This article was originally published on TipRanks.com
Apple (AAPL) has budged to regulatory pressure in South Korea. Reuters reports that the tech giant has submitted plans that could pave the way for it to allow third-party payment systems in its App Store.
Apple is a U.S. company that designs, manufactures, and sells an array of devices, including smartphones, tablets, wearables, and personal computers. It also operates a service segment comprised of AppleCare, cloud services, and the App Store.
The App Store
According to Reuters, Apple plans to allow alternative payment systems for a much lower service fee. Currently, the company takes as much as 30% in commissions. The high commissions have been the bone of contention and have seen some developers and companies try to launch in-app payment systems of their own.
By submitting the plans, Apple essentially complies with new South Korean laws that bar companies from forcing software developers to use specific payment systems. The Korea Communications Commission (KCC) had written to Apple and Alphabet’s (GOOGL) Google to submit compliance plans.
Apple joins Google, which filed plans to allow third-party payment systems on Google Play last November. The iPhone maker has already affirmed its readiness to work with the KCC and developer communities in compliance with the amended Telecommunication Business Act.
Apple is also under immense regulatory pressure in the U.S. over its stance on third-party payment systems. A judge has already ordered the company to change its App Store rules that ban developers from including links for external payment systems.
Yesterday, Bernstein analyst Toni Sacconaghi reiterated a Hold rating on Apple stock and raised the price target to $170 from $132, implying 2.90% downside potential to current levels.
Consensus among analysts is a Strong Buy based on 21 Buys, 4 Holds, and 1 Sell. The average Apple price target of $176.80 implies 0.98% upside potential to current levels.
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