Disney and Apple are breaking up over App Store fees

• Disney is breaking up with Apple — at least a little bit.
• Disney is no longer letting new customers sign up for Hulu or Disney+ via Apple’s App Store.
• The move comes after Disney CEO Bob Iger complained about app-store fees.

If you want to sign up for a subscription to Hulu or Disney+, don’t bother taking out your iPhone.

Disney is now telling would-be customers to pay for subscriptions on Disney’s own site, instead of on Apple’s App Store — though people who’ve already started paying for either service via Apple can keep doing that.

The two companies are still working together on some projects. But the App Store split does represent a rift between two longtime partners, so it’s definitely worth noting.

Disney’s rationale is clear here: When customers sign up for Disney subscription services via Apple, Apple takes up to 15% of the monthly fees those services generate. And Disney CEO Bob Iger has made it clear that he doesn’t want to pay that anymore.

“We have to look at the way we’re distributing,” Iger said at an investor conference in May. “Unlike Netflix, we distribute largely through third-party app stores. There’s obviously an advantage to that to some extent, but there’s a cost to that, too. And we’re looking at that.”

Iger’s comments didn’t generate a ton of attention at the time, but in retrospect, it’s easy to draw a straight line from that public positioning to now. Just like Netflix in 2018, Disney has decided that the services Apple offers through its App Store — the ability to market to and bill a giant installed base — aren’t worth giving up a meaningful chunk of revenue.

But one reason I thought Iger was hoping to get a new deal from Apple, instead of an outright break, is that Apple and Disney — and Iger and Apple’s cofounder Steve Jobs, in particular — have had a long-standing and public alliance.

Back in 2005, Iger let Jobs sell individual episodes of Disney-owned shows like “Lost” through Apple’s iTunes store, which was a big deal at the time. Much more important was the deal the two men did the following year, when Disney bought Jobs’ Pixar for $7.4 billion, which made Jobs Disney’s largest shareholder.

Iger later joined Apple’s board following Jobs’ death in 2011, and the two companies have remained quite tight. Disney, for instance, last year signed on to create apps and experiences for Apple’s Vision Pro headset, though it’s hard to tell whether that move has helped either company.

Reps for both Disney and Apple declined to comment.