Documents shared today by the House Judiciary Committee showed that Apple agreed in 2016 to halve its App Store fee for Amazon as part of a deal to put the e-commerce giant’s Prime Video app on Apple’s mobile devices and TV set-top box.
Eddy Cue, an Apple senior vice president, and Amazon Chief Executive Officer Jeff Bezos negotiated directly on the deal.
According to emails released as part of a congressional hearing on anticompetitive behaviour.
The companies agreed to a 15 percent revenue share for customers who signed up through the app and no revenue share for users who already subscribed via Amazon or elsewhere, the emails showed.
The deal, announced in December 2017, allowed Amazon’s video service to integrate with Apple’s voice-activated digital assistant, Siri, and the iPhone maker’s TV app, which launched in 2016. The agreement gave Apple a 15 percent cut of subscriptions to Amazon Prime partners like Showtime for users who signed up originally through Apple.
Apple receives a 30 percent cut for the first year of an app’s subscriptions made through the platform. That fee drops to 15 percent after the first year. The agreement with Amazon is like a programme Apple announced earlier this year letting select developers avoid the 30 percent fee in exchange for integrating with specific features. Amazon is part of that programme.
The report also reveals that Apple once considered taking a 40 percent cut from some subscription apps.