Apple reportedly 'undercutting' other businesses through new app store rules

Yahoo Finance tech editor Dan Howley details the criticism Apple is facing for its new rules on its App Store and how it impacts other businesses.

Video Transcript

DAVE BRIGGS: Apple adding a new tax to its App Store. Some see as another direct shot at Facebook parent, Meta. TikTok performer Dan Howley here with more on this story. Dan, what are we learning?

DAN HOWLEY: That's right. Apple is essentially forcing, or enforcing, its in-app payment rules on Facebook parent Meta. In particular, this has to do with when people make purchases to boost some of their posts on the likes of Facebook or Instagram. Those were not being processed through Apple's App Store payment system. And so Apple wasn't getting any revenue out of that.

So now they're saying that, look, other companies do this, like Twitter and TikTok, so now we're going to enforce this with Meta. Now, this comes as the two companies spar-- continue to spar, rather-- over Apple's privacy changes that it made to iOS, which has really smacked Meta as far as ad revenue goes-- as well as Snap, by the way-- and also comes as Apple talks about how it's going to be increasing some ads across its own platforms.

Now, when Apple talks about its advertising business, it talks about how it protects user privacy, how it doesn't collect user data, how you only see it in particular places. And that's its way of contrasting itself against something like Meta or other social media companies that will display ads for you from places that you may have visited online or through third party apps.

So, really, this is kind of a continuation of the butting of heads between the two companies. And I don't expect it to end anytime soon. It doesn't look like it's going very well on Meta's side of things. The privacy changes have really struck at them. And they continue to try to work through the Metaverse transition. So it's really hurting them more than it's hurting Apple.

But part of the philosophy behind their desire to be a Metaverse company and behind that push that's costing them $10 billion a year is to get away from relying on third party hardware partners like Apple. So this is kind of their way of ensuring that if the Metaverse is the future, they can call their own shots. They don't have to rely on Apple doing things like this.

SEANA SMITH: Dan, let's talk about another big story for Apple today. It's going to comply with the EU's ruling that all devices are going to use the USB-C ports. Talk to us just about how costly this could potentially be here for Apple.

DAN HOWLEY: Yeah, this is almost something that a lot of people were expecting to happen. We already have USB-C on the Mac. We already have it on the iPad. So it almost felt like a foregone conclusion that we would see it on the iPhone, as well as its AirPods. The cases for the AirPods are still Lightning enabled. But they do offer the Beats brand. That uses USB-C, so it's not as if this is something that is completely alien to them or anything like that.

I don't know how much it will end up costing them. I do think that it is just another hardship for consumers, though, because all of those Lightning cables that they have, they'll become useless once they have their new iPhones. So it really does become this unending cycle of there's another cable. Now I have a whole rat's nest of them in my basement. What do I do with them?

DAVE BRIGGS: Right.

DAN HOWLEY: I gotta get rid of them. So I think that's really what this comes down to. It does make more sense. You know, a USB is universal. You can use it to charge your computer and your phone. It's just a shame that it took Apple this long to get on the USB train.

SEANA SMITH: Yeah, all I know is I already have way too many Apple chargers at home. So now you gotta figure out--

DAVE BRIGGS: And now you need more.

SEANA SMITH: Yeah, exactly. It's turning into a bigger problem. All right, Dan Howley, thanks so much.