How Meta’s Muse Could Challenge Apple’s App Store

Meta’s Muse could challenge Apple without displacing the iPhone. If people increasingly ask an AI agent to find a service, compare options and complete a task, that agent could become the gateway between users and businesses—potentially diverting some transactions from Apple’s App Store. Needham’s estimate of a possible $10 billion annual revenue hit describes one scenario for that shift, not a loss already recorded. 914

How Muse Connectors could change app discovery

Muse Connectors let services make their offerings available to the agent through a connection to their systems. Instead of opening an app and navigating its menus, a user can make a request through Muse; the agent then routes the request to a connected service. Connectors require user permission, and Muse’s usefulness depends in part on which services grant access. 1014

That creates a different kind of distribution channel. If a customer discovers and uses a business through Muse rather than an App Store app, Apple could have less influence over that interaction—and potentially miss revenue tied to transactions that move outside its payment flows. The scenario is about control of discovery and transactions, not whether Apple continues to sell iPhones. 914

For developers, a connector could offer another way to reach customers. Needham’s reported case for concern includes more than 1,500 developer applications to join the platform during its first 168 hours. But applications to participate are not the same as live integrations, sustained customer use or business shifted away from Apple. 8

What the $10 billion estimate assumes

Needham’s calculation starts with Apple services revenue of $123 billion for fiscal 2026, assumes the App Store accounts for 40% of that total, and then assumes 20% of App Store revenue shifts to Meta’s zero-fee Muse Connectors platform. 9

The arithmetic is straightforward: $123 billion × 40% × 20% equals about $9.8 billion, rounded to roughly $10 billion. Needham estimates the corresponding EBITDA impact at $7.5 billion. That is a scenario built from assumptions about the size of App Store revenue and how much might migrate; it is not a measurement of current losses. The analyst warned that a hit of that size could put pressure on Apple’s growth rate and valuation multiple. 9

Why the concern goes beyond App Store commissions

An agent that handles recommendations and actions could become the first stop for tasks people now begin in an app or through a phone assistant. The Morgan Stanley concern described in reporting is that a capable third-party agent could influence which services users choose before they search the App Store or ask Siri. If that behavior takes hold, Apple could retain the device relationship while having less control over discovery and referrals. That is a potential strategic pressure on Siri, not proof that Muse has replaced it. 7

Subscription management is another possible pressure point. Muse can help users identify and cancel recurring charges, which could make it easier to stop paying for services they no longer want. That may challenge subscription businesses that benefit when customers overlook recurring payments. The broader Apple concern raised by Bank of America is that agents could steer discovery and transactions outside Apple’s ecosystem; it does not establish that subscription cancellations have already reduced Apple revenue. 4629

Early interest is not evidence of displacement

Muse reached the top of the U.S. free-app chart, and CNBC reported more than 2.5 million downloads in its first two weeks. That shows substantial early consumer interest, but downloads alone do not reveal how often people use the agent, whether they complete purchases through it, or whether those purchases would otherwise have gone through the App Store. 2

Developer interest has similar limits. Applications to build Connectors show that businesses are considering the platform, but they do not show how many connections become active or how much revenue they generate. To establish a material threat to Apple, Muse would need to turn interest into recurring use and transactions that genuinely bypass App Store pathways. 814

The key uncertainty: access to services

An agent can only act on services it can access, and companies do not have to provide that access. Amazon blocked Muse agents from shopping on its website, while Shopify’s response was more welcoming. The contrast illustrates why the connector model’s reach depends on cooperation from the businesses users want to interact with. 14

The evidence therefore supports a plausible risk, not a settled outcome. Muse could weaken Apple’s position if users rely on it to discover and transact with services, developers build for it, and those transactions move outside Apple’s channels. Its early download figures and developer interest are worth watching—but they do not yet demonstrate the revenue shift behind Needham’s estimate. 289