The EU’s Digital Markets Act
In the ever-evolving digital landscape, Apple’s recent policy updates aimed at complying with the European Union’s Digital Markets Act have sent ripples through various industries, including the cruise sector. We say “aimed” because some of these changes appear to be punitive choices by Apple, rather than good-faith efforts to comply.
The new legislation was designed to foster tech competition and offer consumers more choice. This meant forcing Apple to open its ecosystem to alternative app stores and payment methods. However, concerns have been raised about the implementation of these policies and their potential impact on app developers, including those in the cruise industry.
Apple’s Response
Apple’s response to the European Union’s Digital Markets Act introduces two distinct licensing models for app developers in the EU: the original license model and a new alternative. The original model maintains the status quo, where developers pay Apple a commission of up to 30% on sales made through the App Store. The new model offers a way to bypass this commission by allowing developers to use alternative payment systems or distribute apps via competing app stores, but it introduces a new fee structure, including a charge for each download above a certain threshold. This complexity and potential cost increase have sparked skepticism, suggesting that the alternative model may be designed more as a deterrent than a genuine option, effectively keeping developers tethered to Apple’s ecosystem and its associated fees.
Implications for the Cruise Industry
For cruise lines, digital payment systems have been a cornerstone in enhancing guest experiences. From digital check-ins to onboard concessions, shore excursions, dining reservations, and spa treatments, technology has streamlined operations and enriched the cruise experience. With Apple’s new policy changes, there was initial apprehension regarding activities such as:
1. Adding a credit card for payments onboard (in a digital check-in scenario)
2. Booking and paying for onboard concessions with a digital wallet
3. Booking and paying for shore excursions, dining reservations, and spa treatments
However, after direct conversations between Sourcetoad and Apple, it has been clarified that these use cases for cruise line clients do not fall under the monetization applications category as initially feared. This distinction is crucial as it means that cruise lines’ apps, which are designed as value-add services rather than direct revenue-generating platforms, are exempt from the potentially prohibitive financial implications of the new policy—as long as cruise lines stay with the original license.
A Sigh of Relief for Cruise Lines
For Sourcetoad’s cruise clients, this clarification brings a sigh of relief. The digital amenities and services provided through their apps are integral to the modern cruise experience, offering guests unparalleled convenience and personalization. Recognizing these services as value-add rather than monetization ensures that cruise lines can continue to distribute their apps in the EU without facing the financial penalties associated with the new licensing model.
Given this understanding, cruise clients are encouraged to opt into the original Apple App Store license rather than navigating the complexities and financial uncertainties of the new model. Opting into the original App Store license not only maintains the current economic framework, but also ensures that cruise lines can continue delivering the innovative digital experiences that modern travelers expect—without additional costs or hurdles.
How Sourcetoad OnDeck Can Help
Keeping up with the ever-changing world of technology regulation and policy changes can be daunting! At Sourcetoad OnDeck, we’re committed to helping cruise lines and ferries deliver exceptional experiences for their guests. If you have questions about how regulation changes may affect your cruise line’s mobile app, get in touch to schedule a 30-minute call. We’d love to learn about your challenges and explore ways we can solve them together.