Founder Playbook · Sub Club by RevenueCat
15 tactics from DMA Panel: Gabriel (Runway), Nico (Adjacent), Jacob & Jens (RevenueCat), David Bernard
Apple's Response to the EU's DMA — What Developers Need to Know
Watch the full episode“The numbers you see first when you read through Apple's documentation are 10% and 17% that basically replace the 15 and 30% typical Apple cut. However Apple now charges 3% — that means you end up at 13% and 20% if you're using IAP.”
New 17%/10% commission balloons to 20%/13% once you add Apple's 3% payment fee
The headline 17%/10% rates only apply if you bring your own payment processor. Stay on Apple's billing and you pay 3% on top, landing at 20%/13% — far less attractive than the marketing suggests. The cut is closer to a few points of relief than half-off.
“The Core Technology Fee is 50 cents per first annual install per year once you've hit a million installs threshold. The interesting thing very easy to miss is that this includes not only 'I tap the button in the App Store to install' — it also includes app updates. So you can think about it as the number of people in the EU that have the app on their iOS phone.”
Core Technology Fee = €0.50 per annual install — counts UPDATES, not just first downloads
The €0.50 CTF isn't just a per-download fee — it triggers on every annual app update, converting it from an acquisition cost into a recurring per-user tax on the entire EU install base over 1M. Free apps with retained users get hammered every year.
“If you have a yearly plan and a conversion rate and you multiply both and it's bigger than five then it makes sense. This is what the numbers say. For second-year renewals it's basically 25 EUR per user that remains.”
New terms only beat the old 30% if yearly_price × conversion_rate > 5
Nico's quick test for whether Apple's new EU terms make sense for your app: multiply your yearly plan price by your conversion rate. If the result is below 5, stay on the old terms. Most freemium apps with sub-5% conversion don't clear this bar.
“The Core Technology Fee is the only fee that you pay. Inside those marketplaces you can use any payment provider you want, you don't pay Apple any commission, you don't pay Apple any billing fee — the only thing you pay Apple in these marketplaces is the core technology fee.”
Third-party marketplaces flip the math — only CTF, no commission, no billing fee
Distribute through a third-party marketplace and Apple takes zero commission and zero billing fee — only the €0.50 CTF per install. The economics get interesting for high-LTV or paid-upfront apps that can absorb the per-install cost without freeloader exposure.
“Everybody's a temporarily embarrassed first-rate millionaire. Somebody's going to accept these terms, somebody's going to end up becoming a viral hit and then they're going to owe Apple millions of dollars. The beauty of the old models — Apple bore all the costs, this developer just shared their revenue.”
Free downloads + CTF = catastrophic tail risk if you go viral
Jacob's warning: the new terms invalidate the no-risk rev-share model that made the App Store work for indies. A viral free app with low LTV could owe millions in Core Technology Fees per install. The 2% fee savings don't compensate for accepting that tail risk.
“Every click you're losing 10% of your users. I have to install Netflix's app store, get a big scary sheet — I'm a normie, I don't know what this is but it looks scary. Then navigate inside and click again, another big scary sheet. By the time you get to the end of this chain — 30% comes at you real fast when you compound a couple gates.”
Two scare sheets + every click loses 10% = compounding conversion loss
Apple inserts two Apple-controlled scare sheets in the sideloading flow: one to install the marketplace, one for each app inside it. Each is a friction point Apple controls. The compounding effect roughly recreates Apple's 30% cut as conversion loss instead of fee — the friction IS the moat.
“You can put up a hard paywall, you can discourage users from using on free, you can eliminate your free plan — but you can't make them delete the app. You can't make this app self-destruct if you do not convert in 10 days. So that's the big unknown on how many people actually are going to delete their apps.”
Hard paywall doesn't save you — you can't make users delete the app
Under new terms, free users cost €0.50/year each via CTF on every update. You can wall them off with a hard paywall, but you can't force uninstall — and most users won't bother, creating a recurring annual liability that compounds over the app's lifetime in the EU.
“For the second year renewals it's basically 25 EUR per user that remains — and it includes the free and the paid users — that you have to have in the annual sub same or more to benefit from it.”
Second-year retention math: every retained user (free or paid) costs €25 in ARR to break even
Year two of opting into the new terms requires each remaining user, free or paid, to generate at least €25 in annual subscription revenue. Long-tail free users become an active liability, forcing a rethink of the freemium model itself — long-retained free users are now a cost center.
“These third-party marketplaces probably make the most sense in two specific cases out of the gate. One is if you're a AAA game and you charge up front — Nintendo could launch the Switch store with backbone as a controller and you pay $30 up front. The second is a more B2B marketplace where you know you're going to have a much higher LTV.”
AAA paid-upfront games + multi-seat B2B = cleanest marketplace launch plays
Both viable opportunities share the same property: tight control over downloads so the per-install Core Technology Fee doesn't compound on free riders. $30-60 upfront for an AAA game absorbs the €0.50 CTF easily; $30/month B2B seats with no viral motion do the same.
“We pulled RevenueCat numbers and from all of our customers, App Store EU-specific revenue is 12%. So even Nintendo coming out with a Switch store — that's a lot of work to build the marketplace, to maybe move the needle on 12% of your revenue.”
EU is only 12% of App Store revenue — opportunity ceiling on the whole debate
Before reshaping your business around EU-only DMA changes, remember it's roughly 5-15% of total App Store revenue for most apps. RevenueCat's aggregate number is ~12%. That sets the ceiling on how much engineering and risk any EU-only opportunity is worth.
“I think that was Apple's point — the purpose of the way they've complied was to induce maximum pain while staying as close within the regulations as they can, because frankly they've got a monopoly on their users' time and dollars and they don't want to let that go.”
Apple's malicious compliance — maximum pain inside the rules
Jacob diagnoses Apple's DMA response as a deliberately punishing implementation designed to discourage developers from switching, while technically complying with the letter of the regulation. This is the start of a negotiation, not the end — expect more rounds.
“Gruber had a good line — the last thing you want to do if you're a sports team in a high-stakes sporting event is piss off the refs. That's what Apple's doing. They're just inviting more regulation. South Korea is already threatening to fine them. They're squandering developer goodwill.”
Apple is pissing off the refs in a game it's already winning
David's read on Apple's strategic blunder. By choosing maximum hostility in DMA compliance, Apple signals to every other regulator in the world that they won't cooperate — which guarantees more aggressive future regulation in other jurisdictions and slowly erodes the developer goodwill that built the platform.
“My greatest failure in life will be if I cling on to an existing business model to the point that I'm regulated by the EU. So make sure that we adapt to the changing market and respond to consumers.”
Greatest failure: clinging to a business model until regulators take it from you
Jacob's parting principle for any founder. Don't let inertia turn your business into Apple — be the one who concedes early when the market signals change, instead of being forced into change by Brussels. The lesson generalizes far beyond mobile platforms.
“I will stand up and say everybody on this call do not switch to the new business model. Like do not. It is at best a bad idea, at worst a huge distraction. The 2% discount is not insubstantial — maybe 12% of fees reduction — but you're accepting this potentially catastrophic risk that if your app goes viral, you can owe Apple millions on Core Technology Fee.”
Indies should NOT switch — 2% upside doesn't compensate for catastrophic tail risk
Jacob's blunt advice to indie founders: don't be a guinea pig. The headline 2% fee reduction looks attractive until you model what happens to a free app that suddenly goes viral and racks up €0.50 per install on millions of free downloads. Let larger companies with modelable cases go first; this may be a one-way door.
“My understanding from reading this is that because it's an amendment to the developer agreement, that is probably per developer. So you can't opt in some of your apps, opt out some of the others. And right now the documents Apple released say it's a one-way decision.”
The new terms are likely per-developer (not per-app) and probably irreversible
Two huge structural details developers miss: the choice binds your entire account (every app you ship), and Apple's docs suggest it can't be reversed. That makes the decision tree dramatically more consequential than headline analyses suggest. Treat this as a one-way door at the developer-account level, not a per-app experiment.