Week in Mobile Games E59 - A dark day for Xbox

[Music] Hello and welcome to the pocket gamer.biz podcast week in mobile games where we discuss the week's news and attempt to provide some insights. I'm Craig Chapel, head of content at pocket gamer.biz. With me today, Aaron Assel, our news editor. Good to have you on the show again, Aaron. How you how you doing this week? Yes. Hello. Yes, I'm doing a bit better this week. I thought for anyone concerned last week I should show my shoulders are not so bright red anymore. They I would say they have recovered. They they they don't look in this light. They're a little bit tanned but um it doesn't hurt to like lie down anymore which is an improvement. That that is that sounds like an improvement. Yeah, that's that's only good. Other than that, like for me from the last week, I went out with a friend to do some karaoke end of last week. I'm a biggest fan of karaoke, so I'm all for that. It's um we'll have to try and do

one together at a, you know, PGC in the future if there's another one in, you know, in London or whatever. If there's one thing about games industry events, it's people always seem to find a karaoke, right, as the afterparty. You yourself are very good at PGC London last year. I think it was was it last year? Yeah. 24. Yeah. Sadly, um time to do any this year. No, I always enjoy those. Ask myself, I just I've been out in the sun. That's about as excited as it's been with some friends. This week has just been extremely busy with our events coming up. We been working on the awards. I'm ready for the weekend and obviously which we'll go into shortly. Just reporting on just a lot of news, very kind of depressing news really frankly for for for the industry. Yeah. So, there's been a lot. Otherwise, I'm going to see uh Jurassic Jurassic World Rebirth tonight. I have no expectations. Um but I am a sucker for monster movies, so I I'll go in, I'll watch it, and then

I'll be like, "That was okay." I don't know if I mentioned last time, I watched 28 Years Later recently, and that was good. But there's a big butt. And the only It's not really I don't know if it's a spoiler. just it's I'm not going to say anything details, but the end just made me think like did I even enjoy this film. There you go. The the the next 28 Years Later is out in January, I believe. So, it's coming up here. That's not long. Yeah. Yeah. So, I'll still go see that. It was a good film, I think. Right. So, a few shout outs. So, uh we got for PC Summit Shanghai coming up July 30th. I did get my visa so I'm going and there'll be charge joy just after that as well. I think that we have some sort of deal there so be sure to check that out. PGC Helsinki October 7th to 8th. PGC Akaba November 8th and 9th we got the mobile games awards during Gamescom

in Cologne. We'll also have the PGC party out there I think the night after. So keep an eye out for details on that. And by the time this podcast out, we should have the mobile games awards finalists out and voting ready. So, be sure to check out the site if it's up. I'll put a link in the description. Right. So, obviously the big news we're going to cover is the news this week that was coming. We all knew it was coming. How bad is it going to be is the Xbox layoffs. And it's a total disaster. And I'm going to go through a few bits. So, I'm going to go I want to cover kind of the news. What I think it means for mobile and that includes some other news that's come out over the past couple months. How does this help studios? How does this help the studios and Xbox's future and just a communications disaster as well? Like that it was handled so shockingly poorly, but I'll go into why on the messaging and how they dealt with journalists. So, so the news is so the wider news is that Microsoft is enacting 9 9,100

layoffs, which is 4% allegedly. Microsoft has disputed this, but then they I'll go into the coms's ass later. They won't make any clarification on this on their rejection. As far as I'm concerned, what they're saying doesn't mean anything. So yeah, the reporting is uh and this was the Seattle Times and CNBC. 10,100 staff are going to be let go from Microsoft, which is about 4% of the company based on last year. They reported to have 228,000 staff. There might have been layoffs since then. So it could even be higher percentage like say cuz there so there's so many to go through. I'll try and go through them quite I'll just go through some of the the top line ones quite quickly. Bloomberg reported that people familiar with the plan said King is cutting 10% of its staff which would be approximately 200 employees and we've reached out to King. They haven't got back. Other divisions impacted including kind of Zenamax in Europe in the US marketing team was cut. There's been reports the video games chronicle IGN

and others have had kind of reports. So Sea of Thieves developer Rare has seen some layoffs. Someone I think that worked on like the first Badjo Kazouie is gone. They've cancelled Ever Wild, which is I guess been stuck in development hell for a long time. That's gone. Allegedly turn 10 does the Forza games, not Forsa Horizon, which is Playground. Turn 10. Forza, they've laid off 50% of stuff. The Initiative is closing and development on Perfect Dark is ending. So that's been in development hell. But they did bring on Crystal Dynamics to help with that. And they did show trailer last year and you kind of thought I I thought that development must have been doing pretty well at that point, but obviously it wasn't shown in a recent showcase and they've just decided to nyx it incredibly. And then there's just like loads of other layoffs on other teams. It's all bit messy. Raven Software was one that was hit. So they work on Call of Duty. That's a surprise considering the whole reason

you buy Activision really is for Call of Duty layoffs at one of those studios. Crazy. And then last night we had uh Blizzard. They've ended new content development on Warcraft Warcraft Rumble and there's been layoffs at the studio. Uh there wasn't any clarification on how many staff. So Blizzard actually made an official statement about that game. According to Aftermath, Blizzard cuts are about 100 staff. I'm not sure how many of that is specifically the RAW Warcraft rumble team. I'd be surprised if there was that many working on that game. I believe that's kind of across the studio. And I think they did say also affected kind of the marketing marketing and customer service teams there. So all of that is just absolute disaster, right? So I guess now you kind of go on to I guess first I'll go what does it mean for Xbox itself and its future? And I think this just is like game pass is obviously a total failure. I think Phil Spencer when he came in he had you could argue in many ways he had

an impossible job and there is a quote out there that I saw on a video a YouTube video from Laura Frier who's a former Microsoft exit. He was talking way back when and he said like they they've lo they lost the most with Xbox One they lost the most important generation because that's when everyone got their kind of digital libraries online and and then that was a massive failure public failure right they kept talking about TV and they wanted to bring all media services together they bundled the connect absolute mistake so they lost that generation and they have never recovered and one of the ways they thought they could do that was game pass clearly if you're going to make this many layoffs within your company and subscriptions just aren't aren't rising as quick as they need. The only result surely is to say that it hasn't worked at all. It is a good deal for players. I'm a hypocrite because I say that's not how people consume games because you play you kind of find one game and you play it. But I also use Game Pass because it is such an incredible deal like for certain games that I want to play. Can't dispute it. Play you want to

play Call of Duty or Clear I can just get those for a small fee each month. But for developers, like it's just total totally destroys any value in these all the studios that they have internally. You know, you're going to release billion dollar franchise in Call of Duty and you just throw it up on on Game Pass. And since that acquisition, I mean, you were saying before this Aaron when we were talking just bit before. So, previously they made layoffs specifically to do with the Activision Blizzard acquisition, which was 1,900 layoffs. I can't remember. I think they even said they weren't going to do this, but they did. And then in September I think across Xbox 650 like you were saying Aaron and now we don't know how many hundreds maybe thousands the strategy doesn't make any sense to me. You've destroyed value in your top IP and even after buying Activision get Call of Duty that doesn't seem to have there doesn't seem to have been such a massive surge in game pass subscriptions that I've noticed. I'm sure there was, but like not to such a to a massive

degree that suddenly you think that $69 billion was worth it, right? It it hasn't worked out that way. Over the years, over the past decade, Microsoft has destroyed the value of their IP of their biggest IPs. Gears of War is not what it was. Halo is not what it was. I worry about other franchises that they have. They've just kind of squandered. I mean, this is an Activision issue, but they also kind of squandered some of their big IPs like Starcraft, you know, that used to be huge. I'm big fan Starcraft 2 and that's just been squandered. That's basically on on it last legs now. And it should be kept up by esports, but they're just not interested. So, how does it help? How does all this help Microsoft future? Again, I don't understand. So, if I look at it, you you're just about to go into the next console generation. Does laying off 50% of the turn 10 team help that studio make the next Forza game for your next platform and then make another game

after that? If they could do it with half the team, they would have done it with half the team surely. Just doesn't make any sense. And it actually is a bit of an insight into I think that and many of the other layoffs and cancellations is that why why has all why has this happened at once? Obviously there technically there've been layoffs a number of layoffs over the past couple years but like with this like why did why was the decision to cancel Warcraft Rumble taken yesterday when it was kind of visibly it was very visible 6 months ago whatever that it wasn't a success other studios would have just cut that straight away and said we're going to focus on something else why does it take this long to make these decisions you could say that Ever Wild and maybe even Perfect Dark they were stuck in development hell So, someone has made the decision finally to go, "Look, we're going to have to cut our losses. This this isn't working." So, you could applaud that decision in one way, but then it got to this point. It got so far. What was Ever Wild was that 10

years, Perfect Dark? I I don't actually know, 5, six, seven, eight years, whatever. A reboot of that. These decisions surely should have just happened sooner. And now I just don't know. It's hard to see what the strategy is moving forward. Um, and they've come up with a load of nonsense I'll go into in a minute. It's kind of really flaky words that don't mean anything from the executive team. So, I think they don't really set Xbox up well for future success as a hardware platform. And I think they're going to I think they're just going to really struggle with that. The Game Pass thing and and they've just what is it? They've just announced Hell Dive. Sorry, Hell Divers has been announced coming on Xbox and Gears of War going on PlayStation. If your future is crossplatform, I mean, there's no reason to buy Xbox hardware, I think, other than Game Pass, but that hasn't got the traction they need. And I think it's going to change in another generation. I think everyone's going to be like, well, I'll just get my PlayStation because I can also now play Xbox games on there, and maybe I'll get Game Pass. So, the hardware division's kind of screwed. And

I think they're going to have to get rid of I'm not the only one set obviously, but like serious questions about the future of a subscription service to actually create value at that company. and and this hasn't worked out. A bit about uh the mobile business. Sorry everyone, just uh I I warned Aaron before I had a few things I wanted to go through. So, a few words about the mobile business. So, 200 cuts at King Castle Warcraft, Rumble. I think there is no They'll prove me wrong in a couple months, I'm sure. I I think there is no room for mobile at Microsoft. So, I'm not saying that they're going to get rid of King. King is King is a cash cow, right? When it was Activision, I think it was like 50% of revenue is basically come from King and Candy Gross. I think laying off 200 people, I guess there's two sides to that. Well, a few sides. So, it's obviously really bad for the staff there. Like, and and across the company, everyone must be like, "What the hell?" Again, that's that's not good for your long-term prospects. I think staff will be kind of worried, especially this is the latest about just the long-term vision, which there

doesn't appear to be one. But if you're making these layoffs at a company that's extremely profitable, that's concerning. You could argue that King does have some games that aren't they aren't Candy Crush Saga. They aren't Candy Crush Soda Saga. They don't make that much money compared to the billion dollar games that they should be aiming for. So maybe there's an argument to be made for some cuts. A company that employs 2,000 people. One of the problems with King as well is that again, it's a cash cow. They're very successful. That's not the issue. It's that that is not the company that is going to translate any of Microsoft's IP to mobile. They just can't do it. They they were going to make that Call of Duty game announced many years ago and big announcement. I think they were hiring in as a guess. I think it was in Sweden and we never heard of it again, right? Because they can't do it. They've tried midcore loads of times. They can't do it. They did Crash Bandicoot and it was a flop. So King is basically very focused on it can

make these amazing puzzle games that frankly the franchise has also had diminishing returns for Candy Crush. But ultimately it is one of the biggest top grossing games on earth and does need a big team behind it. I just think King's not the one to help expand it in any way really properly into mobile if that's what it wanted. So its future is if it wants to do that is going to have to be partnerships like it did with Tencent. It's like Activision did with Tencent for Call of Duty Mobile and then it tried to sort of cut Tencent out with War Zone and that failed completely. Then the Xbox store, let's talk about that quickly. We've only ever heard Sarah talk about it kind of on stage basically and and then there was like a web page for it at some point and it was supposed to come out in a year ago. Didn't happen. They've since blamed uh Apple, which you could argue, fair enough, Apple was made extremely difficult for other stores to come up, etc. I I've always thought that just sounds like a bit of an excuse to be honest. And and now with the US ruling and potentially the DMA, but with the US ruling that actually cracked open the

app store to allow anyone to freely link to their own web shop, is it does it make sense for Microsoft to have an app store? But I I don't think it does, especially not an Xbox game store. It doesn't make sense to me that you're not going to be able to get enough people to get to uh enough people to download that. I don't think for mobile publishers already, there's no incentive for them. I think unless it's just a discovery play to put their game on there, and it have to be a pretty low fee that Microsoft would charge. Maybe that's one way it could work. But is that going to be interesting enough for Microsoft style 10% cut and we'll give you this. Is that interesting at that level? I I don't think so. I I feel like that whole plan is probably going to be scuppered. It might come out this year and then and then we'll judge it on how it performs, but I'd be surprised. And then Microsoft's whole crossplatform play to bring it to mobile. And if you do that through cloud, that doesn't make any sense either. You don't want to play Halo on on your mobile. You just don't, right? It works with a Genchin Impact

with a PUBG Mobile when they're kind of built with mobile in mind, right? And even then, they can be a bit clunky compared to a controller or a keyboard, but they they do actually make it work. But you see games like Resident Evil coming out on mobile. They do absolutely nothing. You can't charge you can't charge someone £80 to play on their play on their mobile. They're not going to want to do it. So, you just rule that out. The only way that people do it is on a tablet or controller maybe while they're out. Um, so that part of the strategy doesn't work. The rogue ally I think is potentially a waste of time if the cost is going to be super super high. So there's a whole strategy there that I think I think mobile doesn't make sense in Microsoft's future. So I want to start with the comm's disaster and that is that we uh after I put the story out yesterday, Microsoft PR agency gets in touch and and they lead it with the header and uh and then they say uh we spotted your article wanted to check whether you received the full and most

up-to-date information from the team regarding the recent organizational changes at Microsoft. Okay, I mean I don't think they were sending that. In particular, there are a couple key clarifications that we'd like to reflect for accuracy. They give me an official statement. We continue to implement organizational workforce changes that are necessary to position the company and teams for success in a dynamic marketplace. Microsoft spokesperson that tells you absolutely nothing. There's absolutely nothing. It's a multi- trillion dollar company and and and they're being vague about all marketplace conditions. Yeah, we know the market struggle. This is this this is absurd. And then they went just clarify a few points. Sorry. The overall impact represents less than 4% of Microsoft's global workforce. I asked clarification on that. They didn't provide any. Their response after that I said is that in well is 4% actually inaccurate. So what is the percentage? Is the 9,100 figure wrong of layoffs at Microsoft? How many staff does Microsoft employ? You know how many people in the games division you lay off? Because they said while gaming is impacted, it is not the majority. No specific team breakdowns will be provided out of

respect for those affected. out of respect, especially after um but yeah, after you know if they said they reached out to like clarify and make sure all the information is accurate and then they don't want to provide you with information. Yeah. So what what's wrong? You're not you're not giving me it it makes them sound like they don't know which I don't think they did at the agency which fair to them. The whole thing sounds like there was no prep involved frankly. Some of the executive team obviously, but then the rest they're just like, "Okay, here you go." Jesus, you need to all sort this. They have a core team that sort out beforehand, preps, and then it's ready. And none of that none of that has happened. We reached out to King. They didn't get back to us about the layoffs. And then after I asked those questions to to clarify things, you know, they said, "Uh, yeah, thanks. Get back. We have nothing more to said we share beyond what is noted by Phil Spencer and Matt Booty's emails." and they didn't provide me the emails. They linked me to

two variety stories. So, basically what they're trying to do is they're saying, "Oh, here's the correct information of another variety." Having a goal, but of of another site that repeated some of their claims that they've made to us, but why are they linking me to a media outlet with the quotes for Phil Spencer about booty? Why not just send me them? That's insane. That's insane. So, that again is very little prep. And then the last thing I want to say and I'm going to go through the statements that were made. Okay, so here's Phil Spencer's memo. Today we are sharing decisions that will impact colleagues across our organization to position gaming for enduring success and allow us to focus on strategic growth areas. We will end or decrease work in certain areas of the business and follow Microsoft's lead in removing layers of management to increase agility and effectiveness. out of respect for those impacted today. The specifics of today's notifications and your organizational shifts will be shared by your team leaders in the coming days. So all this is being reported and people not knowing and then there were reports of people staff like looking at their Slack seeing it get

shut down and then they assume well maybe I've been laid off faster straight away. There's no proper communication. I know it's bigger organization but there's there's surely a better way to do this. Uh, I recognize that these changes come at a time when we have more players, games, and gaming hours than ever before. Our platform hardware and game road map have never looked stronger. The success we're seeing currently is based on tough decisions we've made previously. Why are you you're talking you're trying to insert into this this terrible announcement, right? And they're talking about respect for stuff and you've clearly had failures that you're making yet another round of layoffs and at this scale you're canceling games and you're talking about success. There's no success here. It's total failure and it's disrespectful to say we've been oh we're doing really well but we're going to lay off staff like that itself is disrespectful as a comms that's terrible I I would say we must make choices now for continued success in future years and a key part of that strategy is the discipline to prioritize the strongest opportunities we will protect what is

thriving and concentrate effort on areas with the greatest potential while delivering on the expectations the company has for our business. this focused approach means we can deliver exceptional games experiences for players generations to come. I kind of said already like that just it's hard to see how some of this really sets them up well for the future. When you're kind of canceling games, laying off teams, surely that actually makes it kind of harder to to kind of fulfill this mission. It makes it more difficult. Prioritizing our opportunity is essential, but that does not lessen the significance of this moment. Simply put, we would not be where we are today without the time, energy, and creativity of those roles who were impacted. These decision is not a reflection of talent, the creative dedication of the people involved. Momentum is not accidental. It is the result of years of dedicated effort from our teams. It talks about HR says thank you. And then quick so this is Matt Booty's internal statement. So following Phil's note want to share this made decision stop never wild. We're closing the initiative. These decisions along with other changes across our teams reflect a broad broader effort to adjust priorities and focus resources to

set up our teams for greater success within a changing industry landscape. We do not make these choices lightly as each project and team represent years of effort, imagination, and commitment. Our overall portfolio strategy is unchanged. Build games excite our players continue to grow our biggest franchises. Well, you've just hurt Forza. You have got rid of Perfect Dirk. I mean, well, you've got rid of Ever Wild. It's not one of his biggest franchises. We have more than 40 projects in active development. Continue momentum on titles shipping this fall and a strong slate headed into 26. And then right at the end it says I believe in the strength of our team is the direction we're taking on the path ahead. But they're talk I was speaking with Alex who does PC games inside. He was making point one of these things that's wrong with this. It's talking about they keep talking about this vision of the future rather than the now and the future is just out of out of grasp. It's not there. And this kind of commentary is just kind of embarrassing uh for them to do. Some I just I worry about Xbox is yeah it's all been a

failure really. He had an impossible job but the direction they've gone in is has not worked out since took charge. I can't see from this I can't see it really what's going to change other than being a games publisher moving forward. Hard to know. And within Microsoft, man, like their focus is now on AI, but they obviously showed a lot of backing in Xbox, you know, $69 billion acquisition of Activision. They bought Bethesda, they spent a lot a lot a lot of money, and now they're just kind of tearing it all apart. And I think it's almost like the leadership of Microsoft is kind of given up. So yeah, good luck to everyone that's been affected by this and uh that is also still there. I don't say it's it's just not great. Will this be the last set of layoffs? I think it's the same commentary every time. That will set us up for future success. And each time when they laid off, 1900 staff, 650 staff, it didn't lead to a better future. Okay, I'm done. Bouncing off that point, like you said, um earlier

like yeah, it's sort of hard to see how laying off people on that scale can like lead to like bigger and better things projectwise. And like if if these teams could have made great games with, you know, a fraction of the team size, you know, they they probably would have done already. Like just getting rid of people, it's not really Yeah. evident how that's going to improve their output really. It's just like trying to up cost. Yeah. I I just think uh what hasn't happened in this disaster so far is that no one on the executive team has taken the fall for this and at this point that has to change and the other question I had was who is making this decision to do this because if the executive team is still there and they're making this decision but they've already been they've already had past failures why do we think that that's going to change in the next 10 years with the same team and so if they if Microsoft does get rid of this leadership team. Well, now the decisions that have been made affects what the

next leadership team does moving forward. So I I guess you assume that it's pressure from the leadership at Microsoft on the Xbox team to do this. Yeah. I So there's a few reasons there that more reasons that raise questions about the decisions that have been made, why they've been made, and why none of the leadership team is taking the form because ultimately apologies, their heart goes out to the team. They're all empty words when when you do it repeatedly. Obviously, layoffs do happen. Mistakes happen from leadership and and you know, sometimes there has to be honest discussions and then they're trying to turn the ship around with the experience that they've now got and the noise they now got. But when it keeps happening repeatedly for a decade, but particularly over the past few years. Yeah, it's just not it's just not the way to it just seems I just don't know where Microsoft's going. Okay, so that's Microsoft, but we can close out. Aaron, you've got a couple stories that were quite interesting. Yeah. So, um, in a bit of kind of brighter news, Angry Birds Bounce has just launched today as

of us recording this, uh, so July 3rd. Before its release, I had the chance to speak with Brian Cook, the game lead. So, we talked about quite a few interesting subjects like the game's kind of brick breaker direction, which is a first for Angry Birds of the them developing it for Apple Arcade. It's an exclusive to Apple subscription service and uh particularly we also discussed developing the game under Sega. This is the first Angry Birds game to really have been developed since the acquisition. Apparently, it got green lit like a few weeks before the the deal went through with, you know, the ROI acquisition. Um so yeah, it was quite interesting hearing about that in particular. So obviously um yeah they'd like just started work on Angry Birds Bounce. Apparently ideas had been floating around for about 18 months before they actually kind of settled on we're going to make like a brick breakaker game for blockade and then the the Sega acquisition went through. But

moving forward it was quite noteworthy that um yeah so Brian Cut said that basically Sega now has to greenlight Roio projects. um if so Ravio can you know um ideulate and come up with you know whatever possible projects they want. It's still a very independent thing but yeah apparently they do have to take it to Sega for approval to like make something new which I guess you maybe think Sega's not likely to tell them no. I would imagine they might not have bought them if they didn't think they know what they're doing. But it is I think yeah quite noteworthy that that is a thing now that they have to do. And he also said the kind of closeness that Sea will work with Roio is gonna depend on the project. So like Angry Birds Bounce, they've been quite hands off but available if Ravio's had any questions or whatever. I did ask kind of on that basis whether Ravio's kind of considering broadening beyond mobile and

kind of getting Sega's support there which um there's nothing concrete apparently in that regard. Brian said that he think right now in the industry everybody is looking for opportunities but he's not aware of anything like that. So not a hard no but it sounds like rodeo's probably sticking to mobile for the foreseeable future. The mo yeah as you were saying the most interesting thing from this that stood out to me was the green lighting because when we spoke to Roio last year an executive they they were saying basically that they'll retain their independence and from this statement that's it's not quite true obviously yeah the ideas are allegedly like their own independent ones that they can ideate although obviously as we know with Sonic Rumble which turns out it's actually made by Sega they got Roio's team to help publish that and provide some of the publishing operations for that cuz they also get told what to do which kind of makes sense you you've been acquired like I guess these things companies company but

maybe that you know that's part of the strategy but I'm not much criticize that yeah then like similarly the new parent must approve of any any contract for it could be sides and the level of saying invol like depend project I just it's just weird that roio can't just be like we're going to do this or or rather we're doing this and then that's it maybe I'm making more of it than it is it could just be saying it's like yeah sure whatever But it doesn't it doesn't feel like that. It's like a I don't know broad discussions I guess. But yeah, that was that was the biggest interesting take for me. I think um if I was to look at since like the deals happened oddly like Roio's if you just looked at estimates there could be reasons for this and maybe we don't see some revenue now because it goes through ROIO's own direct consumer platform. Revenue has kind of tumbled since 2023 really to now. They still make money obviously, but they're not making what they were in 2022. Like between 2017 2022, it looks like they were making more money from their games business than they are now. Obviously, we have the new Angry Birds

movie coming up. Um I guess we'll see how that does um and how worthwhile that'll prove to be. It's interesting that they're doing it. But yeah, uh that stuck out to me. Yeah, like I do wonder really I say whether Sega would, you know, whether they might bring a project and then Sega's just like, "No, we don't like it. You're not doing it." Like I in a way I can't really see that happening. But you're right, like I guess technically, you know, they can do that if they just don't want Roio to work on something. Yeah, I saw those very different cultures, business cultures. Although that was they were trying to tell me before there wasn't maybe that much of a difference, a clash of cultures, but I feel like there is having worked having worked at Nintendo between Europe, the US, and Japan, I can tell you that company cultures across those three countries were extremely different. All right, very quickly, one bit of news, but we we went so it's about Apple and the DMA. So we we did actually speak excessively about Apple last week and I think we actually covered off quite well

kind of the DMA and how Apple's kind of treating regulations and it future etc. But it's worth just going through some of the terms. Uh so Apple has in its words to comply with the digital markets act. This isn't compliance really. This isn't actual compliance with what the DMA wants. But they they've already made their very confusing European business terms just exceptionally more confusing. Right, I'm just going to read the article because it is actually impossible to get my head around some of this. So under the new terms, publishers are able to link out off to off payments. New rules include an initial acquisition fee, store services fee, and the core technology commission, which is different from the core technology fee, but also the same. It's different. The initial acquisition fee charges 2% when a customer purchase digital good or service from an actionable link from an app within a six-month period. So if you link off store, 2%. Meanwhile, the store

services fee is paid on all purchases that occur within 12 months of an install. This is split into two tiers. Tier one charging a 5% fee with reduced app store features and is mandatory for apps communicating and pro promoting offtore offers. unavailable services, if you're on that, include automatic app updates, ratings and reviews, app tags, app store featuring, which I guess no one really cares about anymore, and marketing. See, they have this full list. Check out the story kit. It It's insane. So, now Apple is really slowly positioning uh the fees, the 30% fee as they're trying to package it in different levels. So, eventually they'll be able to go to the courts and say, "Well, look, we still we still deserve 20% because that's what we charge for this." They can char they can use their own payment system eventually. This is how I vision it will happen once they finally have to relent. I'm picturing what's in Apple's minds, not in anyone else's, just apples and their strategy. And eventually they can go, right, okay, yeah, 20% this. We've already made clear that that's what we want. That's what we charge it.

I don't think that will what that will I don't think the DMA will accept that. European Commission will accept that. I don't think that would happen in the US either if they tried to bring that there. I feel like in the US it looks like that ships can't kind of sell but they are appealing. There's tier 2 with 30% fee which again gives you all the other stuff. The core technology commission which charges 5% fee. And by the way the conspiracy theory that I think was put forward by uh well Mishka at Dstrual fun and I'll speak with Oscar Clark about this same thing. It's just like is Apple Games this weird thing of there they'll move games to that and then they'll treat that differently from the app store so they can claim back their 30%. Notably, Apple Games is mentioned in an engagement category and is not included in the uh store services tier one. So something to watch if you're a conspiracy theorist. Super was obviously like this is madness. Basically, he labeled the new terms malicious a malicious compliance scheme and it's blatantly unlawful. He said it makes a

mockery of fair competition in digital markets. I don't think we we haven't heard the EU's response to this. Um, if the EU doesn't agree with this, bear in mind that Apple's deadline to comply has passed. This was announced on the day of that deadline last week. Presumably, if this doesn't pass muster, Apple will receive more fines. And then we'll see also once again how much teeth the DMA has. If I find them 500 million, but that was probably speculation that that was less because some reports are saying the the European Union was worried about what the Trump administration how they would react. Given that there are it's been cracked open in the US, maybe that won't be so bad here. But I think a fine that's big. Not just the rules, but the fine. and any any words about taxes, but that that could be the particular issue because that will look like Europe's picking on one of the US's darlings and maybe Trump will get angry specifically about money. But if they say you're not

complying, you need to do this or something. Anyway, so so that's that big news. Don't know if you have any thoughts on that. Aaron, Apple's crazy. Yeah, it just sort of fits the the general Apple trying to find any loophole it can. It feels like Yeah, I can't think of anything too insightful to add. It's just sort of Yeah, it it's in line with what they've been doing the whole way through. Yeah, it it's just uh Apple being Apple and it's just going to go on and on. They're not they're never going to relent. You could argue that they can't ever in some ways they can't relent maybe to be a shareholder uprising. I'm looking at stuff about how much like they're making this massive figure the app store and it obviously makes an enormous amount of money but it tells the whole business how how really significant is that? That brings us to the end of the week mobile games podcast. Thank you Aaron and everyone listening for if you did stay for staying for my long monologue about Xbox but it's a really really important topic and I wanted to get across a few insights especially on the comm side. So you know myself I've worked in journalism for since 14 years nearly and

I've also had a little bit in in PR most on the content side and and some marketing. So you know I I've seen some sides of this and none of that communication was how I would do it. Right. So anyway everybody thank you once again thanks for listening. Have a great weekend. We'll catch you again next week.