Apple Inc. AAPL offered fellow technology giant Amazon.com, Inc AMZN a 50% lower cut on the subscription revenues from the latter's streaming video-on-demand app over what it charges other third-party developers.
The Cupertino-based tech giant offered Amazon a 15% fee on Prime Video subscriptions garnered through its App Store on iOS and on Apple TV, while it normally charges a 30% fee to other developers.
Cue’s email also extended a deal, wherein, if Amazon sold the Showtime service or other similar services within its app, the consumer electronics giant would only take a 15% fee in cases where the customer had originally signed up through Apple.
Prime became available on Apple TV in 2017, and had been available on iOS since 2012.
In a separate email from 2011, Cue suggested that the company “should ask for 40% of the first year only but we need to work a few deals to see what is right,” Bloomberg noted.
Why It Matters
The internal documents were made public as part of the House probe into antitrust allegations against the two companies, along with Facebook Inc FB and and Alphabet Inc GOOGL GOOG. The CEOs of the four companies testified before a House committee on Wednesday.
Spotify Technology SA SPOT last year filed a complaint against the iPhone maker with the European Union alleging anti-competitive practices saying its made to pay a 30% tax to the U.S. tech giant.
Last month, Apple said it would allow app makers to challenge its policies after developers expressed outrage at what they perceive as unjust rules imposed on them by the company.
At the House hearing, Apple CEO Tim Cook was asked if the company would give other app developers the opportunity to bypass the 30% sales cut that it takes after it reached an agreement with Amazon Prime. The chief executive acknowledged that the discount is available to developers “meeting the conditions.”
Apple shares closed 1.9% higher at $380.16 on Wednesday and traded about 0.2% in the after-hours trading. Amazon shares closed nearly 1.1% higher at $3,033.53 and rose another 0.4% in the after-hours trading the same day.
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Ad Disclosure: The rate information is obtained by Bankrate from the listed institutions. Bankrate cannot guaranty the accuracy or availability of any rates shown above. Institutions may have different rates on their own websites than those posted on Bankrate.com. The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where, and in what order products appear. This table does not include all companies or all available products.
All rates are subject to change without notice and may vary depending on location. These quotes are from banks, thrifts, and credit unions, some of whom have paid for a link to their own Web site where you can find additional information. Those with a paid link are our Advertisers. Those without a paid link are listings we obtain to improve the consumer shopping experience and are not Advertisers. To receive the Bankrate.com rate from an Advertiser, please identify yourself as a Bankrate customer. Bank and thrift deposits are insured by the Federal Deposit Insurance Corp. Credit union deposits are insured by the National Credit Union Administration.
Consumer Satisfaction: Bankrate attempts to verify the accuracy and availability of its Advertisers' terms through its quality assurance process and requires Advertisers to agree to our Terms and Conditions and to adhere to our Quality Control Program. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the institution you choose, please click here.
Rate collection and criteria: Click here for more information on rate collection and criteria.