Apple Modifies EU Core Technology Fee Structure to Avoid Bankrupting Viral Apps
No Fee for Non-Commercial Apps
Developers who earn no revenue from their apps will not be subject to the Core Technology Fee (CTF). This includes students, hobbyists, and freeware app developers. Developers must declare their non-commercial status annually and have no revenue in or out of the App Store for their app to maintain this status.
Three-Year Ramp-Up for Small Developers
To address concerns about the CTF burdening apps that unexpectedly go viral, Apple has implemented a three-year on-ramping process for small developers. During this period, if an app exceeds the one million annual install threshold triggering the CTF, the fee will not apply if the developer earns less than 10 million euros in global business revenue. The fee is capped at one million euros per year after that.
- Under 10 million euros: No CTF during the three-year period.
- Between 10 million and 50 million euros: CTF must be paid, but capped at one million euros per year.
- Beyond 50 million euros: Full CTF applies.
- After three years: Developers pay for each first annual install after the initial one million.
This ramp-up period is only available to small developers who have not previously exceeded one million first annual installs, and is calculated based on global business revenue, not just App Store revenue.
CTF Applies Only to Apps in EU Business Terms
The CTF only applies to apps that have opted into the new App Store business terms in the European Union. Apps in the EU can now be distributed through alternative app stores and developer websites.