebook Gaming

App Store regulations have also limited Facebook’s ability to expand certain products, such as its gaming service. The launch of Facebook Gaming on iOS was notably restricted, offering only streaming capabilities due to Apple’s policies against apps containing other apps or games.

Protecting Ad Revenue

A primary concern for Facebook is safeguarding its advertising revenue, which is vulnerable to policy shifts imposed by external platforms.

Over the years, these revenues have enabled Facebook to invest in diverse sectors and maintain its apps free of charge, as Zuckerberg pointed out.

Metaverse Ecosystem and Fee Structure

The company intends to replicate this approach within its metaverse ecosystem, potentially subsidizing devices or offering them at cost to broaden accessibility. Unlike Apple’s App Store, Facebook plans to support sideloading and PC linking, providing users and developers with greater flexibility.

Zuckerberg indicated that developer and creator service fees will be kept low whenever feasible. However, he cautioned that higher fees may be necessary to offset the substantial investments required to develop the metaverse.

Long-Term Investment and Growth

“To keep investing in this future, we’ll need to keep some fees higher for some period,” Zuckerberg explained, emphasizing the billions of dollars expected to be invested before the metaverse reaches widespread adoption.

The company anticipates that within the next decade, the metaverse will attract a billion users, facilitate hundreds of billions of dollars in digital commerce, and create employment opportunities for millions of creators and developers.

Becoming a Platform Like Apple

Ultimately, Facebook’s strategy appears to be evolving towards a model similar to Apple’s, leveraging developer revenues and establishing its own set of rules within the metaverse.