Microsoft Says Apple's 30% Fee Makes Xbox Cloud Gaming iOS App 'Impossible'

Apple has allowed cloud gaming apps on the App Store since earlier this year, but cloud gaming services still haven't bothered making iOS apps. Microsoft recently explained why, telling UK regulators that it didn't bring Xbox Cloud Gaming to Apple's ‌App Store‌ because the rules are still too restrictive.

App Store and XCloud
The UK's Competition and Markets Authority is investigating mobile browsers and cloud gaming, and put out a call for comments. Microsoft responded in late July (via The Verge) and said [PDF] that while cloud gaming apps are technically allowed, there are still multiple rules that cloud gaming apps can't comply with for "technical and economic reasons."

Microsoft's chief complaint is that the ‌App Store‌ rules require subscriptions and features to be made available on iOS devices with in-app purchase, which is "not feasible." A consumption-only situation where content is purchased on another platform and played on iOS is not allowed for cloud gaming apps.

Apple's 30 percent commission fee "makes it impossible" for Microsoft to monetize its cloud gaming service, and it is neither "economically sustainable nor justifiable."

Microsoft also complains about Apple's lack of support for alternative app stores and the limitations of web apps, such as an inability to access device hardware features.

Google also submitted a separate document in the UK, and it simply suggests that regulators focus on the iOS ‌App Store‌ rather than taking a look at Google Play.

Apple's own statement said that it "supports and encourages" cloud gaming services on iOS, and that there are successful cloud gaming services such as Antstream. Apple suggested that regulators revisit their thinking following its support for cloud gaming, which did happen after the investigation launched.

The UK will take Microsoft's comments and comments from other parties into account when making a decision in the ongoing mobile browser and cloud gaming investigation.

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Top Rated Comments

Jason2000 Avatar
26 weeks ago

Apple's rent seeking behavior has to stop.
Apple has become so greedy. Its beginning to turn me off.
Score: 49 Votes (Like | Disagree)
JCCL Avatar
26 weeks ago

Dude right....! My Landlord's rent seeking behavior has to stop too..! Who are they to charge me for using the apartment they built and maintain!

Plus, Microsoft's cloud segment had 111.6 billion in revenue for 2023, i think they will be fine...
Hardly the same as a landlord. They are gatekeeping devices that the customers have fully paid for. We should be able to decide where we want to install software from. You don't want it, fine, I don't really care how you use your device, and you shouldn't care about what I want to do with mine either.
Score: 46 Votes (Like | Disagree)
brofkand Avatar
26 weeks ago
Apple's rent seeking behavior has to stop.
Score: 39 Votes (Like | Disagree)
Joe The Dragon Avatar
26 weeks ago

Apple's rent seeking behavior has to stop.
30% when they not hosting or providing the games is way over the top.
Score: 39 Votes (Like | Disagree)
WarmWinterHat Avatar
26 weeks ago

Dude right....! My Landlord's rent seeking behavior has to stop too..! Who are they to charge me for using the apartment they built and maintain!

Plus, Microsoft's cloud segment had 111.6 billion in revenue for 2023, i think they will be fine...
Im a landlord, and this is nonsense. Your landlord owns the home you're living in. Apple doesn't own my iPhone.

I don't charge the current people who bought the house I built and sold back in 2014.
Score: 32 Votes (Like | Disagree)
acgmph Avatar
26 weeks ago
[HEADING=1]Revenue Share[/HEADING]
Microsoft takes a 30% cut of game sales and in-app purchases for most developers publishing on Xbox. This means developers keep 70% of the revenue their games generate on the platform.
[HEADING=1]Fee Reduction for Some Developers[/HEADING]
In 2021, Microsoft announced they would reduce their cut to 12% for PC games sold through the Microsoft Store. However, this reduced rate does not apply to Xbox console games.
[HEADING=1]Free-to-Play Games[/HEADING]
Microsoft does take a cut of in-game purchases made through its platforms. Specifically, for games sold on the Microsoft Store, the company takes a 12% cut of the revenue from in-game purchases, which is a reduction from the previous 30% cut that was standard across many platforms. This fee structure aligns Microsoft more closely with the Epic Games Store, which also charges a 12% fee, and is part of a broader strategy to remain competitive in the gaming market, particularly against rivals like Apple and Valve.However, it's important to note that this 12% cut applies specifically to games. For non-game apps, developers can retain 100% of their revenue from in-app purchases unless the app is categorized as a game, indicating a clear distinction in how Microsoft handles revenue sharing between games and other types of applications.
[HEADING=1]Additional Costs[/HEADING]
Besides the revenue share, developers may incur other costs when publishing on Xbox:

* Development kit fees
* Certification and testing fees
* Marketing and promotion costs

[HEADING=1]Comparison to Other Platforms[/HEADING]
Microsoft's 30% cut for Xbox games is in line with industry standards. Other major platforms like PlayStation and Nintendo also typically take a 30% share of game sales revenue.While Microsoft has reduced its fee for PC games, the standard 30% rate remains in place for Xbox console games as of 2024. Developers should factor this revenue split into their financial planning when bringing games to the Xbox platform.
Score: 26 Votes (Like | Disagree)