Apple’s hold on the App Store is loosening, at least in Europe

“Fortnite” maker Epic Games on Friday said it is launching an alternative app store for iPhone users in Europe. Spotify this week began directing Europeans on its iOS music-streaming app to the company’s website to sign up for subscriptions, something it wasn’t previously permitted to do.

Apple separately said Wednesday that it plans to make it possible for developers in the U.S. and several other countries to offer secure contactless payments through their own apps on iPhones. Apple had previously committed to opening contactless payment technology in Europe to settle a European Union antitrust case.

The changes are opening up Apple’s devices to outside developers in new ways, allowing third parties to bypass elements of its control and, in some cases, its fees. They show how a wave of new regulations, antitrust enforcement and rulings, many in Europe, are chipping away at Apple’s “walled garden” of devices and software.

Apple has long argued that its approach supports users’ privacy and security. It has also become a lucrative part of the company’s business model. Apple’s services unit, which includes the App Store, generated $85.2 billion in sales during the 2023 fiscal year, accounting for about 22% of overall revenue.

Epic Games said Friday that its new app store for iPhone users in Europe will initially offer three games: “Fortnite,” “Fall Guys” and “Rocket League Sideswipe.” Those games will also be made available through other alternative app stores in Europe beginning with one called AltStore, Epic said.

The move takes advantage of a recent EU law called the Digital Markets Act, which requires some of the world’s biggest technology companies to comply with rules meant to boost competition in digital advertising, online search and app ecosystems.

Epic said it can’t offer the store for iPhone users outside Europe because Apple doesn’t allow alternative app stores in other regions.

Epic and Spotify have both been engaged in a long-running feud with Apple. They say the iPhone maker imposes unfair rules through its App Store and takes too large a cut of developers’ revenue.

“Fortnite” was kicked off Apple and Google’s app stores in 2020 after Epic attempted to bypass the tech companies’ standard 30% concession for in-app purchases. The game could still be downloaded on Android devices through Epic’s website.

Earlier this year, Apple revoked Epic’s developer account after Tim Sweeney, the game developer’s chief executive, publicly criticized its new European App Store rules. It later reinstated the account.

Sweeney said Europe’s approach to setting and enforcing new rules for big tech companies showed that “regulation can have teeth and can succeed.”

“It also provides a road map for every other country’s regulators,” Sweeney added.

Apple is facing pressure in the U.S. too. The company is already being forced to allow developers to process purchases outside of the App Store following the verdict of a U.S. lawsuit brought by Epic.

But Apple’s plan to comply with the 2021 ruling has stirred outrage among developers because of its high fees. Apple collects a 27% commission on app transactions that go through an alternative payment system, compared with the company’s standard 30% fee.

A U.S. federal judge is currently examining Apple’s compliance with the ruling in the Epic case. In hearings, the judge has grilled Apple executives on its fees and the array of warnings that now precede a user’s choice of a non-Apple form of payment.

“Other than to stifle competition, I see no other answer,” Judge Yvonne Gonzalez Rogers told an Apple executive in court about the company’s system. In court, Apple said that it believes it is complying with the court’s order and not trying to stifle options for its users. Instead, it is trying to maintain the privacy and security of its users while also running a business, a company executive said.

Earlier this year, the U.S. Justice Department also sued Apple, alleging that the company had violated the country’s antitrust laws by making it difficult for third-party developers to integrate with the iPhone. Apple, the lawsuit alleges, does this to keep users locked into its ecosystem.

Apple said it would defend itself against the government’s lawsuit and filed a motion to dismiss the case earlier this month.

While Apple has made concessions in Europe to allay regulatory scrutiny, some app developers have said those changes don’t go far enough.

Spotify began posting subscription pricing information in its iOS app on Wednesday after the company said it opted into a new program that allows music-streaming apps to inform European users about alternative ways to make purchases.

However, users still can’t directly subscribe to Spotify through the company’s iOS app or click on an in-app link to purchase a subscription because Spotify doesn’t want to pay a commission to Apple that it views as unreasonable.

The Spotify move follows an EU antitrust ruling earlier this year, in which Apple was fined roughly $2 billion for allegedly setting unfair rules for developers of music-streaming apps. Apple has appealed the ruling.

Spotify said it wasn’t satisfied with the changes Apple has made so far. It said music-streaming services should be allowed to give users a link for purchasing subscriptions without being charged a fee if a user subscribes after clicking the link.

Apple declined to comment on the changes Spotify introduced this week.

The EU has in recent years passed a raft of rules affecting tech companies, at times prompting complaints from business groups about the difficulty of operating in the market of roughly 450 million consumers.

Meta and Apple both said earlier this year that they would delay the launch of new artificial-intelligence products and features because of concerns over the EU’s regulatory environment.

The European Commission in June alleged that Apple wasn’t doing enough to comply with its digital-competition law, including rules related to the App Store. Apple could be fined as much as 10% of its worldwide revenue if regulators ultimately determine that it broke the rules.

Apple said at the time that it had made changes in response to feedback from app developers and the Commission and was confident that its plan complies with the law. It added it would continue to listen and engage with regulators.

Write to Kim Mackrael at kim.mackrael@wsj.com and Aaron Tilley at aaron.tilley@wsj.com