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Apple and WeChat resolve disagreement over App Store cut on tips

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WeChat disabled its built-in tipping system last year, after Apple issued a new policy that recognized tips as in-app purchases. WeChat, which bundles services inside its app, is a popular messaging app used in China for group chats, streaming, and even accessing services like food delivery or news. WeChat has always encouraged its users to tip individuals, but Apple wanted a 30 percent cut of that revenue.

The Wall Street Journal reports that WeChat creator Allen Zhang revealed Apple and Tencent, the owner of WeChat, have reached an agreement over tips. “In the past, companies like Apple might have had a difficult time understanding China-specific features,” said Mr. Zhang. “We now all share a mutual understanding and we’ll soon bring back the ‘tip’ function.”

It’s not clear if Apple will still take a small cut on tips, but the iPhone maker did alter its App Store rules again in September to allow users to gift money to each other in apps without Apple taking a cut. Gifts need to be true gifts, and not related to access to content or services.

Apple’s agreement with WeChat comes at an important time for the company’s presence in China. Thanks to China’s fast-growing population, the country has become a giant software and services market for Apple. While Apple’s revenues and its market share have dipped in China, the company still recorded more than $2 billion in in-app revenues during the fourth quarter of 2016.