BRUSSELS, March 12 (Reuters) - Apple ( AAPL ) made a

major concession in its battle to protect the dominance of its

App Store on iPhones and other devices in Europe on Tuesday,

saying developers will be free to distribute their apps directly

to consumers.

Apple ( AAPL ) announced the changes to comply with the European

Union's Digital Markets Act (DMA), which kicked in last week.

The changes could dent the high profit margins and steady stream

of revenue that Apple ( AAPL ) has come to rely on from its App store,

where it charges developers fees of up to 30%.

The changes, which affect only the European Union, come amid

continuing criticism from rivals that Apple's ( AAPL ) compliance efforts

are falling short.

Beginning this spring, software developers operating in

Europe will be able to distribute apps to EU customers directly

from their own websites instead of through the App Store.

Developers must still meet terms and conditions set by Apple ( AAPL )

and be authorized developers. Apple ( AAPL ) has also introduced a "core

technology fee" of 50 euro cents per user account each year,

even if developers opt not to use Apple's ( AAPL ) App Store or payment

system.

The DMA aims to rein in Apple ( AAPL ), Amazon ( AMZN ), TikTok owner

ByteDance, Meta Platforms ( META ), Alphabet's Google

and Microsoft ( MSFT ) and create a level playing field for

smaller rivals and ultimately more competition for Europeans.

"To reflect the DMA's changes, users in the EU can install

apps from alternative app marketplaces in iOS 17.4 and later.

Users will be able to download an alternative marketplace app

from the marketplace developer's website," Apple ( AAPL ) said on its

website. IOS refers to the software platform that runs Apple's ( AAPL )

iPhones and iPads.

The opening in Europe of Apple's ( AAPL ) ecosystem, which the

company has long guarded as a highly profitable "walled garden,"

comes at a sensitive time for the tech giant.

The iPhone maker is struggling with shrinking revenue and

weak demand for its smartphones in China. In January, Microsoft ( MSFT )

dethroned Apple ( AAPL ) as the world's most valuable company, with

investors viewing Apple ( AAPL ) as lagging its Big Tech rivals in their

race to dominate artificial-intelligence technology.

Apple's ( AAPL ) stock was up 0.6% on Tuesday afternoon, reducing its

loss in 2024 to 10%.

Changes announced on Tuesday include letting developers set

up alternative app marketplaces to offer a catalogue solely made

up of the developer's own apps with immediate effect.

Developers can choose how to design in-app promotions,

discounts and other deals when directing users to complete a

transaction on their website instead of using Apple's ( AAPL ) template.

Under pressure from regulators and the DMA, Apple ( AAPL ) last week

took a step back in its feud with Epic Games, allowing it to put

its own game store on iPhones and iPads in Europe. DMA

violations can cost companies fines as much as 10% of their

global turnover.

Apple ( AAPL ) has also said it will appeal an EU antitrust fine of

1.84 billion euros ($2 billion) handed to it last week for

thwarting competition from Spotify ( SPOT ) and other music

streaming rivals via restrictions on the App Store.