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Comment by jw1224 | Hacker News Reader

Honestly, Apple's response is actually pretty reasonable, all things considered. Read the full letter — it was clear, fair, and professional — despite coming off the back of a lot of bad press.

I see plenty of comments are focussing on this quote, re their Basecamp apps:

> These apps do not offer in-app purchase — and, consequently, have not contributed any revenue to the App Store over the last eight years

Apple have (freely) provided Basecamp a platform to grow their business via the App Store, whilst giving Apple (effectively) nothing in return.

Now that Basecamp want to grow their revenue further (at Apple's expense), AND they are breaching the rules (whether you agree with them or not) — I don't blame Apple for pressing the brakes. Especially not after all the negative press this whole debacle has brought them.

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Some people are going to quibble with you over the costs paid for developers licenses, but I think that's missing the real problem.

Apple is welcome to provide a platform for developers to distribute apps on, on that platform I believe they should be able to charge whatever they determine is reasonable.

Apple SHOULD NOT be allowed to have a legal monopoly on making that platform.

It's not really a fair price (doesn't matter what it is) if there's no alternatives because you've literally blocked them from competing.

This is the problem.

> Some people are going to quibble with you over the costs paid for developers licenses

Yeah, I thought I'd phrased it clearly enough saying "effectively" nothing was given in return, but obviously not!

I see a new perspective in the rest of your comment. Thanks for sharing.

My Smart TV doesn't let just anyone deploy apps on it, is that an unfair monopoly? I can always buy a different TV or in this a different phone.

The issue is rarely that such a tactic exists, the issue is when a single player (or a few very large players) dominates the market and uses that tactic to stifle other entrants.

In 2001 when MS was sued by the government for this exact issue, it was the combination of market dominance and tactics around vendor lock in that got them in trouble.

I think in this case it's pretty clear that Apple is abusing their market position in a similar way (as simply noted by how many of the comments in this thread are "App store is good because of huge distribution channel")

So yes, in theory you could switch from Apple to Android, but honestly, Android has exactly the same problem.

I'll add, I'm in no way absolving Google of the same practice. I think it's well past time the government took them both to task for the app stores.

---

Finally - Your tv comes with several ports on the back explicitly designed to let it play signals from other vendors (like your cable box, fire tv, apple tv, or any other)

So that's a trash comparison.

> Apple have (freely) provided Basecamp a platform to grow their business via the App Store, whilst giving Apple (effectively) nothing in return.

It's not free though, is it? You have to pay $99 a year, and purchase Apple hardware to develop and test software for their platforms. Basecamp, who hire 50+ people most likely all run Apple hardware, so that's tens (if not hundreds) of thousands of dollars to Apple over the years.

How far do you think $99/yr goes in the grand scheme of things?

Cost of servers, cost of bandwidth, cost of maintenance of the App Store backend services and development of future features, technical support for developers, Xcode development, App Store review time, etc

I would hazard a guess they make nothing on that $99 at the end of the day. The cost is merely to be a gate to prevent anyone from submitting terrible apps for review. Having some monetary requirement there is just a deterrent for the lower quality stuff (obviously not all of it, but probably a rather significant amount).

>Cost of servers

How much does each individual server cost per registered paying developer?

>cost of bandwidth

If the bandwidth cost is so high, why doesn't Apple charge for it separately? And also, how much bandwidth does it actually require to deliver these applications? The HEY app is 31 megabytes. For $99, you can get 1100 GB of S3 egress. I honestly doubt that your average developer is amassing nearly that much traffic in a year.

>cost of maintenance of the App Store backend services and development of future features

Is funding the upkeep of the App Store fully on third party developers? It's a product that's sold as a part of the iPhone. And according to some speculation, $1,249 iPhone XS Max made like $500 of profit after parts, labor, R&D, admin, and other associated costs.

>technical support for developers, Xcode development

I'd also argue that this is something that shouldn't be fully paid by third party iOS developers. Having a way to develop applications for a platform is a pretty basic requirement.

>App Store review time

We should ask DHH if he feels like he's getting $99/year worth of value from this.

Why does Apple need revenue from Basecamp (or any content provider)? They don't have any cost whatsoever associated with this content deliver. You already paid for the phone, $$$. The network isn't theirs; Apple takes zero part in the content delivery. Apple provides no content; that's all Basecamp.

This is just Apple noticing money being changed hands, and inserting themselves into the process so they can extract a cut. Get their beak wet, as it were. Not for value received, because there is clearly no value add here.

And the hoops they jump thru to make sure they get their cut! Locking down the phone; a walled-garden marketplace (you can't go anyplace else); the threat of revoking the app from a customer phone(!) if you don't toe the line.

Apple does have cost.

Specifically in the case of Hey:

* Bandwidth to deliver the app to each user that downloads it

* App Store Review requires human beings, so there's paying those people

* There's also generally maintenance of the App Store servers, backend software, etc.

In the past, I'm sure Basecamp (the app) was featured somewhere on the App Store and thus got featured and brought more eyeballs to the app. These features are done by actual people and there's a cost there.

Any store has a cost. Lets say Basecamp were to be able to side load. Now they'd have:

* Bandwidth for delivery of the app for each download

* Cost to maintain their servers

* They'd have to maintain whatever delivery system they had to write in order to provide the same features of the App Store

* They'd have more support costs as well because can the average person understand side loading? What happens when that goes wonky? Now it's on their support team to handle that business too.

Apple provides a lot of value there.

Edit: Jesus... I hate the formatting options on this site..

The store already takes a cut, to pay for the store. All that is covered. Like every other app.

So, the 'enforcers' have to be paid? ( the reviewers that keep any money from slipping thru Apples' fingers )? That's the whole story? They are already paid for by the store cut as well (like every other app).

> Why does Apple need revenue from Basecamp (or any content provider)? They don't have any cost whatsoever associated with this content deliver

I see it partly as a response to the fact that the industry is moving from one-time purchases to subscription-billing. Apple were always able to make their cut from the one-off sale of a $34.99 premium application. Now that the app is available for a $2.99/month subscription from the developer, Apple have to recover the lost caused by the shift to subscription models somehow.

And they certainly do have costs associated with content delivery. There's the trivial costs (bandwidth, hosting, etc.), and the larger overheads associated with R&D, developer review, continually fighting security risks, and so on.

Apple doesn't have to recover it, as a cost to something they don't have any part in.

They could take a cut of housing sales too, for all the sense that makes. I can see them in front of congress now: "But Apple isn't making the billions we once did! We neeeeed this money!"

Apple sells $25 phones for $1000. That's their business. Trying to make their business, taking a cut of other people's business, is egregious.

> Apple have (freely) provided Basecamp a platform to grow their business via the App Store, whilst giving Apple (effectively) nothing in return.

I've purchased an expensive phone mainly so that I can have access to a high quality ecosystem of apps. Apps like Basecamp and Hey are part of that for me. Apple gains so much from the breadth of high quality apps on the app store, including free apps. If they begin to see free apps as giving them effectively nothing, I see that as an indication that they no longer value the reasons I go to them as an iOS user.

Disagree. They let Dropbox slide, and it looks arbitrary that HEY is considered that different. If HEY stores your email in their servers they should argue that they are also similar to Dropbox then and should be exempted. This seems like Apple drew an arbitrary line where it still can draw one, and is having a tantrum. Nevertheless the arrogance of suggesting that their benevolence is why apps like basecamp have survived is just boggling. They make the best devices for sure but I keep hoping other companies start stepping up and give them real competition.

> Apple have (freely) provided Basecamp a platform to grow their business via the App Store, whilst giving Apple (effectively) nothing in return.

So the apps on the App Store don't provide any value to Apple? If all business apps were only on Android, would they have the same market share?

Once, phone makers thought that apps were a benefit to their phone, not a cost.

At Apple's expense? Does it work on Windows without paying MS a penny at Microsoft's expense?

>Apple have (freely) provided Basecamp a platform to grow their business via the App Store, whilst giving Apple (effectively) nothing in return.

App Store has never been free for developers.

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