Apple has reversed course and is now demanding a 30% cut of donations sent to teachers in the popular Insight Timer meditation app. The change apparently comes after Apple allowed the app to use its own Stripe-based in-app purchase system for over a year.
As detailed in a report from TechCrunch, Insight Timer’s allows it users to send “tips” to their favorite teachers and instructors. In its App Store Guidelines, Apple has specific rules about this:
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Apps may enable individual users to give a monetary gift to another individual without using in-app purchase, provided that (a) the gift is a completely optional choice by the giver, and (b) 100% of the funds go to the receiver of the gift. However, a gift that is connected to or associated at any point in time with receiving digital content or services must use in-app purchase.
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Since 2022, Insight Timer has used Stripe to power its platform that allows users to send those tips, therefore not paying a 30% commission to Apple. “Apple appeared to have blessed this use case, as the tech giant went on to approve 47 more updates to Insight Timer’s app over the course of a 12-month period,” TechCrunch explains.
In late 2023, however, Insight Timer was told by App Store review that those tips were now considered “digital content.” This means Insight Timer will have to use Apple’s In-App Purchase system rather than Stripe, and pay a 30% cut to Apple itself. the
As the report explains, Insight Timer’s business is based around a subscription model. Apple’s decision to require those “tips” to use In-App Purchase has no effect on its finances. Instead, Insight Meditation’s teachers are the ones affected:
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Late last year, those approvals stopped. An app reviewer told Insight Timer that these donations were no longer considered monetary gifts — they were now “digital content.” That meant they were also now subject to Apple’s commissions. This decision doesn’t hurt Insight Timer’s bottom line, as the app’s main business is subscriptions. Instead, it hurts the community of teachers who generate additional funds via users’ donations. Now, Apple demands a 30% of that revenue, which means the teachers are getting a 30% pay cut overnight, so to speak.
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In an interview with TechCrunch, Insight Timer CEO Christopher Plowman said the company ultimately has no choice but to comply with Apple. Apple gave Plowman a deadline of February to comply with the guideline, or else have Insight Timer removed from the App Store. The two sides went back and forth in search of a compromise, but ultimately couldn’t come to a conclusion.
Plowman also said in the interview that Insight Timer users donated an average of $100,000 per month to the platform’s teachers.
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“So in the end, I agreed,” Plowman told TechCrunch in an interview. “I don’t want to pick a fight with Apple — I’m not picking a fight with Apple. I think this problem is largely about regulators not stepping in. Apple’s a public company, but it has shareholders — it’s doing what it’s allowed to do,” he says.
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Apple hasn’t yet commented on this story.
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