Apple Is Making Creators the Enemy with Patreon Fees, But There’s a Loophole

But there’s a third option that Patreon isn’t promoting. Creators could (and likely will) recommend that their fans make transactions on Patreon’s website rather than the iPhone app. That means creators — and Patreon — wouldn’t lose money to Apple. Apps like Substack and Netflix already work this way, where subscriptions are handled outside of the app, and once a user logs in, they can access their subscriptions in the iOS app.

For years, Patreon was able to bypass Apple’s App Store fees. In 2021, Patreon CEO Jack Conte told The Verge that Apple had not explicitly told the startup it had to pay.

That changed in late 2023, when Apple first came down on Patreon, forcing a 30% commission on all commerce purchases made in the Patreon app. And now Apple is expanding that to all transactions made in the Patreon app, including subscriptions. If Patreon doesn’t work, Apple is threatening to remove the app.

Creators are frustrated and confused

“Creators are panicking,” said former Patreon CEO Avi Gandhi. “We live in an age of digital gods, and Apple’s App Store is certainly one of them.”

On Reddit and Discord, Patreon users have been voicing their frustrations with both Apple and Patreon. Some want Patreon to abandon its iOS app entirely, others want Patreon to pick up the tab (which wouldn’t be financially feasible), and others are just plain mad at Apple.

“Apple has gone from ‘Think Different’ to ‘Think Extortionate,’” Laurel Kilgour, research director at the American Economic Liberties Project, wrote in a press release Wednesday. “This outrageous 30 percent revenue cut — nearly 2.5 times larger than Patreon’s highest premium membership — is especially egregious given Apple’s ongoing antitrust legal battles around the world.”

But don’t worry, developers will find a way to get around the fee charged by Apple.

Creators are already discussing ways to bypass Apple’s fee by allowing fans to make transactions outside of the Patreon iOS app.

Patreon doesn’t explicitly promote this solution for creators, presumably to avoid further irritating Apple. And it needs its iOS app because that’s where the users are.

“If we don’t do this, Apple could kick us off the App Store, which would be terrible for creators and terrible for Patreon, because iOS is currently the most used platform for the Patreon community,” Conte said in a YouTube video posted on August 12.

Apple and Patreon did not respond to Business Insider’s comments.

Apple is not seen as a friend in the creator economy

Patreon is not the only platform that startup founders are using to build businesses around their communities and content.

Other platforms like Kajabi, Mighty Networks, Passes, and Substack are either already being taxed by Apple or are dealing with these issues on an ongoing basis.

“This is what happens when you build in a rented space instead of your own,” Ahad Khan, CEO of Kajabi, told BI. “You’re building your business on a platform that can change the rules of revenue sharing whenever it feels like it.”

For example, Kajabi helps creators create branded mobile apps, but creators understand that if they put that app on the Apple App Store and there are in-app transactions, they will be taxed by Apple. Each creator ultimately has to decide what makes sense for their business, Khan added.

Similarly, Mighty Networks helps developers get their apps onto the Apple App Store and has had to deal with fees from Apple for years.

“When in-app purchases are activated on any Mighty network, we don’t take any commission,” CEO Gina Bianchini told BI. “So we’re essentially giving back everything we would have given to the creator.”

Meanwhile, other platforms like Substack and Passes are trying to answer these questions by expanding their presence in mobile apps.

Substack co-founder Hamish McKenzie wrote that the startup “does not believe Apple should be entirely to blame” and is working with Apple to introduce in-app purchases on Substack.

“We’re doing everything we can to make the in-app purchase implementation as creator-friendly as possible,” McKenzie wrote.

Lucy Guo, CEO of Passes, told BI that the price of its iOS app will be higher than its website prices to compensate for the decline in creator earnings.

“We believe Apple should make exceptions when it comes to creators,” Guo said in an email. “Apple’s tax hurts individual creators who rely on Passes as their primary source of income.”

Suffice it to say that when it comes to the creator economy and Apple, things look like this: complicated.

“I don’t really blame Apple,” Bianchini said. “Apple isn’t the worst thing in the world, but it’s not everyone’s friend either.”