Netflix has abruptly informed Apple-paying subscribers they must switch to an alternative billing option to avoid interruption, escalating tensions between the tech giants.
The move ends Netflix’s prior compromise allowing existing iOS users to continue Apple in-app purchases. Now the streaming leader wants total payment independence – and 100% of your subscription dollars.
What’s Behind Netflix’s Payment Power Play
The crux lies in Apple’s longstanding rule taking a lucrative 30% cut of App Store transactions. After halting iOS sign-ups in 2018 to skirt the fee, Netflix has decided it’s done indirectly padding Apple’s profits.
The streamer first tested subscriber frustration thresholds by trying to nudge just some users off Apple billing. Seems it decided the risk was worth shedding all remaining in-app payment dependence.
Of course this puts squeeze on customers suddenly forced to update long-intact billing details. But Netflix clearly wagered on subscriber inertia ultimately winning out.
The move also continues Netflix’s aggressive strategy revamp to stabilize its position. That apparently now includes playing hardball with titan frenemies like Apple when it benefits the bottom line.
What Should Users Do?
If you’re a subscriber impacted, you’ll need to switch to direct credit card or other non-Apple payment method when prompted to avoid the interruption guillotine.
And expect the tech giants’ tense tug-of-war over subscriber control and revenue to continue raging behind the scenes, with consumers caught in the crossfire.
For Netflix, the prize of keeping all its hard-won earnings outweighed risks of ruffling loyal Apple fans’ feathers. Time will tell whether alienating users tired of being payments pawns pays off in the end.
