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Comment by CharlesW | Hacker News Reader

> Totally different dynamic vs. the App Store.

What's the difference?

BTW, Apple regularly sells app store "dollars" at a loss. I once bought a $200 app store gift card for $165 at Costco.

When you sell boxed software in a retail store, you're selling using the wholesale model: it has a retail price of $99 but you're selling it to them -- or more likely your distributor -- for about 40–50% of that price. The distributor takes another 10%, and the retail store gets the difference between that and the retail price they choose to sell it at. This is very distinct from the "agency" model that the App Store uses.

Well: actually, when you sell boxed software in a retail store in 2020, you sell nothing because nobody does that and this is a super stupid comparison for Apple to keep making. The Mac App Store isn't competing with Target and the ghost of CompUSA, it's competing with other online store systems like Paddle, which takes 50¢ + 5%. The iOS App Store is competing with... nothing, in practice, because it's literally the only way to get applications onto your iOS device. Which is kind of what's getting everyone to argue about this, right?

Come on, this is basic stuff. You can sell your product without selling at Target, you effectively can't sell your ios app outside the app store. It's not so much about the markup (which should come down since modern digital business capabilities should have efficiencies that reach the consumer as a benefit), but the practice of closing out alternatives.

Why would you build an iOS app with the intention of selling it somewhere other than the iOS App Store? It’s not like Apple is blindsiding any developers with the revelation that the App Store is the only way to distribute software on non-jailbroken iPhones.

That's the problem.

If Apple purchased 10,000 units of an app from the developer upfront, they can then resell each unit at whatever markup or loss they think people would buy it. This is a commission model where Apple is getting a cut of each sale.

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