Will iPhone 16 no longer support WeChat? This rumor has been denied by multiple parties.
Recently, it was reported that due to Apple's previous "Apple Tax" on WeChat ecosystem developers, WeChat may not support new iPhone 16 phones. Subsequently, multiple related topics such as "Apple WeChat" have become hot searches on Weibo. A source close to Tencent told Interface News that this news is a rumor.
On September 3rd, Interface News contacted Apple's official customer service, who replied, "There is currently no information saying that the iPhone 16 does not support WeChat. Don't worry, all current iPhone phones can use WeChat normally." According to Apple's official website, there is no indication that any iPhone phone does not support or is incompatible with WeChat.
Apple tax refers to the 30% commission charged by Apple Inc. on paid apps and in app purchases in its App Store. Like all mobile phone manufacturers, the commission for in app purchases is a major source of profit for Apple. In 2023, Apple generated $22.34 billion in revenue from this, of which about a quarter came from the Chinese market.
The Android app store also has this rule, with mainstream mobile phone manufacturers such as Huami OV even offering discounts of up to 50% on in-game purchases. However, the Apple tax has been more questioned due to the relatively closed ecosystem of Apple, which does not allow developers to download applications from other channels.
In the Android ecosystem, developers can choose more flexible workarounds. For example, games such as "Genshin Impact" are not available in mainstream Android app stores, but guide users to download them on their official websites. Of course, this is also highly related to the appeal of the game itself.
The Apple tax has once again sparked controversy due to its new negotiations with Tencent. Previously, it was reported by foreign media that Apple was negotiating with ByteDance and Tencent, requiring the latter two companies to plug the "loopholes" in the applications that bypass Apple's payment system and guide users to external payment platforms, so as to ensure that Apple could extract profits from these transactions.
For example, in WeChat mini games, some developers use in-game customer service chat windows to guide players to click on official websites or external recharge links for in app purchases, thereby bypassing Apple's payment system.
This is not the first time that Apple and Tencent have had a disagreement over the Apple tax issue. In 2017, Apple requested that the article reward function of WeChat official account be accessed into the app for purchase, but Tencent refused and once took this function offline. Since then, Apple has made a concession and modified the terms of the development contract, allowing official account to use WeChat payment as a reward, but also not allowing WeChat to draw a percentage from it.
The focus of this controversy is on small games. At first, the main monetization model for small games was advertising, where users did not need to download or install, and simply clicked to play. Game developers earned revenue by displaying advertisements. But as the scale of small games continues to grow, developers not only generate advertising revenue, but also charge users for in-game purchases of props, virtual currency, and other items.
So, mini games gradually became an important part of the WeChat business ecosystem. At the 2024 WeChat Mini Game Developers Conference, WeChat announced that the number of mini game users has reached 1 billion, with 500 million monthly active users and continuous growth in user usage time. There are over 240 games with quarterly revenue exceeding 10 million. According to estimates from multiple market research institutions, the annual revenue of WeChat mini games will be approximately 24.2 billion yuan in 2023, with iOS revenue exceeding 10 billion yuan.
According to the "China Game Industry Report from January to June 2024" released by the Game Working Committee of the China Audio and Digital Association, mini games have maintained a strong growth trend in the domestic game market for three consecutive years. The actual sales revenue in the first half of this year was 16.603 billion yuan, a year-on-year increase of 60.5%. The revenue generated from internal purchases was 9.098 billion yuan, with a year-on-year increase of 81.56% in actual sales.
The new business model and rapidly growing revenue scale have undoubtedly aroused the interest of mobile phone manufacturers. Mobile phone manufacturers, whose main source of profit comes from channel extraction, clearly do not want to miss out on this cake.
Regarding the progress of negotiations between the two parties, Tencent executives previously responded at the financial report meeting: "I think there is some misunderstanding about the essence of the current situation, which is that we have not commercialized small games on iOS through in app purchases (bypassing payments)." Tencent stated that it hopes to achieve commercialization on economically sustainable and fair terms, and this discussion is currently underway. I hope the discussion can achieve positive results, as it will be a win-win outcome.
A person close to Tencent analyzed Interface News that the core of the negotiation may be the issue of the percentage of commission. The developers behind small games are mostly small and medium-sized enterprises, with over 80% being small teams of less than 30 people and profit margins mostly below 12%. A 30% ratio will compress the survival space of these enterprises, and WeChat hopes to protect the rights of small and medium-sized developers and seek a more reasonable commission ratio.
Application developers are particularly sensitive to the percentage of commission. Previously, foreign media reported that Huawei's native HarmonyOS system promised to waive all commission on WeChat in order to attract WeChat to join. The commission rate for other developers is set at 20%, which is lower than Apple's 30%. However, Huawei and WeChat have not confirmed this rumor.
At present, negotiations between Apple and Tencent are still ongoing, and this will be a continuous game. For two companies with such a large scale, requiring users to "choose between two" is an extremely unreasonable business decision and almost impossible to occur.
And other games under Tencent, such as "King of Glory", "Peacekeeper Elite", "Dungeon&Fighter: Origins", etc., have also contributed high commissions to Apple. For example, the DNF mobile game generated $600 million in revenue through iOS channels within 70 days of its launch, equivalent to RMB 4.27 billion. Before making any decisions regarding WeChat, Apple clearly needs to weigh the huge impact it will bring.