I'm sorry to say this but your comment reads like some core concepts from Econ 101 were absorbed but the part about how economics theory is largely descriptive not prescriptive was missed. You're not far into your comment before having the "in theory" qualifier.
There are lots of reasons why volume discounts exist:
- To encourage more use;
- It's aspirational in that users believe they can get big enough to get that lower per unit price;
- Every customer has fixed and variable costs. Volume discounts account for fixed costs. Generally speaking, a large customer will be less overhead for the provider in cost per dollar of sales;
- Bargaining power. Some customers are price takers. Others are price makers;
- Anchoring. Supermarkets in malls will tend to pay lower rents (per square foot) because mall owners know their presence brings in customers that frequent other businesses. Likewise if a customer is accustomed to buy Fortnite skins through your ecosystems they're more likely to spend on other things;
So basically I don't accept your premise so the rest is kind of irrelevant.
You're literally giving examples of how his premise applies in real life.
"Companies in theory only offer volume discounts when it makes commercial sense to do"
- Encouraging more use makes commercial sense because it yields more money overall even with the discount (if done correctly)
- Users aspiring to buy more makes commercial sense because people buying more means more money
- It makes commercial sense to give discounts because large customers cost less relative to small ones due to fixed costs not changing based on customer size
...and so forth. You're saying his premise is irrelevant but giving a series of examples of why his premise is relevant.
It is Econ 101, and of course all this is theory - but that's the idea right, we are describing why it is in Apple's interest to do what they are doing. You are prescribing a change that goes against basic economic theory and also isn't the behaviour being observed, so I personally don't think that criticism is fair!
The main thing your comments miss is how apple is going to make up for the immediate shortfall in profit from your proposed changes. Bear in mind, they need to increase revenue 5 times to make the same amount of profit.
It's fine to hand-wave about how Apple should provide volume discounts because everyone else does, but you don't really provide a reason for why they should do that from a financial perspective and how they can do it without loosing a majority of their profit (everything is a soft-benefit which doesn't account for the huge financial losses this would incur).
I don't mean a bullet point, I mean like "I think a reduction of the fees to 10% would translate to a 20% reduction in the price of apps, and that would encourage people to buy 5 times more apps".
Or that all the money these big companies make will be so inspirational that 5x new developers will enter the market and these will, on average, be just as successful as the previous developers with zero cannibalisation.
There are lots of reasons why volume discounts exist:
- To encourage more use;
- It's aspirational in that users believe they can get big enough to get that lower per unit price;
- Every customer has fixed and variable costs. Volume discounts account for fixed costs. Generally speaking, a large customer will be less overhead for the provider in cost per dollar of sales;
- Bargaining power. Some customers are price takers. Others are price makers;
- Anchoring. Supermarkets in malls will tend to pay lower rents (per square foot) because mall owners know their presence brings in customers that frequent other businesses. Likewise if a customer is accustomed to buy Fortnite skins through your ecosystems they're more likely to spend on other things;
So basically I don't accept your premise so the rest is kind of irrelevant.