Setapp Mobile Is Shutting Down: What the EU’s “Alternative App Store” Experiment Got Right (and What Apple’s Fees Broke)

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When the European Union’s Digital Markets Act (DMA) finally pried open the iPhone’s famously sealed app-distribution jar, the expectation was simple: competition would bloom, prices would drop, and users would enjoy more choice than “App Store or… App Store.”

Reality, as always, arrived with a few extra dialog boxes.

On January 20, 2026, TechCrunch reported that Setapp Mobile—one of the earliest and most prominent alternative iOS app stores enabled by the DMA—will shut down. The store is operated by Ukrainian software company MacPaw, best known for CleanMyMac and the long-running Setapp subscription bundle on macOS. According to MacPaw, Setapp Mobile will be sunset on February 16, 2026, and all apps will be removed from the mobile marketplace by that date. Setapp’s desktop service will continue. Original report by Sarah Perez (TechCrunch).

This isn’t just another product sunset. It’s an early “stress test” result for the DMA’s new iOS distribution model—one that tells us a lot about how Apple’s EU compliance structure works in practice, why subscription-based app bundles are hard to port to iOS, and what kinds of alternative stores might actually survive.

Below, we’ll unpack what Setapp Mobile was trying to do, why it struggled, what Apple’s fee structure has to do with it, and what the shutdown implies for developers, regulators, and anyone who hoped the EU would make iOS distribution feel a bit more like the open web.

What Setapp Mobile was (and why it mattered)

Setapp on macOS has long been a “Netflix for apps” concept: one subscription, a curated library, no per-app purchases, and a focus on quality rather than volume. When Apple started allowing alternative marketplaces in the EU, MacPaw moved quickly. It launched Setapp Mobile in open beta in September 2024, offering a bundle of iOS apps across categories such as productivity, creativity, finance, photo/video tools, and more. The entry price for most users was a $9.99 monthly subscription, and it required an Apple ID tied to an EU member state and iOS 17.4+ era eligibility. citeturn2view0turn1search6

The timing mattered. Setapp Mobile was one of the first “real” attempts at an alternative iOS app store that wasn’t purely about game emulators or a single developer’s niche needs. It was a mainstream consumer proposition: pay one monthly fee, get a curated library, skip ads and in-app purchases. That’s a clean pitch—especially in a world where the average mobile app has more subscriptions than a gym in January.

It also represented something regulators wanted: a competing distribution channel that could, at least theoretically, influence pricing, business models, and discovery beyond Apple’s App Store rules.

A quick DMA refresher (because context is a feature)

The EU’s DMA is designed to curb the power of “gatekeeper” platforms and require them to allow more competition. For Apple in iOS land, this meant enabling alternative app marketplaces and other changes. Apple announced its EU changes in early 2024, including a system of Notarization (security checks for apps), an authorization process for marketplace operators, and new disclosures for alternative payments. Apple also argued these changes introduce privacy and security risks and warned the experience would be less intuitive. citeturn0search5

Importantly, alternative marketplaces aren’t “anything goes.” Apple still sits in the critical path through notarization and policy constraints. The DMA opened the door—but Apple designed the hallway.

The shutdown: dates, details, and the official reason

Per TechCrunch, Setapp Mobile will remove all applications and stop operating on February 16, 2026. Setapp Desktop won’t be affected. citeturn2view0

MacPaw’s stated reason is telling: “still-evolving and complex business terms that don’t fit Setapp’s current business model.” citeturn2view0

TechCrunch notes that MacRumors first spotted the announcement, and other outlets (including The Verge and 9to5Mac) echoed the same framing: the EU alternative marketplace terms remain complicated and in flux, and Setapp couldn’t make the economics work. citeturn2view0turn1search0turn1news12turn1search5

MacPaw CEO Oleksandr Kosovan characterized Setapp Mobile as a “bold, breakthrough project” and said the company still believes in the vision, but not under the current commercial conditions. citeturn1news12turn2view0

Apple’s EU fee structure: the stuff that makes spreadsheets cry

To understand why a subscription bundle might fail, you have to understand Apple’s EU business terms. The most infamous element is the Core Technology Fee (CTF).

The Core Technology Fee (CTF) in plain English

Apple’s CTF is based on first annual installs over a 12‑month period. Under Apple’s EU alternative terms, developers receive one million free first annual installs per year, and then pay €0.50 per first annual install over one million (with some on‑ramp conditions for smaller developers). citeturn3search2turn3search3

“First annual install” is not just a first-ever download. Apple defines it as the first time an app is installed by an EU account in a 12-month window; reinstalls and updates can count depending on circumstances, and installs across multiple distribution methods can be included in the accounting. citeturn3search2

Apple also notes that marketplace developers may pay the CTF for every first annual install of their marketplace app (including before one million), which changes the math for anyone trying to run a store as a business rather than as a hobby. citeturn3search2

Why a subscription bundle and the CTF are an awkward fit

Setapp’s core value proposition is to make installing lots of apps frictionless. That’s fantastic for users—and potentially terrifying when each install becomes a line item risk.

In a bundle model, you want users to sample broadly. If the store is doing its job, users install more apps, more frequently, across categories. But under a regime where installs can trigger incremental fees, “more installs” isn’t automatically “more profitable.”

Yes, the first million first annual installs are free. But app bundles often live or die by scale. If you hit scale, you might hit fees. If you don’t hit scale, you might not cover your fixed costs. It’s a business model designed to be either wonderfully efficient or wonderfully stressful—sometimes in the same quarter.

Setapp Mobile’s shutdown message strongly suggests that the moving parts—fees, reporting, evolving compliance terms, and the uncertainty of what “next quarter” looks like—made the model unworkable.

The other problem: adoption and friction (a.k.a. the “15 steps to install” era)

Even if fees were perfectly stable, alternative app stores on iOS have faced a second enemy: user behavior.

Most iPhone users are trained—by design and habit—to treat the App Store as the one true place where apps live. Changing that behavior is hard, especially when the installation path includes extra warnings, extra permissions, and extra “are you sure?” friction.

Epic has been very vocal about this. The company has claimed that iOS alternative marketplace installation drop-off was severe early on and improved only after Apple simplified the flow in iOS 18.6 (including fewer steps and fewer discouraging screens), under EU pressure. citeturn0news14

The point isn’t whether Epic’s framing is neutral (it’s Epic). The point is that the alternative marketplace UX has been a battleground, and Setapp Mobile had to fight that battle too.

And here’s the sneaky compounding effect: if the install flow is annoying, fewer users adopt the alternative store. If fewer users adopt it, the store has less revenue to justify the operational overhead of compliance, notarization coordination, developer support, refunds, and ongoing negotiations with Apple’s terms. That’s not a death spiral every time—but it’s a spiral-shaped risk.

Setapp Mobile wasn’t alone: how the EU’s alternative stores have evolved

Setapp Mobile is closing, but alternative marketplaces in the EU aren’t disappearing. They are, however, shaping up to be a very specific kind of ecosystem: smaller, more niche, and often subsidized or strategically motivated.

AltStore PAL: indie, open-source, and… funded by Epic

AltStore PAL launched in the EU in April 2024 as one of the first alternative iOS marketplaces. It initially shipped with a small set of apps (notably the Delta emulator and a clipboard utility). citeturn3search0

By July 2024, AltStore PAL began adding third-party apps. TechCrunch reported early third-party additions that included tools like UTM SE (an emulator) and other non-mainstream apps—exactly the kind of software that tends to struggle in the traditional App Store model. citeturn3search1

AltStore PAL even had a small subscription fee at one point—until Epic provided a MegaGrant that allowed it to drop the fee and cover Apple’s Core Technology Fee obligations. TechCrunch described this grant-driven shift explicitly. citeturn3search4

That’s instructive: one of the earliest alternative iOS marketplaces became more viable not through organic revenue alone, but through subsidy from a player (Epic) with a strategic interest in alternative distribution.

Aptoide: a familiar Android name tries iOS (carefully)

Aptoide, long known as a Google Play alternative on Android, launched an alternative iOS game store in the EU in June 2024, initially with a small catalog and a planned expansion path. citeturn3search5

This “start small” approach makes sense in a notarization- and compliance-heavy environment: keep operational complexity contained, prove demand, then scale. Setapp Mobile started with a larger “bundle” proposition—still curated, but aiming for broader mainstream value.

Epic Games Store: the heavyweight with a mission (and legal history)

Epic’s EU iOS marketplace is arguably the most high-profile alternative store, because it’s tied to Fortnite’s long exile from Apple’s App Store and a years-long fight about platform rules. TechCrunch’s earlier overview of EU alternative stores cited Epic and others as ongoing players. citeturn1search4

Epic also has the financial and political incentive to keep pushing even when the economics look ugly in the short term. Most companies don’t have that luxury. Many, like MacPaw, have to run marketplaces as a business—not as a strategic campaign.

So why did Setapp Mobile fail where others might survive?

It’s tempting to reduce the shutdown to “Apple’s fees killed it.” But it’s more accurate (and more useful) to see Setapp Mobile as a collision between three forces:

  • Business model mismatch: A subscription bundle wants lots of installs and easy sampling, which can conflict with install-based fee risk and ongoing marketplace overhead.
  • Regulatory/terms volatility: MacPaw explicitly cited “still-evolving” conditions—meaning it couldn’t model the future reliably. citeturn2view0
  • Adoption friction: Changing iPhone user habits and navigating an installation UX designed to be cautious (or, critics say, discouraging) is difficult, and low adoption makes the financial picture worse. citeturn0news14

AltStore PAL’s path hints at an alternative survival strategy: stay lean, remain niche, and if necessary, get subsidized by a big strategic backer. Setapp Mobile, by contrast, was built like a premium consumer product. Premium consumer products have premium expectations, including predictability.

What happens to users and developers now?

Users: back up your data before February 16, 2026

MacPaw’s guidance (as echoed by reporting) is that users should transfer or back up app data before the sunset date, because access to the apps via Setapp Mobile will be removed afterward. If you were using Setapp Mobile as your primary way to access certain apps, you’ll need a plan—whether that means switching to App Store versions, direct subscriptions, or alternative marketplaces (if available). citeturn1news12turn2view0

Developers: distribution fragility is still real

For developers who participated in Setapp Mobile, the shutdown is a reminder that alternative marketplaces aren’t automatically stable channels. A store can close. Terms can change. User acquisition can stall. And if your app’s audience is tied to one curated marketplace, that creates platform risk—just a different platform than Apple’s.

This is not a reason to avoid alternative stores entirely; it’s a reason to treat them like any distribution channel: diversify, plan for exits, and keep your customer relationship portable when possible.

What regulators might learn from this shutdown

The DMA aimed to create competition, but competition doesn’t materialize just because the law says “you may now compete.” It materializes when the economics, the UX, and the incentives align.

Setapp Mobile’s closure is a data point suggesting that the current EU iOS marketplace model may favor certain kinds of entrants:

  • Strategic entrants (Epic) who can sustain losses or treat the store as leverage.
  • Very lean niche stores that keep catalogs small and operational costs controlled.
  • Stores with external funding (grants, sponsorships, or ecosystem plays) to offset fee exposure.

Meanwhile, a mid-sized software company with a subscription bundle and a real business to run may struggle if commercial conditions remain complex and frequently revised.

Regulators could interpret this as a sign that the market is still too constrained—by fees, by process friction, or by Apple’s retained control via notarization and account permissions. Or they might see it as a normal shakeout: some models work, some don’t, and the ecosystem will settle over time.

Either way, this shutdown adds weight to the argument that compliance mechanisms matter as much as compliance headlines.

What Apple might say (and what critics will say back)

Apple’s public stance on DMA-era changes has emphasized security, privacy, and the idea that alternative distribution increases risk for users. Apple has also stressed that the EU changes come with safeguards like notarization, marketplace authorization, and malware protections. citeturn0search5

Critics argue that Apple’s compliance has been designed to be legally sufficient while remaining commercially unattractive—using complexity, fees, and UX friction as subtle deterrents. TechCrunch’s shutdown coverage explicitly frames Setapp’s “complex business terms” as referring to Apple’s complicated fee structure, including the CTF. citeturn2view0turn3search2

There’s also a middle, less dramatic interpretation: Apple is attempting to retrofit a tightly controlled ecosystem into a partially open one without breaking the economics that fund iOS development, security infrastructure, and App Store operations. In that interpretation, complexity isn’t sabotage—it’s the inevitable result of a platform being forced to support multiple distribution paths while maintaining accountability.

Still, when a high-quality, curated alternative store exits early, the “complexity as deterrent” narrative gains fuel—whether or not it was the intent.

Case study comparison: why Android-style alternatives don’t map cleanly to iOS

On Android, third-party app stores have existed forever. Amazon’s Appstore, Samsung’s Galaxy Store, and Aptoide-style alternatives have long competed with Google Play to varying degrees. Most users still default to Google Play, but the presence of alternatives is normalized.

iOS is fundamentally different because the baseline assumption has always been “one store.” The App Store isn’t just a marketplace; it’s an iOS cultural expectation. That means alternative stores must overcome not only a technical and regulatory framework, but also a user psychology problem.

Setapp Mobile was trying to overcome that with a strong consumer pitch: curated apps, one subscription, fewer in-app nags. That’s arguably a better pitch than “here’s an emulator store” for mainstream users. And yet, even a strong pitch may not be enough if the install experience is clunky and the underlying economics remain uncertain.

What comes next for MacPaw (and for the idea of app bundles)

MacPaw says Setapp Desktop remains unaffected, and reporting indicates the company is refocusing on other initiatives, including work on an AI assistant project called Eney and enhancements to its existing desktop subscription products. citeturn1news12

For MacPaw, this looks like a pragmatic retreat: keep the profitable core, stop bleeding on the experimental edge, and reallocate engineering effort to products where the company controls its destiny more directly.

For the broader market, it raises a question: can “bundles for iOS apps” work at all under the current DMA structure? Maybe, but likely under different constraints—smaller catalogs, higher prices, enterprise-oriented distribution, or partnerships that offset install-based costs. Or perhaps the bundle idea will shift toward web apps and cross-platform subscriptions rather than iOS-only marketplaces.

Practical takeaways for developers considering EU alternative distribution

  • Model install-based exposure carefully. Even if you never cross one million first annual installs, marketplace-level obligations and administrative overhead are real. citeturn3search2turn3search3
  • Expect terms to evolve. MacPaw explicitly blamed “still-evolving” commercial conditions; build contingency plans. citeturn2view0
  • Don’t underestimate user acquisition friction. If users won’t install your marketplace, they won’t install your apps from it. citeturn0news14
  • Diversify distribution. Treat alternative stores as a channel, not a singular lifeline—especially for subscriptions and paid apps.
  • Be ready for reputational narratives. If you exit, the story becomes part of the larger Apple-vs-EU debate. Your communications should be precise and date-specific.

The bigger picture: the DMA is real, but the “new iOS era” is still under construction

Setapp Mobile’s shutdown on February 16, 2026 is one of the clearest signals yet that opening iOS distribution is not simply a matter of allowing new stores to exist. The viability of those stores depends on fee design, user experience, policy stability, and whether marketplace operators can build sustainable economics without betting the company.

The DMA forced a change. Setapp Mobile tested that change. The result, at least for this particular model, is a reminder that regulation can create possibility—but not guarantee profitability.

And yes, somewhere in Cupertino, a spreadsheet just made the “told you so” noise.

Sources

Bas Dorland, Technology Journalist & Founder of dorland.org