Apple Opens iOS in Japan With Third Party App Stores and Alternative Payments

Apple has officially begun reshaping how the iPhone ecosystem works in Japan. In response to the country’s Mobile Software Competition Act, the company is allowing third party app stores, easing long standing payment restrictions, and giving developers and users more freedom than ever before on iOS.

For a company known for tightly controlling its platform, this marks a major shift. Japan has effectively become one of the first markets where Apple’s traditional walled garden approach is being reworked under regulatory pressure. The changes affect how apps are distributed, how digital payments are handled, and how much control Apple retains over developers operating on iOS.

TLDR:

Apple now allows third party app stores and alternative payments on iOS in Japan

Changes are driven by the Mobile Software Competition Act, not Apple’s choice

Developers gain more freedom and lower fees, users gain more options

Security remains, but users must be more cautious outside the App Store

Understanding Japan’s Mobile Software Competition Act

The Mobile Software Competition Act, commonly referred to as the MSCA, is Japan’s attempt to rebalance power in the mobile ecosystem. The law targets dominant platform operators and aims to prevent practices that restrict competition in app distribution, payments, and software access.

Japanese regulators determined that companies controlling mobile operating systems and app marketplaces hold disproportionate influence over developers and consumers. As a result, Apple and Google were required to introduce structural changes that promote choice, competition, and fair access without compromising user safety.

Unlike similar laws in other regions, Japan’s approach allows regulators to consider security, privacy, and child protection when enforcing competition rules. This flexibility has shaped how Apple implemented its compliance strategy.

Third Party App Stores Come to iOS in Japan

One of the most significant changes is Apple’s decision to permit third party app marketplaces on iPhones in Japan. Developers are no longer restricted to distributing apps exclusively through the Apple App Store.

That said, Apple has not removed oversight entirely. Any company wishing to operate an alternative app store must receive authorization from Apple and agree to ongoing operational responsibilities. These marketplaces must demonstrate financial stability, maintain content moderation standards, and actively protect users from scams and malicious software.

All apps distributed outside the App Store must still pass through Apple’s notarization process, which checks for malware and basic functionality. While this review is lighter than the full App Store review, it ensures that apps meet minimum safety standards before reaching users.

Apple argues that this framework preserves trust in the iOS ecosystem while complying with competition rules. Critics, however, see it as Apple maintaining indirect control over rivals.

Apple Relaxes In App Payment Restrictions

The MSCA also forces Apple to loosen its grip on in app payments, long one of its most controversial policies. Developers in Japan can now offer alternative payment methods alongside Apple’s own in app purchase system.

Apps are allowed to present external payment options with equal visibility, meaning Apple cannot visually favor its own payment flow. Developers can also include links that send users to external websites to complete purchases.

When users choose a non Apple payment method, they are clearly informed that refunds and customer support may be handled by the developer or a third party rather than Apple. This transparency is designed to protect users while allowing greater flexibility.

For many developers, especially in gaming and digital content, this change dramatically reduces costs. External payment providers in Japan often charge significantly lower fees than Apple’s standard commission, making alternative payments financially attractive.

What These Changes Mean for Developers

For developers, Japan’s new rules open up meaningful options.

They can now choose whether to:

Stay exclusively on the App Store

Distribute through third party marketplaces

Use Apple payments or external payment systems

Combine multiple approaches depending on strategy

Large developers with established user bases may benefit the most, as they can guide users toward lower cost payment options or alternative stores. Smaller developers may still prefer the App Store’s reach and trust, even with higher fees.

Apple has updated its developer tools to support these changes, including APIs that allow safer handling of external purchases and parental approval features for younger users.

While opportunities have expanded, complexity has also increased. Developers must now manage compliance across different distribution paths, support systems, and payment flows.

What Changes for iPhone Users in Japan

For users, the impact is subtle but important.

The biggest benefit is choice. Users can access apps from more sources, compare pricing, and use local Japanese payment methods that better suit their preferences. These include mobile wallets, carrier billing, and convenience store payments.

However, there are trade offs. Apps from alternative marketplaces do not undergo the same level of review as App Store apps. Users must be more vigilant about scams, misleading subscriptions, and data privacy.

Apple continues to warn that third party app stores may carry higher risks, though regulators argue that informed choice should outweigh platform lock in.

Special protections remain in place for children. Apps aimed at younger users must follow stricter rules, including parental approval for purchases and limits on external payment links.

How Apple Changed Its Fee Structure in Japan

To align with the MSCA, Apple introduced a revised commission model for Japan. Fees are now lower and more flexible than Apple’s traditional global structure.

Developers using external payment systems typically pay far less to Apple than before, while those remaining on Apple’s payment system benefit from reduced commission rates compared to the old standard.

Apple maintains that developers will pay the same or less overall under the new system. Critics argue that the complexity of the new fee structure makes true comparisons difficult.

What is clear is that Apple’s revenue from Japan’s App Store is likely to decline as more developers move toward external payments.

How Japan’s Rules Differ From Other Regions

Japan’s approach stands apart from both Europe and the United States.

In Europe, the Digital Markets Act goes further by allowing direct app downloads from websites and fewer restrictions on alternative stores. This has raised concerns about content moderation and security.

In the United States, no comparable nationwide law exists. Apple still largely controls app distribution and payments, aside from limited court rulings that allow developers to mention external payment options.

Japan’s MSCA sits between these extremes, combining regulated openness with strong emphasis on safety and accountability.

Industry and Developer Reactions

Japanese developers have largely welcomed the changes. Many major app publishers moved quickly to adopt external payments, offering users better value or bonus content when paying outside Apple’s system.

Payment providers and digital platforms also see new opportunities as Apple’s exclusive control weakens.

Some critics worry that reduced platform oversight could encourage aggressive monetization tactics or increase fraud. Regulators acknowledge these risks but argue that competition and transparency are worth the trade off.

What Happens Next

Japanese regulators will closely monitor Apple’s compliance. Apple is required to report on its practices and justify any restrictions it imposes on developers or marketplaces.

If disputes arise, regulators can demand changes or intervene directly. This ongoing oversight means Apple’s Japan strategy may continue to evolve.

Globally, other governments are watching closely. If Japan’s model succeeds without major security failures, it could influence future regulations in other countries.

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Conclusion

Apple allowing third party app stores and alternative payments in Japan marks one of the most meaningful shifts in iOS history. Driven by the Mobile Software Competition Act, the changes weaken Apple’s traditional control while expanding freedom for developers and users.

Japan has effectively become a testing ground for a more open version of iOS. Whether this balance between competition and safety holds will shape not only Apple’s future in Japan, but the direction of mobile platform regulation worldwide.

For now, the era of absolute App Store dominance on iPhone is no longer universal. In Japan, at least, choice has officially arrived.

Frequently Asked Questions

Does Apple really allow third party app stores on iPhones in Japan?

Yes. Apple now allows third party app stores on iOS in Japan as part of its compliance with the Mobile Software Competition Act. Developers can distribute apps outside the App Store, as long as they meet Apple’s safety and authorization requirements.

Why did Apple make these changes only in Japan?

These updates were driven by Japanese competition law, not by Apple’s voluntary policy shift. Japan’s regulator required Apple to open up app distribution and payment options to promote fair competition.

Can users install apps directly from websites on iPhone in Japan?

No. Unlike some regions, direct website downloads are not allowed. Apps must still be distributed through an authorized app marketplace and pass Apple’s notarization checks.

Are third party app stores as safe as the Apple App Store?

They are less tightly reviewed than the App Store. While Apple still checks for malware, alternative stores do not receive the same level of content moderation, so users should be more cautious.

What changes with in app payments on iOS in Japan?

Developers can now offer alternative payment methods alongside Apple’s system. Users may pay through external websites or third party payment providers instead of Apple’s in app purchase.

Will apps be cheaper because of these new payment options?

Potentially, yes. Since external payment providers charge lower fees, some developers may pass those savings on to users through discounts or bonus content.

Does Apple still earn money from apps using external payments?

Yes, but less than before. Apple now collects reduced platform fees instead of its traditional full commission, depending on how the app is distributed and paid for.

What happens if there is a refund issue with an external payment?

Apple will no longer handle refunds in many cases. Developers or third party payment providers become responsible for customer support and dispute resolution.

Are there protections for children and family accounts?

Yes. Apps aimed at younger users must follow strict parental approval rules, especially when using external payments or alternative marketplaces.

Could these changes come to other countries too?

Possibly. Regulators worldwide are watching Japan closely. If this model works without major security issues, similar rules could spread globally.