围墙花园崩塌：苹果-Epic裁决对应用开发者具有变革性

Issuer of report:HSBC Bank Middle East Ltd,DIFCView HSBC Global Research at:https://www.research.hsbc.comListen to our insightsHSBC Global Research PodcastsMohammed Khallouf*, CFAAnalyst, Consumer TechHSBC Bank Middle East Ltd, DIFCmohammed.khallouf@hsbc.com+971 4 509 3337* Employed by a non-US affiliate of HSBC Securities (USA) Inc, and isnot registered/ qualified pursuant to FINRA regulationsEquitiesSoftwareUnited States 7,195 Find out more Apple-Epic rulinga win for the mobile app publishing industryApp developers are moving quickly to capitalize on recentlegalhappeningsOn30ApriltheUS district court of Californiaruled thatApplewasin wilful violation of theCourt’s 2021 Injunction which sought to tackle Apple’s “anticompetitive conduct andanticompetitive pricing”,in regards to its long-running feud with game publisher Epic over mobileAppstore fees.The legal tussle kicked off in 2022 afterApplebannedEpic'spopular gameFortnitefor offeringiPhone users better paymenttermsoutside Apple's ecosystem.The latest rulingsingled outApple’s move to charge developers a 27% commission for allowingthem to conduct payments outside the App storeandsteps to impede their ability to directconsumers to external purchasing channels, branding bothas breachesof the earlierjudgment.For Apple thecourt’sdecision is no small matter as fees onAppstorepurchases in the USwereestimatedatUSD10bn in 2024 by mobile data provider Appfigures, with a total of USD27bn atstake globally if the rulingwereto inspire other regulators to follow suit.Apple is appealingandasking the San Francisco-based 9th U.S. Circuit Court of Appeals to stay the injection, but inthe meantime has beenrequiredto comply and has already updated its App Storeguidelines toallowappsto steer users to external purchases.The ruling has widespread implications across wide swathes of online industries that rely on in-appspend and have traditionally had to share c30% of all revenues generated on IOS devices withApple. We notethatD-T-Cexternal payment channels already existed across some of our coveragenames, but their uptake had historically been limited by the prohibition ofin-app advertising or links,with TTWO for example generating just 5% of 2024 mobile revenues outside app stores.Nowhowever, developers can build web links for subscription or digital good purchases directly into theirapps and advertise lower prices and different tiers, free of any Apple commissions.1Q25 earnings commentary indicates many are already working to capitalizeon theruling,in onlinedating,MTCHshared that itwas”encouraged by the court's decisionandhave submitted revampedapp releases and are testing discounted offers”andin game publishingTTWOdescribed it as“greatopportunity to expandourhighly accreditive D-T-C payments”.Second-hand gains are also beingforecastfor mobile marketingwith APPcommenting that “lower fees for content developers, ourcustomers, means they can invest more in user acquisition which benefits our platform”.Growth of externalpaymentschannelstodrivemargin expansionApp developers looking to shift payments outside the App store will be looking at some incrementalcosts,mainlyonline gateway processing fees in order to accept card payments. Global paymentsprovider Stripe is already offering developers a new checkout experience that would redirect an app’scustomers to a Stripe-hosted payments page for a 2.9% take rate plus USD0.30 per transaction. Weestimate that average blended all-in payment-processing fees would amount to c5% of spend.Developers will also have to make do with someforgone revenues in the form ofdiscountsorofferstoincentivizeconsumers to part ways with the trusted and hassle-free existingAppstorepayment option.We note thatMTCHhas publicly disclosedthatitcurrentlypays out27% of anyrevenues generated throughtheUSApp Storein fees, and thatit expectsthat forevery 10%shift to web channelsitwould save around USD25mannually.Weforecast FY25MTCHUSrevenues ofUSD1,511m, USD25min savingson USD151mofrevenuestranslates to ac1,700bpimprovement in gross margins,loweringtotal payment-related expensesto 10%ofrevenues (from 27%), and implyinga discount ofonlyc5%willbe offeredon webpurchases(assumingc5%card processing fees).We believeMTCH’s assumptionsaresomewhatgenerous,noting thatRBLXtoday offersup to20% more of its virtual currency the Robuxwhenpurchased onlinein orderto entice users to try the new channel.We estimate the averagediscount offered toweb paymentcustomerswould amount to c10% of spendover the long run. 2MTCH is already testing newpayment offerings,whileTTWO expects to expand itsexisting platform Wehenceestimate thatrevenues sourced through external payment channels could onaverage deliver margins1,500bpahead of Appstore payments.We sizeup thetangiblenear-termopportunity…Across our game publishing and online datingoverage universe, we estimate the share ofannualrevenues that is generated through the Apple Appstore in the US,and henceaffectedbythe ruling,is highest at BMBL a