Netflix testing new payments system to avoid paying Apple

Netflix

Netflix and Apple have been living in harmony so far, but a new move by the former may permanently damage that relationship. The company has just confirmed that it’s stopping select users from paying for their subscription via iTunes.

This may sound counter-intuitive at first, but it makes sense if you consider how much money Apple makes from subscriptions. The iPhone maker asks for a 30% cut of a person’s first subscription and a 15% cut for renewals. It looks like Netflix wasn’t happy about paying a middleman and is now redirecting folks to its mobile site to sign up.

Netflix vs Apple

This way, Netflix will get to keep all the revenue and bypass Apple completely. It told TechCrunch that it’s testing this new system in 33 countries including India, Britain, France, Spain, Australia, Canada, and Japan. This change affects existing subscribers who’ve signed up via iTunes in the past too. They won’t be able to renew their account through the iOS app.

Instead, these customers will have to go to Netflix’s site and submit their payment details directly. A customer support agent confirmed that this experiment has been around since June 2018 and will last till September 30. During this time, some will see the regular iTunes option and others won’t.

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Netflix says it’s going to monitor the response it gets and change its practices accordingly. It’s already implemented the same policy over on the Google Store. New or rejoining customers can’t use the platform to pay for a subscription anymore. Those who are already using Google Play’s billing can continue until their account gets cancelled.

It’s unclear how Apple is going to respond to Netflix’s move. It got pretty mad at Spotify when the music streaming platform tried to pull a similar trick a few years ago. It’s unlikely the Cupertino-based brand will ban Netflix from the App Store given how popular it is, but the company probably won’t let this slide.