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Comment by xuki | Hacker News Reader

Apple need the 30% to keep the services revenue up to keep the stock price up. I have no doubt many people at Apple know this is wrong, including the people at the very top, but stock must not go down.

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What is the right amount of profit margin? Would this apply to households too?

It's obviously not 30%, because on top of this you better pay for ads on your app name or have your competitor show up on searches for your app.

I always had a mild smile for the tales of the "secure refined Apple store" but seeing the reality has been a bigger shock than I expected. It's a scam haven.

I would say there isn't such a thing as "the right amount of profit margin" as much as there is "the right way to secure a profit margin". The more your margin is able to exist because competition isn't allowed the less right it is, be it 1% or 99% in absolute terms.

Is profit margin not partly a function of competition? A retail business is easily replicated, hence retail businesses have minuscule profit margin.

Insurance companies have lots of competition, also low profit margins.

Making a top of the line smartphone does not have a lot of competition, hence higher profit margins.

Medicine is patented and hence does not have a lot of competition, also higher profit margins.

Whatever the market is willing to pay.

We don’t know what that is, since there currently is no market.

The market obviously exists. Apple is the seller, numerous other businesses are buyers, and they are buying, hence the current amount is an amount "the market" is willing to pay.

And how do we call a market with only one seller and no chance of competitors entering the market?

Sure, technically it's still a market, but I wouldn't consider it a remotely efficient one to do price discovery.

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