This counts one install per 12 month period, whether update or fresh install (new user). So it’s €0.50 per user device. For application providers that opt into the new terms and release updates every two weeks like clockwork even if there are no meaningful updates for 300Mb application bundles (Facebook, Duolingo, a few others)…this is likely a fair cost (and my suspicion is that yes, there's a premium, but it's probably not Apple's usual 20%+ premium on products since many applications would not be subject to this fee at all, even under the new terms).
It is not per update and the most significant thing is that it is also for apps that get distributed outside the app store. Which is the real issue and that is definitely insane
> A first annual install may result from an app’s first-time install, a reinstall, or an update from any iOS app distribution option — including the App Store, an alternative app marketplace, TestFlight, an App Clip, volume purchases through Apple Business Manager and Apple School Manager, and/or a custom app.
Assuming this doesn't count updates - the service is probably costing Apple €0.10 on average. Apple has a very hefty margin on everything it sells.
If each update costs €0.5 - I suspect this is going to lead to a massive decline in European apps. That's simply too expensive for almost every app.
There's probably less than 1000 apps this would make any material money off of.
This is just another way for Apple to try to tax Facebook, Google, and a handful of other big apps.