This is How Apple Killed My Company

Intro

“Apple is stifling innovation”. This is an ongoing trend that lasts for the past few years. Normally small developers don’t talk too much about their apps being removed from sale: fighting against a monopoly doesn’t bear fruit, so they just move on.

But this year has become special: there are more and more big developers suffering from App Store’s rules and policies. A short list includes such companies as Coinbase, Epic Games, Facebook, Telegram, Basecamp’s Hey and others. This mysterious “crackdown” has led to many innovations being limited or suspended. As a result we’ve seen a launch of an advocacy group to push for App Store changes.

Apple’s monopoly makes iPhone users dependent on the App Store when it comes to using apps and extensions. If you own an iPhone, there’s no way you can download an application from any third party and enjoy it as you would do with App Store apps. So if an app gets removed from the App Store, there’s no way it can reach iPhone users.

There are roughly 1.5 billion active Apple devices in the world, so technically today it’s Apple that at its sole discretion decides which content to show to their owners, where and on what terms. Does the fact that there’s a single company controlling this even sound right?

There’s no effective instrument out there that allows you as a developer to stand up for your rights and appeal against unfair treatment and vicious circles of app reviews.

I’m sharing my story with hope to inspire other entrepreneurs and developers. These anti-monopoly investigations that Apple has in the EU and the US are not a coincidence — this is a logical course of events, which we — developers and customers — can put an end to by defending the rights for our innovations.

What is Eristica & what happened?

My name is Nikita and I’m the founder of the entertainment app ‘Challenge App’ (also known as Eristica or ‘Dare App’). We’re helping Gen Z spend time online with fun content and, at the same time, make money with their talent. How it works is very straightforward: our users ask their friends or even strangers to complete funny and positive challenges to make money and prove it by posting a video.

Pitching Challenge app at Slush Asia

The Eristica company was started in 2015. It went through a Taiwan-based accelerator from SOSV (MOX) in 2017 and had a rebirth in late 2018 with a more scalable brand name and became breakeven in 2020. For the last 2.5 years, our team has been working on this product to bring positive values and fun to our users, competing with such great companies as TikTok, Zynn, and Likee. And we are very proud of the results we’ve managed to achieve. We were just about to launch a game-changing feature — multiplayer challenges — which could bring even more fun and value to our users through online competitions.

Pitching Challenge app at RISE accelerator, Bangkok

Sadly, the App Store Review Team stopped that from happening. How? On July 15th, 2020 our app was removed from the App Store due to violation of the guideline “1.4.5 Safety: Physical Harm” without any specific explanation.

A letter from the App Review Team not specifying the details

Our attempts to resolve the issue

After a call with the App Review representative, it became clear that, apparently, Apple doesn’t allow any features that let users post content because it may be harmful, despite the fact it’s going through severe human pre-moderation and post-moderation. If that doesn’t sound right or make sense to you — you’re not alone. Saying that an app needs to be removed because reviewers may miss bad content is akin to saying that the App Store itself should be closed because they might miss bad content (which they do in 15% of the cases).

Imagine that you’re selling ice-cream in a trailer for 5 years, and then the landowner comes and tells you that you need to remove your trailer from this property because the ice-cream you sell may cause harm and potential death of kids choking on your ice-cream or dying from diabetes as your ice-cream contains sugar. Funny enough, if you look around you will see that there are much bigger ice-cream trailers full of sugar, chocolate, and marshmallows next to you on the same property. You can find links to these content items below.

Eristica team after MOX demo day, Singapore

It also became clear that arguing about this as well as about the total lack of any evidence of such content on Challenge App is not going to bring us back, so we decided to stay on the safe side and obey Apple’s guidelines. To resolve this issue we have been submitting new app builds, where we have gotten rid of our most important features, which let users generate content. Here’s the list of what we’ve done so far:

  • Removed the feature of creating a challenge
  • Removed all custom challenges from the main feed and any other segment of the app
  • We offered the Apple Review Team to approve a fixed list of challenges that they won’t find harmful in any way and stick to that list forever
  • Made all the content go through human moderation
  • Made pre-moderation of all user-generated content
  • Rebranding: to get rid of a negative connotation of the word ‘Dare’ we switched the name to ‘Challenge App’ and changed the logo
  • We fixed the description of the app where we emphasized the safety of challenges and any other app content
  • We changed app screenshots and removed any content that Apple Review Team may find harmful on those screenshots (e.g. a picture of a person on a skateboard)

Since the App Review Team wasn’t communicating a specific feature or screen they didn’t like, we’ve been continuously submitting app builds getting rid of all content generation features step-by-step (totaling 7 different app builds). Guess what? They all were rejected with the exact same wording as on the picture above. I don’t need to specify, there were no details given or evidence of any violations.

Pitching Challenge app, Singapore

Still doesn’t make sense? In the case of a 2-trillion-dollar company, it doesn’t have to make sense. To stop iPhone fans from using our app, the App Store ironically decided to use the reason why hundreds of millions already use other UGC applications — the ability to post content and unleash users’ talents (Instagram, TikTok, Zynn, Likee, UPLive etc.).

Since there were 7 rejections of our app builds, we decided to ask around and find relevant people that actually could make decisions at Apple. I was introduced to an ex-Director of the App Review Team that built it from 4 up to 300 people in 2009–2016 and had the ability to reach out to C-level executives. That person was so kind and understanding about our case and helped us reach out to Tim Cook (Apple’s CEO), Phil Schiller (responsible for the App Store), Greg Joswiak, and Ron Okamoto.

After 3 emails were read and ignored, we asked our users to email Phil Schiller and kindly ask him to bring the App back to the App Store. There were a total of around 50 emails sent their way.

App Store Challenge on Challenge App

And now it has been more than 2 months of daily and weekly attempts to revive our App on the App Store, but they are met by a brick wall of ignorance and a vicious circle of app reviews in Cupertino.

Another letter from the App Review Team specifying that we can be removed for any reason

Can UGC be a reason for app removal?

UGC stands for user-generated content. With help of social media services, they became wildly popular on the Internet. The main idea behind UGC platforms is to allow users to post content for others to view online.

Some well-known UGC platforms include YouTube, TikTok, Thriller, Reels, Instagram, Likee, Zynn, Facebook, Byte and many others. Some of these platforms started as web-based projects and were eventually scaled into some of the most popular apps on iPhones and Android devices.

Having the freedom to post anything online has a huge drawback — the potential for users to post content which may be considered bad and/ or harmful. It goes without saying that bad content circulating on a platform is not healthy for the platform itself, not only because it scares users away, but also because it inhibits advertising potential; brands don’t want to be associated with any negative content as it can negatively affect their reputation and sales.

Historically, platforms have figured out multiple moderation mechanisms to eliminate distribution of such content. These methods include:

  • Automated text moderation: a program figures out keywords and sentences that are violating platform’s policies
  • Automated visual moderation: software that finds and analyzes photos and multiple frames in videos
  • Human moderation (text & media): humans reviewing content items and deciding if they adhere to guidelines
  • ML moderation: combined moderation mechanism that uses machine learning to moderate content more efficiently over time
  • Pre-moderation: content isn’t published before it is approved by a moderator
  • Social moderation: users are able to report content they find unsuitable for others to view

Challenge App has all the above mentioned layers of moderation except for ML moderation. Most importantly, we use pre-moderation of content which means that a UGC unit will not go live until it is approved by a human moderator. This approach lacks speed, but guarantees that the content part of the app stays on the safe side.

The word ‘Dare’ garnered a negative connotation thanks to this well-known party game ‘Truth or Dare,’ during which challenges are completed that could potentially be silly or reckless. We have managed to solve this issue by putting the challenge-proof process online. This means that a challenge text always comes first and a video happens only after a challenge was taken. That way, content moderation actually becomes easier — bad challenge texts are immediately and automatically banned and leave no chance for a bad video to be posted.

This approach guarantees safe user experience on Challenge App — users are unable to see bad video content as well as bad challenge texts. This consequently means that users can’t take a bad challenge and record a bad video proof to it.

That implies there is only one window of opportunity for a user that intentionally wants to post harmful content to do so: they could potentially take a random challenge and post an irrelevant, harmful video proof.

To stop this from happening we use two layers of moderation — automated video frames analysis and human moderation. The first layer randomly selects several frames from a video and using an open-source algorithm detects unsuitable content, which leads to an automatic suspension of the video in question. The second layer is made for extra safety and allows a content unit to be posted only if there are no violations of our content policies. Not to forget that it’s all still pre-moderation.

We have been applying this moderation approach for more than a year, which has allowed us to eliminate any possibility of harmful and bad content on Challenge App. However, other companies, which are much bigger and have millions daily active users, use different moderation frameworks which leads to a natural distribution of restricted content. Below you can find a list of apps [1] where we’ve found bad content in as well as links [2] to specific videos*.

*Reminder: we’ve been banned from the App Store for a possibility of such content.

Screenshots of content that is considered harmful by the App Review Team. Still live on the App Store

The question we’re raising here is very simple: if we assume that this Guideline 1.4.5 is equal for everyone, why was the Challenge App removed when the App Store currently promotes apps that violate this guideline in the exact same way (even worse in fact) and makes users hurt by allowing harmful content in bigger apps?

What’s next?

Unfortunately, the iOS app was the main driver of the company’s revenue with 90% of the total income and 80% of all active users. Thanks to our iOS app and despite Apple’s 30% commission fee, we managed to reach the break-even point five months ago. Not only that, we were thrilled to become the #4 top app in the social category in the U.S in July.

At that point, we had managed to scale the company up to half a million users over the last 2.5 years. Our average cost of user acquisition was $0.06 (16x lower than the market average) and our ARPU was $0.25, which makes our ROMI extremely attractive — we were making $4 in revenue for each $1 invested in marketing. It could have been $6, but we were fine with sharing $2 with Apple (30% commission fee) as it is a mandatory condition of being on the App Store.

Here’s what we’ve brought to the community of our users:

Challenges submitted: 775,335
Satisfied users: 660,456
Money earned by users: $3,509,799
Money donated to charity: $175,489

Since our app was such a booming success by any standard, we received commitments from leading VC firms for an investment round A to start scaling faster than ever before. This round could have potentially helped us reach 30 million users and at least USD$7m in revenue by the end of 2021.

Eristica team at demo day, Taiwan

Since Challenge App has been taken off the App Store, our company can no longer show such growth — there’s no way we can reach iPhone users anymore.

We could have shifted our focus to scaling the Android app through Google Play and alternative stores, but with the intransparency of content policies and lack of communication, there is no way to guarantee that the same thing wouldn’t happen on the Android app.

Moreover, that wouldn’t make any economic sense on our side: ads with bloggers only bring 20% of the traffic to the Android app, which means that CAC is going to be increased 5x and ROMI goes negative (-20%). This implies that scaling Challenge App on Android would only scale our net loss.

If we were a larger company, we could absorb the loss. As you’ve probably heard already, Epic Games was fine with losing $26m a month after their extremely popular multiplayer game, Fortnite, was removed from the App Store. Epic Games battled Apple to repeal their decision, resulting in hefty PR and legal costs.

Being a small software company, we unfortunately can’t afford to fight with the Goliath. If we had a runway of more than a month, we could have waited longer than these two months with no revenue, during which we’ve been waiting for Apple’s move. But since the lives of all 13 members of our team depend on us, we were forced to make the tough decision to suspend our operations and switch to the maintenance mode until the situation has been resolved.

We have spent the last 6 years of our lives working up to the results we finally saw come to fruition in June and we were thrilled to scale even further in partnership with world’s leading VC firms. The last thing we expected was for Apple to become this ‘black swan’ and put a knee on our neck.

Eristica team at TechInAsia, Jakarta Indonesia

We wish the best of luck to all SMEs, entrepreneurs, and developers who are standing up for their rights in the battle for the free access to their products and users.

Modern and future companies need a transparent policy of rules, and a transparent decision-making process, whether to be an application in a store or not. Even despite their rule that they can be removed from the store without explanation. Thanks to the App Store and Google Play, everyone can become an entrepreneur and launch their services. However just like that, they can take it all away from you in the blink of an eye.

If we at least start talking about these problems and share our stories, we could prevent Apple’s monopoly from taking total control over innovations we create & use and content we choose to see. I hope that someday we will create a democratic tool to communicate such problems transparently.

[1] List of Apps Involved in Distribution of Harmful Content

[2] Harmful Content Distributed by App Store apps

Harmful challenges:
https://vm.tiktok.com/JFctKdn/
https://vm.tiktok.com/JFcbK5B/
https://vm.tiktok.com/JF3jvvg/
https://vm.tiktok.com/JF3Mj4D/
https://vm.tiktok.com/JF32pDE/
https://vm.tiktok.com/JFT2fhw/

Air/Concussion Challenge:
https://vm.tiktok.com/JFcsy57/
https://vm.tiktok.com/JFcuvvb/
https://vm.tiktok.com/JFctKLf/
https://vm.tiktok.com/JFcfb9E/
https://vm.tiktok.com/JFcbtUb/

Cereal Challenge:
https://vm.tiktok.com/JFcDSHM/
https://vm.tiktok.com/JFcmLKf/
https://vm.tiktok.com/JFcmT64/
https://vm.tiktok.com/JFcGKRc/
https://vm.tiktok.com/JFcUVS3/

Pass Out Challenge:
https://vm.tiktok.com/JFcKB8g/
https://vm.tiktok.com/JF3FfXY/
https://vm.tiktok.com/JF32B2s/
https://vm.tiktok.com/JF3dwGP/
https://vm.tiktok.com/JF3J3Q7/

Salt and ice challenge:
https://vm.tiktok.com/JFcTLSH/
https://vm.tiktok.com/JFcWrWt/
https://vm.tiktok.com/JFcKv7T/
https://vm.tiktok.com/JFcTuoj/
https://vm.tiktok.com/JF3dFQM/

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Take a challenge🤝 Make money💰

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n10v

n10v

Founder of Eristica (Challenge App)

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