Apple is opening small cracks in the iPhone’s digital fortress as part of regulatory measures in Europe that seek to give consumers more choice – at the risk of creating new avenues for hackers to steal personal and financial information stored on the devices.
The overhaul starts on Thursday only in the European Union represents the biggest changes in the iPhone App Store since Apple introduced the concept in 2008. Among other things, people in Europe can download iPhone apps from stores not operated by Apple and get alternative payment methods for in-app transactions.
European regulators are hoping for changes prescribed by the Law on Digital Marketsor DMA, will loosen the grip that Big Tech’s “digital gatekeepers” have gained over the products and services that consumers and businesses use as they become increasingly dominant forces in everyday life.
The measures came into effect just days after EU regulators fined Apple almost 2 billion dollars (1.8 billion euros) to prevent competition in the music streaming market.
Apple has sharply criticized the new regulations for unnecessary security risks for iPhone users in Europe, exposing them to more fraud and other malicious attacks launched from apps downloaded from outside its ecosystem and widening the spectrum of unsavory services that sell pornography, illegal drugs and other content that the company has long banned in its App Store.
Despite efforts to maintain security measures while complying with new rules in the 27-nation bloc, Apple warns that “the changes required by the DMA will inevitably cause a gap between the protections Apple customers outside the EU can rely on and the protections available to customers in the EU moving forward.”
Apple’s warnings should be taken with a grain of salt, experts say.
Mobile device management is “completely different” from third-party app stores, and Apple is “deliberately confusing it here to muddy the waters,” said Michael Veale, an associate professor at the University of London who specializes in digital rights and regulation.
“Apple’s App Store is not a proxy for corporate data security — apps inside it regularly send data to insecure cloud servers, hidden third-party trackers and more,” he said.
Some smaller tech companies like music streaming service Spotify and video game maker Epic Games are also attacking the ways in which Apple respects DMA as little more than a facade that “mocks” the intent of the regulations.
“Instead of creating healthy competition and new choices, Apple’s new terms will raise new barriers and strengthen Apple’s hold over the iPhone ecosystem,” Spotify, Epic and more than two dozen other companies and alliances he wrote in a letter dated March 1 To the European Commission, the executive branch of the EU that oversees the DMA.
Epic, which makes the popular game Fortnite, as well claims that Apple is already brazenly violating the DMA by rejecting the alternative iPhone app store he planned to release in Sweden. Epic claimed that Apple thwarted its attempt to compete in retaliation for harsh criticisms released by CEO Tim Sweeneywho led the largely unsuccessful antitrust case against the iPhone App Store in the US
In response, EU regulators said on Thursday that I want to test Apple due to accusations that it blocked Epic’s app store. Apple was defiant, saying it “decided to exercise that right” to launch an app store based on Epic’s past behavior.
The changing digital landscape in Europe is forcing changes in other technological powerhouses such as Google and Facebook, but the new regulations strike at the core of Apple’s philosophy of maintaining iron control over every aspect of its products.
This “walled garden” approach pioneered by the late co-founder Steve Jobs starts with meticulous hardware design and then extends to all the software that powers the devices as well as oversees the commerce that takes place on them.
The approach built an empire with almost 400 billion dollars in annual revenue — a success Apple attributes to the trust it has built over decades of carefully managing the iPhone and other popular products like the iPad, Mac and Apple Watch.
Even Epic’s Sweeney admitted that one of the reasons he uses the iPhone is because of the strong security measures Apple has put in place to prevent hackers and protect the privacy of its users. This happened during testimony at the May 2021 trial that resulted the judgment of the American judge that the App Store is not a monopoly.
In that ruling, the judge required Apple to begin allowing links to external payment options within iPhone apps in the US. It’s a request the company began allowing earlier this year after the US Supreme Court refused to hear an appeal on that matter.
Apple — which is making changes in Europe via iPhone software updates — still doesn’t allow alternative iPhone app stores in the US or more than 100 other countries outside the EU.
European regulators seem confident that the benefits to consumers from greater competition will outweigh any increased security risks.
One potential upside is lower prices for in-app digital transactions if competing stores charge lower commissions than the 15% to 30% fees Apple has imposed for years.
But critics have raised doubts that will happen because Apple still plans to charge fees after app downloads reach relatively low thresholds and has put up other hurdles that will make it daunting for alternatives to make significant inroads in Europe.
Apple insists that the security problems created by DMA are of such concern that it has heard from government agencies — particularly those in defense, banking and emergency services — that want to ensure they can block employees with iPhones from accessing apps distributed outside of Apple . fenced garden.
“All of these agencies recognized that sideloading — downloading apps outside of the App Store — can compromise security and put government data and devices at risk,” Apple said.
Veale, the digital expert, shot back.
“Any company or government that believes ‘apps from the App Store are secure’ may need to refresh their security and data protection teams or policies,” he said.
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AP business writer Kelvin Chan contributed from London.