Internal emails reveal how badly Apple wanted to keep Netflix with in-app purchases

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Internal emails revealed during the Epic Games v. Apple lawsuit indicate that employees at Apple were considering giving Netflix special treatment to persuade the streaming service not to give up in-app purchases. In the run-up to Netflix discontinuing its subscription offering to avoid Apple’s fees, a presentation within Apple suggested promoting Netflix in its stores, using part of the App Store commission fee cut to run search ads. pay and even bundle Netflix. with other Apple services.

The emails, spotted by 9to5Mac, begin by explaining a test Netflix wanted to run to study the impact of disabling in-app purchases on iOS. Netflix’s main concern, as Carson Oliver, director of App Store Business Management wrote, was the “voluntary churn” of subscribers through the App Store. The exact amounts are being corrected, but that seems to indicate that Netflix subscribers from the App Store have canceled the service more than subscribers who joined in other ways, such as through the Netflix website.

Carson Oliver’s summary of Netflix’s in-app purchase test.

Since Apple is cutting 30 percent of subscription costs as part of its App Store policy, there are also clear financial reasons why Netflix might want to consider not using IAPs. Netflix could keep more of each monthly subscription without Apple’s cut.

In Apple’s initial internal responses to Netflix’s plans, Oliver asks if the company should consider penalizing Netflix if it goes through with the test. There is a few months’ difference between the first batch of emails and Apple’s later Netflix discussions, but the tone seems to have changed when Netflix appeared to be committed to A / B testing to facilitate in-app purchases. remove.

An email from July 2018 revealed that Apple employees had made a presentation in favor of in-app purchases. It contained reminders of the things Apple has done for Netflix and new deals, such as offering subscriber discounts (Apple would eventually launch something like this in 2020) and letting Netflix control what Netflix shows and movies Apple writes about it in the App Store.

Apple also highlighted all of the promotion it did for Netflix in the editorial section of the App Store. Specifically, Apple is also calling out that Netflix was seen more than any partner, and that content written about the streaming service’s shows had increased downloads by six to seven percent.

But in the same presentation, Apple considered floating even more benefits to Netflix, some of which went beyond what the company has publicly offered to other developers – though the email emphasized that “the ‘What we could do’ section included. pie is in the sky ideas for completeness, and these ideas haven’t been approved yet. ”

The presentation included email campaigns dedicated to promoting the Netflix app only, freeing up some of the subscription fees for App Store ads, and the ability to bundle Netflix with Apple’s other services well before Apple Apple TV Plus or Apple One bundle. .

Whatever discussion happened between the companies, in-app purchases were still removed from Netflix’s app, and the company doesn’t seem to have been hurt by it in the long run – Netflix reached more than 200 million subscribers by January 2021.

What this whole email story illustrates is how Apple’s developer policy appears to have exceptions. The details aren’t fully explained in the presentation, but Apple does point out by offering “video partner program benefits” to Netflix, which sound the same as the deal it struck with Amazon for Prime Video. The emails could serve as evidence that Apple appears to be willing to make concessions for lucrative and powerful partners.