Apple approves a version of Tencent’s WeChat app for iPhone 16 - report

Apple (NASDAQ:AAPL ) has reportedly given the go-ahead for a version of Tencent Holdings WeChat app to be compatible with the upcoming iPhone 16, providing more time for ongoing negotiations over modifications the U.S. company has requested for China’s top social media platform.

According to Bloomberg News, Apple recently approved an update to WeChat for the iOS platform that Tencent submitted earlier this week. This update introduces new features in the app’s WeChat Moments, similar to Instagram, as well as its live-streaming capabilities.

Bloomberg’s report noted that the approval could dispel rumors in China suggesting the conflict between Apple and Tencent over app store fees could escalate, possibly leading to WeChat being barred from iPhone 16 devices.

At the heart of the dispute is Apple’s demand to receive a share of transactions occurring through WeChat’s mini-games platform, where many independent developers offer casual games.

Apple has asked Tencent to block links to external payment services within these mini-games to prevent developers from bypassing Apple’s typical 30% fee. It also pushed for the disabling of in-game messaging, but Tencent rejected this as too extreme.

While Tencent has resisted Apple’s demands thus far, discussions between the two companies are ongoing.

The aim is to reach a compromise that could be incorporated into future updates, the report said. Tencent is negotiating a revenue-sharing arrangement with Apple to allow payments within mini-games to be processed through Apple’s system, as confirmed by analysts during a recent earnings call.

Apple’s tight control over its app ecosystem is intended to maintain global quality and security standards. However, its tougher stance in China this year, including similar warnings to TikTok owner ByteDance about in-app spending, risks alienating developers in a critical market.

In China, where over 1.4 billion people use WeChat for everything from bill payments to booking movie tickets, many of these transactions are exempt from Apple’s fees. Still, entertainment services like mini-games remain subject to the charges.

As developers of these games monetize through in-game purchases, some have found ways to bypass Apple’s system to boost margins. Apple is now pushing Tencent to eliminate this practice, known as “steering."

Source: Investing.com