Facebook Is Deploying Users To Eat Apple's App Store Lunch Fee
Facebook has created a separate online store to sell Stars, offering a handsome bonus to users while avoiding the 30 percent App Store tax.
Facebook is no fan of Apple's strict 30 percent revenue sharing policy for all in-app payments, so the company has now created a dedicated Stars shopping website of its own to avoid paying the Apple tax. For the unaware, Stars are essentially virtual items that viewers purchase and then send it over to their favorite creators during live audio or video streaming sessions. Facebook pays creators a sum of $0.01 for every star they receive from fans and followers.
To buy a Star, viewers need to open the comments feed of live audio or video sessions and tap on the Star icon next to the "Write a comment" button. Once there, viewers will see their current Stars balance and also see a Buy Stars option to buy more bundles. However, the payment is ultimately processed through Google Play or App Store, which means Google and Apple take a 30 percent share of whatever users spend while buying Stars. Not many stakeholders are a fan of that policy, and Facebook is one of those unhappy clients.
The social media titan — which now goes by the name Meta — has finally created a workaround to avoid the Apple tax, all in the name of giving users more bang for their bucks. The company has made a dedicated Stars web store where users can buy the virtual item and use it to support their favorite content creators. The logic behind the store is simple — an external website means transactions are not processed by the App Store's native in-app payments system. And that means Facebook avoids paying the 30 percent App Store fee. Apple's policy doesn't have many fans out there in the first place. Facing heat from within its own community, Apple recently reduced the cost from 30 percent and pulled it a notch down to 15 percent for small developers with a small revenue turnaround. Facebook is no small developer, which means it needed to pull some other trick to avoid the Apple tax. That Stars store is a result of that desperate maneuver.
However, this is not the first move of its kind for Facebook. Just over a month ago, Facebook started offering custom subscription links to creators to skirt paying the App Store fee. And as a sweet incentive, Facebook will let users get more stars for the same amount if they purchase from its new Stars store. For example, purchasing 530 Stars by spending about ten dollars will now add an extra 420 Stars as a bonus. The number of bonus stars changes depending on the bundle size and also varies from market to market. In the U.S., a bundle of 145 Stars priced at $2.99 comes with a bonus of 105 Stars. In India, a bundle of 175 stars only adds 15 Stars as a bonus.
All the Star transactions on the website are processed through Facebook Pay, while those purchased within the Facebook app rely on Apple's own in-app payment system. Aside from a new store, Facebook has also launched a new system that allows viewers to send Stars together, something it calls a Star Party. Viewers have five minutes once a Stars Party countdown timer starts, and in that duration, they need to reach the goal collectively. But Facebook is not the only worry for Apple. The company faces increasing pressure from regulatory authorities in multiple countries over its revenue-sharing policy, and antitrust investigations are also in progress.
Source: Meta, Facebook Stars Store