Apple will charge 27% commission for alternative payment systems in Netherlands
9to5mac.com
9to5mac.com
They certainly could have made a lot more money back in the day!
I know it's controversial to say it's fanboyism, but if this isn't one proof of it, I don't know what is.
I have no desire to deal with endless dark patterns to get me to not cancel a subscription.
If they're not changing platforms, then the value they get from using Apple's products must be higher than the cost of dealing with higher app prices, mustn't it?
Furthermore, if there was enough of a demand for a more open platform, wouldn't it be able to attract investors to build it?
Apple is using its market advantage and lock-in as leverage against the user.
Consumers are not aware of this problem. Apple doesn't allow apps to inform users about the 30% tax.
https://www.theverge.com/2020/8/28/21405140/apple-rejects-fa...
"Apple blocked Facebook from informing users that Apple would collect 30 percent of in-app purchases made through a planned new feature, Facebook tells Reuters. Apple said the update violated an App Store rule that doesn’t let developers show “irrelevant” information to users."
Apple overcharges for literally everything, why would people in the ecosystem even notice when it happens?
It will result in payment processors passing on Apple’s fees to merchants. Payment processors already do not allow you to charge a higher fee to customers using a credit card normally, so merchants must pass on the cost of these fees to ALL customers regardless of payment method. This makes it of concern to more than Apple’s customers.
Personally, I can't help but think of Standard Oil. Plenty of value was made there, drove oil and kerosene prices way down... and they still got broken up.
Do you have examples of software that costs more on iOS than elsewhere?
It's a bit silly this needs to be defended by example though, where else do people think the 30% cut on stuff subscription is coming from? Certainly not a 30% margin cut or 30% for payment processing, it's ~27% Apple tax apparently.
Look at Android and there are alternative stores like F-droid and rampant piracy. I don't even see any ads because of a combination of Blokada and Vanced.
It's not artificially more expensive, I'm happy to pay for the service and reliability offered by the App Store.
>users feel like you're just scamming them.
Users feel that way because so many subscription services ARE trying to scam them. As a commenter said below, subscribing through the App Store provides a simple, reliable way to manage your subscriptions and guarantee a cancel if you want without having to deal with whatever dark pattern bullshit apps normally throw up at you.
Choose to pay less and enjoy a world of endless unreliable, shitty apps and shady practices if you want, I'm happy to pay not to.
The point? I don't care about rip-off on optional products if I cannot avoid the rip-off on the most basic human needs. I vote with my wallet not to pay Apple anything, problem solved.
Developers are literally subsidizing other developers, and it’s not necessarily the richest ones helping the poorest ones. Someone trying to make money on a $0.99 app is sacrificing more to Apple than Facebook does with their free app.
That’s why I find all these percentage and payment discussions weird: income is so insanely distributed that a lot of this literally does not apply to more than 80% of the stuff on the store. There are fundamental issues that need to be resolved too.
the app for my phone network just opens a webview where i pay for stuff. then i close the webview and the funds just show up in the app. do they also pay 30% to apple?
I'm pretty sure if Apple let people just download IPA files (like they do with APKs on Android), lots of developers would choose that over the walled garden.
---- Sony ----
https://www.retroreversing.com/official-playStation-devkit
> Perhaps the most ingenious move on Sony’s part was its decision to use the PC as a development platform, enabling it to call on the skills of huge number of developers. Licensees now receive a pair of full-length ISA cards that plug into a normal PC. These two cards contain the entire PlayStation chipset, as well as extra RAM and some logic to enable them to talk to the PC. ‘lt’s great having the system inside the PC,’ reckons Peter Molyneux. ‘With most bulky console development systems it sometimes feels like you’re surrounded by NASA control.’
> Such technology doesn’t come cheap, though. PlayStation developers need to cough up £ 12,000 for the full system (which Sony is adamant it doesn’t make money on), although all subsequent software tools and hardware upgrades are free.
---- Nintendo ----
https://developer.nintendo.com/faq
> Registering for the portal and downloading the tools is completely free. Also, if you plan to release a digital only title, you can use the IARC system to retrieve the age rating for no fee, which will allow you to publish in all the participating countries. All that is left is the cost of acquiring development hardware: you will find more information on this inside the portal.
https://developer.nintendo.com/home/development-for-nintendo...
> On 3/25/2021, the only Nintendo platform for which new development is possible will be Nintendo Switch.
> Development for Nintendo 3DS and Wii U will only be possible for those who have already purchased development hardware. Those who do not have development hardware will not be able to develop.
https://www.digitaltrends.com/gaming/nintendo-switch-dev-kit...
> At the Game Creators Conference 2017 in Osaka, Japan, Nintendo announced that Switch development kits would only cost 50,000 yen, or roughly $450.
> To put things in perspective, a PlayStation 3 development kit ran for $20,000 at launch.
---- Microsoft ----
https://developer.microsoft.com/en-us/microsoft-store/regist...
> Individual accounts cost approximately $19 USD, and company accounts cost approximately $99 USD (the exact amounts may vary depending on your country or region). This is a one-time registration fee and no renewal is required.
(having some difficulty finding the specifics of the Xbox series X and series S dev kits)
--- --- ---
The point of this is that as a game device, the iPhone is in line with other developer programs and in some cases (Sony, looking at you) quite a bit less expensive.
This is a hilarious quote, especially with the way you highlighted "never giving apple a dime"
Because Apple doesn't give them a choice! Android developers can host their own apps, set up their own CDNs and downloading/updating infrastracture, pay journalists to review their apps etc.
This is like tying someone up in your basement and telling them to be grateful that they don't have to pay rent.
It's the logical move for them as they move into being a more service-oriented business and leverage all the devices they have in the world.
Google Chrome has been restricted from removing support for third party cookies (long gone in competing browsers) because they are also an advertising provider, and such a move has been deemed anticompetitive.[1]
Going more heavily into advertising would give more ammunition to defang anti-tracking protections being built into the platform with technical measures, as well as remove the ability to delist apps which work around those measures (ignoring user preference.)
They could pull off a mandate for SIWA because their competitors couldn't muster strong arguments it was costing them revenue. Such a mandate would be way harder too use some new in-app ad solution for impressions instead of third party solutions.
In-app ads, especially in games, are really scammy these days. Apple's solution wasn't to try to create a competing ad network, but to create a subscription game service that mandated all games be without DLC, IAP, or ads.
1: https://www.ft.com/content/b42db1db-8cfd-4247-90f5-3c6f934b5...
Users are already paying a premium for the privilege of buying an iOS device. And Apple knows that usually it will add some pressure on friends and family to have devices in the same family. Everything related to the app store is already paid for, the bandwidth is cheap, maintaining the service is cheap enough and covered by the device premium AND the developer subscription.
Whether the apps are free or paid for (with a big cut for Apple), the company is already making money. The tax on top of everything is just a way to make a lot of money and favor Apple services when compared to competitors in the same segment.
Pretty sure $99/year is more than a dime. It should be more than enough to pay for hosting the app. As for reviews, app developers don’t need those, so if Apple wants to review apps, they should also be the ones paying for it.
App Review alone takes hours per update and is done many times a year for apps. Even if a single Apple employee is involved, and even if they are paid something pathetic like $5 an hour, that $99 will be eaten up quickly from reviews alone.
My point is that it doesn’t add up; Apple likes to claim all these “costs” for “running” the App Store but there are gaping holes in their accounting unless you consider that not all developers are really equal here.
This has been the case since the beginning with mobile app stores so who knows how the distribution of paid vs ad-supported apps would be if this wasn't the case.
Historically they have not offered enough options here, such forbidding time-limited trials and not providing specific guidance for companies who wish to sell paid upgrades to new major versions. Apple's (arguably workable) solution here was entirely based on subscriptions.
That said, the ease of use of subscriptions and the high variability of billing amounts/periods has caused them to be the preferred mechanism for App Store scams.
Seriously: Apple should focus on selling hardware and be happy to facilitate those payments that people - and application developers - voluntarily process through their system.
All this stupid taxation of other peoples' businesses should stop, it is anti-competitive behavior that they themselves would never tolerate.
Imagine if in the past Apple would have had to pay 30% of their gross to Microsoft in order to be allowed to run their software on Windows.
Based on latest Q4 earnings, Services is one of the highest growth segment of Apple at 25% YoY (others being Mac at 25%, Other Products at 13%). As the clamor for M1-based Macs subsides, monetizing its existing 500M+ users is the only major revenue-growth area. But what happens if their commission rate is cut in half to 15%? Apple doesn't break out the specific App Store revenue amount or percentage but it must be quite significant.
Hence they're willing to risk these continued lawsuits and regulatory backlash. The day that Services division no longer reports 20%+ YoY growth could well be one when Apple stock faces the reckoning like FB/Meta.
The consequence of this is that they have to lean into inequality: get their existing high income customers to pay them more money. This is why services are such a good strategy and they are so unwilling to give up on that revenue, and it is also why they are planning to launch very expensive (and therefore high profit) new product categories like vr goggles and cars targeted at their existing customer base.
Apple is so ridiculously big that it is fun to map them back onto the world economy. Their yearly revenue is 0.4% of the world economy. Their market cap is 0.6% of global wealth. But that does present a real challenge to Tim Cook to keep growing. If apple doubles again they will be 1% of the world economy. Does that make sense for what amounts to a luxury brand?
Is that what happens to a piece of software after it has eaten the world?
Android OEM are incentivized to sell as many phones as they can. They only make money on new hardware. Apple on the other hand still makes money on older hardware as long as the user still buy from the ecosystem. So it makes sense for them to keep the products working longer.
Apple TV+ and Apple Arcade are examples of good services where Apple are commissioning and paying content producers. The services are good value, good quality and have competition on a level playing field (e.g. Netflix directly compete against both and don't have to pay a commission to Apple despite both their games and video services appearing on the App Store).
Other services from Apple like cloud storage, Apple News and Apple Music are more debatable value but they have competition so if you don't like them, use something else.
The App Store is different because you don't have an alternative. It is a parasitic system where where 70% of revenue (not a guess, that's the real number according to emails in the Epic lawsuit) comes from loot box grifting in games and there's literally no alternative to Apple's 30% tax. It is a poison chalice from top to bottom.
It comes down to the monopoly.
The fact they are trying to keep a stranglehold on this revenue seems penny wise and dollar foolish. Clearly regulators are gunning for them and it's not long before they lose this and don't get to set the standard.
> Imagine if in the past Apple would have had to pay 30% of their gross to Microsoft in order to be allowed to run their software on Windows.
Anyone making software for the Xbox has to pay Microsoft. Why is this different?
[0] https://developers-kr.googleblog.com/2021/11/enabling-altern...
Edit: Good grief, people. I am not pro-App Store. But jacquesm is literally claiming that Apple is nuts and that their solution will never fly. But everything we've seen so far in analogous cases suggests it will.
Yes, reported on yesterday by Reuters [1]:
> As for Google's plan, the official said the KCC was aware of concern over Google's planned policy of only reducing its service charge to developers by 4 percentage points when users choose an alternative billing system, and the regulator is waiting for additional information from Google.
> "As a result of any policy, if app developers find it realistically difficult to use an alternative payment system and resort to using the dominant app store operator's payment system, it would not fit the law's purpose," the official said, adding that this stance would likely be reflected in the final ordinance.
[1] https://www.reuters.com/technology/skorea-seeks-improved-com...
Historically, writing software for the Xbox meant getting dev kits not sold to the public as well as access to private documentation. And there was a level of support from Microsoft game studios could expect. The deals between studios and Microsoft could also include co-marketing or exclusivity. Plus to get an Xbox tittle out you needed a distributor (remember brick and mortar stores) so it really was B2B. Today I wouldn’t be surprised to see Microsoft just going with the Store model and taking a very small cut from indies. But distribution is nowhere as hard and expensive as it was back in 2001.
I really don’t think it’s the same as Apple that advertise it’s developer program to individuals. Apple’s developer program almost seems like a consumer product (term and conditions are pretty much the same for every individual dev out there, it’s a flat fee).
It’s not like they make money off of the hardware, and their new push is in Gamepass subscriptions which people will still want.
There will of course be people who pirate, just like they do on the switch, but piracy is likely to be so small that it won’t affect Microsoft’s profits.
"97% of developers don’t sell digital content and are not subject to any service fee for having their apps displayed in the Play Store or for any of the services listed"
And it mostly talks about fees going down.
I don't know. But I do know it is nuts that we programmers still support these extortionists.
It's different because Apple sells and markets their hardware as general-purpose computing devices. An Xbox is a gaming console and that's what it's sold and marketed as.
I already use apps in iOs that bypass the store to transfer money, pay for train tickets, parking, etc. Many people in Sweden likes Swish and probably will be ok with being able to choose it for all their transactions.
I could be wrong, but I don't think that there is data to support the opposite either.
3% payment processing
27% monopoly rent
3% payment processing
12% cost of channel
Best Buy, Verizon, and other hardware retailers buy Apple products at a discount and sell them for retail price. So, in a way they do get a cut of the revenue that Apple would make when Apple sells products at Apple's retail stores.
They aren't nuts. It's a middle finger to the legislators.
I.e. they're nuts.
Or if you mean developers abandoning support for iOS and Mac, then yes, that is precisely what we did.
That's pretty reasonable compared to other distribution channels.
If they think this maximizes their payoff, they'll do it. I'm 100% certain that they realize that this may/will invite further lawsuits and have factored this into their calculations.
Big corporations are giants with clay feet. From inside one can see the real humans behind the curtains.
So, you could be right and its a long term strategy, but it's also possible that they are just thinking about their next bonus.
1.) web view/touch/audio streaming app - 10%
2.) accelerated web view/SDvideo app - 15%
3.) HDvideo H.264 app - 20%
4.) 3D Graphics/ARKit SDK app - 30%
3D and ARKit which are pushing the boundaries of the silicon probably do have associated R&D costs as well as silicon COGS costs that perhaps do need to be recouped in a manner similar to gaming console SW licensing agreements (i.e. Xbox, PS, Nintendo royalty payments).
In the court of public opinion it would also minimize the effectiveness of "think of the solo iOS dev" type scenarios that the big guys such as Epic, etc. like to hide behind.
There's a department and the head of that department's responsibility is to make the profit number go up.
So, he/she is doing just that.
It'd be nuts if that didn't happen, that would be nuts.
Cydia is free and open source. Hopefully Jay can clarify the commission for paid apps on Cydia, but something tells me it isn’t 27%.
Sure, instead Best Buy would record a 22% gross margin for selling the software on a CD [0] (I know it's not a perfect example since Best Buy sells a lot of things, but Software was 22% of sales in the linked period)
[0]https://s2.q4cdn.com/785564492/files/doc_financials/2006/bby...
If anything, that's just evidence that Apple is grossing abusing its market position.
With Apple, its the opposite. If Apple sells something at a discount, the developer suffers (or Apple has to pay the difference in some countries). If it doesn't sell, no one gets any cash. Apple has no incentive to market something and/or move inventory. Apple has only the incentive to market things that you spend money on vs. Best Buy that has to take a risk on something by spending money to buy it from the publisher first.
Why don’t you apply that to the Xbox, PlayStation, etc.?
> All this stupid taxation of other peoples' businesses
Exactly. Stop trying to overthrow Apple from the ecosystem they built.
It’s as simple as that.
Nobody is talking about loading something besides iOS on Apple mobile devices. The argument that "The OS is everything" failed over 20 years ago in US v Microsoft.
Apple is less concerned about this than profits.
They could make their hardware ecosystem more open, that's easy, but that wouldn't make them a significant amount of extra money, so why would they?
iPod wouldn't have happened and Apple wouldn't exist today. Apple relied on the fact that most of its customers used Windows and that they got to transact for free on the platform. Heck, they didn't even need Microsoft's approval to offer iTunes downloads.
Think about all of the small businesses and startups that are getting snuffed out today by Apple's aggressive over-harvesting.
Some non-trivial percentage of Apple's $3T market cap owes itself to a system of feudalism and mafia-style tactics rather than innovation and product sales. Imagine of those dollars were instead represented just about anywhere else.
TL;DR Apple and Google will have to allow to install third-party app stores trough their stores.
This type of private taxes will become impossible to enforce.
https://eur-lex.europa.eu/legal-content/en/TXT/?qid=16081168...
Gatekeepers like Apple will have specific obligation according to Article 5:
(b) allow business users to offer the same products or services to end users through third party online intermediation services at prices or conditions that are different from those offered through the online intermediation services of the gatekeeper;
(c) allow business users to promote offers to end users acquired via the core platform service, and to conclude contracts with these end users regardless of whether for that purpose they use the core platform services of the gatekeeper or not, and allow end users to access and use, through the core platform services of the gatekeeper, content, subscriptions, features or other items by using the software application of a business user, where these items have been acquired by the end users from the relevant business user without using the core platform services of the gatekeeper;
And Article 6:
(c) allow the installation and effective use of third party software applications or software application stores using, or interoperating with, operating systems of that gatekeeper and allow these software applications or software application stores to be accessed by means other than the core platform services of that gatekeeper. The gatekeeper shall not be prevented from taking proportionate measures to ensure that third party software applications or software application stores do not endanger the integrity of the hardware or operating system provided by the gatekeeper;
(k) apply fair and non-discriminatory general conditions of access for business users to its software application store designated pursuant to Article 3 of this Regulation.
Following articles, like:
- article 7: Compliance with obligations for gatekeepers
- article 10: Updating obligations for gatekeepers and
- article 11: Anti-circumvention
Give the EU Commission quite a lot of maneuvering power to ensure effective implementation.
https://ec.europa.eu/info/strategy/priorities-2019-2024/euro...
[0] https://news.ycombinator.com/item?id=27413934
[1] https://news.ycombinator.com/item?id=14526156
It should not be up to the developer to choose how I pay them, only the amount.
So, you'd be shown 2 options. Option 1 would be their payment processor, and option 2 would be Apple's. And you could choose to pay an extra 30% to use Apple's.
Problem solved right? Everyone gets what they want, and pays the appropriate fee.
Paragraph 1, a provider of core platform services shall be designated as gatekeeper if:
(a) it has a significant impact on the internal market;
(b) it operates a core platform service which serves as an important gateway for business users to reach end users; and
(c) it enjoys an entrenched and durable position in its operations or it is foreseeable that it will enjoy such a position in the near future.
Paragraph 2, a provider of core platform services shall be presumed to satisfy:
(a) the requirement in paragraph 1 point (a) where the undertaking to which it belongs achieves an annual EEA turnover equal to or above EUR 6.5 billion in the last three financial years, or where the average market capitalisation or the equivalent fair market value of the undertaking to which it belongs amounted to at least EUR 65 billion in the last financial year, and it provides a core platform service in at least three Member States;
(b) the requirement in paragraph 1 point (b) where it provides a core platform service that has more than 45 million monthly active end users established or located in the Union and more than 10 000 yearly active business users established in the Union in the last financial year;
for the purpose of the first subparagraph, monthly active end users shall refer to the average number of monthly active end users throughout the largest part of the last financial year;
(c) the requirement in paragraph 1 point (c) where the thresholds in point (b) were met in each of the last three financial years.
Alternative payment processors were never going to accomplish that, as this case shows. You can make Apple accept alternative payment processors, but that doesn’t really change the price they set for using their store.
Unless you want to abandon a free market economy, a government can’t force a company to provide a certain service at a certain price. Squeeze one spot with regulation and a company will extract more revenue from another. Squeeze everywhere and a company will leave the market.
What they should do is force Apple to allow competing stores.
Apple can keep it’s 15-30%… if it can compete at that level. If not, it will have to adjust, by either offering something more compelling to developers or charging them less. And if Apple can’t do well enough, and pulls back from its app store, then, well, iPhone users will still have the stores of all those stronger competitors to choose from.
We don’t have to wonder what a platform with a competing sources for software looks like. We have a bunch of them, and they seem to work well.
Just to be clear developers care about this, not “people”. Vast majority of iPhone users couldn’t care less. Wanna know why? Because the developers have to compete on price and Apple is cutting into their margins. This is Apple vs app developers through and through. If Apple stopped taking a cut there would be no price changes. Developers would just make better margin.
Since Apple provides me with a great experience and developers tend to mostly be bad or mediocre, I’ll stick with Apple thank you.
> What they should do is force Apple to allow competing stores.
No thanks. I like that my grandma who uses Facebook has Apple making sure (within bounds) that they aren’t doing shady stuff, and that they have to state what they use data for and confirm permissions routinely.
> We don’t have to wonder what a platform with a competing sources for software looks like. We have a bunch of them, and they seem to work well.
If it’s the best model you don’t need government intervention because it’ll just win out. If Apple’s “monopoly” on the App Store is that bad people will buy other phones. But the truth is it’s a great model and users love it, which is why Apple crushes sales quarter after quarter.
This reminds me of someone recently defending Google doing something on behalf of users. Developers thinking they know what their users want “opt them in to this great feature they previously opted out of” so they can discover it. Same stuff different tune. It’s all business and just rich corporations attacking other rich corporations with no benefit, except that I lose benefits when Apple isn’t in charge.
The problem is that it has been proven that Apple used its store in a monopolistic way, lying to developers, stealing ideas for its own native apps, ruining developers' life.
This is much more than just an economic problem, you can't trade dark patterns for presumed governance and security.
People want software for their underutilized M1-powered Apple hardware investment.
Software requires — developers with a sustainable business.
When people invest years of data entry and muscle memory in software for their Apple device, their investment can be lost if the developer goes out of business due to excessive fees imposed by Apple.
I don’t know why it’s OK for Apple to protect us from ourselves, but not for regulations to protect us from Apple.
BTW, I think Apple’s model is good and people (users and dev) are widely satisfied with it — you said “great” and “love”… I wouldn’t go that far, but we’re on the same page. So if there were a choice of stores, a great many would be unaffected, probably including your grandma.
What's to stop Apple from charging the owners of any competing store 30% of their store's revenue?
It is like the mafia demanding you pay for the privilege of doing business on your street.
30% is just too much.
My client is selling a service where they are selling a physical product together with something you do with it in the app. Currently the customers buy the service and device in a separate shop and the app is just for the convenience of the user, they could also use a laptop conputer or whatever else. The client wanted to include a link to the shop in the app, but apple wouldn't allow it without their 30% tax. With this 30% cut providing the service for apple users wouldn't make business sense, they would lose money on each sale. Should they have higher prices for iphone users to make up for that?
It's Stockholm Syndrome.
Apple got away lucky that they weren't ordered to be split up and to run their payment service provider as an independent entity. It could still happen, the EU is pretty aggressive when it comes to monopolies overreaching their legal limits or abusing their position.
The various phone operators here have been smacked down pretty hard time and again on things like roaming, service fees and so on. Apple is no different.
I’m also arguing for the tax because I believe that Apple has the absolute right to collect such a tax, why wouldn’t they? They’re far from being a monopolist.
Stockholm syndrome? Mobile app development sounds like the last thing I’d want to have anything to do with.
Do the math.
Supposedly I did work to earn a profit, but clearly not so much work that I shouldn't thank whatever system I'm subject to for the privilege of... making a transaction that barely involved said system, if at all.
5% or even 10% would be more acceptable. But 30%? lol For what? There's no way the vast majority of that cut is necessary for Apple's financial operations or for them to make a reasonable profit. How some people can't see this as greed is mind blowing. Where do they draw the line?
If they can't make 30% on the app store they'll go do something else which will make them 30%+ and leave it to rot. Because 5% or 10% is a commodity business and they can do better than that.
And you are paying for the cost of the channel i.e. customer acquisition.
When you look at an airline that's about to fly a plane with twenty empty seats, do you say "sheesh, it's totally unreasonable that seat is selling for anything more than zero, it costs the airline nothing to have someone sit in it, the greed is mind-blowing"?
Maybe you do?
If Apple were to add this tax or raise it long after launch I could perhaps see this argument.
However, this tax is nothing new. AFAIK it has been like this for _years_. App developers must have known (before starting development) that there is a fee if you were to use the platform.
If you knew a certain street has mafia activity (or other similar taxes), would you make the concious choise of moving your store there? Well, if the business opportunuties are good enough, then it might be worth it. If the mafia suddenly showed up, then the equation could be different. This is just like any other business investment analysis.
If 30% is too much all in all, then it is unsustainable to keep the app store as an option.
How much revenue would developers make if Apple hadn't built the iPhone and the App Store and successfully marketed the thing to millions of customers?
What would be a fair price?
The linking stuff is simply because developers have tried time and time again to game the system by linking to outside shops. Hence the blanket ban.
The cloud storage, the authentication, the AR libraries … the list of stuff Apple provides is overwhelming.
It’s fine to criticize their business practices, and their monopoly.
But you have zero right to their street.
Or like the IRS
i see you never had to deal with retailers.
If so, then that implies no profit. If no profit, why bother?
No, the poster isn’t implying that all businesses should be capping their fees. That’s absurd. However, Apple is not all businesses and regulation is structured in a way that has a number of conditions. I for one am glad that the department of insurance makes my car insurance affordable and that when I purchase water it’s not from a private equity firm.
apple never said 30% is just payment processing. they claim the infra, the testers, the approval etc etc costs a lot. so now we know it’s 27%. which is absolutely normal.
should any app use their proprietary apis, without their explicit approval? of course not. the phone might be yours, but the code running on it a hard no.
but at the end of the day it’s all politics so i normally assume the worst: a worse overall end-user experience because some companies spent more on lobbying than others.
Bah, we most certainly don't.
They pulled that number completely out of their ass, just like the previous 30%. The only rationale behind it is because they could get away with it.
what cost does apple incur per iap on somebody else's payments service?
Why do people insist on acting like the platform commission is a payment processing fee? No one says that about the platform commissions by Xbox, Playstation, Twitch, Patreon, ...
Desktop computing for decades has been just Windows or MacOS (For 98.5% of people, yes I know Linux exists, but quit being cute).
Mobile computing took only a few years to shake down to iOS and Android.
Are OS markets inevitably always going to mature into duopoly? To me this is the core issue here.
Since computing is now the basis of the modern economy, the 3 companies that are in the OS business across desktop and mobile (Microsoft, Apple, Google) are basically the wealthiest companies on earth due to their ability to extract rents from all of computing.
I get that these companies built the market (although you could argue the tech was inevitable, so many teams were working on it in the early days) but once you become one of the winners and most valuable company on earth, extracting 30% rents starts to feel like a drag on future innovation.
It’s also interesting to me that Jobs originally courted John Scully from Pepsi to run Apple way back in the 80s—-what a bizarre choice. Did he know the market would inevitably always be a duopoly like the Cola market, already back then?
When you use Apple tools to to make and publish software, Apple is entitled to a cut. The limitations Apple imposes on the payment processors are simply to make it easy to collect their cut and streamline the user experience.
I think the only scenario where Apple is not entitled to a cut is when you use non-Apple toolchain to develop your apps and spread it through non-Apple distribution channels, i.e. Cydia. Currently that requires a jailbroken device but maybe if Apple is forced to allow side loading, the cut for distribution can be collected by other companies instead of Apple.
[0] https://9to5mac.com/2021/09/14/apple-can-still-charge-its-ap...
“Apple has the legal right to do business with anyone they want,” said Paul Gallant, managing director at Cowen & Co. “So Apple could change the terms of the App Store and say to developers, regardless of where you collect your revenue, you owe us 30%, and if developers refuse to pay it, Apple would be free to de-platform them.”
The first 15 minutes is a summary and the balance of the video is a more detailed look.
https://www.youtube.com/watch?v=43CMV8KIs3E
TL;DW, the judge makes it clear that Apple can still charge a cut even if developers use someone else's payment system.
She also hints strongly that Epic screwed up by not challenging the size of Apple's cut instead of challenging their right to take a cut.
Even when using frameworks like flutter I'm pretty sure you still need to use an apple compiler to make the final build, right?
On a non-jailbroken devices you will need to sign your binary with Apple's help but on a jailbroken device you can install whatever you want. It's also perfectly legal.
Besides, some hacking companies manage to install their malware on non-jailbroken devices.
> 3.1.3 The following apps may use purchase methods other than in-app purchase. Apps in this section cannot, within the app, encourage users to use a purchasing method other than in-app purchase.
Yes, it should be illegal for them to prevent you from breaking the cost down, but they have historically interpreted this statement that way.
[0] https://www.ithinkdiff.com/fornite-mega-drop-offers-discount...
For me, that's a pretty good deal. I could never do this on my own. Any other provider would probably take the same cut for that kind of service.
Too bad we'll never know because Apple prevents the competition on their platform!
No one is saying Apple shouldn't offer the service, or that it's not a good service, or even that Apple shouldn't charge 15%. If you think Apple do a good job and offer value for money then you should use their service and pay what they charge.
The only thing people want is the opportunity to use a competing service. That's it.
Apple is not a government, they should not be able or allowed to levy taxes.
The drop to 15% took too long. But it’s here now. If the Epics of the world want to enlist/manipulate the suffering of the “little guy,” they really can’t anymore.
The value that Apple provides for the smaller developers is immense, you don't actually see small developers complaining about Apple(with exception to those who were sherlocked maybe) but you see multi billion corporations pretending to be advocating for the little guy.
I'm very annoyed by all this, I'm afraid that they will win and solo developers will lose any chance to make it big without getting screwed by large publishers.
Can you please stop saving the small developers from Apple? Thank you.
So you can almost take money from Apple by buying these cards and spending them on your app. The only problem is taxes.
The 27% in the article is just mad, I think they could justify 10% when not using their payments, maybe. But it would be better to have an opt out where there is a set rate for app approval (this could easily be hundreds of dollars) and a download cost for app/data delivery and storage.
I like some of their products, but these companies have to be curtailed.
This fun anecdote is about what I think is Apple's treatment of other companies' pricing rules — The Apple Company Store at 1 Infinite Loop in Cupertino used to sell a variety of clothing, accessories, and various items including, seasonally, Lego Mindstorms kits.
My impression from having observed Lego over the years is that they have very strict retail pricing rules. I have no other evidence for this than what I've seen in the market.
Each year at the Apple Company Store, when Christmas season rolled around, the store would get Lego Mindstorms in stock. One year, we decided to buy a set.
The store is frequented by Apple employees, who get a steep discount on Apple merchandise. But Lego… they have (I think) strict rules about discounts, so what was Apple to do here?
Now I am making some guesses here, to be fair. But I found it very interesting that there at the store they had a large pile of Mindstorms sets that all had mysteriously carefully damaged boxes, which looked like the corner of the box had been gently stepped on, all in the same way, and that were all marked down significantly, something like 30 or 40% for "damage." Inside, the sets were fine.
It could have been just a coincidence, but my spidey senses were telling me it was something else… I suspect it was Apple, not able to mark the items down for employees due to strict Lego corporate rules about when sets can be marked down and when they cannot (sound familiar? Apple is pretty strict about pricing as well, in my understanding). And they found a loophole in that damaged items could be marked down.
So, somehow, the items ended up "damaged", as a nice holiday special gift item for employees (or for anyone who came into the shop, lucky for me).
These days, the Apple Company Store after a revamp does not carry as much third party merchandise, so I don't know if this is still a thing.
Burning goodwill and brand value while they do it though.
The issue is what’s the recourse and remedy? Go to Google/Android, which charges a comparable fee and tends to be less valuable?
Folks are getting their money’s worth on Apple’s ecosystem. But they somehow feel like they should just be getting more, just because. But apple doesn’t have a monopoly. They just have a good product.
Tax is spent, not accumulated. Tax is for everyone. Apples take on transactions is not a "tax" it's rent.
This is apple rent-seeking. I like to call this leeching
> Absolutely vile. This says everything about @tim_cook’s Apple and what it thinks of developers. I hope the company gets exactly what it deserves. Everybody on their executive team should be ashamed, and some of them should not be here when it’s all over. We all see you.
> We’ve been told that if Apple ever asked its employees to betray their principles, they’d leave. In a similar vein, everybody, top to bottom, involved in planning, editing, implementation of everything in this document should leave Apple. You betrayed us.
1: https://twitter.com/stroughtonsmith/status/14895589519056691...
Someone on 9to5 Mac suggested Steve to put his money where his mouth is, i.e. pull his own software from App Store, before demanding from Apple employees that they leave the company. I think that's a good advice.
That's a projection of his own belief in the way it should work onto the beliefs of thousands of employees who may not share his thoughts on the matter.
If people actually just stood firm against the fees then viable alternatives would manifest.
The same way when automakers tried a similar game and then.. the government stepped in, slapped the tar out of them with regulation, and told them to play nicely with third parties or lose the ability to do business.
Or when utilities had natural monopolies were preventing competition and.. then the government put strict regulations on them, set pricing rules and allowed significant control of them.
The answer is that if the two dominant parties have managed to keep out competitors and basically engage in collusion, the government should correct the situation.
So should companies not be rewarded for making an awesome system so they can charge these commissions? I mean Amazon and Microsoft can't blame Apple for their failure to produce phones people want to use...they certainly had the resources, and still do.
Comparing utilities, based on physical constraints, with digital goods doesn’t make any sense. It doesn’t require any effort to make a web app relative to the status quo.
Furthermore your example doesn’t make any sense because you make money with Apple and pay a fee - you’re not paying for nothing. Natural gas, for example, has constraints around distribution and collection. These don’t exist for apps.
Ironically, if more developers just made web apps instead of going to app stores it would not only make their apps more accessible as they are inherently cross platform, but would likely lead to the creation of a web App Store to resolve the distribution problem.
no, you just need a webapp.
It's really the 50% shouting on social media that hurts the most. Instead of maybe recommending your app, they will recommend one of your competitors that support both.
If I don't like the app store fees can I just not use it? You see what I'm getting at?
You only pay Apple store fees if you make money. Your comparison is dumb. Charge more to your users and be done with it a all of your Apple competitors are bound by the same rule.
It makes the point that their fee isn't about credit card processing.
I suspect, baring specific language in the law baring the practice, Apple, Google, etc. will force their commissions no matter what other allowances they're asked to make.
If I were a company who literally created a whole industry and many other companies were making millions off the platform I created, I'd of course take my cut, and a well-deserved big one.
It's a for-profit company who enabled those apps/purchases* to be made in the first place, not a charity or a non-profit.
(*: not talking about non-app related payments like real world items, obviously)
If you create an industry, a platform, you already have instruments to monetize on it. the Apple software platform is already tied to its own devices, from whose sales Apple has earned a vast amount of wealth over the years and profited thanks to their massive margins. What makes Apple different from Google in this regard is that the Play store has won due to consumer choice, while Apple has basically prohibited side loading and alternate stores in any possible way and shape.
The Amazon Appstore has failed to gain marketshare because people simply didn't like it, and Google play was just superior, end of it, and if you want to use Google services in order to give your customers what they want you have to pay Google's fee, fair and square. On an Apple device there are no ways to sell people anything without paying Apple because Apple does not allow it.
If Apple starts providing a shitty service with its Appstore, there is no way to circumvent it, you must choose either to quit the iOS market entirely or play along whatever rules they decide to adopt. This is basically extorting protection money, with a few extra steps on top of it.
This is called patents, so yes, actually. But this is more akin to Microsoft charging 30% for sales in Windows and Xbox, which would be totally allowed.
> politicians are borderline computer illiterate
And developers are ignorant of business and law which is what this case is really about. Absolutely nothing about Apple's sales commission is about tech. Wanting something to be different just because it's digital doesn't make it so. Uber is still a taxi company.
> you already have instruments to monetize on it
And that instrument is charging for access to the platform -- some might say 30%.
> there are no ways to sell people anything without paying Apple
Right. This is the point. This is literally the thing Apple charges for. The one thing. The thing that people, very rationally, want for free. I also want to get all the benefits of a company's work without paying too.
> you must choose either to quit the iOS market entirely
This is the core issue, Apple, and the law in most countries, say you have absolutely no inherent right to access the market they created. You don't get to demand the ability to set up a stall in someone's mall because they charge 30% to the stores.
Because computing didn't exist before Apple?
I wonder if such arguments existed decrying Microsoft's immense charity in allowing others to make money off of its platform back when Windows was the dominant way of computing and connecting to the Internet with 0 fees for installing software on Windows...
Surely they wouldn't put hosting and approval processes there if free apps don't pay separately for those?
Now maybe 15 percent is a more reasonable price, but Apple developed the phone, apple developed the SDK, apple made it available to everybody, heck Apple even developed the computer language used.
This is all available for anybody for a fixed percentage, which means that it scales pretty well with how much you make and it cost you nothing more than 100 dollars a year if you don't charge people.
Developers can absolutely develop an app with whichever payment system they want and keep all the income to themselves. Develop a web app and do whatever you want. You integrate with whichever third party systems you want and provide the experience you think is best for your users and yourself. Anyone will be able to use your web app from an iPhone as much as they will be able to use it from a Desktop device.
However, if you actively choose to develop a native iOS app in order to integrate with Apple's native APIs in order to provide an experience which can be superior to a web app then it's not a far stretch to expect you to therefore integrate with Apple's native APIs across the board, including payments. I mean that is literally why you choose to develop a native app, because you want to provide EXTRA value to your users by making use of APIs which Apple invested in.
https://en.m.wikipedia.org/wiki/Progressive_web_application
No surprise here. They will literally block/slowdown progress every way they can.
We are just behind on features and it's a "highly technical issue"
;)
LOL!
Apple has no way of knowing how many sales actually occurred in the app, so they have to trust the developers to report the correct number. How the tables have turned :-)
And this won't improve it, apps are very expensive for they do, phone is pretty much a closed up black box which apparently is easily hackable if you manage to find the security holes.
I don’t want to take away from this.
I also feel grateful Apple created and maintains an ecosystem where I (for a small fee) develop and distribute applications which build upon libraries and infrastructure that took untold developer hours to make, and untold developer hours to maintain.
And I can give this away for free and it’s available to soooooo many people who can carry it around in their hand.
Every developer like me is subsidized by every complex scheme Apple uses to extort money from the successful ones.
And I’m not sure what to think about that.
I can see a reasonable processing fee, and even a reasonable establish-the-purchase fee. Perhaps in the order of - or a bit more than - a credit card. So maybe somewhere between 5 and 15%. (Depends on how much more likely users find an apps through the app-store as opposed to a web search.)
Anything above is abusing Apple's market dominating position. Especially because there are no (official) ways to install 3rd party apps on iPhones et al.
Just MHO.
So when the person clicks the buy button on the app they get a invoice like
Software subscription: 66.66 Apple hostage fee: 33.33
Total: $100
66.66 + (66.66*.30) = 86.658
Which is one more hint that our legal system is not working as it should. It is completely ineffective at enforcing laws above a certain threshold of power.
But, if you were really unhappy about it then the solution is kind of easy on paper. If every developer pulled their apps from the app store in unison and suffered a short term loss then Apple's sales commission would drop to $0 and they would announce a cut in rates probably within 48 hours -- no regulation or competition needed. This strategy works for any marketplace.
[0]: https://developer.apple.com/app-store/small-business-program...
Cydia is free and open source. Hopefully saurik can clarify the commission for paid apps on Cydia, but something tells me it isn’t 27%.
Nice one Apple.
You wanna sell stuff to players in your Xbox game, 30%. You wanna sell stuff to players in your Playstation game, 30%. The service they're selling is stalls in their market that gets a lot of foot traffic.
Can they be more blatant about the Apple Tax they are collecting?
As such, I use second-hand Android devices with Lineage OS, and get my software from F-Droid.
Personally, I predict that they'll need to either give up on service revenue growth, or roll back on these changes.
This will occur as the next big f2p games will find it much, much harder to monetise profitably without being able to measure/optimise at a user level.
It'll be interesting to see what happens here.
There is no need to give up on service revenue. Before 2016, my expectation of future Apple Services was growth from AppleCare and iCloud. Today, Apple put $10 per devices to services revenue for OS, Map and other Software. Apple could hike the price and move those to services. For example iPhone price hike but with 2 years AppleCare by default.
Nearly 80% of App Store revenue are from Gaming. There is no reason why Apple cant separate Game into a different Store and continue to charge 30% off it. That would have protected 80% of App Store revenue alone. EPIC wouldn't be happy, but I am sure most people couldn't care less. Gaming are not the fabric of our modern society ( I am sure there will be people who disagree ).
Then it is the Apps and Services. Which is not only just a revenue problem but a power play problem. Why does Apple get to dictate which business it is allowed on their platform when it holds 60%+ of usage in US / UK market. I have an app for my restaurant, but Apple refuse to host it. While QSR next door get to use Apps and customer are flying in. Under which law does Apple gets to discriminate small business? May be that is fine by US standards, I can assure you this wont fly in EUR. And where are business and developers going to complain? And how is Apple responding? If you watch every speech, interview or answer Tim Cook gave, it is obvious he ( representing Apple ) doesn't think they have a problem at all. And the biggest problem in the world is not understanding there is a problem.
It is sad those who were on Steve Jobs side are all gone. Phil Schiller, Katie Cotton, Jony Ive, Scott Forstall, Bob Mansfield, Ron Johnson. And only Tim Cook and Eddy Cue left. There may be not of people with high intellect at Apple, but very little with intuition.
“Intuition is a very powerful thing, more powerful than intellect, in my opinion,” - Steve Jobs
But every shareholder of any corporation wants exactly that. Moreover, Tesla proves this can be achieved largely on promises (look at the capitalization/revenue).
TSMC should force Apple to pay a 30% tax, and if they don't comply, kick them out of the FabStore.
In case if you haven't read the comment:
From [0] of page 112 (b)
> The Court agrees with the general proposition that Apple is entitled to be paid for its intellectual property. The inquiry though does not end with the bald conclusion. Apple provides evidence that it invests enormous sums into developing new tools and features for iOS.
I don't think anyone would agree to develop all of that for free at a loss, especially when it is used by billions of users and devices. They will still collect the fees either way and as predicted.
[0] https://www.courtlistener.com/docket/17442392/812/epic-games...
And hence 27% is the price for the service of forcing you to use their app-store, sorry I mean non well working scam scanning, sorry I mean sup-par mac only build tools, ah wait I mean download cost, ... or maybe their sometimes abusive and often non-well working moderation, ah no that can't be it either. Maybe it's subvention the hardware cost as a iPhone only costs... wait... Why does it seem like profiteering no matter how I try to look at it??
Jokes aside, in app payments are basically only monetary processing. Now you can claim that in app-payments are subvention reduced up-front payments. But that only holds up up to some degree of average per-active-user payment. But at least the more revenue rich phone games to quite a bit above that.
All this talk of using "alternative payment systems" just seems like a way to skirt around paying Apple commission.
I can definitely see why this fee and it's associated lock-in upsets many consumers and developers. It's clearly a divisive issue right now, and I am unsure we'll see any resolution to the overall narrative until the EU/US forces Apples hand.
If people thought the lawsuits were about the commission they're wrong, they were about forcing Apple's method of payment, but even after you get through that they still feel they are entitled to the commission.
You might have your opinions about whether thats right or wrong, but Apple's approach was to look as both as 2 different things whereas everyone seemed to see them as the same. And thats what they took advantage of.
It's a ridiculous demand. It is a pretty American way of thinking that the courts order is about the payment system rather than because of the commission when clearly, if the commission weren't there companies would not be looking for alternative payment systems to begin with. It's ignoring the spirit of the ruling. Prediction: this won't end well for Apple and it will cost them plenty of goodwill in NL.
All that needs to be funded somehow plus as I always say - nobody has forced engineers to build iOS apps.
An example: what if US engineers dislike the privacy laws of the EU and start asking to get them removed because you know their app wants to track and stalk ppl without their knowledge.
Maybe not the best example but I hope you get the point