Apple’s new fee Policy: what it means for Patreon creators

The impact of Apple’s fee on Patreon's pricing

Patreon is a popular platform that allows creators to charge for various types of content, including digital material such as podcasts, music, and comics, as well as physical merchandise. Until now, Patreon had been exempt from Apple's standard fee, but starting in November 2024, any transactions made through the Patreon iOS app will incur a 30% fee. This development follows Apple’s established practice of taking a large share of revenue from transactions within their ecosystem, a policy that has affected numerous other apps and services.

According to an emailed statement from Patreon, the new fee will apply solely to new transactions and not to existing memberships. To mitigate the impact on creators, Patreon plans to implement tools that automatically adjust prices within the iOS app to compensate for Apple’s cut. This adjustment is intended to preserve the revenue that creators earn from their supporters. However, Patreon has acknowledged limited flexibility in addressing this change and emphasized that the adjustment will not apply to existing subscriptions.

Creators’ reactions and potential consequences

The new policy has been met with mixed reactions from Patreon creators. Ernie Smith, an editor-in-chief of the tech newsletter Tedium based in Virginia, expressed frustration with Apple’s decision. He suggested that Patreon should consider leaving the Apple ecosystem and processing payments through their website to avoid the 30% fee. Smith’s criticism highlights a broader concern among creators about the increasing costs associated with maintaining a presence on Apple’s platform.

Craig Baird, a podcast producer from Edmonton and creator of Canadian History Ehx, is also concerned about the potential need to raise prices for his supporters. Baird points out that although the price increase might initially seem minor—his lowest tier is $3 per month—it feels as though the cost is being unfairly transferred from Apple to his patrons. This sentiment reflects a broader unease among creators who feel that Apple’s fee undermines their ability to provide affordable content.

The specific dollar value of the price increases remains unclear, as Patreon has not disclosed detailed data on how many users make payments through the Apple ecosystem. Creators like Baird may face challenges in navigating the new fee structure while ensuring that their patrons are not adversely affected.

The broader context of Apple’s fee policies

Apple’s 30% fee is part of a broader strategy that the company has applied to various apps and services on its App Store. This policy has been the subject of numerous legal battles, most notably with Epic Games, the developer behind Fortnite. Despite some court rulings that have challenged Apple’s practices, the company has continued to enforce high fees and has even introduced a 27% fee on transactions using alternative payment methods.

Industry experts, such as Mohammad Keyhani from the University of Calgary, argue that app developers have little choice but to comply with these fees to maintain access to Apple’s vast user base. Keyhani suggests that Apple’s practices effectively establish a taxation system on value creation within its ecosystem, which may prompt increased scrutiny from governments and regulatory bodies.

In contrast, Carmi Levy, a tech analyst based in London, Ontario, notes that Canadian authorities may not act swiftly to address the excesses of tech giants like Apple. Levy emphasizes that creators and users must adapt to the existing power dynamics, where platform owners dictate the rules and fees that impact their business models.

Apple’s new fee policy represents a significant shift for content creators on Patreon, who will need to navigate increased costs associated with transactions through iOS devices. While Patreon is implementing measures to mitigate the impact on creator earnings, the broader implications of Apple’s fees highlight ongoing tensions between tech giants and content providers. As creators adjust their pricing strategies and explore alternative solutions, the conversation around platform fees and regulatory oversight is likely to continue evolving.

source: CBC