TikTok seems to be dodging App Store commissions in Epic fashion

TikTok seems to be dodging App Store commissions in Epic fashion

It’s unclear how many TikTok users are being prompted in-app to visit its website for cheaper TikTok Coins. | The Verge

TikTok appears to be probing App Store rules that require it to pay the “Apple tax” on in-app purchases. According to Sendit app co-founder David Tesler, some TikTok users are being directed to purchase TikTok coins — digital tokens used to tip creators during live streams — on the company’s website via an in-app link, effectively dodging the 30 percent commission Apple takes on digital purchases.

Screenshots acquired by Tesler show at least two instances where iOS users are encouraged to “recharge” their TikTok coins on TikTok.com to explicitly “avoid in-app service fees.” Tapping the “try now” link on these notifications opens an embedded web view where users can access payment options like Apple Pay, PayPal, or credit/debit cards to bypass App Store fees. A message on this page informs users that they can save “around 25 percent with a lower third-party service fee” compared to purchasing coins in the TikTok app.

TikTok might get banned from the app store next week

Why? It looks like they’re circumventing apple fee by directing users to purchase coins via external payment methods pic.twitter.com/VG8ihvsRmv

— David Tesler (@getdavenow) April 30, 2024

Tipping has fallen under the same category as other in-app purchases on the App Store since 2017 after Apple demanded its 30 percent cut from popular Chinese social network WeChat. And while Epic Games didn’t direct users to its website, TikTok’s decision to dodge Apple’s commission fees holds similarities to the direct payment option added to Fortnite in 2020 that led to a multi-year legal battle after the game got booted from the App Store.

The alternative payment feature is only being shown to a select group of TikTok users, according to Tesler, noting the account that provided the screenshots had previously purchased a large amount of coins. It’s unclear how many users have been presented with these in-app web links, though the purchasing options could suggest TikTok is targeting users who typically purchase large quantities of TikTok coins. Coin options range from packs of 70 (priced at 74 cents) to custom quantities that state “large amount supported.”

Image: TikTok / The Verge

These promotional messages arent exactly subtle, even if only a handful of TikTok users may be seeing them.

TikTok’s support page makes no mention of the ability to buy TikTok coins via its website, listing just the App Store and Google Play as locations where coins can be purchased. Neither TikTok nor Apple have responded to our request for comment at this time.

It’s likely that TikTok is violating Apple App Store rules with this feature. Apple started allowing select services to include in-app website links back in 2022, though this was limited to “reader” apps like Kindle, Netflix, and Spotify, and could only be used for things like account management or creation. And as noted by TechCrunch, only apps that don’t offer in-app purchases (which TikTok certainly does) are permitted to make use of this External Link Entitlement.

These violations seem like something that Apple would swiftly (and typically, aggressively) seek to rectify, though the company doesn’t appear to have taken any action yet. Apple is currently stonewalling Spotify from implementing similar in-app weblinks in the EU despite being fined about $2 billion for its App Store practices. And TikTok’s immense user base — last reported to be over a billion monthly active global users — makes it trickier to simply evict from the App Store, with Bloomberg’s Mark Gurman claiming “the only way Apple removes TikTok over this is if it wants to destroy itself.”