Postmates founder here. I am subscriber to Internal Tech Emails and I couldn't help but smile reading these emails this morning. It was in 2017, around April 12th when we launched Postmates Unlimited - the subscription program that inspired all this. Now, we all know Postmates didn't win the space but some product decisions outlast a company and this was one one of them. I still remember the meeting when we decided to launch the subscription. No one had ever done it, the board thought it was nuts. It became the industry standard. ¯\_(ツ)_/¯
Regardless of outcome, it must feel pretty good to know you and your company ended up being a keystone in corporate tech history. Very few people get to say they were at the meeting when these subscription models became the future. Historians 30 years down the road would love you if you wrote a book about your perspective on it.
>Very few people get to say they were at the meeting when these subscription models became the future.
Yeah, it's like being at the meeting where planned obsolelense was first invented, or when a telco devised the "jump through hoops to to cancel your service" concept...
WAT? Adobe launched "Creative Cloud" (which at the time was basically desktop-software-as-a-service) on July 17, 2013; if I recall correctly they had been trialing that for about 1year in Australia before deciding it's a good idea and doing the global launch. Not sure if Adobe was first, but they definitely preceded you by half a decade!
SaaS was mainstream but e.g. Creative Cloud was not really SaaS - it was "we give you desktop products and you pay an yearly fee instead of the one-time cost". Adobe tried very hard to add Saas features but especially initially, the appeal was purely in the payment model (and I know a lot of individuals didn't like it! But a lot of companies did).
Arguably, Netflix started this trend even earlier - with their exclusively-subscription model for renting DVDs (something that one used to at least be able to pay-per-rental).
I looked up Uber Eats Pass; it’s not an all you can eat subscription. It waives delivery fees and gives a percentage discount to orders. It’s more like a loyalty program you pay for, like Prime.
Sorry, all you can eat was a bad choice of words. I meant in terms if the fees that Uber Eats collects.
I'd say prime is similar because you get free shipping but clearly Amazon.com makes money on each sale so the more they sell the more they earn.
On the other hand, movie pass is a fixed price. You pay the same regardless of whether you watch one movie or a hundred. What makes Netflix work with all you can eat but not movie pass? Is there a way to know ahead of time what works with all you can eat?
Forgive my confusion, but wasn't Amazon Prime started a good 10 years before that? It seems like that'd the precedent. I'm guessing I'm missing some major detail.
May be I am too naive but even if you want to limit to apps/companies providing similar kind of services, I don't think this to be something Uber/Lyft wouldn't have tried to do eventually anyway? May be others just had bigger fish to fry?
I was at your presentation to Super Mondays at the end of the Difference Engine accelerator, when you demo'd Curatedby, many years ago. It's fantastic to see what you and the team you've built have achieved since then. :)
Many brands are part of a holding. Like "Just Eat Takeaway.com" Which also owns Grubhub and SkipTheDishes in North America. Mostly active in Europe though.
Depending on how bullish you are on the market it's either DoorDash or no one. Because DD is the frontrunner by a pretty solid margin but time will tell if the business ends up being sustainable med-term.
Yeah, it’s very region-specific. Uber basically doesn’t exist in Southeast Asia. Here, Grab is king. A while back, Uber sold their SEA operations to Grab for a stake in Grab, and then I think they were trying to sell their stake to Alibaba.
> but time will tell if the business ends up being sustainable med-term
Narrator: "it won't. As the whole American startup scene nowadays is based on the idea of losing unlimited investor money for years and decades with literally zero plans to change that"
Fraud from Uber or fraud from the deliveries? I uninstalled Uber eats and rather drive to pick or use any other service than touch Uber. Uber eats was one of the nastiest apps with the absolute worst UX I have tried. Germany had a website pizza.de a decade earlier and they would send faxes in the backend and even that was better.
Even plain Uber keeps trial to sell me on their subscription every single ride.
Could you say more about the fraud problem? I've used Ubereats a few times a week for a couple of years and I don't think I've had a problem, though only ever in a tier 1 city.
Cities have tiers? Anyway, in San Francisco I order food and the driver doesn't move for an hour and a half. I call in to customer support, get another driver and he drives to the other side of the city before coming back and picking up my order (I paid for priority)
Not a fraud issue but in Miami over the break I ordered food from Uber eats, I got 5 different drivers who all got assigned then dropped the order.
> Anyway, in San Francisco I order food and the driver doesn't move for an hour and a half. I call in to customer support, get another driver and he drives to the other side of the city before coming back and picking up my order (I paid for priority)
Oh wow, that sucks. Not sure how I never experienced that, though when I was in SF I used it a bit less often than I do now (NY). If anything, I would've thought it would be way worse in NY: systems/platforms seem creakier here in general.
anecdotally i saw a huge dip in consistency across both ubereats and doordash in the back half of 2021. like orders taking 1+ hours greater than expected delivery. that being said, i've never had the problems you're citing with either on food delivery.
as for tiering, i think it's a rough estimate of the population density. getting delivery/drivers in suburbs is plain harder given their physical sparseness
Seems to work just like their car service then. Driver accepts the ride, sits there for 10 minutes, and then texts you asking you to cancel (they think I don't know it hurts their stats if they're the one to cancel).
Perhaps it won't hurt their statistics if you cancel their trip, since the driver has been waiting for you for ten minutes and he can do it with confidence. I already had a bad experience with a taxi when I was still ordering transportation services on https://www.bostonexecutivelimoservice.com/new-york-city-to-... . Then I was fifteen minutes late and notified the driver in advance, but my trip was canceled due to the fact that the workload of orders was oveloaded and every car was on the bill. Apparently they had the right to do this and simply canceled my trip, since the fault was on my part and the situation was not changed by the fact that I warned the driver that I would be late. Most likely you have a similar situation and there is nothing to worry about, just order another taxi.
I had a problem once but it turned out to be the restaurant's fault (they accepted my pick-up order, marked it as picked up and closed for the day before I got my food - all of this in the span of ~10 mins). I submitted a complaint via the app and Uber refunded me no questions asked. </shrug>
I read </shrug> as a self closing tag <shrug /> as human language is not necessarily valid XML. It is amazing how we "autocorrect" things as we read that we have to consciously stop and think what we did.
Kind of a toss up. Doordash has more market share in US but UberEats has wider international presence and is a leader in some markets. But yes, Uber acquired Postmates at one point and is now rolling out a subscription program called UberOne that encompasses rides, eats and its nascent grocery/pharmacy offering from the cornershop acquisition.
Also depends on the metro. I think NYC is actually primarily GrubHub, Seattle and central TX are primarily UEats, but for the most part DD is a safe bet. North TX is definitely DD territory.
They had the first food delivery subscription service among the food delivery services, such as Uber Eats, DoorDash etc, is what I believe they mean to say, not that they literally invented subscriptions.
Aside, the sibling comments are quite uncharitable, I don't see why anyone would reasonably believe that the founder invented subscriptions. If one thinks for even a second, they know this isn't true, so why not think for another second about what they really mean? I don't see the need to complain and hem and haw about how the "world's gone crazy."
I have observed over the years the IT/Tech tends to attract a lot of incredibly literal, grumpy people who do not like it when people take liberties with language.
It is also a difference in culture, americans tends to praise themselfs for every small things as a big achievement. In other countries one would not even consider this as an achievement, just a standard iteration to explore.
For me as well the first content is strange, that "I've invented subscription".
It is basically just applying an existing pattern from not-so-much-different other field?
indeed amazon prime is the same, gym subscription is the same etc etc. Not sure what justifies the "no one ever done it"
It is an easy, lazy response that doesn't require much thought, and gets internet points anyway. I'm just glad HN offers a way to collapse threads because so many comments result in massive flame wars about trivial matters like syntax and word choice.
It also stems from a laziness to consider where a person is coming from, other than literal reading of text. Brains become callused, or worse slightly autistic, where only precision matters.
You just have to ask yourself who is responsible when lack of precision leads to bad outcomes. If it isn't you, then meeting the other person halfway by increasing your level of precision helps.
The emotional labor of having to be fully responsible for precision is under-appreciated. That burden is where the grumpiness comes from.
It's pretty clear from the original thread and the reply that the implication is that Postmates was the first to offer subscriptions through iOS without going through IAP, therefore bypassing Apple's 30% cut, not that they "invented subscriptions."
"no one has ever done it" - it definitely sounded to me like they implied to transform something that used to be a "pay per consumption" into a "service". Which is definitely untrue, Creative Cloud preceded them by half a decade, Amazon Prime was before that, and arguably Netflix inspired everyone.
I feel like these marketplaces could maybe justify 30% on the purchase of an app up front, where there are clear benefits to the exposure and platform offered by them. But ongoing revenue is really attributable to the app itself and feels to me much harder to justify.
At this point I’d be happy if Apple just let me install apps outside their ecosystem, then they could at least defend themselves by saying if the developers aren’t happy with the terms of the App Store they can offer alternative methods.
It's more than that: it's the fact that all of the payment info is there. Every step, field entry, hurdle you put infront of a consumer is usually associated a significant increase in "cart abandonment". By apple allowing you to just apple pay straight in and avoid CC, and billing address etc, they are decreasing the hurdles and increasing the conversion.
Is it worth 30%? In 2013? Maybe In 2021? Definitely not. It should be closer to 5%.
That being said I do like using Apple subscriptions because they make it REALLY easy to cancel them, all in one place, something that can't be said for a lot of other services.
Yeah, one MAJOR issue I have with the folks complaining about apple. Many of them have HORRIBLE cancellation policies.
I had to fight NY Times like crazy (it was sign up online, call to cancel kind of thing).
Match is also in the "alliance" fighting apple with Facebook. They also have scummy practices (either tracking you or again duping you).
The other thing I like with Apple, the trial periods are REALLY clear. When you sign up with comcast it's like $29/month (and then in tiny tiny print 10 pages later you find out that after 6 months it's $69/month or whatever).
So until these folks clean things up where they ALREADY have full control (on the web) I'm willing to cut apple a ton of slack.
Apple will remind you to cancel a subscription when you delete a related app. It reminds you if a subscription will renew and you can cancel then. I willing spend money through the app store I'd not spend ANYWHERE else. For folks willing to spend money but who don't want to f'ed around with constantly apple is the place to be. And it is super easy these days. Double tap or touch and done.
I understand your view, but the hilarious (or sad?) thing here is we are applauding a multi-trillion dollar company for the most basic functionality. This is like saying “this restaurant sucks, but hey, I am glad that I got at least something to eat!”
The bar has been set so low, that allowing customers to cancel easily is worthy of praise! This is a shitty situation for ordinary people to be in.
Another thing to think about - if Apple were a bit more nicer to developers, they can have the developer loyalty for ever and ever. But they are so big and their competition is so bad that they don’t think developers have a choice. Short term profits is apparently more important than long term goodwill. Of course, they aren’t alone in this.
The saddest part is - after all their shenanigans, they are still better than other companies:(
The issue is the policy makers / department of justices entire focus seems to be on fighting so that companies can make more money and/or scam users by getting outside of app store polices.
Why this level of DOJ involvement against apple (with very little CONSUMER harm) when your grandma is LITERALLY getting scammed by fake tech support etc and they do jake crap over any of that.
Millions of consumers get screwed over, in big ways and small, day in and day out. Crickets.
Apple creates a small ecosystem that is completely optional for consumers to use that does a few things right (little tracking, fights all these companies on everything from tracking to trial periods to cancellations and more). And now that is a crime. The App store is the LEAST of my consumer protection worries.
Most of the "alliance" of folks fighting apple run scammy business. Loot boxes for kids (Epic/Fornighte type folks) / Zynga / Facebook data exploiters / Match.com fake profile type players / NY Times impossible to cancel people.
The Apple ecosystem isn't "optional for consumers to use"; if you want iOS then you absolutely have to participate in the ecosystem. Same reason why the "buy an Android if you want to sideload" argument doesn't work for me: the platforms aren't interchangeable.
A lot of what you're describing here are things that absolutely should be illegal, and a properly-funded government should be investigating and prosecuting. What Apple has done is turn iOS into their own sovereign territory, written their own laws, and levied their own taxes. In other words, they are a digital warlord. If we are going to ban loot boxes or data exploitation, we should be passing actual laws in actual Congresses and Parliaments to ban loot boxes or data exploitation.
Yes, the consumer harm might be minimal, but the consumer is not the end-all, be-all of the economy[0]. Apple bossing developers around creates compliance costs and higher barriers to entry for smaller businesses. This is inherent to monopolies of any kind, pro-consumer or otherwise. Yes, I can absolutely point to scams that Apple has judiciously removed from the App Store; but for every one of those I can also find stories where Apple just absolutely dicked around with a smaller developer and held up their app for no reason. In contrast, large companies like Zynga, Facebook, or Match Group have dedicated staff for making the Apple warlords happy, and know exactly what they can get away with. This isn't an open and vibrant marketplace; it's a group of warlords negotiating who owns what.
[0] More generally, the "consumer welfare" standard that modern antitrust enforcement has adopted is effectively a tacit agreement to not prosecute antitrust violations.
+1 re: “”What Apple has done is turn iOS into their own sovereign territory, written their own laws, and levied their own taxes.””: a few of my friends think I am off the rails on this one, but I think a plausible future is similar to the cyber punk world of William Gibson novels that describe a future maintained and ruled by corporate interests that provide corporate enclaves for people to work and live - sort of replacing countries.
Yes, all the players you mentioned suck, and they suck more than Apple probably. But that doesn’t mean we should not call out Apple’s bad behavior.
Also - Apple has infinite resources. They can be nice to everyone if they want. They choose to be arrogant, just because they can.
None of the companies you listed have a cult following, Apple does. Nobody gives Facebook or Zynga a tenth of the respect they give Apple (I think it is justified, those companies suck real bad).
Is it unfair to expect Apple to behave better than others? In my opinion, no. Others might disagree.
CVS blocked apple pay forever. So did Walmart. They said Apple sucks for wanting control (and providing privacy etc). They launched their competitor CurrentC I think which was of course totally hacked:
The reality is that a lot of these startups have almost NO controls over user data relative to inside actor threats. So I'd much rather sign up and have all my details / home address etc on apple's servers. Is this walmart alliance designed with privacy in mind or to exploit my data? I'm serious?
Ny Times is a good example. My subscription let me use their app, but I couldn't cancel it inside the app. Instead its the phone call BS (maybe they've stopped that).
So as a user, I actually kind of want apple to have a ton of market power, because the folks like DOJ / SEC etc are toothless in these areas. The only thing these agencies seem good at is stupid cookie banners (which are pointless).
> I understand your view, but the hilarious (or sad?) thing here is we are applauding a multi-trillion dollar company for the most basic functionality. This is like saying “this restaurant sucks, but hey, I am glad that I got at least something to eat!”
It's not so much as applauding Apple for providing basic features to their users, but as saying that unlike a lot of other companies, they do provide those features.
If things were _okay_ elsewhere, we wouldn't need Apple's ecosystem and they couldn't make billions with it.
Yes, they take as much advantage as possible of their position, but if they're where they are, its partly because nobody is providing what they do.
>So until these folks clean things up where they ALREADY have full control (on the web) I'm willing to cut apple a ton of slack.
Sorry, but its easy to say that if they're not grabbing 30% of sales from YOUR small business. If you think this fight is about Facebook or Match or NY, you're missing the whole point. Those big guys can take care of themselves just fine.
> its easy to say that if they're not grabbing 30% of sales from YOUR small business.
They're not grabbing 30% of the sales from ANY small business. They lowered their fees to 15% for the first million dollars (I think both per year and per app).
There are plenty of small businesses that have $1 million in yearly revenue or more. A single restaurant can easily make that or more a year.
If you go with SBA definitions, they use a $1 million to about $40 million range for revenue, and a maximum of 100 to 1,500 employees depending on the industry[1].
I mean, I would imagine a single restaurant would have to make more revenue in a single year to no longer be a small business - their costs of goods are far higher.
Meanwhile, when someone says "small businesses" cannot afford something, and that small business is a 1,500 person software company with $40 million in revenue, I think more "that is no longer a small business" than "poor small business". And if it turns out I'm technically wrong about a legal definition of small business, that's not going to change how concerned I am about that 1,500 person company - it's going to make me specify my concern is around supersmall businesses or whatever. That is, me being wrong about terminology is primarily going to make me change the terms I use.
They did not do this out of generosity or good will to small businesses. They did this for the PR, knowing that they're still rolling in the cash like Scrooge McDuck from all the years they've been milking it, and will continue to milk it, whilst looking like they're giving a handout. And it honestly looked like it worked from the comments of people defending their stance.
> They did not do this out of generosity or good will to small businesses. They did this for the PR
I doubt they did it for generosity or for PR. I do think there was some amount of goodwill. I think it's Apple's way of ensuring that more apps get made. That is, they are "subsidizing(ish)" the creation of many small apps they make almost no money off of anyway in the hopes more small apps will be created which might contain a breakout success. If lowering the revenue on all small apps leads someone to try to make an app and fall into viral like Candy Crush, well Apple is probably going to make more on that one app than they "lost" on all the small apps they charged 15% on combined.
It's actually worse than that. The vast majority of IAP revenue comes from the bigger mobile game publishers.
Not only do Apple take 30% of this, they screwed over all those developers by removing their (ad platforms mostly) ability to track users, thus breaking the developers monetisation model.
I honestly find it hard to believe that they didn't realise that this was going to hit them hard with IAP revenue, but then I've always been surprised at the lack of joined up thinking in large companies.
Yeah, but this one actually hits their revenues. It's disguised for now because their ad platform is way up, but over the longer term this will absolutely crater their app store revenue.
Therefore, I suspect that this will be substantially weakened/rolled back over the next few years (this process has already started, btw).
> I had to fight NY Times like crazy (it was sign up online, call to cancel kind of thing).
I had that issue several years ago with Sonic (the broadband provider).
However, if you're in California, it should be possible to cancel a subscription by the same means that one subscribed to the service in the first place. For example, if one signed up online for a newspaper, they should be able to cancel online as well. This has been in place since July of 2018 I believe.
New restrictions coming into effect in July 2022 require having a link or button to cancel a subscription as part of a customer's profile page, as well as notifying customers of an impending renewal for trials that have an extended free trial period.
Don't get me wrong, I hate all that, but it's not worth a 30% tax on every recurring purchase to me. As Apple admits in the linked emails, this is a cost passed on to the customers.
The idea that these companies can't make 30% more per user on the app store is what is insane to me. On the app store customers have trust. My app store spend is many multiples of what I would spend otherwise.
For most business if you said, hey, I'll take 30% for marketing but get you 100% more revenue they would do that right away. Are Apple app store customers really that cheap relative to android? Androids marketshare is FAR FAR bigger, but apple has just sorted out the give us money safely story.
My own glance is that iOS users spend easily 4x as much as google play users AND are much less likely to steal apps. If that's not worth it to devs apple should be able to unlock and really give users freedom (including to download from anywhere online and install). I wonder if android has a bigger app piracy problem then iOS (which devs apparently don't care about).
Not in the US. Apple has 60% of the mobile market compared to Google's 40%[1], and Apple's App Store is responsible for 100% more revenue than the Play Store.
I used to pay 7.50 then 8 bucks for the Times. But each year I had to call and threaten to cancel. One year they charged me 15-16 and I was pissed off and their phone guy not very helpful so instead of the retention route I just told him cancel no deal. Nothing.
Next day or week after expiry they offered me 4 bucks. I was happily paying 8 but they made me figure 4 was possible so now that's my bar.
> So until these folks clean things up where they ALREADY have full control (on the web) I'm willing to cut apple a ton of slack.
I spent years working at a place where apple wouldn't allow us to even link to a website to manage your account if the signup wasn't sourced by apple, so I feel like any marketing they have around being customer focused is really just window dressing.
This is a "class gets punished because of a few bad students" kinda thing. Without this rule everyone would and did just play the game of using their iOS app to drive people to their website to sign up to avoid paying Apple.
Apple, who charges for exposure and access to their users, I think is reasonably annoyed that people are trying to get that for free.
No one who has an app on the App Store is getting free publicity. There's a $99 fee per year per developer. For that much money, if someone uses their app to drive people to their websites, so what? Don't you think it's hypocritical of Apple to use iTunes as a gateway to Apple Music and iCloud without paying Microsoft a cut?
It's one thing to say Apple has the right to do what it wants with its own platform, but it's another thing entirely to set up a straw man in order to justify those rights.
Exposure in this context means “the right to set up your stall in Apple’s market and sell to their customers.”
It might have been more precise to say “reach” but at the end it’s semantics.
You not paying for “publicity” in a marketing sense you’re paying for high-value shelf space in a store that brings in a lot of customers — iOS devices.
If MS wants to charge publishers 30% for all sales done on Windows then power to them.
No one is trying to get it for free. They are trying to get it for [significantly] less than 30%.
If it's so great to use Apple Pay (one click, easy to revoke payment -- sounds great!), why would a customer not use it over browsing to a random page, entering CC details, and worrying if it will be hard to cancel?
I'd guess the convenience is not worth 10%, much less 30%, to most users.
> They are trying to get it for [significantly] less than 30%.
So what is the right fee for access to iOS users, and in turn, paying for iOS development itself? This isn't just a transactional payment system, it's an end-to-end payment platform designed to take high-value customers and turn them into sales with minimal friction. iOS is that system, not just IAP.
> No one is trying to get it for free. They are trying to get it for [significantly] less than 30%.
And Apple charges 30% for sales of digital goods on their platform. You're trying to get what Apple is selling without paying for it. Don't sell on their platform them -- do what Amazon does with Audible or what Netflix does.
> If it's so great to use Apple Pay (one click, easy to revoke payment -- sounds great!)
Because that isn't what Apple is charging for, users don't pay this fee -- publishers do. They're charging publishers for the privilege to sell to Apple customers. I'm sure users like the convenience, I do, but the fee isn't for me. You're absolutely right that it's not worth 30% to me. But it's absolutely worth 30% to you when the alternative is not being able to sell on iOS and Apple knows it.
It's nuts that in threads like this that people begrudgingly pay Apple's 30% fee while in the same breath saying that they're overcharging. Well clearly not since you're paying it. If they were actually overcharging then you wouldn't be complaining because you just wouldn't have an iOS app.
> Because that isn't what Apple is charging for, users don't pay this fee -- publishers do. They're charging publishers for the privilege to sell to Apple customers. I'm sure users like the convenience, I do, but the fee isn't for me.
Do you seriously believe you're not, in the end, paying that?
I find it hard to believe that you do. Seems far more likey you're gaslighting for your idol, as Apple fanbois so often do.
You can opt-out though. Just don't sell digital goods on your app and don't use your app as a funnel to direct people to your website where you sell them. Audible takes this approach and it seems to work fine enough for them. Boom! Apple will take 0% of your revenue.
That's a useful workaround when Apple allows it, which they haven't done consistently.
But that's not at all what I meant by opting out. I meant "If this is the price for 'exposure', just stop giving me 'exposure' and let me sell digital goods in my app."
Also it's not just 'digital goods', it applies to services too. You can currently manage a netflix subscription in the app, I think, but it's been unavailable a lot and netflix seems to have a special exception that doesn't apply to video services in general.
Audible and Netflix have exceptions given they are “reader” apps. For something like Roblox, they must have in app payments if they accept payment via the web, so the publisher would have to opt out of the platform completely to avoid the 30% surcharge for one of these types of apps.
Do virtualized credit card numbers address this problem? I have a free browser extension from my credit card company that generates virtual account numbers and when I pay for a service I create a new number for it. If it’s difficult to cancel the service I just delete the number instead.
Apple allows you to block the company from doing tracking of you and connecting that to other info. These things are hard to block technically sometimes.
I had a company threaten collections action over an unpaid subscription because they continued to provide the service (that I didn't want) and I hadn't paid. It doesn't matter that I had an email saying please cancel. You have to dial XXX.
On the business side we are seeing more deals where you have to provide written notice 60 days BEFORE the end of the 5 year term but not more than 90 days (check your copier lease agreements). All these are essentially tricks to force renewals in my view (and are totally allowed).
It addresses the problem in the same way that shoplifting addresses the problem of not having enough money for what you want. Technically, you're in the wrong. You're failing to pay a bill you signed up to pay. And no one will go after you for $4 (unless they really want to lose money, I guess.) But if you try the same thing on tens of thousands of dollars of subscriptions (say, as a business you make a decision to do that) you'll probably get sued.
This shouldn't be on-the-right-side-of-the-law. You should be able to have your credit card send a "cancel" signal and that should be it. Further charges are theft.
Legally it doesn't, but for practical purposes most recurring subscriptions probably won't pursue you over a declined payment and will just suspend your account. I don't advocate this, but I've heard that it works.
And yet subscription scams abound on the App Store. Apple makes it INSANELY easy to start subscribing to a $7.99 per week subscription that there is a load of scummy apps that try to trick you into starting one and people would be a lot more cautious if they had to manually enter their billing info.
I find a lot of their content quite good and am more than happy to pay for it.
And a quick googlin' indicates it wasn't a marketing department that came up with "the paper of record" but librarians.
But to be Fair and Balanced, you're right to be shocked that a company would use marketing slogans to sell their product. Especially a news organization.
Apple Pay isn't the only payment processor that's convenient like this. But of course, Apple has created a market where their processor is the only one allowed.
I mean I pay for shit on my iPhone with PayPal, "Shop Pay", "Amazon Pay", or direct CC entry -- not digital goods obviously but still it's a frame of reference. None are half as good as Apple Pay's "hit button, double click, FaceID, done" flow. Like I will actually switch to using my phone to make purchases because I don't want to enter my CC info on some random site.
Your experience with other payment processors on an iPhone are indeed not as good simply because they aren't allowed to be as good. Every single one of your experiences with these alternative payment processors was forced through a Safari browser.
Nothing is stopping the 'Shop' app or Amazon app from being used for any and all third-party (or fourth party, in this case) payments, as long as they're not selling purely digital goods.
I also wish Apple would make it easier to switch to a different credit card for a one-off purchase. And stop forcing everyone in a Family Sharing group to use the same credit card for all purchases
Argh, every day I consider going back to my iPhone 8 Plus purely because FaceID is so terrible. The point about switching cards easily is also absolutely right, plenty of places don’t accept American Express which is my default card.
If it's anything like Google Subscriptions, there's the danger of disputing charges leading to your Apple account being banned, so it's probably in the users' interests to avoid it.
But of course, when you've just come off of a plane at 2 AM and want to get a ride to your hotel so you can get a few hours of sleep before checkout time, this is probably not something users will think about.
> It's more than that: it's the fact that all of the payment info is there.
Haven't Lyft and Uber already collected that payment information to charge per ride today? Is there even any friction savings here? What justifies the 30% cut when these companies seem to have done just fine not using the Apple Payment infrastructure?
Apple Pay is different from App Store fees. Apple Pay is a payment process where the store doesn’t get your credit card number. Apple Store fees are a matter of business agreements between software companies and Apple.
Using PayPal won’t help an app company escape its agreements with Apple.
Apple should be forced to allow other payment processors store a platform wide login like you can with a Google account. So none of the payments run through Apples infrastructure, but there is no extra friction over their provider.
Eventually they will be in every sizeable market outside the US starting with Korea. With all that 30% cut money leaving the domestic economy and multi trillion valuation, Apple has made itself too juicy a target
Even with the 30% up front - if it is such a great deal, why don't they allow alternatives?
It's clear as day they know the minute they allowed alternatives, a giant fraction of the App Store would depart because they can get a better deal either elsewhere.
> It's clear as day they know the minute they allowed alternatives, a giant fraction of the App Store would depart because they can get a better deal either elsewhere.
As an user of an iPhone I don't want this. I bought an iPhone because I deal with enough technology in my day to day job and I want a phone that's straightforward to use and doesn't need any attention. So no I don't want to install three app stores on my iPhone and have to deal with 20 different payment providers.
In the end it's important to make the distinction between consumer interests and the interest of businesses that want to sell their product on the iOS platform. I get that this sucks for developers because iOS is from what I've heard much more profitable than Android. In my opinion consumers interests should be weighed higher here and Apple's policies for the App store are mostly pro consumer, at least compared with the situation on different platforms.
Consumers that want a more open platform can always choose Android or Linux phones.
It's a totally false dichotomy that you have to choose between consumer friendly and business friendly outcome. The idea those things are linked is a convenient fiction Apple has come up with to maintain its position of control.
Apple can put however many constraints it wants on external app stores. It can make them present a uniform interface for payment, delivery etc etc. Just like it puts those constraints already on the apps. Pretending it's powerless and all these terrible outcomes will ensue when it literally already controls every detail of every single app on the existing store is one of Apple's "big lies" (but one clearly a lot of people have fallen for).
> Apple can put however many constraints it wants on external app stores.
I doubt you mean that. All apps must be served from server farms in the Oort Cloud and be in Esperanto would be acceptable constraints?
But it's actually not a false dichotomy. Things I want are vendors who make iOS apps forced to use other parts of the Apple ecosystem. Forced to use Safari. Forced to offer Apple Single Sign On (if they use anyone's). Forced to offer Apple's payment methods. Those are the very things they are trying to get out of by having alternate app stores.
That's a huge issue actually. See the story the other day about Optional Chaining operator breaking iOS 12 Safari[1] and there's nothing users can do about it even if the hardware is perfectly capable of handling Optional Chaining operators.
If I could just install another browser then that issue disappears. But I can't do that, because Apple will never allow any other web renderers on the App Store.
The day Apple allows other browsers is the day you can put a countdown clock on the entire web only working with Chromium in a way that Microsoft could only dream of during their IE on the desktop period. Not because Chrome is better, but because Google has been very effective at using its dominant web position to force people to "upgrade" to Chrome.
Even Microsoft, which invested huge amounts of money in Edge, packed it in when Google kept telling people that Edge was going to kill their firstborn (or whatever other tactics they use, like allegedly making YouTube not work properly.)
So, yeah, I'm fine with allowing other browsers - a few years after we've seen Google successfully broken up.
Meanwhile, I'm fine with websites just not using Optional Chaining operators. It's syntactical sugar. And frankly, rapid iterations on JavaScript, adding optional features only supported on Chrome and then making people think the web is broken without them, is a huge source of Google's ability to bully people into using Chrome.
I agree it's a stupid problem to have when simple solutions exist (use cool features while developing, babel them into old boring code that runs on your smart fridge from 2002), but it's a problem nonetheless and a problem we wouldn't have if it was possible to install a new non-Safari/WebKit browser on iOS 12.
> Forced to use Safari. Forced to offer Apple Single Sign On ...
I don't understand why you think Apple couldn't make those requirements? They already do for the apps on their own store, why couldn't the require it for apps on other stores? Apple can still control the signature process to allow apps to install on devices, they can just not sign anything they don't like.
(Putting aside whether those are reasonable constraints or not, I don't necessarily agree with them, but it's a separate matter).
Avoiding those restrictions (including Apple signing apps) are usually the reason listed to start other stores. Why benefit would those other stores offer to anyone?
Why would prices be cheaper? How would the user interface be changed in anyway and how would it benefit users?
That's exactly my point. There are no real improvements I can see coming from any new store. Please explain how it will be better and why any actor would make it better.
One Apple employee acknowledged that in their discussions with Uber employees about their need to pay a commission on IAPs, Uber tried to convince Apple to remove their commission because that 30% would have to get passed on to customers.
However, I have no reason to believe that Uber would actually follow through. It seemed like a bluff. Certainly, any economic theory I'm aware of would have Uber and customers split that 30%, with Uber paying the vast majority out of profits.
should apple be allowed to make a (what seems like substantial) profit off that lock-in? by comparison payment processors like stripe can offer as a baseline 2.9% and 30 cents. if you predict that the average uber is 10 dollars (which is probably low these days) that's 6% if you were able to process with stripe and they're still turning a profit.
If you want to make the argument that because of the substantial number of free apps that apple needs to subsidize the costs of review etc. then I'm 100% sure that these companies would rather pay for the underlying resources than get raked over by this pricing scheme.
You do understand that Uber can use Stripe (or whoever else) to process the rides? It's just the in-app premium monthly membership fee we're discussing?
Apple's payments are extremely pro-user friendly. Do I wish they charged less? Yes. But if it's open to competition no one will use Apple payments even if they are the cheapest, because they are tilted more in the user's favor than other payment methods (subscription cancellation, etc.)
> It's just the in-app premium monthly membership fee we're discussing?
Sure, but even then Stripe charges half a percent extra to handle subscriptions. Given Uber One is 10$, my original assessment still stands that Apple wants ~4x what equivalent processors wants on their marketplace.
> But if it's open to competition no one will use Apple payments even if they are the cheapest
You're assuming that all subscription businesses would prefer to engage unethically with their customers. Many businesses are much more interested in the customer acquisition funnel and building up trust, and if Apple payments eliminates dropoff in subscribers because their payment credentials are already there or it just has strong user trust then many companies will prefer it even if they aren't the cheapest (but competitive).
And if Apple wants to enforce standard such that even the unethical companies have to play in their garden, then they need to be pegged at a fair and reasonable cost of services delivered which we can ascertain from everybody else who is doing this.
> You're assuming that all subscription businesses would prefer to engage unethically with their customers.
I'm assuming some do. Apple protects me from those companies. I also think most people aren't going to steal from me, but I still lock my door. Meanwhile, you have far more faith than I do that businesses will pay a fairly high additional cost (say 4x) to signal that cancelling is trustworthy - whether it makes sense or not.
Basically, Apple currently protects me over app developers, and I want that to continue.
Would you support them doing the same thing on MacOS? Or transactions through Safari?
I don’t see how iOS requires a 30% cut but Macs and transactions through Safari don’t.
The justification is the same, they make and maintain all the tech behind those the same as they do iOS. So really iOS shouldn’t have a cut or MacOS and Safari should. To be consistent.
There is a mutual benefit. More apps means that Apple benefits from a stronger platform (and can sell more copies of iDevices/iOS). That's why Microsoft never charged 30% for the privilege of selling an app on MSWindows, back in the old days.
A platform is largely "made" by external developers who contribute to the platform. It is unfair to start charging them (or anyone who comes later) for being on the platform.
Of course, Apple execs, who have no pride in making things but only in extracting money out of things, will have a different opinion on this.
> A platform is largely "made" by external developers who contribute to the platform. It is unfair to start charging them (or anyone who comes later) for being on the platform.
> Of course, Apple execs, who have no pride in making things but only in extracting money out of things, will have a different opinion on this.
I think they've always known, that's why they created an artificial ecosystem where this equation is backwards. No developer can harm Apple, but Apple can harm the biggest of developers on a whim.
And this is the issue as I see it. Apple have made a device they know will be used a certain way, a general purpose computing device, but they are the only ones who can decide what software is allowed on it. I believe this should be illegal, either you've made a purpose-specific device and can impose a lot of restrictions on usage, or you've made a general purpose computing device, and once you've done that I believe there needs to be laws that say an owner of such a device must be allowed to personally decide what software runs on it. That means:
- Ability to unlock bootloader if I want to
- Ability to load software on the device unrestricted
Computers always worked like this, so we never had to regulate it, but now that corporations have discovered the loophole we really need to impose regulations. If we don't then markets like the App Store will never be fair.
I think governments are slowly addressing "platforms". Not just computing platforms, but platforms in general. E.g. shopping platforms, gig-platforms. Platforms are like an economy inside an economy, with the platform-company being the regulator, and this can be a bad thing (much worse than if the government was the regulator).
Exactly, the best example with regards to the App Store is Apples own participation in large swaths of it with both iCloud storage (Dropbox, Google Drive, Box, etc), Apple TV+ (Netflix, Disney+, Amazon Prime Video, etc), or Apple Music (Spotify, Tidal, whatever Google has called their service for 2022, etc).
In each of these categories Apple are competing unfairly by demanding their competitors pay them 30% for the privilege of reaching over half the population of every first world country.
> I feel like these marketplaces could maybe justify 30% on the purchase of an app up front, where there are clear benefits to the exposure and platform offered by them. But ongoing revenue is really attributable to the app itself and feels to me much harder to justify.
It’s not 30% of ongoing revenue though. You only have to pay 30% in one situation: you are already earning millions of dollars in the App Store AND it’s the first year of the subscription.
If you earn less than a million dollars, you qualify for the small business program and the rate is 15%:
maybe stop supporting apple's exploitive practices then and not buy their products. At this point, they're second tier on phones and laptops and dead last in desktop PC. I guess they're still first in watch and earbuds but that isn't saying much.
If you're talking about hardware capabilities you are so wrong. They are only in the market position that they are in because their stuff is expensive, and people think they need to buy new stuff so often that Apples stuff becomes prohibitively expensive for them.
Their tech is solid. M1 completely obliterates the competition for laptops, and is getting there for desktop. Their desktop positioning is mostly self-made to be honest, they haven't really focused on it.
Phones are so overpowered these days that the only thing that really matters is battery life, and Apples chips accomplish so much more than the competition with a lot less battery.
> M1 completely obliterates the competition for laptops
IMO, you are both wrong. The M1 is fine as a laptop CPU, because what it needs to do well, it does very well - which is power efficiency. However, if what you need is computational power, and you don't particularly prioritize power consumption, then the M1 not only does not obliterate the competition, it significantly under-performs. And this is before you add in a dedicated GPU that solves some of those tasks much, much faster.
Take Cinebench R23, where M1 Pro (10+16) has about the same performance as the top contenders that do not have dedicated GPU cores, e.g. Ryzen 9 5900HX and Core i9-11980HK. Throw in a dedicated GPU for a work task that can properly utilize it, and the performance difference is at least 3x that of the M1.
Now, I'm not saying that the M1 is bad. It's just that.... "Completely obliterates the competition for laptops" is a strange way to describe "yeah, if both systems do very little, the M1 will use much less power!". For many, this results in it being the best laptop CPU for the tradeoffs they want, especially if the MacOS is an added positive.
However, that the M1 competes and outperforms in terms of computation performance, would be just wrong.
Which is why I specifically said laptops, where workloads tend to be of the kind that benefits from efficiency. You're right that there are many workloads that they are not perfect for. Hoping that the second generation addresses some of these issues, but as a web developer M1 is already pretty damn great.
> At this point I’d be happy if Apple just let me install apps outside their ecosystem, then they could at least defend themselves by saying if the developers aren’t happy with the terms of the App Store they can offer alternative methods.
And, of course, you can also use a different smart phone ecosystem. Android makes it comparatively easier to sideload apps and mess with stuff.
The overwhelming majority of apps can be turned into websites instead, unshackled by store regulations. Devs should vote with their feet if app store costs outweigh the benefits
But a lot of app classes can't. Browsers being the obvious one, but generally anything that requires optimised code, heavy computation, multi-threadedness, or access to certain sensors. Anything that fits any of those requirements has to be a real app and must then adhere to Apples rules.
I suspect if the UI offered customers to pay now using Apple's thing, or have a button to get 30% off by going to some more convoluted flow, a lot of people would choose the rebate.
I think at the point they're making the transaction, they're already locked in. It's not like someone is going to buy a new phone and replace all their apps when they're purchasing an Uber subscription.
Plus, I think another commenter pointed out that the end user is still getting the same price on Android - I don't know if that's because Apple mandates something or a business decision on the company's side?
> Apple wants their cut. This is the only way for them to get any cut at all. It’s either this rule or $0 revenue.
Why do they deserve a cut?
Uber and Lyft, deliver a material service, Apple have not contributed to that in any way beyond existing as a general purpose computer manufacturer.
Take an alternative, food delivery service, you pay a monthly subscription for a set selection of fruit and veg delivered every week. The cost is made up of food cost and delivery cost... You could sign up through a website, or you could sign up through an app on Apple's app store, in the later case the only option would be to increase the price by 30%, because there is no where near 30% profit left over.
Not convinced? Ok lets go to an extreme, what about a mortgage monthly repayment app, that's essentially a subscription to your home right? Do you think Apple deserve to have almost 30% of the value of your house for the privilege of letting you use an app to pay? Does their App store really deliver that much value?
Before, it was sort of justifiable when people were trying their get rich quick schemes with flappy bird clones... because the argument from the other side was a weak "but that's my get rich quick scheme", Apple's platform and what they shove in front of users faces made a real difference to the almost pure profit of those Apps, the apps simply would not be popular without Apple... but as soon as we start talking about apps that deliver material services and other significant value it makes no sense to argue that Apple deserve even 1 penny. Apple have gone completely fucking mental with their own greed, they think they deserve a slice of the entire world.
Where's Uber without a trustworthy, city-corner-accurate GPS location for every driver and rider? Where's Instacart without a high-quality barcode scanner^W^Wcamera in the pocket of every shopper? The platform and software Apple delivered enabled those physical businesses.
I guess but that's not really how services like that work. And iOS is 100% a service with customer owned hardware. The real cost of your iPhone is paid by every publisher that wants to sell you stuff on your phone.
Amazon operates this way, DoorDash operates this way. You aren't paying the cost of your deliveries, sure you get charged a fee but the bulk is paid by the seller forking over 30% of their revenue for the privilege of selling to you.
Just because you're paying doesn't mean you aren't the product.
Your argument is essentially the same as for patents... "I invented this tech, everyone can use it to create whole new things, I deserve a cut for my investment."
But Apple didn't invent GPS, it didn't invent the barcode scanner. Apple sells a hardware with a ridiculous profit margin. Devices that only have value through the software that is written for them, Uber is not selling a device with a GPS, they are selling a taxi service (for better or worse), and they will use whatever is available on the device to make that work well.
Developers for 10+ years abandoned Symbian, BlackBerry, webOS, Windows Phone and everything else and instead focused on better hardware, software and developer APIs (iOS and Android) and led other companies to die because either their hardware wasn’t good enough or consumers were abandoning them because they couldn’t download their favorite apps.
So maybe Apple did something “right” to deserve millions of developers and billion+ consumers to chose them instead of others?
It’s awesome to be in 2022 and act like “Apple doesn’t deserve anything”. Look at last 15 years of mobile history and what Apple has done to this industry.
Apple did do something right a long time ago... but it doesn't mean they get an indefinite 30% cut of the entire world.
I don't have a stake in this, I don't own an iPhone or Android phone, or any smart phone and never have... I just see a rent seeker abusing their position as much as possible.
> Developers for 10+ years abandoned Symbian, BlackBerry, webOS, Windows Phone and everything else and instead focused on better hardware, software and developer APIs [...]
Note that we are discussing a huge markup on a material service, not merely software.
Yeah that's the problem entirely. We need legal regulations here to force Apples hand. If you can't define in simple terms what specific category of entertainment your device falls under then you've made a general purpose computing device and that must come with requirements that users can load whatever code they desire onto it with your blessing.
Allow users to do that and they can put whatever rules they want on their store.
Feel free to start your own company that makes phones that behave however you want. Why should you get to decide what other people’s products “should be”?
And Apple's not asking for a cut of that.
Apple is asking for 30% of the monthly Uber Membership fees, created as an IAP. The part that is completely non-scaling to the amount of rides the person takes. The part that is practically guaranteed to come from Uber's profits and not from the end users or from drivers.
So, I really find it hard to care about big companies fighting about it.
> e, what about a mortgage monthly repayment app, that's essentially a subscription to your home right? Do you think Apple deserve to have almost 30% of the value of your house for the privilege of letting you use an app to pay?
Apple's made it a point that they don't collect 30% on real (non-digital) purchases. Like a mortgage. They would be collecting 30% of the $25 convenience fee your bank slaps on, not the mortgage payment. Which may make it less likely a bank decides to add those fees.
Some middlemen are completely useless, others play a critical and necessary role in providing access to a product, and there is a whole spectrum in between.
There is some reasonable cost involved in sourcing food from different countries reliably, regularly, in quantity into your local supermarket. Sure they take a profit, but they invested in infrastructure and employ people to put it all together, without which you wouldn't have a good selection of affordable food... They add a tangible value, and in fact effectively reduce the cost of the end product through scale (it's more cost efficient to deliver a million oranges over a long distance than single oranges in a disorganised manner).
Apple are not part of this equation, without Apple it would still exist, it might only be slighly less convenient to pay and select via a native app.
In short, Apple is an artificial middleman... they are at the extreme end of the useless scale, the rent seekers with an outrageous markup. They are not part of the chain of people involved in delivering food or picking up passengers, they are at most a transaction fee handler, and even then they are forcibly a transaction handler. Everything about it is artificial.
Thank you for your thoughtful response! I think we’re in full agreement — which is weird on the Internet.
> There is some reasonable cost involved […]
Apple is just taking a profit like your corner store, COOP, Migros, etc. Is it reasonable? Don’t know! Are profit margins how most business operate? That is for sure.
I don't know if you're trolling or not... but are you seriously unaware of the value they're providing? Is this some kind of mystery to many people?
In the PC/Linux space -- where traditionally no online marketplace existed with wide reach -- if you want to sell your software you have to pull yourself up by your own bootstraps:
1. Create a website.
2. Market your software. Nobody will see it. Spend more money on more marketing, and then maybe -- just maybe -- you might reach 1-10% of your potential market.
3. Sign up with a credit card payment processor. Find out that people will navigate all the way to your store page, see the CC entry form, and click cancel. A lot of people. Like... 50%.
4. Discover that you're treated like the dirt stuck to the bottom of the payment processor's shoes, and they charge a lot of overhead too. Especially for small transcations. You have no hope, ever, of selling 1 million copies of your small app for $1 and make anywhere near a million dollars.
5. Get hacked because you can't afford a full security team to babysit your online store 24/7.
6. Discover that you're on the second page of Google's search results for your exact product name because of competitor's SEO.
7. And so on. And on, and on...
Apple's 30% cut is cheap. It's notably less than doing it yourself at a small scale, under one million dollars or so.
They instantly provide you with hundreds of millions of potential customers, free marketing and exposure, frictionless payment processing that goes down to the single-dollar range efficiently, secure systems for all of that, and more.
Everybody in the mobile app industry knows that while there are more Android devices out there, the profit is in the Apple ecosystem.
An ecosystem Apple created at enormous expense.
An ecosystem that has devices that are mostly kept up-to-date (by Apple! For 6+ years! At huge expense!), massively reducing development and test effort. Notably, unlike the Android platform which is a shit-show of bargain basement garbage with either zero vendor support, or next to zero.
An ecosystem where customers feel safe because of the security guarantees provided by Apple! Confident customers spend more. A lot more. The Android marketplace is like 30% malware at this point, for comparison. Customers don't feel safe spending their money there. I know I don't.
I could go on like this for pages and pages, but I hope you get the point.
You're getting the end-result of the main product of the world's biggest company. If you think this is worthless, literally without value, then you're probably one of those people that also think that they could reproduce the Uber app over a weekend...
You wrote this block of text but missed the whole point of the link: they didn't end up charging this fee, at all. They got 0%. The cut didn't go up. The store didn't close. There was never a basis in cost, whatsoever.
It's reasonable to assume that Apple chose 30% because that was the prevailing standard in the physical retail world.
That markup has been competed away in some circumstances (eg Costco) but otherwise still holds generally (Walmart 32%) It reflects unavoidable costs to all retailers, like local rents, staffing, transport etc
Given that tech does not have a retail's fixed costs why has that markup not been competed away to establish a markup based on tech's unavoidable fixed costs?
What is your argument here? That Apple's services cost literally nothing to provide?
Apple provides developers access to an enormous marketplace that they run. A marketplace with hundreds of millions of "high value" customers pre-configured for payments. All sorts of related services are included, such as fraud detection, currency conversion, etc...
What do you think Apple does? Just skim 30% off the top without doing anything else?
Seriously, some people live in this fantasy world where all products should be worth 100% of their raw material cost, and services should cost only what the showroom rent+aircon costs to provide.
Apple's profit margin on the App Store was ~80% in 2019[1]. In a healthy market, competition would lead to increased efficiencies and more savings for consumers that would cut into those margins. Instead the market has stagnated because competition was forbidden, and one company profits handsomely from it.
> It is Apple's Devices, Apple's Software, Apple's Platform, Apple's user and Apple's Customer, everything belongs to Apple. But Apple is very generous and give "70%" of those revenue to developers and business partners.
> These companies and developers are greedy. They want even more than 70%! Uber and Lyft should be kicked out of the App Store.
> Laws and Regulations wants to fine Apple for Anti-Trust and Anti Competitive practice, Apple should pull out those market, that is the EU common market, Australia, Japan, South Korea, Russia, India!
I wish I made these sentiment up, except you will find many Apple apologist supporting Apple writing exactly that.
But none of these matters to the general public. Apple is Three Trillion Market Cap company, they are very successful, selling iPhone and Mac in record numbers. Tim Cook will continue to tell you Apple is making the world a better place. To enrich people's lives. And privacy is a fundamental human right. [ Subject to Terms and Condition ]. With a big smile on the face.
On another note it is interesting this isn't the first time Phil Schiller has been fighting the battle for users and developers. But now he is "promoted" ( cough ) to Apple Fellow. And Eddy Cue......
Apple is a small country disguised as a company. This is nothing else but essentially a tax, collecting economic rent from their digital fiefdom. Of course unlike actual nation states, Apple's not really in the business of providing many public services in return.
Seems like we're kind of at the point where actual nation states should take that as a sign of peer competition and do something about it because I honestly have no idea why we're tolerating this.
As an attempt to steelman their point, Apple has more employees than about 30 countries and has more CASH on hand than the GDP of over a 100 countries (220~ total worldwide).
As far as regulations go, I think those points could be an argument that more regulation could be warranted.
Apple's yearly revenue is ~140B, which would make it the 77th largest country by GDP if it were a country, and if you consider revenue and gdp to be similar terms.
US can print their own money. AAPL can't.
It's like if you moved money from credit card to a checking account.
You are not going get any richer from that. Just the opposite.
that's like saying "standard oil just sells hydrocarbon". Computing underpins virtually every aspect of the economy, almost all communication, the national infrastructure, increasingly the military, and the public debate.
The tech industry (of which Apple is the largest representative) is, and increasingly becoming even more, the second largest center of power within any modern nation. As evidenced by the fact that they can and have removed elected representatives (most of which I'm not a fan of to make that clear) from public debate.
Sure, computing as a whole is critical. Apple overwhelmingly is just doing consumer stuff. Servers, military, voting machines, you’re not likely to see that Apple logo.
Older versions of the app review guidelines allowed apps that could access content sold outside the app store ("reader" apps) to dodge the app store commission if their in-app content was provided "at the same price or less than it is offered outside the app store" (formerly section 11.13 of the guidelines).
Hmm, I wonder if Uber/Lift could have a system where you either have an iOS account or an Android account. So then whatever you buy on Android wouldn't be transferrable to iOS. You could switch your account between the operating systems but your subscription wouldn't transfer.
Except that just means they'll get less subscribers. The margins on these things are razor thin. If people don't think they're getting a deal they won't sign up.
This is such a bullshit argument nowadays. There are an estimated 113 million iPhone users in the United States [1]. That's ~half of the smartphone market, and ~half of the number of adults in the US. Apple sells brand new iPhones starting at $400. Samsung sells brand new Galaxy phones at base storage starting at $1800.
Apple's best selling main-line product in 2021 was not the iPhone. Not Mac. Not the Watch or iPad. It was Airpods. Normal Airpods, not even the Pros. The cheapest product to ever be graced with a top-page tab on apple.com, Apple sells tens of millions more Airpods than iPhones. And why wouldn't they? They're cheap! Because, hate to break it, but Apple isn't a premium brand; they're just a brand.
The iPhone is about as premium a smartphone as Target is a premium store, and this notion that Apple still exclusively services the premium segment probably comes from some combination of Apple users wishing they were rich & special, and even Android users looking to play the everyman victim. None of that is valid. But it gets applied to justify Apple's unprecedented control & tax over commerce on their platform; its alright because it only impacts rich people, if you want access to the rich people you gotta charge the rich people more, and make the rich gatekeeper even richer. In reality, all it serves to do is make everyone poorer; it serves to limit affordable access to goods and services; and it makes Apple rich.
> They're cheap! Because, hate to break it, but Apple isn't a premium brand; they're just a brand.
AirPods are not cheap to the average person. You can get earbuds for under ten bucks. AirPods are a premium option for most people. AirPods being for rich people was even a popular meme for a while.
Ten dollars for headphones? United States Dollars? Who are you, Bill Gates?!
Personally; I steal a bit of copper wire from whoever had the misfortune of parking outside my box, I mean, house, then wire it up to a couple styrofoam cups I dig out of the garbage can down on the corner. With how compressed MP3s are, I doubt anyone could tell the difference. I can't imagine why anyone buys headphones, really.
Then again... Airpods & Airpods Pro are reported by many sources to be the best selling headphones of 2021... but I'm sure, in aggregate, all those wish.com $10 cans outnumber their sales... and let's also, you know, not consider the more fair comparison of aggregating Alexa Buds, Sony XM4s, Bose Buds, Surface Buds, Galaxy Buds, Galaxy Buds Pro, Galaxy Buds Live, Pixel Buds, Beats Buds... If there's a reason why every company and their mother churns out Beans like they're going out of style, it probably isn't because they're, uh, selling. They're all Premium Brands making Premium Products for Select Clientele.
If you don’t think $129 for earphones is an expensive luxury for the average person, you are in a bubble. Apple offers payment plans for them because people can’t afford to drop that much cash in one go.
Compared to what, Fisher Price? The entry level iPhone is $400, with refurbs lower, and even new units are often available free on contract with a carrier in the US.
To my knowledge you are allowed to do so, but aren't allowed to tell people that it's cheaper somewhere else. I don't know how this works in practice though
I disagree. I think Apple should get nothing from them. The rent seeking has to stop. Anything with a service fee should be outside their grasp. The product isn’t the app, it’s the service.
Apple should not be entitled to any transaction that happens on the phone. They don't get a cut of money I move through my banks app. Anything I buy on the Amazon app. Do they get 30% of my water bill I pay? Again if something is being bought through the app store, like a game, an app, etc sure. But if your app is about a service that exists completely beyond apple, they should get nothing. Imagine comcast asking for 30% because it happened between your internet provider and an online store.
Recently there was discussion[0] about Apple devices dominance amongst teenagers ~85% mobile devices in US. Apple is heading towards market domination in a couple of years - in US first but in some European countries trend seems to be catching as well.
With company's total control over locked down hardware, software, software delivery and browser (and other, fresh endeavors like identity management aka AppleId, payments etc) it will be very interesting time and quite a show to observe.
Maybe they should... "We charge $50/month extra for the iphone charging service. If we detect an iPhone in your house, the charge will be automatically applied to your bill".
Not saying I agree with what I'm about to respond with, but nonetheless:
If not using IAP is worse for users, wouldn't users then immediately gravitate to apps that do use IAP? Meaning not using IAP would be a competitive disadvantage and tada, capitalism magic--especially given iOS users are the most valuable segment in the world (typically wealthier and much more willing to spend $1.99 on an app than their Android counterparts)
The counter-argument is it is better for users in ways they are oblivious to (i.e. security), but even that should eventually make its way to the user. If eventually all but IAP cards are compromised or abused, users will eventually change their behavior, especially iOS users (typically more educated).
* all iOS user characterizations are based on 3rd party research and not my own opinions
I think a lot of the takes on this are coming at it from the wrong angle - "Why does Apple deserve a third of app revenue?"
What if we flip it to: "Why do app developers deserve access to Apple's customers?"
30% is the price to access Apple's customers.
If you're a developer and don't like this, then don't build an iOS app. Build Android-only, or build a web app.
If you're a customer and don't like this, then don't buy an iPhone. Vote with your feet. Buy an Android. Or a Pinephone/Fairphone/Librem which are as close to a general purpose computer-as-a-phone outside of the Apple-Google duopoly that there is at the current time.
I understand that the value of the Apple ecosystem is not just what Apple bring to the table. It's the ecosphere of apps available. So there's definitely a symbiosis here. But Apple is like China here. No matter how ethically questionable, there will always be those for whom the market that Apple represents is too tempting to ignore. Even with a 30% cost of doing business. Meaning there will always be app developers building apps for iOS.
> What if we flip it to: "Why do app developers deserve access to Apple's customers?"
As I posted in another comment, part of the reason Apple has so many customers is that their platform has so many apps. If all developers left the App Store overnight, would anyone go out and buy an iPhone the next day?
Apple benefits greatly from their app ecosystem, even ignoring the 30% App Store cut. They should be careful not to kill the goose that lays the golden eggs.
I absolutely agree, however the point I made is that the temptation of the market share means there will always be app developers willing to step in to replace any that withdraw from the market.
If I'm an app developer, from a purely financial perspective, why would I forego a market of Apple's size, even with a 30% tariff? Sure, I may lobby for change, or even go to court to try to reduce that tariff. But while I'm doing that, I sure won't be leaving money on the table. And there's little chance I'll abandon that market in the interim, in order to maintain an ethical position.
I don't understand this argument. Would it apply anywhere else? Could some company sell houses where they demand 30% of the price of every appliance you buy? You're the housing company's customer so they're bringing you their customers apparently.
Could some car company demand 30% of all gas, tires, oil, and electricity? You're the car company's customer. Could a refrigerator company demand 30% of all groceries you put in it?
There have been laws that disallow you to limit customer choice. For one example, a company can't force you to buy 1st party parts for repairs
You're position seems to be if they can prevent people from doing something with their device they don't like and people still buy it then that's ok. So if a sofa manufacture found a way to prevent people of color from sitting on it and people bought it that would be perfectly fine by your position I guess. I could certain make a fridge that complained if you put something in it that had no RFID tag and that those tags must correspond to items they've licensed.
In any case, my position is, no company should have that kind of power, period. A house company shouldn't be able to decide who my guests are who what items I put in it. A fridge company shouldn't be able to decide what items I keep cold. A cabinet company shouldn't be able to to decide what I store in my cabinets. And a computer company should not be able to decide what I can run on my computer (smartphones are computers).
Apple has to pay to keep your app hosted in the store. They have to pay to check your app for safety. They have to pay developers to maintain the store. Your fridge doesn't have that. Your fridge manufacturer made something to host your food. It costs them zero dollars to perform the hosting. In fact, you have to pay another company (the electric company) that hosting cost. If a fridge manufacturer decided to become the electrical company, then it would make more sense.
Apple has to pay costs to maintain the app store, the operating system for the app store, and the hosting costs in-between.
This is mostly just arguing accounting, which is something Tim Cook admitted under oath that Apple doesn't do [1].
The benefit of such a simple fee structure is that it becomes insidiously difficult to ask questions and receive legitimate answers about equity. How much does it cost to host the app? To pay engineers & marketers to build security scanning and storefront features?
These are not questions we generally ask of private institutions. But Apple's products are decreasingly operating like a private institution; they're looking a lot more like a public institution; a critical platform that hundreds of millions of people worldwide rely on for productivity, entertainment, communication, and commerce. We do ask these questions of our governments; we want to know how much we're spending on things like the military, roads, NASA, because knowing these numbers is critical in assessing effectiveness and accountability.
Here's a question: Apple does invest some amount of money into application security scanning and reviews. Now there's an important domain; keeping your users safe. How much? We don't know. What we do know: They're REALLY bad at it. Inarguably, the worst in the industry; right down there with Microsoft Teams and Log4J. They keep many things quiet, but they can't keep that quiet. Are they spending billions, and seeing such poor outcomes? Are they spending thousands, and should be spending far more, but won't? We don't know.
This always leads to: If users had an issue with the platform, they would leave. Let's play in the space where this is true; where the smartphone market is full of fungible platforms (it isn't, but:). Would users leave if they knew just how bad the App Store & iOS was at keeping them safe? Many users don't even know what those two things are. But they still deserve to be kept safe; maybe even more-so than more experienced users like us. The onus is on Apple to keep them safe, and Apple has spent a decade failing at it. Where does the onus fall, then? To the void? It's reasonable to argue: Experts, and the Government. Someone needs to hold them accountable. If a bridge fails, injuring dozens of people, we don't say "well, they tried their best! just think on all the cars that were able to use it without it falling." Nor, do we expect drivers to do an engineering deep dive on every bridge they cross, so they can make an informed decision about which one they want to take to work today.
I won't argue Apple's safety record on absolute terms, but I am fully convinced that it is safer than the Android alternatives in the smartphone space. This is the one reason why even after I de-Appled my PC (sold the MBA and bought a made-for-linux laptop), de-Appled my cloud storage provider, and de-Appled my email, I still use an iPhone.
That totally happens by the way. When we built our house, we had to use bathroom supplier X and the builder took a cut (might very well be 30%). Same for the kitchen.
The builder brings in the customers, and the bathroom and kitchen suppliers seem to be happy to share a ~30% commission for it.
(note: this is in Belgium, but I assume similar setups are commonplace in other places)
This is way too charitable to the largest company in the world, one which enjoys a duopoly over the smartphone market in the United States. If you are Lyft and you don’t have an iOS app, then you probably go out of business.
Lyft would only go out of business (without an iOS app) because there are Lyft competitors who won't cede the Apple customer segment. If all those players stayed Android-only, not only would they survive, but they'd be turning Android into a more compelling alternative. But this would require two things - for them to collude to stay off iOS, and for no new competitors to write an iOS app.
If having access to the Apple customer segment is the difference between success or failure - even despite the 30% tariff - then why is it strange that access to that segment has a price? This is a market.
That’d be a fair point if the Google Play store didn’t charge the same 30% fees. As things stand, you have no choice but to pay these fees if you want to distribute a native app to smartphone customers.
That’s why the market isn’t fair. Because two companies control essentially all app distribution, and can charge whatever fees they want with no credible challenge from any market force.
These companies have also shown they intend to squeeze the market for whatever they can without any sympathy for consumers or app developers. I think the only reasonable option is for the government to step in with antitrust measures.
I agree with you but I think a far more effective way to "win" this for consumers, would be to press both Apple and Google to clarify disambiguate the 30% from the total cost to the consumer. i.e. just like on a grocery receipt where you clearly see the sales tax you pay as a separate item from the price charged by the vendor, this is what people should be fighting for - both in the app stores, and on the receipts that are emailed to people for their purchases.
It would (a) make the tariff visible to all consumers not just the techies, and subsequently (b) create significant customer-led pressure to lower the tarrif (I suspect something on the order of 10% would probably be acceptable to most customers as that aligns with typical sales taxes give or take).
I think price transparency would be a good start towards lowering fees. I doubt that Apple or Google would do even this without being forced to, though.
I realize that the only reason they don’t have an iOS app is because Apple didn’t let them, but OnlyFans is doing very well as a web based service. It’s certainly not iOS-or-nothing.
> If you're a customer and don't like this, then don't buy an iPhone. Vote with your feet. Buy an Android.
That's a good option. At the same time I can also work together with other citizens of my country to force Apple to allow alternative app stores. Our reason would be that we think society stands to benefit from this. Whether or not Apple "deserves" [1] a third of app revenue doesn't matter.
Allowing alternative app stores would then be the price Apple has to pay to access our market. They might not like this, but they're free to ignore this market. Other companies will be happy to comply.
[1]: I'm not sure that it's meaningful to say a trillion-dollar company does or does not deserve something.
I actually love this answer, but I will point out that any arguments relating to "deserving" - especially in relation to companies' profits - becomes a very different discussion. We live in a capitalist system and "deserves" = "can achieve within the law". I offer no assessment as to whether this is a good system or not, but its the one we have.
It's absolutely reasonable for a government to impose its own market rules - but even there, the government follows its own logic for what to impose. Either to benefit consumers, protect local industries or industry segments (e.g. smaller companies), or increase tax revenue. What's the logic behind such a restriction? Unless applied to all app stores, this would be unfair to Apple.
For both customers and app-developers, we make an assessment of value and decide which phone to buy or which phone to target with apps. For app developers this involves a contractual obligation they freely sign on to. Making an assessment of value that is based on not meeting the obligations you agreed to is an act of bad faith. You don't "deserve" to play on my turf if you're not following my rules. Go play in someone else's yard. I can see how it makes sense for a government to assess whether everyone's yards needs to be follow a basic set of rules. That currently exists in the sense that no contract or agreement can upend the laws of the land. Is new law required here? Perhaps, but then it won't be Apple specific. Depending on how its worded it may apply more broadly than to just app stores. In which case there's a whole raft of rent-seekers who may not want such laws.
Fundamentally, it boils down to this (in my view):
Are smartphone ecosystems private property upon which third parties are allowed to conduct commerce subject to the property owners rules?
OR
Are smartphone ecosystems a public commons upon which third parties are free to conduct commerce as they wish?
I completely agree that any new law should apply to not just Apple and iOS, but to all similar products. Of course what exactly "similar" should mean is likely a tricky question. Perhaps a rule like this would be sensible: If a device allows users to install third-party software, then it (also) has to allow for a reasonable way to install third-party software that doesn't involve the platform owner acting as a gatekeeper.
> If you're a customer and don't like this, then don't buy an iPhone. Vote with your feet
Alright, so then if microsoft wanted to ban alternative web browsers, or engage in anti-competitive practices that are currently illegal, and they lost the court case for, your answer is "Yes, that should be allowed for microsoft to do"?
Most of society would agree that laws that outlaw anti-competitive behavior are a good thing.
And if you opinion is the naive "just vote with your feet, lol" position, then you need to bite the bullet and just straight up say that you think that anti-trust law is bad. Just say that you support the standard oil monopoly, or the microsoft monopoly and be honest about it.
Microsoft's share of the desktop market at the time was very close to unity. You couldn't vote with your feet because there was nowhere to go. Even now, MS have about 75% of the PC OS market.
Apple's share of the smartphone market is around 15% globally, and 55% within the US. Under no definition can Apple be said to be in the same position that Microsoft was. You can indeed vote with your feet and many do (in both directions).
Anti-trust law is designed to do two things. Prevent companies from becoming monopolies in a market, and break up companies that are monopolies. By the numbers, Apple is not a monopoly, and there are plenty of healthy alternatives to Apple. Anti-trust law is just fine and dandy and I support it. It just does not apply here.
In the Internet age, monopolies should be defined in the 2nd degree.
It should not be about how many consumers using X anymore. It should be about how many consumers are related to consumers using X.
The reality is internet network effects create too much concentration of power. The question is how hard is it for a new business to build a dense network? And who profits from it being difficult?
Microsoft's anti-trust charges arrived in 1998, years before endemic Internetification of social interaction and making use of business's services. There were charged for attempting to control the Internet.
Apple's hypothetical anti-trust charges in 2022 would arrive years before endemic open APIs and personal data ownership. They would be charged for attempting to control people's freedom to interact with each other regardless of each others chosen platform.
We have court precedent that says otherwise. The Epic vs Apple case had at least 1 count that defined Apple's behavior as being illegally anti-competitive.
> Under no definition
Yes there is a definition. Under the definition that Judge Gonzalez Rogers used, they are large enough that some behavior is illegally anti-competitive.
So yes. An actual judge, who is the authority on the matter, disagrees with you, that it is impossible for apple to engage in illegal anti-competitive behavior.
> It just does not apply here.
Actually, it already did apply. Judge Gonzalez Rogers applied it to Apple.
"While Apple is not considered a monopoly and did not engage in anti-trust behavior on nine of ten counts, Apple’s conduct in enforcing anti-steering restrictions is anticompetitive."
Apple are currently appealing the anti-steering restriction.
So then, yes, on 1 count it did engage in illegal anti-competitive behavior.
See, you were the one trying to claim that it is completely impossible, that any definition of anti-trust law would cover Apple's behavior. And we have evidence that this is false.
Clearly, your previous extremely strong claim, of zero possibility of anti-trust behavior, is wrong. Because on 1 count, it was ruled that it was illegally anti-competitive.
Glad we could clear that up.
If you wanted to be more accurate, you could have instead said something like "Apple's position in the market is complicated. It does not have complete control of the market, but it has a large enough control of the market, that some of its most egregiously bad behavior, could be illegal. Really, things could go either way on some of its actions".
That would be a much better, and more nuanced statement, that opens the possibility for some of Apple's behavior to fall under anti-trust law, but not all. Clearly it is not as absurdly in Apple's favor you were trying to claim, and it is not as simple as "just vote with your feet, they aren't doing anything illegal or anti-competitive".
Leaving aside the possibility that Apple have a good chance of overturning the anti-steering ruling, I'd like to ask you directly - what is stopping you as either a customer or a developer from buying an Android phone, or developing exclusively for the Android ecosystem? i.e. why can't you just vote with your feet?
Because Apple's actions are illegally anti-competitive, and I support existing anti-trust laws.
If you think that it is totally OK to engage in illegal anti-competitive behavior, then just say that. Otherwise this is the answer.
The answer is that we have anti-trust law for a reason. So if you disagree then you need to say that you want anti-competitive behavior to be legal and bite that bullet of being in favor of that stuff.
So go ahead and just say that you support microsoft anti-competitive behavior or if you think that it is not OK, then whatever reason you have for saying that anti-competitive behavior is bad, I can use whatever reason that is.
> Because Apple's actions are illegally anti-competitive, and I support existing anti-trust laws.
Sorry but that's not a reason. You indeed can choose a different smartphone and smartphone ecosystem (as a customer), and you can choose to boycot Apple as a developer, and tell your customers that iPhone users are stuck with the web app while Android users get the benefit of better integration and features. These are real choices that people and companies are making today.
As I said in another comment, you absolutely can pursue legal remedies either through the courts and/or the political process - which is also happening right now. But absolutely nothing is stopping you from buying and using a Samsung/LG/Pixel/etc phone right now, and having a really good (by all accounts) experience.
And to make myself completely clear to you - I do not want anti-competitive behaviour to be legal. I just don't think this is anti-competitive.
Also worth noting that Microsoft filed an amicus brief in support of Epic in its fight against Apple. Google did not.
Ok, then that is not a reason that you can use against microsoft or standard oil. Thats your position that you have that you have to bite the bullet on.
> These are real choices that people and companies are making today.
Ok. Then in your opinion, those are "real choices" that people can use against microsoft or standard oil.
I don't know about Standard Oil, but I absolutely do know about Microsoft. In the late 90's and early 00's there was no realistic alternative to Microsoft Windows. So no, they are decidedly not the same. Not sure why you can't see the difference.
Microsoft engaged in illegal anti-competitive practices. As well as how Apple has engaged in illegal anti-competitive practices, as according to the decision of Judge Gonzalez Rogers.
Honestly, I can see validity in both your comment and the parent comment that you're arguing against. But I'll press you a little, if only to understand your point better:
> Microsoft's share of the desktop market at the time was very close to unity.
> Apple's share of the smartphone market is around... 55% within the US.
At what percentage of the market should Apple be required to loosen their grip over their platform / open up their marketplace? Is there a specific number they could reach where you'd feel comfortable placing more restrictions on these practices?
Good question. I don't have a view. Though the boiling frog analogy is probably apt so there should be a threshold or some agreed metric of "competitiveness". One of the key aspects though is the disparity between US market share vs global market share. Given that globally, the remaining 85% of market share are virtually all Android, is penalising Apple increasing or reducing competitiveness? I don't know there's a clear or objectively fair answer.
Good luck! Safari is crippled. The examples are too numerous to list but even the UX around existing features that would bring Web apps closer to on-par with App Store apps is terrible. For example my friend was sad that Wordle wasn't an app because they wanted it on their home screen. No problem I said! I know you can add shortcuts on iOS. But they couldn't find the option. They even game me the phone and I couldn't find it in the 30s I looked! I'm sure it is there somewhere but it is clear that the UX is damanaged to keep the moat between native and web artificially high.
Huh, maybe there's an opportunity to make an app that appifies appfiable sites. Like a captive browser. That app could be free. But Apple would find a way to say it's not OK with their rules and boot it from the store.
> 30% is the price to access Apple's customers.
Perhaps, but you'll notice many people don't agree, and those people participate in politics, and some of them will say "company store!!" and demand statutory or judicial intervention, and who knows, they might get it. Lucky for Apple 99.9% of their customers aren't those people.
I assume you are implying "access to all app providers on the phone of their choice". What about those app developers that have chosen not to target a market? For example there are plenty of app developers that are iOS-only, and some that are Android-only. Do you then force them to target both systems? (since the customers deserve it). Would you enforce this on PC developers too? I'd love to have native Microsoft Office apps on my linux laptop. But I'm not holding my breath.
They could have a union to represent {!apple} and negotiate fees down. The threat could be uber and others chuck in a free android phone loaded with their app with their subscriptions!
Greedy fucks get 30% for doing nothing. You already got your massive nut [from iDevice sales and first party subscriptions] and now they want a piece of everybody's smaller nut [from the developers via "IAPs" shares].
Not to mention the yearly fees you pay to apple if you want to publish to the App Store. I really hope the anti-trust laws come down heavy on Apple, Google, and et al.
30% seems to imply that Apple somehow brings 1/3 of the value, simply by not allowing you to sell anywhere outside of the marketplace. It's extreme lockin.
That would be my preference. Regulating a service fee like this can get messy. There are plenty of models where intermediaries take a cut of something and actually provide roughly equivalent value for it that you'd have to write a "This only applies to Apple and Android" app store law. Even then, 30% for a small low profile developer just starting out isn't entirely unreasonable when no one would easily find them or know who they are without App Store exposure, even with the noise in there. (I think devs like this get a slight discount already though)
Of course household names like Uber are different, but it would also be difficult for Apple to have a policy like "The top 100 most recognizeable brand only pay 10% because we're not providing exposure value to them since people already know who they are."
I think a regulation that requires the ability for competing app stores that can be installed without Apple or Android putting scary security warnings in user's eyeballs before installing them would be a cleaner move.
Admittedly, even then I'm not sure where to draw the line-- should Xbox also then be required to allow competing game stores? Samsung smart watches? Fitbits? I don't have an easy answer to that.
Especially when both have done everything in their power to make the lives of "competing platforms" as difficult as possible. It's hardly a winning VC pitch.
Strong language is coming, skip my post if you're delicate.
They're cowards. Plain and simple. They want a "safe" investment with a pre-defined path to an IPO in 2-10 years so they can cash out. Makes me fuckin' sick. We could have a third alternative to iOS and Android, but it won't be easy, it won't be fast, and it won't be cheap. These VC vultures don't have the goddamned balls to put significant amounts of money on the line with the prospect of absolutely no return ever, and that's why it'll take a miracle straight from Heaven for us to get a third option - because these people have no real grand vision and no damned backbone.
No one on Planet Earth is going to convince me that the best the human species can do is Android and iOS.
Forget the VC, even Microsoft, with a market cap close to Apple’s, and the net income to support it, are too cowardly to invest a few billion and 10 years into developing quality device.
The App Store was ruled not to be a separate product from iOS in Epic v Apple, so the iPhone really is the full package including iOS and App Store, and you must compete against it fully.
What is locked into mean in this context? If you’re an adult I don’t know how this would happen unless you chose to use Apple products which you could equally choose not to do.
> That means I can't subscribe to postmates or uber?
Those are available on Apple devices, don’t know why you think you can’t subscribe to them?
I just wonder how history would be if in the 90s the Microsoft suits tried to get a cut of everything running on Windows.
"Oh you used Windows and Internet Explorer to buy AutoCAD?"
Microsoft did not control the entire ecosystem. They would have locked the entire ecosystem down in a heartbeat if they had full control over hardware and software. You can look at Xbox as an example, they do exactly that.
> Because they have tons of competition and don’t dominate the market. By revenue, android is way higher.
Apple has 60% of the mobile market in the US[1], and the App Store is responsible for more than 100% more revenue than the Play Store, too[2].
Regulatory bodies aren't concerned with layman definitions of monopoly[3]:
> Courts do not require a literal monopoly before applying rules for single firm conduct; that term is used as shorthand for a firm with significant and durable market power — that is, the long term ability to raise price or exclude competitors. That is how that term is used here: a "monopolist" is a firm with significant and durable market power.
They have a strong position, but I don’t think 60% is proof of any type of monopoly. I think people in this thread don’t 1) understand what monopoly means and 2) understand what US antitrust considers monopolies that damage consumers.
You forgot the rest of the quote from your 3rd source:
"Courts look at the firm's market share, but typically do not find monopoly power if the firm (or a group of firms acting in concert) has less than 50 percent of the sales of a particular product or service within a certain geographic area. Some courts have required much higher percentages."
Most anti-trust cases have historically been against companies with 90+% market share: Standard Oil, Bell Telephone, Microsoft. I'd love to see an example of a company that was found to have a monopoly with only 60% market share.
In fact I think Standard Oil wasn't far above that by the time action was taken. They were also cutting prices and modernizing heavily.
To get much beyond that I think you need some special advantage like govt protection. I suspect the patent system, which literally guarantees monopolies to companies in return for a fixed fee, creates a big advantage for the leaders in tech markets. Hence modern leaders last a lot longer with more market share (and way higher margins) than they should.
Except there are alternatives for all of these, you just have to use a different operating system.
Interoperability has never been legally mandated in the past, but for most of history it has just "happened" because people could get around hostile designs (IBM PC clones anyone?).
The problem with the complexity of today's technology is that, it's no longer feasible for an upstart to make a "compatible" device. You can't engineer an "iOS capable" non Apple device or an Apple-compatible non-Apple OS, not because it is not legal but because it is not feasible technologically. There are ways to do legally clean reverse engineering (ReactOS anyone?) but you cannot get around chip level signature checks nor can you fab your own state-of-the-art chips.
Yep, regulation is way behind. None of this lockdown is for the public good and thus it should not exist. The demand side of the market doesn't seem to be able to balance this out (i.e. vote with your wallet, stop buying the products, they hurt all of us long term). You would need another global level actor building the replacement, in the fair, for public good manner. However due to these global corporations essentially being close to global states in power, there is very little any one nation state can do comparatively. The level of investment would be worth it, for the world, but not for any single state.
"You just have to use a different operating system"
No. This can't help the customer who already bought a device, because Apple can (and does) change the terms on which the device is used. It would be more fair to use the word 'rent' when you buy Apple's devices, because you don't truly own them, Apple does: It decides which apps you can run, and it can pull off the apps you need from the Appstore, and so on.
When Apple alters the deal, all their customers can do is pray Apple doesn't alter them any further. This IS a monopoly, and you can't use a different operating system on your iPhone if it would be rendered useless to you by Apple.
You could say the same for game consoles and yet people are okay with those being closed systems because you can choose between different brands.
I don't like Apple's business practices either, but labels like monopoly and "rent"ing a device have clear definitions and Apple doesn't hit them. If anything this is a failure of regulations to catch up to the reality of technology.
The focus in the future should be mandating things like repair and interoperability.
> You can't use a different operating system on your iPhone if it would be rendered useless to you by Apple.
This is not true. First, all apps already installed are not automatically uninstalled just because they've been pulled from the store, you just stop getting updates. Secondly, even if Apple completely drops all app support for your phone, it does not make it "useless". The phone still does all of the basic functions it was advertised to do. Having a device get new features in the form of apps is not required, it's a nice to have. At best you maybe could make an argument for misleading advertising if any launch features were gone (see PlayStation otheros) but Apple have been very diligent to make sure that's not the case.
They absolutely dominate the market of iOS apps. Imagine the uproar you would be able to install windows apps only via MicrosoftStore? The uproar would be deafening, and yet the impact on users would be far less severe than Apple's tyranny, because you can install other OS on PCs, but you can't install other OSs on iPhones.
They absolutely dominate the market. If you wanted to create a successful service today and don't support iOS you have no chance. If that's not domination, what is?
I’m as concerned as anyone about apples behavior with services in general, and the App Store in particular. But it’s also true that the market is not iPhones, it’s smart phones. And Apple is most certainly not a monopoly in smart phones or smart phone apps. They’ve very carefully built up an ecosystem that attracts the best app dev talent and the most lucrative app customers, but that does not make them a monopoly.
> But it’s also true that the market is not iPhones, it’s smart phones. And Apple is most certainly not a monopoly in smart phones or smart phone apps.
Apple certainly has a duopoly with Google in the mobile device market, mobile operating systems market, mobile app distribution market and the mobile app payments market.
Next week, on "lifestyles of the rich and rent-seeking," we'll speak to the folks from Apple, who have discovered how to extract copious sums from captive app developers and their downstream customers! You won't want to miss this episode!
(Of course, if you do, you can livestream from another app whose access they probably control)
Someone working on a subscription application here and quite intimiately know all data around our acquisition, retention, engagement - you can subscribe to us through apple or you can subscribe outside the apple ecosystem - and apple only takes the cut when through them.
Ultimately - it's the user choice where they're going to do it - and if the user wants to reward the company, they could subscribe through other means. Most users don't know this, obviously, but it is a possibility. And if we reach them through a different acquisition channel, the users won't subscribe through Apple, they will subscribe elsewhere.
However, the customers who subscribe through Apple are usually a lot more valuable to us (more affluent, stable payments, more engaged), and even with the 30% cut, having Apple as an acquisition channel is valuable. It is not worth it for us to go out of Apple's ecosystem.
Apple know this - and are just playing the economics. They are aware the added benefits to the user and the marketing pull they have in their store. The next step for App Store is going to be changing the 30% to fit the business model of whatever they're marketing - if they're rational. There was already suggestion that for streaming apps (very high operating cost, very low margin) they might drop to 15% - because they'll try matching the economics to the barely positive tradeoff for the businesses using the app store.
I see nothing wrong with the Apple model from a business standpoint of a multi-platform business. When something is specifically an app business it becomes more tricky because essentially in order to acquire the customer they have to install the app so the app store becomes your main acquisition channel. But even there you could argue that your business model wouldn't exist if Apple wasn't providing the customers, OS, app store and marketing. So it makes sense for Apple to take a larger cut (in relative terms per acquisition volumes).
Both Apple and Google enforce using their payment methods on any app distributed on their app stores. That means that there's a 15% to 30% rent incurred on all revenue in the mobile app space. Just to participate in the mobile app market, you need to give up to 30% of your revenue to either company.
The entire mobile app market essentially has to pay either company a significant chunk of their revenue just to exist. That's insane.
Its the troll under the bridge, the bandits on your way home from market - they are not fair, just violent bullying thieves that society once banded together to expel.
Getting things to market is a lengthy endeavour, a long term project with many stages.
Finding land, that is suitable, renting the land, matching the crop to the land, acquiring the seeds, planting, watering, weeding for many months. Losing crops due to weather, harvesting, storing (renting a structure to store in), preparing for transport.
Then transporting them to market, then selling them etc.
A bridge the cart crosses twice (once to and once from market) provides perhaps 1% of the necessary effort.
If Apple charged 1% of revenue, or perhaps 5% of profit, that might be fair for the bridge.
Many/most things have expenses nearly matching revenue, so their profit is low. If it costs $90 to hire land, hire a shed, hire a cart, hire labour, get wiped out by weather sometimes, hire a market stall, hire market sellers and so forth, and your revenue from the sales is $100, then your profit margin is 10%. Apple would honestly be asking too much at 30% of profit. But in this situation Apple is taking 30% of REVENUE.
In Q3 2021 (the latest earnings release), Uber's gross bookings were $23 billion while their revenue was $4.8 billion. I.e. 79% of the bookings were being paid out to the drivers, Uber's cut was 21%. I suspect the drivers are much happier with that than you suggestion of 30%...
I'm not advocating that drivers only be paid 30%. Just that Apple is over exaggerating their value add to the ecosystem.
Netflix ran a global quasi experiment[1] to see if it was worth dropping IAP with Apple's rates. Consumers want to watch a movie and are willing to pay for it. The same as they just want to get home safe after a bar session and are willing to pay for it.
Netflix was able to drop IAP because the web is a viable platform. Apple's platform is their justification for their slice of the pie, but it pales into comparison to what drivers and filmmakers actually do day in and day out to actually add value to the economy.
> In Q3 2021 (the latest earnings release), Uber's gross bookings were $23 billion while their revenue was $4.8 billion. I.e. 79% of the bookings were being paid out to the drivers
I don't see that follows. Does Uber provide that number explicitly? And what is the net for driver/hour?
Imagine if all the malls around the world that lease a physical store to Apple say to Apple: 30% of everything you sell at the store in our mall belongs to us.
Presumably they pay rent in those malls, and the bigger the store, the more rent they pay. The problem with that arrangement is that you need to be at a certain minimum scale in order to afford rent at all - you can't just occupy a free/basically free store to play around and make toys in. Taking a commission avoids that issue by making 'rent' scale with the amount of business you do, not how much floor space you need.
I'm not saying that 30% is the right amount - I really don't know. But the mall comparison doesn't seem like a cut-and-dry case to me at all.
Did anyone read the emails? That's not what they said at all. The reference to 30% was to an existing membership cut that predated these emails on their subscription platform. The language, "...would be a concern for them" indicates they're pointing out that they will have to adjust the 30% value.
Nice read after my app update got rejected some weeks ago for not using in app purchases, even though it was already on the store for a year. It is a news reader app, but they said it does not fall under the "reader" category where they make an exception. I did not even want to make an app, but basically all the feedback from users I got was: is there an app out yet? Sadly progressive web apps are bullied, for example you cannot play audio in the background as I do for podcasts. But there is no way I will add IAP, I am not even trying to sell anything, it just for existing users. Kind of sad you cannot just provide an app even though you pay a fee for the store as developer.
The second problem I have as someone who is offering subscriptions himself, is how Apple earns money with scam subscriptions. I could have justified the closed Appstore in the past by saying that they take care that you do not get trash on your phone, but - the App Store is full of trash. Check the top two guitar tuners, they are free. Open them up and you will see a 8$/week subscription, that you accidentally agree to with the finger on your home button. The ratings are full of people complaining, but Apple puts them at the top. There is no way they don't see this shady business. Wonder how much of their revenue comes from shitty scam apps.
People who suggest to just not be present on the app store, it is just not an option for many businesses, as the App Store is basically a monopoly.
I think, if they did not insist on the %30, which I believe is fine when it comes for stuff that scale with almost no cost increase(like crystals in a game), and came up with something reasonable to accommodate transactions with thin margins they would have actually provide a good service. Receiving payments via IAP is hugely valuable because it reduces friction big time, however it is unreasonable to ask %30 in businesses where margins are %10 or even lower.
I think Apple realised that to some degree as they have much lower commission for certain categories like 1:1 tutoring etcetera.
Anyway, I think Apple might have crossed a line on these commissions and we see rulings all over the world requiring Apple to allow alternate payment methods.
With my user hat put on, I'm not excited about that because it's actually much much pleasant experience to use IAP because you have all your subscriptions in one place and Apple is super good on refunds.
What I would like to see one day is some kind of "Universal payment protocol" that provides standardised UI for mobile payments. Imagine the IAP interface being able to accept any kind of payment(like paying with your card of choice with Apple Pay) and keeps track of these payments in your iDevice with a button for cancelling subscriptions that makes an API call to the payment provider.
The argument against an app store being controlled by a private entity is to me similar to that of other infrastructure, like broadband, roads, utilities, access to the market itself, etc. It should be available to everyone at self-cost or less. Major and common infrastructure must abide under special rules.
How in the world is an App Store infrastructure? It’s a proprietary platform. We have the Web as the free open platform, anyone can use any device to visit any web site. The App Store is a premium alternative.
Remember the fight for net neutrality? Well a lot of the infrastructure that makes up the internet is owned by private companies. e.g. Comcast, Verizon.
If Comcast (Google) and Verizon (Apple) both charged 30% markup on anything you bought on Amazon, would you think that's reasonable? Without them, you wouldn't be able to purchase anything at all, of course!
Electric, water utilities are private companies.
There will likely be a legal framework that develops to define a threshold and definition for when something constitutes a "platform" with sufficient market size such that competition within the platform be allowed.
Fundamentally I think it comes down to monopoly. If Comcast is the only way to get internet and they gouge me on price that’s bad.
The App Store is a more premium alternative to the Web. It’ll never be a monopoly — every iPhone comes loaded with Safari for alternative ways to engage with customers.
Well, if they gouge you, you can move to a different neighborhood (switch to android).
Pretty evident when you go through the thought experiment that ecosystems/platforms, with high costs of switching, are a new form of monopoly (at sufficient scale)
I mean you're picking something that has a massive amount of regulation on it to compare? What can be sold, prices, taxes, what customers you can or can not deny service to, legal operating hours, and more. The list goes on and on if the app store had 1/100th the regulations 7/11 has it would look vastly different.
This would be a weird thing to do, which is obviously why they made it optional in the end - it's such a large amount of money that it creates a massive incentive to switch or undercut apple's business.
Most teenagers use an apple, but it's not impossible to switch. In the 90's, almost all computer users were on PC's, and a big problem for apple was a lack of software offerings on their OS to compete with windows. It seems like some executives are interested in short term profits to the point that they are comfortable creating an environment that would seriously disincentivize use of apple products and the math on that is nuts - if it's no longer profitable (and I can't imagine it is at a flat 30% increased costs) then you remove the service.
The cut apple takes is too big, and, afaict the cut seamless and Instacart and probably Uber and Lyft take is way too big too.
Technology can increase ease while also lowering prices, but it’s just so easy for it to go the other way.
I think Uber and Seamless are most obvious to me in NYC. The overall cost of doing basic stuff was initially depressed and now has increased way over inflation.
Regulators have played their part.
Contrast with Amazon who we all like to hate on, and who may be abusive to retailers and manufacturers, but the savings is clearly passed on to the consumer.
Why don’t these companies just drop Apple then? They can just make web sites and then users can order Uber’s and food from any browser on any device and pay nothing to anybody.
Opinions/commentary on such things tend to focus on some detail, and judge it right or wrong. Is forced use of Apple's payment processor OK? Would X be ok if Apple provided some way of installing externally to the app store? Would 15% be OK.
I think these lines of thought miss the point. This discussion demonstrates, IMO, the mentality & reality of bigness/monopoly.
Mentality-wise, Sheree & Lindsey are expressing something more akin to "We feel that Apple is entitled to a 30% cut of this" than a business idea. Second it's obviously more about power than anything else. The "window of opportunity to set a precedent and claim this cut" is the reality.
Whether or not Apple adds value that reflects or justifies the revenue is irrelevant. That's not how they are making the revenue either way.
They get a big cut of Google's ad revenue on iphones via their default search deal. This is about getting a cut of ecommerce & such. Smaller developers are entirely exposed to their whims. It's too much power, and they are abusing it.
There are two levels to monopolism. One is simple prices. You own the only highway to MetroX. You charge truck drivers a high toll. They have to pay it, if they want to truck at all. The second level is when the highway owner wants a cut of all goods sold in MetroX stores. That's what's happening hered.
Apple should split up the 30% cut into different portions of their value add, and then let developers choose which portions they want to have access to. Dropping the Apply Pay stuff would be 5% or whatever. Access to the Apple Store would be 5% or whatever. They could even charge more over the 30% by offering additional stuff, like auctioning off "app of the week" on the Apple Store.
I love that Apple forces subscriptions on their platform through Apple Pay. As a consumer, it's incredibly easy for me to view and cancel subscriptions in one central location. I've signed up for tons of services in the past and all to often they decide to make it a nightmare to try and cancel.
The 30% might suck as a developer, but then just charge more for Apple customers. As long as the rule is applied to all apps on the platform then everyone is playing by the same rules. Nobody is forcing you to release your app on the Apple Ecosystem, you -want- to because it's a huge potential customer base. If you want to participate then play by their rules. If it's too expensive, then don't build your app there. If more developers refused to release their app on iOS they would start to re-evaluate their 30% fee.
My only qualm is the news that in certain situations they have lowered their fee's which isn't fair as it gives those companies a competitive advantage as they can charge less.
I still don't think they deserve the 30%, but it's interesting that there doesn't seem to be any concern in that direction mentioned here. They mention in passing that the 30% may be a concern for partners but they seem basically unfased by it and don't mentioned that it might not be reasonable.
Someone give me a good argument for why Apple deserves a THIRD of revenue generated from apps on their platform? Apple's app store is pure rent seeking. Even the supposed curation everyone is paying for is lackluster. People are scammed left and right.
Funnily enough, this applies to Uber and Lyft too. These middlemen companies have too much power to unilaterally dictate what cut they get from their service.
They might have a point when it comes upfront sales of apps and games. Steam also charges 30%, and the Xbox, Playstation and Nintendo Switch stores also charge similar if not higher premiums, as does other comparable app stores.
Where it get’s ugly is when Apple wants a cut of everything that happens after the sale of the app, too, like wanting a cut when I buy a new book in the Kindle app (and Amazon refusing, instead making it impossible to buy books in the app).
Steam charges 20% to games that sell over $50 million, and 25% over $10 million. Even though those games tend to be bigger and use more bandwidth, they were running into the problem that some of those companies were managing to get bargaining power (Valve announced the change around two days before the launch of the Epic Games store with a 12% cut). Bandwidth isn't actually much of a significant cost.
Yeah % cuts for products sold in stores is nothing new or unreasonable. But once the user has the app on their device, the "store" is now the app and there should be no cut of fees for things sold inside the apps own store.
With software can't you just hack this by selling a free "Epic Store app" and allowing all games and software to be purchased there.
If the "store" is now the app then how does Steam get their cut? Do they just disallow any product that has a "store" inside of it? What constitutes a "store"?
This is the hard question. Apple has already reduced subscription cut to 15% after 1 year, but do they deserve even that?
This isn't bad. There _should_ be able to be an Epic Store app which sells products without the Apple cut. Since Epic has done all of the work setting up the store and processing payments.
Steam gets their cut by developers listing their games there directly. Epic already has a store app and yet Valve still makes money because the steam store and ecosystem provide value that justifies the cost even when alternatives exist.
IMO what cut Apple deserves is the wrong question. A democratic society can in principle decide that the public would be better served if Apple had to allow alternative app stores, and enact legislation accordingly. Whether Apple deserves to establish itself as the sole gatekeeper and take a cut whenever they can manage isn't really a concern. I think using anthropomorphic language like "deserves" for a company isn't even conducive to thinking about this.
I'd ask this instead. Would it be beneficial for society as a whole if iOS had to allow alternative app stores?
Why should Apple be forced to include an app store on THEIR operating system? If they want to be the gatekeeper of all their software, it is on them as a private company to do so.
It is likely beneficial for society as a whole for iOS to allow alternative app stores, but that doesn't make it right for the government to force them to do so.
If the citizens of a particular country want to force Apple to allow alternative app stores, they can. It's their country. Apple can ignore their market if they don't like the rules.
What makes it fair is not that that other companies as you list have similar practices.
What makes it fair is that Apple is a private company, entitled to these kind of business decisions. As such, free market forces should then determine if the true cost of distribution (which is basically what App store provides) is more or less than what Apple charges for it. It does seem that this is still one of the most efficient ways to distribute an app to the end user, as witnessed by the sheer number of developers (silent majority) willing to take the 30% cut vs a loud minority (usually big companies on their own) that isn't.
Is this a joke? Of course it's the 'most efficient' way to distribute an app on iOS - it's literally the only one. 30% wasn't determined by market forces, because it's a monopoly and there is no competition. Your only other choice is to forsake >50% of total smartphone users.
I was not talking about distributing the app on iOS, but distributing an app. If you want to leverage iOS to distribute your app, then 30% is the price for that distribution and vast majority of developers accept it as a good deal as witnessed by enormous volume.
No, volume does not indicate that something is a 'good deal'. When market failure occurs (e.g. due to lacking competition), prices are distorted. How much this impacts volume depends on elasticity. A good with relatively inelastic demand will have high volume whether there is a good deal or not.
And you can frame it however you want, the price for iOS distribution is not determined by market forces because there is no competition for it. Distributing an application on android is not an alternative, but complimentary. It's like if there were two delivery services in the US, each covering one part of the country. It doesn't matter that there isn't only one delivery service, both of them still have a monopoly because they're not competing in regards to what they actually sell.
But I argue there is no market failure here. You can distribute the app via web or Android. iOS just one of the options that you are free to boycott if you find the fee unreasonable. The fact that vast number of developers don't (although they have a choice) proves my case.
> the price for iOS distribution is not determined by market forces because there is no competition for it.
Perhaps you misunderstood. The price for iOS distribution is determined by Apple; whether that price is a good value is determined by market forces. Again, it seems that it is indeed a great deal, because vast (and silent majority) of developers accept it.
> It's like if there were two delivery services in the US, each covering one part of the country.
But it is not. You can reach your user via Web or if they are mobile via Android or Windows phone. Apple can not be blamed if your user prefers to use iPhone (despite it being most expensive) and now you have 30% cost of distribution to reach them. That is exactly type of an outcome a free market would produce. The freedom here is expressed in your user's ability to pick their mobile device and by no stretch of imagination Apple has a monopoly there.
>The price for iOS distribution is determined by Apple; whether that price is a good value is determined by market forces. Again, it seems that it is indeed a great deal, because vast (and silent majority) of developers accept it.
The famous monopoly cases (e.g. Standard oil or Bell system) also had tons of customers, that's what happens when demand is rather inelastic. If you want to say that artificially inflated prices due to e.g. a monopoly can still be a good deal because people are still willing to buy it, then we shouldn't be content with just good deals because they still cause harm to society overall by not being pareto efficient. Apple can't charge the rate they do purely by the strength of their distribution service - it's the device base that is the real value and only by anti-competitive measures can they keep the price up.
>But it is not. You can reach your user via Web or if they are mobile via Android or Windows phone.
What if Apple also decided that every transaction made through their browser had to give them a cut? The situation doesn't fundamentally change (you could still just offer your app to android/desktop users), but I think it's pretty clear that this would be anti-competitive. They might not have a monopoly on smartphones/devices, but they have such a large share that boycotting them isn't really an option.
Users are also currently funneled into apps due to how web is limited in functionality as determined by Apple. e.g. if your app needs long term local storage you now need an 'real' app because Apple changed it so that web app local storage gets cleared on the regular. Windows phone has also been dead for years now.
> If you want to say that artificially inflated prices due to e.g. a monopoly
Perhaps you misread, but I am saying opposite of both. I am saying that both Apple's prices are not high, proven by number of people agreeing to pay them in a market where other options to distribute an app exist, and that Apple does not have a monopoly.
> What if Apple also decided that every transaction made through their browser had to give them a cut... but I think it's pretty clear that this would be anti-competitive.
It is not pretty clear? There are plenty other options on the market in terms of a browser.
> They might not have a monopoly on smartphones/devices, but they have such a large share that boycotting them isn't really an option.
At least we can agree that Apple does not have a monopoly. Everything else is market forces at play. My argument was that the price set by Apple for distribution is such that it is acceptable to majority of developers. If Apple set an unreasonable price instead, say 70% cut, I am sure that a lot of developers would simply not develop for iOS, nor would iOS achieve same reach it has. Thus we can only conclude that Apple carefully picked a price which is both acceptable by vast number of people and maximizes Apple's revenue at the same time. This is free market at its finest.
This isn't a free market. A free market would be that the user purchases the device and that they are free to do whatever they want with what they own, including installing third party stores.
Whether Apple is a monopoly that is still to be determined and entirely different discussion. If it is it would have much bigger problems that the one discussed here.
This discussion is about where Apple as a private company has a right to charge 30% for the distribution on its platform and I argue that it has every right to do so.
That’s your problem right there. We don’t allocate resources or make business deals based on how deserving a group or person is. They can charge it right now so they are
I think it’s similar to why Walmart deserves a third (or more) from manufacturers selling stuff in their store. Or Amazon. Or any store.
Physical goods have about a 100% markup between manufacturer and what a customer pays.
I think it should be less for digital goods, but you wanted a good argument. Apple charges because they are between you and the app makers, like Walmart and target and stuff.
Products sold in wallmart can then provide extra external services which walmart gets no cut of. If I buy an air purifier in Walmart, they get a cut on that initial sale. But the purifier company can tell me they sell filters on their website, Walmart gets no cut of that. On mobile, Apple does get a cut on that sale which they did not facilitate.
The difference is Walmart holds so much less power. It would be like if Walmart owned the exclusive ability to delivery packages to 50% of houses in the world, and then no matter what the filter company does, they can't avoid this fee because Walmart holds their huge captive market and is able to extract these fees without adding much if anything to the transaction.
Walmart does have competition across town, unlike apple store. I can got to Target, Costco, Safeway, et c. Unless they collude to price fix, they will indeed have to compete by driving down their margin.
Moving "across town" from the apple store involves an IT project and hundreds of dollars in order to save dozens of dollars.
Moving from Walmart to target requires lots of supply chain logistics. I suspect it’s actually easier to move apps to new App Stores than work out how to get products into completely different vendors.
Also for IT, Walmart requires IT interfaces from its suppliers.
If I buy a bread maker from Walmart, they aren't entitled to a cut of my revenue should I sell the bread I make. Similarly, if I buy a tablet at Walmart, that doesn't mean they're entitled to a cut of all the purchases I make using it.
Great example! In retail it’s bad if there isn’t a 300%+ markup.
The fascination with making Apple a boogey man on this is bizarre. Your local corner store — which you should very much support! — has a markup that makes Apple look lazy.
Retail provides a necessary service of managing a large inventory of vetted goods readily available under reasonable terms 5-10 minutes from most everywhere america.
There is no way I'm flying to South America for a banana or to Taiwan for a toaster. Their profit is payment for this service.
Your oem provided you a device which is perfectly capable via your ISP and your vendors infrastructure of arranging products and services. Your oem is only an essential part because they insist on it.
FedEx and ford could have in theory done the same or Dell and Verizon.
Sideloading is not allowed per Apple rules and requires jailbreaking which comes with a list of caveats. So technically yes as a user I can side load but as a company providing apps it's not a realistic method of app delivery for the vast majority of use cases.
This is the second time you've made this claim on the thread. Nobody knows what you're talking about. What side loading are you referring to? You mean taking advantage of the dev loophole by asking users to build and sign your code every 7 days?
If you don't like the landlord, don't move into the building. It's not the only building in town, but just the one with the most lucrative customers. If you want them to be your customers, you gotta pay to play.
I bought an iPhone before I knew about the fee. This is like the landlord telling me there's a 30% convenience fee on paying rent after I've signed the contract.
You're now complaining that a BMW costs more than a Toyota. Shop where you can afford. You know how the prices are not too high? People are buying apps left, right, and center.
The cost is mostly being passed on to the purchasers. The same app is nearly always more expensive in Apple's store than in Google's.
But the funny thing is that even with the premium, Apple users spend far more on app purchases than Android users. And in turn developers make more money on IOS app sales - which is why they flock to the platform.
To sum up: developers make more money on the platform, Apple makes lots of money from running the platform, and customers are indicating they are getting value on the platform (even if you personally don't see why) by spending more on the platform. I don't see grounds for outrage here.
Someone once told me this joke, why does the dog suck his genitals? Because he can.
Same with Apple, of course they will do this as long as they can. There is no moral or ethical reason why they are doing this, simply they can get away with it.
I mean if you found a hack where you could get 1% of all the world's transactions, would you really say no to that, or try to find out why you deserve it?
> Someone give me a good argument for why Apple deserves a THIRD of revenue generated from apps on their platform?
You are using their intellectual property? As in the App Store? Thus, as long as you are using that to distribute your app, they are entitled to collect the commission from where-ever they want and it doesn't matter if it is IAP, Web, etc.
From [0] of page 66
> Under all models, Apple would be entitled to a commission or licensing fee, even if IAP was optional.
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.
More like apps that also happen to use iOS as a frontend in addition to other funnels/marketplaces. Costco is one of the examples cited, and I frankly didn't even know that they had an app even though I have a membership. How exactly Apple is planning on justifying taking a cut of this membership fee is completely beyond me.
If Apple allowed installing other apps or appstores from outside sources it'd be one thing. That they've managed to go on this long without an antitrust is incredible. Microsoft got an antitrust case against them for simply installing a default browser. What Apple does is magnitudes worse.
It really comes down to the definition of monopoly and how a market is defined. If Microsoft wasn't found to have a monopoly in desktop operating systems, what they did wouldn't be illegal. Microsoft had north of 90% desktop OS market share at the time of the anti-trust suits. Does Apple have a monopoly? It depends on how you look at it. If the market is defined as iOS market share, then they definitely do (obviously). If it's defined as mobile operating systems, then maybe not. Currently iOS has a 59% market share in the US and only about 16% worldwide.
Imagine paying Apple to show ads for your app/service to the end user, and then once it converts to a sale, Apple comes in and does a 30% money grab from all future sales to that customer. To me, that is super unethical.
> Someone give me a good argument for why Apple deserves a THIRD of revenue generated from apps on their platform?
If you say “X doesn’t deserve Y”, then roughly I hear, “I don’t like that X is getting Y”. It’s like you’re asking, “Why should I like Apple’s revenue streams?” I don’t think I can answer that, but can you tell me why I should care about whether you like Apple’s revenue streams or not?
Apple deserves a third of revenue generated from apps on their platform as much as credit card companies deserve a third of all credit card transactions...
If you look at demographics, iOS devices are the gateway to the most affluent and lucrative market segment. That's the value proposition of Apple, and also why app always ship first on iOS then get ported to Android.
I say let them do it. But we need some anti-competitive regulations in place to prevent Apple for penalizing companies that want to offer a cheaper alternative elsewhere.
That's facile. If no one made apps for these platforms then they would not be nearly as popular. Remember the "There's an App For That" marketing campaign? That's not mentioning the fact that other phone/computing platforms exist where an app could capture some percentage of revenue you get from the App Store.
There's an element of symbiosis between Apple and app developers.
30% is insane, but lets keep the number aside for a moment.
If the user chose app A over app B then specifically what help has Apple provided to the App creator of A to justify the 30%? Apple's argument is they're bringing customers. But even if they do nothing one App is going to get the customer anyway. Also, Apple gets paid for advertising Apps and services to end users, so again, what are they doing to bring in customers to specific apps?
>what are they doing to bring in customers to specific apps?
They are making all the devices your app runs on. They are putting your app in their app store. They could remove your app from the app store and 0 customers would come to your app.
I don't know. I have released 0 apps and own 0 apple devices. I have never used their app store, so I do not have enough information to answer. I believe that question is irrelevant because apple is providing you a platform regardless about what apps they try to get people to install.
Everybody and everything can "provide a platform" if you do enough mental gymnastics. The AWS infrastructure you do you business on 'provides a platform'. The networking devices that route customer traffic 'provide a platform', the browser API 'provides a platform', the CPU that you code runs on also 'provides a platform'. "Providing a platform" doesn't entitle someone to grab 30% of sales from a business. If I rent office space, I pay the rent which is a mostly fixed amount, I don't pay them 30% of sales from my business - Yes, not a perfect analogy, but you get the point! Grabbing 30% of sales is just unethical, but that is just my view.
We can choose to have a legal system where this is OK. Or we can chose to have a legal system which busts anti competitive practices like this. Both are possible and I know which one I would vote for.
The situation is untenable, and as you can see, businesses who aren't scared of Apple are fighting back. Unfortunately, the smaller ones will easily get crushed by Apple and can't finance this sort of push-back without some grass-roots pressure.
Apart from being entirely unearned and unfair, these 30% cuts incentivize platforms to not weed out scams and bad actors.
There are an infinite supply of bullshit apps that have been scamming people with subscriptions that are impossible to cancel. Apple/Google both just send out lip service.
Ten former members of Apple's supplier responsibility team told The Information that Suyin wasn't an isolated incident, and that Apple had refused or was slow to stop doing business with suppliers that had repeatedly violated labor laws or failed to improve workplace safety when it would have cut into its profits.
Just now there’s also an ongoing coverage about scammy Wordle clones that currently haunt the App Store. Their whole protect the customer narrative is a sham when it comes to the App Store. I think the only upside are easily cancellable subscriptions, which, if you think about it, is actually a problem that is a result of their push for the subscription model and should be solved by regulation: mandatory reminders for subscriptions and easy cancellation. There, problem solved for all platforms not just Apple’s.
Uber and Lyft execs: let’s take a 30% cut of every driver’s income while trying to classify them as contractors and avoid employee costs and other bothersome rules.
"Unfortunately, IAP being 'optional' means that no one will ever use it"
I think one of the biggest issue is that Apple is trying to capture all of the revenue from the App eco system from a single function, the in app billing. Which is an extremely bad value prop for any large corporation, and also means a lot of big apps get to use the AppStore completely free.
I think Apple needs to do some shuffling in how they charge for the AppStore.
I wonder how this model compares to things like videogame consoles where the device is (afaik) sold below cost but then made up in licensing fees and royalties on sales?
I think it's a good comparison and would give insight into how a similar scenario has played out in adjacent industries
30% is obscene. Apple obviously deserves to get paid. Either abolish app store fees (Apple gets paid by selling hardware) or force them to allow 3rd party stores on their own store with transparency reporting requirements to foster competition.
Folks here seem fixated on companies being able to make money when using Apple. Why is that such a policy priority? Most of these companies are scammers.
I really wish politicians and everyone would focus on USER experience here.
Apple benefits because there is a ton of crap and user harm in the marketplace that goes COMPLETELY unaddressed. We are just getting around to rules on subscription cancellation practices on the web more generally. Apple has this solved.
Additionally, with a lot of these big players, only apple has negotiating leverage, no individual user could EVER force them to accept things like hide my email or clear trial periods or non-scam cancellation policies. So USERS benefit from the power apple has in some cases.
Is it worth the apple tax? For some it is worth it even though apple has relatively small smartphone marketshare.
I'm still looking in those emails for the oft quoted HN comment of "Apple does all the heavy lifting wrt payment processing and discovery so 30% is fair"
All I see there is talk of how to make even more money.
App ecosystem (great apps, often good UX/usability and lots of small "details"), interoperability between devices and to show their social status.
Why do some people buy an expensive Mercedes if basically any car can drive you from A to B?
I am a Linux user and I love FOSS, GNU CLI tools, etc. But it takes more time, crashes and nerves to edit a video using Kdenlive than it would by using iMovie. FOSS software is awesome but it is hard for their authors to compete with commercial SW made by highly-paid full-time professionals. And commercial software on Linux is often non-existent or problematic (mainly due to ensuring support for so many distributions).
Like the classic example is someone setting up a barrier on the river and charging boats that want to pass through. There's no value being added by the person blocking the river.
Just the same, when Apple says "Let's charge for this", what value are they adding for doing so? They make money off the current system. They just want to make more money while providing zero additional value to consumers or to app makers.
All I can ask is "How do you sleep at night?" but I'm sure I'll get the Rainier Wolfcastle's answer.[0]
That doesn't seem entirely fair of a comparison. If you built the canal, filled it with water, made sure it's wide enough for the boats that need to travel, etc, etc, then you are doing a useful service right. Apple has built something useful and yet we can all see it's wrong to take advantage of it to this extent, but we're having a hard time explaining why.
I think fundamentally corporations should only exist for the purpose of the public good. That is what's wrong with America and capitalism in many ways. It's not the shareholders but the public that they should answer to. If it does not serve the public good to take a 30% cut, then they should not be allowed to do so. As easy as that.
Its astonishing that the sellers of branded small laptops get away with this shit at all. Its orders of magnitude higher than any other infrastructure provider gets alwat with.
its likely that they chose the highest amount they believe the app developers would accept without trying to fight. Similarly at the time, steam and other platforms charged something like that too.
I couldn't find it, but i really want to know the margins of the app store compared to the revenue. How much ripping off are they doing? If the margins are 50%, it's way too high!
It's not a monopoly, it's a vertically integrated business that is using its cash and marketing to lure in and lock in more developers, who in turn end up being working as unpaid labor for them, increasing the value of their app store, and the virtuous cycle continues. Noone else had pulled that before, apple could do it because phones peaked usability-wise and ended up becoming a fashion item. As long as developers keep being on apple's train, she calls the shots. There is no way to win this game, only to bail.
iPhones aren't a "market". If that were the case, then Amazon would have a monopoly on Amazon ad placements, and Microsoft would have a monopoly on Excel features.
In terms of overall downloads, Google Play Store probably exceeds what Apple's store processes.
Interestingly, lawyers/regulators can define a "market" any way they want. The courts can decide.
But, while iPhones are part of the "phone market", "iOS Apps" are their own unique market. Probably only a matter of time before regulators think of it that way.
I assume that you are thinking of a pure monopoly - a single supplier.
When we are talking about monopolies in this context, we mean monopoly power, monopsony etc. For example, when a firm’s ability to charge a price higher than its marginal cost with very little change in demand of their product, it has monopoly power.
When deciding if a company is a monopoly, the first thing to do is 'market definition' - defining the relevant market. Is the whole mobile phone market? Can companies realistically compete if they produce only Android apps? It is in any way practical to assume that people carry two phones? Obliviously not.
Seems pretty obvious to me at least. I doubt your claim that not many would know this. Violence isn't illegal, but misusing violence is. Using the toilet isn't against the rules, but misusing it is.
At the end of the day the consumers also hurt, so you should care. If basic economic theory puts the optimal price for this service at 10$ without the middleman, then perhaps it becomes 12$ with the middleman.
I doubt the customer's cost goes up by 20%. That seems pretty extreme. In fact, I'm not sure of the mechanism that makes that costs go up by that much. I guess it depends on the number of Uber drivers around, maybe? In economic theory, it would primarily come out of Uber's profit margin.
that's implied by every Evil Corp, but yes, you are correct. still, to the consumer it does not really matter which of the Evil Corp gets the money since they will pay it anyway. I don't, for a minute, think that the 30% would not be paid by the end-user if Evil Corp A was not in play. B and C would just raise prices.
> I don't, for a minute, think that the 30% would not be paid by the end-user if Evil Corp A was not in play. B and C would just raise prices.
That's what I hint at with "basic economic theory". Evil Corp X wants maximal returns and there is a price point at which they get maximal returns. They can't just raise prices infinitely, because nobody will buy the service. If a middleman takes a cut then that optimal price point moves. Explaining it as the cut being shifted onto the consumer is too simplistic of a model. A part of the cut is shifted onto the consumer and the rest is lost by Evil Corp B, to maximise their total revenue.
I get your point. still, in this case B and C are, in my opinion, equally evil in exploiting their workers. so having them raise their optimal price to something the consumer would not buy their service would be, in essence, a good thing.
Yes, all "evil" should be eliminated. I don't think they're evil in the sense of Hitler or anything like that, they've just learned to play by the current rules and maximize their power under them. I don't think ultimately that it's ethically correct to do so, but it's understandable, and I'm sure a lot of the actions come from a place of wanting to do good. Nevertheless, I wish the world becomes a better place on this aspect as well.
> I'm sure a lot of the actions come from a place of wanting to do good
although wholeheartedly I agree with your sentiment, that's where our opinions diverge... none of the parties mentioned in the original issue are 'wanting to do good' in my opinion, even thoug it _is_, as you say, understandable that they do what they do.
> none of the parties mentioned in the original issue are 'wanting to do good' in my opinion
Yes, for the immediate issue at hand they just want to make money right, but they might be seeing their greater mission as extremely good, for example in providing the best handheld computing platform to the world or whatever it might be and that makes it all OK. To which level that is delusional thinking I'll let you decide for yourself, but I have a lot of first hand experience of how the mind operates in top level C-suits. They almost have to fool themselves to be able to operate and at their core believe without a shred of a doubt in what they do. Whether this comes from starting each morning with Tony Robbins affirmations I do not know.
Because monopolistic business practices tangibly hurt consumers by reducing incentives to produce a good product and by artificially raising prices that get passed to the consumer
now _this_ is something I can agree with. which is why I try to support Small Corp D and E outside of any store, by directly buying from them (if at all possible)
It's like the model of the world of a turtle resting on another turtle's back, which is itself atop another turtle, but instead composed of FAANG C-levels doing dickish things to each other (and by follow on effect, the end user)
Beyond caring about the larger issues at play here, the way it can effect you is if you have to pay 30% more for every subscription because companies need to account for paying Apple so much
This is not theoretical. In 2018 Netflix would've paid Apple around 256m [0] and Netflix also had a fair number of price raises in the past few years. Obviously the app store commission was not the only factor in these price raises, but it's clearly a factor the tune of about 250 million per year.
personally, knowing the cuts that either app/play store take, I would _never_ subscribe to a service through either of them, that's luckily still an option. netflix raising prices _because_ of a store tax, even for users subscribing outside of them, would be worrying, but your link has no evidence of that, right ?
Sorry, I should have been a little more careful with my wording. You are correct in that there isn't a direct quoted link. But, Netflix raised subscription prices to pay for more content...obviously paying 250 million to Apple (for basically nothing?) doesn't help their balance sheet.
I guess not everyone would look at it this way, but from a big picture standpoint it all adds up to the bottom line.
A 15% to 30% cut of all revenue punishes small businesses and makes many businesses infeasible, especially low margin businesses, as that 30% cut cuts into margins. Loss of competition hurts entire markets, including consumers.
the negative publicity regarding Evil Corp A is certainly a good thing, agreed. and like I said in another reply, I tend to try to support the smaller businesses _outside_ of the stores, knowing they would benefit that much more.
If you think that every corporation is an Evil Corp and actions are evil because evil entities do them then there's no reason you should care.
But if you ascribe the degree of evilness to the action rather than the actor, then you absolutely should care because it's anti-competitive and poisons the general health of the market.
true. in general I would agree any party taking a 30% cut (whether app store or play store or whatever) would be the supreme evil. but since all three parties involved in this instance are of the same caliber, I don't care, and I choose to use none of them.
It's a fair choice to use none of them, but the problem with large entities making decisions you don't like is that the next step from "large" is "institution" (which Apple arguably already is) and then sometimes "dominant institution."
So if you buy the slippery slope argument (which you don't have to), then if there are objections you want to make about that dominant-institution-in-progress, now is probably a good time to think about what they're doing and what you wish would change.
What's missing is that companies don't pay the 30% -- it's the end-users that do. Every user of iOS pays 30% of every app and IAP to Apple. The other company never even sees this money.
If MegaMegaCo forces MegaCo to give up X dollars, MegaCo isn't going to declare instant bankruptcy, it's going to use that as justification to raise its prices to you.
Apple execs might have convinced themselves that they are entitled to a huge cut of pretty much everything that goes on an iPhone/iPad/etc.
To everyone else, this just looks like mustachio-twirling, cackling evil and unfathomable greed from a company that’s already the world’s richest and sitting on a mountainous pile of cash.
Ok, but please don't post this sort of shallow riler-upper to HN. We're trying for something more interesting and less repetitive here, and subthreads like this end up choking that out.
There are lots of conflicting opinions on this. Personally I think its fine that apple provides payment processing but not fine that it forces developers to use their payment processor. A more fair system would allow the developer to present the devs own choice as well as the apple payments and allow the developer to explain there is a 30% charge on using apples payment processor.
Part of the problem is that the in-app purchase cut isn't just for payments infra, it also includes the rest of the infrastructure and value prop for the app store(s), which is otherwise only $100/year, which is nothing for huge companies. The problem is they also force users to use the official app store. tbf this is all less true on Android. I feel like a competitive market would have decoupled these costs.
Yeah I think its fair that Apple charges whatever they want for whatever service they provide. They can charge for the App Store, they can charge for the dev tools and SDK.
But that everything they charge money for, they _must_ allow alternatives to exist. If they want to charge a large fee for getting on the App Store, they must allow alternative app stores. The problem is not that they charge money, but that they use their massive user lock in to force people to pay for these services to exist in the market.
But… this is not true just about anywhere. I can’t go to. Ford dealership and buy a new Chevy or go to Kroger and buy Costco brand. Or when I go to some stores they don’t allow me to use American Express.
And yes you do have choices. There are plenty of other phone manufacturers out there. Can I install Ford UI on my Tesla? Do you think those companies won’t make you use their own payment processing once apps become prolific in car UIs? Can I hail Uber with the Lyft app? Why are they locking me in to only using Lyft on the Lyft app? Can I buy PlayStation games on Xbox?
If you’re against all of it fine, but let’s not pretend Apple is doing anything out of the ordinary here.
The problem is not the exact thing Apple is doing, but the scale they are doing it at. If Ford and Chevy owned every single commercial plot of land on the country and if you wanted to start up a new brand, you are told you just have to buy your own unpopulated island, start a civilization, convince people to move over, and then you can open a new store selling your own product. That would be where Apple and Google sit right now.
Are we talking about phones or operating systems? Apple has decent market share of course but there are other companies out there. You can buy a Pixel, or any number of other phones.
And even so, many of these “issues” are not problems on Android right? You can use 3rd-party app stores and so forth right?
I’d also suggest.. why does the scale issue matter? I prefer that Apple enforces Apple Pay. I prefer that Apple enforced Sign In with Apple. That’s why I buy an iPhone. If those things bothered me I’d buy something else.
It’s totally out of the ordinary. Apple sells about half the smartphones in the US. There are many other options for manufacturers but they all essentially share one other operating system. This big of a market with this little competition and this much vertical integration would normally be an obvious example of a monopoly. None of your examples come close.
But why does Apple have 50% market share? It’s because of these exact things that I as a user prefer. And on top of that, while 50% is obviously a great position, the other half is Android. And then if you compare based on phones there are still tons of options. If customers hated things like privacy warning labels or sign-in with apple they’d buy other phones. But they don’t. So it seems pretty clear to me the best product is winning.
You may stick with Apple because you like all of these policy decisions. Many stick with Apple because changing is so difficult. You lose iMessage, have to move your pictures out of iCloud, and repurchase your accumulated app library. The mere existence of another phone option doesn't necessarily make it viable. This level of lock-in is by design.
It was always like that, and on Android too. This isn't even lock-in, you have to move your files after buying new SSD, or relocate your documents after installing a new OS. It is a lock-in in the same way `apt-get install coreutils` is, because you can't just move to Windows and expect the same workflow.
Yes. Switching from Android is difficult as well. But, I disagree it's always been like this. When I buy software directly from the developer/publisher, I often can get a license that works on both Windows and macOS (or can get a dual license for a nominal fee). It wasn't really until mobile app stores took off that I needed to repurchase software if I went to another platform. And repurchasing that software would not be cheap. It's an actual cost of changing platforms.
I switch between Windows, Linux, and macOS with regularity and while there are platform-specific services, the mobile platform is considerably more walled off. Mobile storage stagnated for years while the apps and any captured media became larger, really pressuring you to use their cloud services in a way I've never had with a desktop. I can store data on a NAS and access it pretty easily with any of the desktop platforms. I'm not sure how someone is supposed to be able to be able to migrate off iCloud when moving to Android without involving a non-mobile computer. It doesn't appear to be anywhere as easy as copying files from one SSD to another or using AirDrop/SMB/NFS.
The iMessage thing is another layer to this. You may not want to call that lock-in, but there have been extensive threads about this topic recently [0][1]. The Epic lawsuit surfaced some emails that strongly suggest Apple views iMessage as a way to lock customers in [2].
Regardless, the original point is switching platforms isn't going to happen without a fair bit of cost and likely some social upheaval. Switching platforms is technically an option, but it's not a realistic one for many. I don't think it follows that if someone has stuck with the same platform for several years that they tacitly agree with all the policy decisions made by that platform.
This doesn't mean anything when so many things are coupled in to one product. I buy iphones because they have the best hardware and get updated for a long time. I don't buy iphones because they force one payment processor.
That is a very different argument than the one I replied to. It’s one thing to say this situation is ordinary, another to say that you’re fine with it.
Remember that there's nothing at all illegal about having a monopoly. If you have such a superior product to everyone else then it's the expected market outcome.
What's illegal is anti-competitive use of monopoly market position.
Since it is a two sided platform, not a single product ("phone and apps"), and as Apple is constraining the payment downstream market, and causing harm to the consumer (30% markup), there is a case.
Some textbook rulings will apply, since Apple exces admit that if they do no constrain downstream, no one will use their 30% markup product. So consumers could be better off by definition
although Apple will argue that they will charge more to downstream producers directly, but this is also difficult to argue (they can do this anyway and extract rents from consumers and producers at the same time).
If you have a monopolistic platform market on which you also produce, it seems rather hard not to get sued
You'd be wrong about going to a Ford dealership and buying whatever you want in most states. They are independent operators that again, have a high amount of independence from the manufacturer. They will gladly but your old car and sell it on their used lot.
This is why we talk about Tesla direct sales all the time. Because we are moving car sales to the apple model.
> I can’t go to. Ford dealership and buy a new Chevy or go to Kroger and buy Costco brand
Bad analogy. A better analogy would be if a customer already purchased a ford car, and then tried to fix the car with a 3rd party repair person.
There are literal laws about this, for cars, that require ford to provide manuals, to 3rd parties, and require ford to sell replacement parts for 3rd parties to repair cars from.
The problem is that, effectively, it is customers making the decision to buy Apple products, but developers who have pay to get access to them. This split means the incentives don’t get to the people in power, and the mechanism breaks down.
It’s exactly the same dynamic as in net neutrality.
Developers have to pay Nintendo a lot to get access to customers with a SNES, Wii, Switch, etc as well, which is the OP's point - if someone makes a good product that gains a lot of market share (iOS, Nintendo Switch, Tesla, etc) that doesn't mean a bunch of 3p companies are entitled to access to those customers.
I think the same thing should apply, but it's just not as harmful to society currently, because it's just one platform among many, many others, and it's just for games. Whatever the proper regulation is to counter this, it might very well apply to pure gaming platforms as well, making it so that anyone is allowed to make, market and sell games on them, no matter how small.
> Developers have to pay Nintendo a lot to get access to customers with a SNES, Wii, Switch, etc as well, which is the OP's point
The different here is that Nintendo is not a 3 trillion dollar company, that owns 50% of a massively important market in the US.
Yes, anti-competitive practices are allowed if you aren't a huge company.
Literally it is the law, that if you become a big enough company, and have enough market power, then certain actions become illegal, that were not illegal if you weren't as powerful of a company.
> that doesn't mean a bunch of 3p companies are entitled to access to those customers.
It actually literally does mean that they are entitled to that.
For the same reason that 3rd party web browsers, were entitled access to windows users (and before you say it, yes I am aware that windows had a larger control of the market than apple, and it is not literally the same in every single exact way, but the same principle still applies, just in a smaller amount)
Payment processing trivially invalidates your premise: I can walk into a Ford dealership and buy any vehicle using any source of cash-like funds I'd like -- I don't have to use Ford's preferred lender.
Is that true? They aren’t required to sell you a car. I think they could require you to use their preferred lender as a condition of selling the car to you.
App store would be there even if they could charge no money for developers and have 0% cut - it's a prerequisite for the iPhone and they are making huge margins just in the devices, this argument that without allowing anti-competitive behaviour there would be no investment in the appstore is nonsense precisely becaus it's a first party integration.
For example I have no problem if a third party store forced one payment option only, but only allowing one store and one payment option is just milking your market position/rent seeking.
> For example I have no problem if a third party store forced one payment option only, but only allowing one store and one payment option is just milking your market position/rent seeking.
See that’s _exactly_ the problem I have. I don’t want to use your shitty payments system that’s likely less secure than anything Apple is doing. Allowing a single payment source that’s not Apple would directly harm consumers from a security and privacy perspective.
I am an exception. I use phone as a phone and offline GPS. Do not even have data plan. So yes anything that can make a call will do. Productivity: for me it is all on PC / servers.
I might reconsider my attitude when / if I can have phone as a generic computing device where I can download and install whatever I need without much hassles and where I can distribute my applications without needing to sacrifice a virgin first.
iOS safety measures do not rely on the App Store. The whole sandboxing and permissions model is there to protect one app from accessing things it shouldn't.
imo the value prop of the App store can be entirely propped up by the $100/year developer subscriptions. They don't even need a profit cut. The app store infra is a joke. You could probably fund it with under $1m/yr
iOS has allowed side loading for half a decade now. Companies that find $100 prohibitive have a free path that’s nearly identical to Android side loading.
iOS most certainly does not have real sideloading. You can if you recompile the app with your own key every 7 days. Or you can use testflight with some very serious restrictions like not being able to monetize at all.
Sideloading on iOS is nothing like sideloading on Android, you have to compile the app from source with your personal key and even then it's only valid on the device for 7 days.
There is tooling to manage self-signed certs beyond the seven day window. Unrelated but I find it weird that “you have to compile the app” is a bad thing now.
There are ways to go past 7 days but all come with even more downsides to both the end user and company trying to get users to sideload. "You have to compile the app" is extremely related if you're a company wanting users to install your app, especially since that requires more than just knowledge to be able to do.
To ask you the inverse question, in what way is any of this "nearly identical" to Android sideloading which allows indefinite sideloading via any delivery method, including installation of 3rd party stores, with no more than a click on an approval prompt from the user?
Optimizing for people who want to side load ~and~ cannot click the build button in Xcode seems wild to me. (No disrespect!)
It’s identical though in that <when one side loads> one is <completely disconnect from the ecosystem of the device manufacturer>.
Re: side loading binaries/APKs on my actual phone that’s logged into my actual bank account? Hard pass. There’s a time and place for lax security. This is what air gapping is for.
> Optimizing for people who want to side load ~and~ cannot click the build button in Xcode seems wild to me. (No disrespec
When you personally limit sideloading to be "I compile the app and manage a personal security chain to keep it active" it may seem wild, that's not what the vast majority of Android sideloading/3rd party stores is though. Xcode, beyond requiring installation, requires a macOS install to run it on. There are other ways to compile iOS apps, each even less accessible to users or distribution by companies. And again: the obvious statement that the vast majority of revenue generating apps on the App Store are not open source.
Even amongst the Android tech nerds 3rd party stores like F-Droid are popular because users don't want to compile their open source apps constantly... and there are even less requirements around compiling Android apps than iOS apps!
> It’s identical though in that <when one side loads> one is <completely disconnect from the ecosystem of the device manufacturer>.
Not true, sideloading apps on Android means loading them from a different source not disconnecting them from Google services or the Android ecosystem as a whole. It of course allows for that if it's what you're after but it's not limited in such a scope.
> Re: side loading binaries/APKs on my actual phone that’s logged into my actual bank account? Hard pass. There’s a time and place for lax security. This is what air gapping is for.
On Android sideloading is being able to pick which app sources you trust, even if that means "not Google". That could mean "I compiled it myself on an air gapped computer" to you, "I loaded it from a 3rd party store" to another, and "I downloaded it from the developers site" to a third. Which you personally choose is irrelevant as each user gets to pick their allowed sources so it can fit any user's need.
There are several methods for doing it but they are all crippled in ways that make it impossible to actually use the system for anything but QA testing and development.
You can install any app you compiled with your own key and it lasts for 7 days before requiring it to be recompiled.
AltServer can do it but in my experience the Windows version of AltServer is extremely unreliable. AltStore never really auto-renewed properly for me until I put AltServer on an old MacBook Air. Furthermore, the fact that this process needs a second device to bootstrap provisioning at all[0] might be a non-starter for some. Take a week-long vacation? Well, now all your sideloaded apps stop working.
A far bigger limitation for me is the three-app provisioning limit. There isn't any way to work around it[1], and if you do want to do serious sideloading you almost certainly will need to upgrade to a paid developer account.
[0] Specifically iOS only allows app provisioning over USB or Wi-Fi, not locally. Locally installed software cannot actually communicate with the remote debugging daemon. You can work around this with network extensions, but you don't get to use them in dev-signed apps unless you have a paid dev account that's been approved by Apple to use them.
For the record, that isn't to make sideloading harder; that's because Facebook went and shipped a spyware VPN with their enterprise cert.
[1] Personal experience time: Even when jailbroken, and with AltDaemon and Immortal installed, AltStore still bumps up against the three-app limit.
A charge for payment processing should be closer to what Visa or Mastercard charges, something more in line with the cost for providing the service. They charge on the order of 1.5% to 3.5%, depending. 30% is extortionate.
The majority of those percentages is the various gimmick bonus programs that convince people they are beating the system and getting back more than they pay. In Europe, the cap for credit cards is at 0.3% and that's still making a ton of money.
If it were, many companies would come in at 0.01% and bank on all the customers that immediately switch payment systems. Or maybe there is a bunch of overhead and investment involved in doing such (personnel, equipment, fraud systems, etc), so no competitor charges a price that would mean break-even or losing money. If a company really doesn't want to use a payment processor, they're free to go back to tab-based/credit-based accounting and hope that everyone pays in cash or everyone pays with ACH.
On that note, I hope FedNOW works well enough to become an alternate PoS payment method[0].
It absolutely has impact in the cost of the transaction. Even if we forget the fact that US credit card customers are bribed with percentage based cash back, card processors are both providing a form of insurance, and giving both merchants and customers cashflow easing loans. If I pay my credit card in full every time, I am, in practice, paying days later than when the merchant received my payment: I think the issuing bank is dealing with that part, and is not charging the customer for it. Many a transaction processor also ends up paying merchants faster than their bank gives them the money too: Their agreements with the merchants are often a little too friendly, and they have to secure loans for a day or two: There are entire teams out there dedicated to avoiding cash flow problems on the first of the month, when so many subscriptions come in, and a lot of money changes hands.
We also have the insurance component: Say some famous musician and a few influencers decide to launch a new music festival, get a lot of money paid to their festival-making company, and then, due to mismanagement, fail to have a working music festival. Most of the people that paid with credit cards will ask for refunds, and will get them, even if the festival company goes bankrupt. Some of those people managing transactions hold the bag, and end up losing millions in refunds. There's also a wide gamut of fraudulent operations that will try to extract money from the system, either by posing as merchants, or as customers. Some of that fraud is also eaten by the companies that handle the transaction.
So while fees could go down in a world with little fraud (and they do, as companies that are large enough, and have sufficient controls, end up negotiating serious discounts), it makes sense for fees to have a flat base and a percentage base, even if the entire system between you and your customer was just attempting to break even. The right percent though, barring the most fraudulent of environments, has nothing to do with a 30% cut.
The merchants lose when there's fraud/chargebacks, not Visa. Visa forwards that cost to the original merchant. That incentivizes them to be more vigilant about fraud protection, e.g. having to put your zip code in at the gas station.
And the banks that issue the cards are the ones that pay points/get interest, not Visa. Visa simply processes the transactions. If you noticed, your "Visa" card has a bank issuer, like the Capital One Quicksilver card (which uses Visa network)
The cost of running a transaction network has nothing to do with credit card points, insurance, chargebacks. Those are all handled by other parties.
I'm not making a statement on what the right or wrong rate is, but in the case of credit cards there's also a level of risk involved with fraud, which does scale with the size of purchase. Debit cards have less risk and thus have a lower, if not totally fixed-rate, fee.
For chargeback-able transactions and transactions that are reversible due to fraud, it seems intuitive that the expected value of loss would be a function of the size of the transaction.
As someone who sells software in the App Store I tend to agree with you although I'll add that for the majority of us it's 15% not 30% and they do handle a fair bit more than just the payment processing.
At this point, I think the way this will all end up (and would be fair) is for Apple’s payment system to remain, but you can choose to use another one. Apple’s take will probably fall in line (otherwise no one would use it).
I also kind of like the idea that something like that happens, except games all caps must use Apple‘s system and pay the 30%. That’s not as fair, but might be workable.
If I had my way over all of this? Do you know what I really want?
No consumable in-app purchases. Period. Outlawed.
One of my favorite things about the early iPhone was the incredible games that you could get. Now there’s almost none of them, the developers of practically abandoned the platform. The only ways to make money are ads and consumable in app purchases which are just complete scams. Like $1000 buckets of Smurfberries.
That’ll never happen. But I wish it would, because it would bring back the great games.
Check out GameClub, for those old great games. They buy the rights from developers that don’t want to continue, then do the maintenance for newer versions of iOS and Android.
But I think we should be able to agree that demanding 30% of nearly everything and completely banning any sort of alternatives is extremely overbearing and ends up taking a lot of money out of the pockets of people struggling to get by.
Developers would be interested in taking 30% and not interested in even trying Apple appstore, which btw sets product quality level guidelines. As a result, user experience will suffer. Those who prefer apple as it is will seek apple-level quality but wouldn't find one, because apple format is now equal to a regular one, and there is no superapple. Apple instead implicitly suggests to just charge apple users more in IAPs and for apps, when a charge is related to some electronic type of value. Whatever price developers see fit, there is no practical limit.
What you are basically trying to do is visiting a vip club (user-value wise) and then making it open to every crap dj out there, because otherwise it's "unfair". Why don't you just go to a regular one then? It is the same as this vip would turn into in a heartbeat. And where should other members who liked it go after that?
good example, that would certainly force them to have more competitive rates. Probably a premium, but still under competition. With how they control the app store though, how could it ever be a fair competition, there's always the risk of being unfairly treated?
We need to throw it back on the user. Apple uses this line of reasoning all the time. They justify their tracker blocking stuff on "the user clicked a button saying they wanted this". So for Apple to justify their fee they need to be able to convince the user that clicking the Apple payment option was worth the 30% fee while allowing other processors on the same playing field.
Users might be ok with some extra fee for conveniences like trust and the ability to easily unsubscribe. Let the user pick and let Apple compete for those sales.
Consumers buy the phones that are advertised to support features (e.g. LIDAR) and iMessage. They pay for the OS development.
Granted the SDKs would probably be much less comprehensive if there were no 3rd party apps but Apple advertises how their hardware can be used incl. by 3rd party apps and providing the libraries to access that hardware is expected by users (even if they don't think about this, most people expect Snapchat to access the camera).
Bandwidth/Hosting is covered under the $100/yr but if it wasn't, they could easily charge devs for tiers of downloads. Most of the support I'd bet is on the consumer side which wouldn't apply if there were other payment processors.
What bothered me as an app developer over a decade ago when Apple Facebook and Google all started taking a cut of app revenues is that they all magically decided that 30% was going to be the number. They didn’t even bother pretending to compete to undercut each other, it was as if they all decided together behind closed doors that 30% was the number and that was it. After that I realized I didn’t want to be developing apps for these platforms anymore.
Apple subscriptions provide me an extremely valuable service. They are easy to track, cancel & pay for. To the point I will not use an a subscription on my phone that doesn’t go through their mechanism.
Is that valuable enough to charge 30%? I don’t know but it’s certainly not outside what seems reasonable by orders of magnitude to me.
I’m sympathetic to the argument that they are a monopoly and should be forced to allow alternate app stores or payment processors but it’s not what they are charging that puts me over the line.
So allow for both Apple subscriptions and alternative mechanisms.
Most likely the non-Apple route would be cheaper to the consumer and get 90% of the traffic for that reason alone. If that's the reality, does that not imply that Apple's practices harm most consumers? Seems self evident to me that they do.
Besides, there really should be some common spec/mechanism to manage subscriptions from any vendor.
That is until you meet some subscription wizard like Adobe or a similar "you have a couple of weeks in December to cancel your sub" legal artist, then you likely miss it, and https://youtube.com/watch?v=8k5oAaXINX8
I think the worst outcome of their attempts to tax others this way is that it'll blow up in their face and they'll lose leverage over the app store.
I'm okay with them enforcing app store policy guidelines etc. I think what they're doing here though is just a racket.
They may have deluded themselves about this (seems that way from their comments about it), but I think most people outside of Apple see it for what it is. You can make a good argument about app store rules being in the interest of customers and chosen by customers. You can't really make a good argument for the profit grab they're doing here, it's just abuse.
> Apple execs might have convinced themselves that they are entitled to ... pretty much everything
Here I fixed your quote.
Including in everything is the $750M bonus Tim Cook received[1]. We've seen that exec comp is inversely correlated with performance[2] and buy backs only cause greater equity packages to be issued (doesn't reduce the dilution)
> To everyone else, this just looks like mustachio-twirling, cackling evil and unfathomable greed from a company that’s already the world’s richest and sitting on a mountainous pile of cash.
What’s really interesting to me is that moves like this are the embodiment of the “charge more” mantra that is (or at least was) extremely popular on Hacker News for years. For a long time it felt like every HN thread about pricing or salary negotiation was full of people insisting that you needed to “charge more” in every conceivable situation.
If you made a thing that was producing a lot of money for your clients, you needed to “charge more”! If your customers weren’t complaining and leaving, you needed to “charge more”!
Yet every time a company actually does a “charge more” type move, HN reaches for the pitchforks.
It’s interesting to see how clear-cut this dichotomy is depending on who the reader thinks is being charged more.
> Yet every time a company actually does a “charge more” type move
"Charge your customer more for your work" is VERY meaningfully different from "Charge someone else's customer more for someone else's work, because you own the storefront for someone else's business".
Sure, building the storefront is hard and high leverage. But figuring out the moral answer to "who reaps the rewards" is an entirely different journey.
I'm not sure it's that different. Not everything is an easily tangible product: We can debate the specifics of effort vs. reward, but I think it's pretty indisputable that the App store does provide at least a little bit of value add in the form of exposure for the vendor and convenience for the customer. So "charge more" applies to that value-add.
> but I think it's pretty indisputable that the App store does provide at least a little bit of value add in the form of exposure for the vendor and convenience for the customer.
I think it's disputable. It would seem to be adding about the same amount of value that the Windows store does for Windows users. How much is that?
The windows store is barely used and devoid of probably 99.99% of applications. You can't search, for example, for "note taking" and find many of the most popular options. Heck, their search is so bad that even apps they don't have done show up. Microsoft's own app OneNote doesn't show in the results.
It is simple not at all comparable in quality to the app store on iOS.
Let's not depict Uber and Lyft as victims. They would do the same - and they do, when freezing rain is falling on me and I need a ride to protect my health.
At least for surge pricing there is argument that you need to manage scarcity somehow. If everybody wants a ride because it’s raining, you can either rise prices or not, and make it a lottery. The latter is more fair, but the former has higher chance of bringing more drivers into circulation.
Could be, but that is a separate problem. For example places I've been in Europe have multiple competing services, even when Uber is present. But that's because the typical Uber business model where drivers are not professional drivers is banned most everywhere.
I fail to see how it’s different. Uber is the one paying this cost not the end customer. Sure they may pass the cost on, but they also would pass the cost on if any other layer of their stack started charging more.
Much different point than the other comment was making. As far as their choice in using Apple’s platform I don’t disagree that it’s not really a choice and it’s potentially a problem.
Apple intentionally limits the capabilities of its web browser to keep it from being competitive with its native platform, and I’m sure there’s an email out there that says as much explicitly.
s/Uber/Costco/ to see a better example: an iOS app is at best a minor convenience to an average costco member. Almost all costco customer acquisitions are through word of mouth / brand recognition and the vast majority of sales happen at brick and mortar stores. Why should costco fork over some 30% of revenue to apple?
Imagine Google pulling the same stunt for inclusion into their app store and it quickly becomes apparent how the pricing structure is laughable at face value.
> Imagine Google pulling the same stunt for inclusion into their app store and it quickly becomes apparent how the pricing structure is laughable at face value.
As of September of 2021 in the US[1], both Apple and Google's mobile app payment policies have converged[2] as Google mandates that all app developers use their payment platform and only their payment platform, along with mandating a 15% to 30% cut of all app payments. I believe Google's policy matches Apple's when it comes to this example.
The first sentence in your first link links to an announcement saying this:
> Android has always allowed people to get apps from multiple app stores. In fact, most Android devices ship with at least two app stores preinstalled, and consumers are able to install additional app stores. Each store is able to decide its own business model and consumer features. This openness means that even if a developer and Google do not agree on business terms the developer can still distribute on the Android platform. This is why Fortnite, for example, is available directly from Epic's store or from other app stores including Samsung's Galaxy App store.
The implication is that apps can choose to only publish in stores with more favorable IAP terms, not that each store is somehow eligible to a fixed percentage of the $120/yr fee for a costco membership that may or may not have originated within the app store's ecosystem. Otherwise, at a cut of 30% per store, an app would owe platforms 120% of subscription revenue to be on merely 4 stores, regardless of how the customer converted.
So is passing on any other cost. I’m pushing back on the idea that the problem is passing on the cost. The problem is that they don’t get to choose whether or not to pay this cost.
It’s different mostly in the sense that iOS is essentially a monopoly. You can not create anything like Uber without being present on iOS, even if Android has the other half of the market.
When you raise your prices on your own work, there’s usually an implied alternative like not hiring you. We know there’s no such thing when it comes to iOS.
Different things are different, sure. I just wonder who is the authoritative source of morals and who deserves what for doing what.
Creating and providing access to a lucrative market is valuable. What's the moral imperative for allowing others to provide access to the market you created or reduce your fees, both of which would reduce your profits for the benefit of everyone else who is trying to increase their profits?
HN is full of these cognitive dissonances; another example is the generally pro-immigration stance when it comes to low-wage workers, which is contrasted with the anti-tech immigration stance. I used to think it was different groups of people on different threads, but I have come to believe that many maintain diametrically opposed views.
There could be solid position there, as I have argued in the manner you have stated here.
"Tech Immigration" is largely H1B immigration is prefectly valid to be opposed to H1B while being pro immigration.
H1B is a predatory program designed to lower wages and put immigrants in a terrible stop when in comes to the immigration status, i.e the employer holds not only their income, but their ability to remain in the nation in the palm of their hands. This created a toxic and coercive relationship with the employer.
At the same time a correction to this program, and a correction to the low skilled workers is simply allowing more open immigration, if you want to come here to work you should be able to.
The 'open borders' position you describe would definitely be a consistent one, but it's not compatible with most of the HN arguments against tech immigrants. Most HN anti-H1B posts talk about how they depress wages, and it seems likely that a significant increase in software developer immigrants would depress wages even more than the H1B status quo.
The alternative is a sane program that is detached from your employer’s whims and provides you some stability and control. As of this writing, that program in the US is called a green card. But don’t get me started on how hard that is get.
I want to be clear no where did I say anything about "open borders", I said "more open immigration"
I do believe in some controls on immigration, security controls as an example. However I also believe it should be vastly easier than it is today, order of magnitude more open than it is today.
Of course I agree with my peer comment, that the alternative to an H-1B isn't open borders. There are a number of other countries with much more reasonable immigration programs - Canada and Australia for instance - which prioritize immigration of individuals that would provide the most value for the labor market by assigning skills and attributes a point value. It's important to separate out the quantity of immigration, what they do/where they go, and how they're restricted in the process.
With that in mind, consider also that 'and according to a 2018 study by the National Foundation for American Policy, immigrants founded or cofounded 55% of the United States' billion-dollar companies.' [1] It's not a zero-sum game, and stapling would-be founders to companies they would rather not work at for decades (H-1B for Indian born folks) hoping to get the freedom to found the next unicorn is quite a waste of time, talent and their risk-on years.
As an aside, it's interesting that folks want high wages, high disposable income, low inequality, low prices and low inflation all at the same time. I strongly suspect that these are fundamentally incompatible goals. Feels like, at most, a pick-two kind of thing.
This contradicts my experiences, as someone who personally went through it. Of all my immigrant friends and acquainteances (around 50 people) at different tech companies, around 90% are or are or were on H1B. Not a single consider themselves abused by their employer. Many of them have changed companies when they've been on H1B. Your status is tied to your employer, but you can find a new sponsor. H1B transfer is standard procedure.
Of course there is abuse. Even systemic abuse. This goes both ways though. For instance, Indian applicants can wait for over a decade for green card, we're talking completely americanized, fluent and self sufficient people, often with high positions at companies. People who did everything right, by any standard. Are these people abused? Perhaps, but if so, it's because the US government refuses to acknowledge them as permanent residents, which they clearly are for all practical purposes.
Alternatives and improvements to H1B is important, but suspiciously few in this community were interested in such a discussion at the time. Imo, parent comment is spot on that this is one of the hackernews dissonances.
> There could be solid position there, as I have argued in the manner you have stated here.
I may have done the same!
Parent and gp are scrubbing any nuance and leaving cartoon version of arguments, then fighting that strawman. Not all immigration is the same, IMO, sameness is a requisite for arguing the only "rational" positions can either be pro-immigration (all of it) or anti-immigration, which is absurd and reductive.
This is not about Apple charging more - it's about Apple charging for something they did not add any value to. This is closer to Oracle's billing tactics, that rightfully get pilloried on HN, the only difference is I'm yet to encounter anyone on HN defend Oracle's billing practices.
As someone who has gone through the immigration process, I can affirm that once you are no longer beholden to your employer for work authorization, more opportunities are available, and that leads to significantly larger salaries.
I am sure a large part of it has to do with the fact that until certain points in the process, you cannot change your employer without restarting the process, so a lot of people just stay without making a fuss about it.
Edit. Regardless, as it stands, the current H1B is indeed a broken system ripe for exploitation.
Who decides H1B is predatory? Based on my personal experience,I don't think it is. H1B is boon for many people, who came here, got educated and started contributing to the local economy.
It appears your pro immigration stance is for people, who are less educated and more likely to provide cheaper non tech services. To summarize, your stance is not for pro or against immigration, but to serve your own interests like everyone.
Facts, Reality, 1000's of people that have exploited by the system and talk about their experiences publicly just like your fellow commenter that seems to have had a different experience than you.
>>Based on my personal experience,I don't think it is. H1B is boon for many people, who came here, got educated and started contributing to the local economy.
2 things can be true at the same time as well, it could very well be a boon for the person, but it could also artificially stunt their growth due to the restrictions placed on them by the program, I am not sure how anyone could honestly argue that is better for the immigrant to be locked into their employer, and for the employer to have the power to deportation over their employee.. Or honestly argue that would not be abused by less than ethical employers of which there many.
You may have found a good one, I can assure you not everyone does
>>It appears your pro immigration stance is for people, who are less educated and more likely to provide cheaper non tech services.
That seems to be a huge leap based on an assumption that does not track with reality. I am unclear as to what would prevent highly educated people from immigrating to the US with more open immigration, but how H1B does not?
>>To summarize, your stance is not for pro or against immigration, but to serve your own interests like everyone.
Does not serve my interests at all really. I am not impacted by immigration one way or the other.
Are you talking about victims of Indian consulting companies that are basically hacking the H1b system? Yes they need to be dealt with. Perhaps they need to just block consulting jobs from the program generally. Stick to at least enriching employers who add some value to the system other than just performing arbitrage.
> generally pro-immigration stance when it comes to low-wage workers, which is contrasted with the anti-tech immigration stance
I have the opposite view and don't believe they are diametrically opposed. I see many legitimate reasons to cap unskilled immigration while seeing virtually no good reasons to cap skilled.
Imagine a web developer gets hired to build a landing page for a product. Yes please, charge twice as much for your work, sure. But say they tried to charge an ongoing 30% of all future revenue for that product. Do you think HN would be behind that?
Exactly, if a small company decides to charge more for their work, it's a risk they take, and their customers might just decide to go elsewhere. But if tomorrow Apple decides you owe them more, what are you going to do? Not stay on the Apple Store? I don't think so.
That’s a nice dream, but it’s highly unlikely individual companies that are already dominating a market would leave billions of dollars on the table to make a statement
Computers are such an interesting and free mathematical concept.
iPhone is compute.
Before iPhone, operating systems and the web were wide open for computation. You could install everything you wanted.
Apple views the iPhone as a sovereign territory, not just some generic compute resource. They can delete accounts, block access to the CPU, and charge whatever taxes they want. It's their land. In their minds, you're blessed to have the opportunity to be on their platform. Your users are strictly on loan from Apple, and you're going to pay for access to their customers. Your app better behave.
The market evolved into the shape that it did because Apple had a great product, a fun evolution of iPod, and a simple and compelling UI. Microsoft missed the shot, Android took time to get its act together.
None of this was a bad deal for developers at the time, but now there's no way to avoid it. We're now living in a sort of North Korea. Entrenched, with no way out. Over half of your potential customers don't have other devices and you can't reach them any other way than going through Apple.
It sucks for small companies in tech having to carve out ever smaller pieces of the pie. Year by year the market shrinks because the giants take it, tax it, and ration it out. If we'd have known then what we know now, we would have bought up every first generation iPhone and buried them all in a ditch.
iPhone is compute, but they'll be damned if you do anything that threatens their dear platform and profits.
We should push for our legislators to require open installs without an App Store. Customers already pay for the device. They shouldn't have to pay additional taxes for us trying to develop for them, trying to survive in this already hostile market.
> Before iPhone, operating systems and the web were wide open for computation. You could install everything you wanted.
That wasn’t always true of phones (pre-iPhone smartphones), PDAs, games consoles, workstations, or some mainframes. Platform owners requiring license fees for on developers on their platform, using their dev tools, was not invented by Apple.
The App Store and new iOS APIs is an ongoing fee, much more akin to a developer charging a fee to continuously support their (for example) Wordpress theme than a one-time fee for creating the Wordpress theme.
The "charge more" advice I've seen, e.g. from patio11, seems to be aimed at charging _new clients_ or for _new contracts_, and in almost all cases has the caveat that one should almost never up-charge existing clients for the same service that they already have. You can add a new higher-price service tier, or grandfather them in _forever_ at the original price, etc, or quote them a larger price for the next consultation ("My fee is now X"), but in every case they have the option to walk away.
Agreed. HN cheers in the name of disruption and competition when rideshare apps gouge taxi drivers and when delivery apps gouge restaurants and couriers. But when it’s developers being gouged …
For startups, the advice is specifically given in the context that cheap customers are often "high maintenance", whereas deep-pocketed customers w/ accounts payable budgets provide more reliable income streams with less drama.
The only thing that is interesting to me is that you somehow have no idea how to mentally differentiate between a solo developer trying to find a way to be successful on their own, and the world's biggest company with cash reserves large enough to purchase entire countries. It's almost as if advice is naturally context dependent!
Apple didn't become to worlds biggest company with cash reserves large enough to purchase entire countries by missing out on opportunities to generate additional revenue.
Apple, much like the solo developer, is looking out for its best interests and what will help it continue to grow.
What shouldn’t be context dependent, in that way at least, is the law. It should apply equally to everyone and each company regardless of how successful they are.
> the “charge more” mantra that is (or at least was) extremely popular on Hacker News
You'll need to ask patio11 for comment. He might have had some disciples regurgitating it, but he's ultimately responsible for this viewpoint. (Not saying I entirely disagree...)
Groups tend to look homogeneous from a distance until you zoom in like this. And when you find a dichotomy, it isn't necessarily that the group is a hypocritical entity, it's that it consists of sub-groups with differing opinions.
It's true that it isn't necessarily hypocritical at the detail level, but the question remains: to what degree is it actually like that at the detail level?
Everything can be taken to unhealthy extremes. It’s one thing to “charge more”, when people can actually take their business elsewhere.
It’s a different thing entirely when you’re the sole gatekeeper between hundreds of millions of customers and anyone wanting to sell them apps and digital services.
It might not qualify as monopoly in the legal sense, but you’re still being a bully, abusing a position of power in the market.
Charging less sometimes can give you interesting advantages. For instance, Xiaomi effectively crushes their competitors by purposely cutting their profit margin[1], such that:
- If you are to build a product with similar quality to Xiaomi's, it has to be priced higher than Xiaom's, because unless your production/sales volume is on par with Xiaomi, your production cost is very likely higher than Xiaomi's. Customers will prefer Xiaomi's product because it is cheaper.
- If you cut down production cost by bringing down quality, you might be able to price the product in Xiaomi's price range. But customers will still prefer Xiaomi because it has better quality for the same price range.
No Dichotomy there, its one thing to 'charge more' for your services, its another thing to ask for 30% of your client's SaaS subscription revenue, because you built them a website.
The 30% cut was worth it to me early on when there weren't a bazillion apps and they handled payment processing, return processing and gave you some decent visibility. Now it's just payment processing and return processing, which typically is around 3-4% using a credit card, not 30%.
I’m pretty sure the average spending of consumers on software today is far more than just a 30% increase from the times before the App Store. Realistically, the market easily tripled with its introduction.
From that angle, it’s easily worth a 30 % fee. Not because it costs that much to run it, but because it creates that value.
It's worth it to all the Legend of Heros games that are visible on the app store, certainly. For everyone else who doesn't get visibility, it means nothing.
It is a weird situation because it's hard to decide where to draw the line. Even right now the exceptions are weird and semi-arbitrary. Everyone paying 30% doesn't work, but neither does no one paying 30%, since every app would just switch to subscription model to avoid paying Apple.
It's also tricky to change the status quo since at this point a huge chunk of their revenue is the AppStore, and any serious change in the 30% will impact that greatly, upsetting investors. Once you take the step forward, it's very hard to take a step back.
They have to know their cash cow is under threat from legislation though don't they? Or maybe they are confident that no legislation will get through somehow... They could try to keep cutting that percentage until the majority of people aren't pissed anymore. A 15%-5% annuity forever is better than 30% bond that lasts a few more years.
They need to collect the 30% fees, how else are they going to invest and purchase $280B from Chinese Supply Chain. While offering iPhone at a discounted whole sale price in China.
TBH, they've basically gotten away with it for years because consumers aren't effected in a way you can see, because the blackmail of the app store platform lock in is so effective. Its absolutely extortion since you literally won't be allowed to do patches on your app until you cow to whatever policy they put in place that month.
And distributing a mountainous pile of cash to shareholders. In FY2021 alone, Apple repurchased $85.5 billion dollars worth of shares and spent $14.5 billion dollars on dividend issuance. That's 1/10th of a trillion dollars per year in distributions. [1]
Buffet alone collected almost $1B in dividends since taking his position. [2]
Is it fundamentally any different from Google charging for clicks that direct traffic to other commercial activity on the internet? You enable some commerce through your platform and take a cut in both cases.
> Apple execs might have convinced themselves that they are entitled to a huge cut of pretty much everything that goes on an iPhone/iPad/etc.
Why would Apple agree to having its intellectual property being used for free? As long as you have an app on the App Store taking payments, Apple is still entitled to take a commission out of that regardless even if IAP is optional.
Even after the Epic v Apple court case, Apple unfortunately still wins. Don't like it?, Maybe use PWAs or failing that build an alternative. Good luck.
Since the Venn diagram of this is concentric circles, with the Greed circle on the inside, you can also be sure about the Evil part (greed being a subset of types of evil) ...
This is business. I don't see the mustachio-twirling evil here unless you're coming from an anti-capitalist perspective. I won't won't debate the merits of that perspective, but this seems pretty mundane strategic business planning by today's standards.
Edit: To clarify further, I'm not saying "the status quo is fine", I would be in favor of legislation that would force Apple and Google to allow alternative app stores as first class citizens, but in the world we live in, I don't think trying to extract profit out of the platform you built is that crazy, this is what every big corp does.
This is Hacker News after all, a lot of us owe our careers to the fact that computers have trended towards open platforms without gatekeepers collecting rent. “Just business” or not, it's sad to see that innovation in commerce has shifted from the relatively open platform of the web to the relatively controlled platform of App Stores.
> This is Hacker News after all, a lot of us owe our careers to the fact that computers have trended towards open platforms without gatekeepers collecting rent.
I daresay a lot of people here owe their careers to the actual (and aspirational, especially considering the site sponsor) gatekeepers collecting rent, too.
A lot of HN is also FAANG and other billion dollar companies, all of which behave exactly the same way. I don't see it as sad, this is the future we, the HN people created.
If they allowed 3rd party app stores or let users install apps directly on their phone, sure. But why should Apple get 30% of a subscription between me and a company?
You could almost argue that it's worth 30% for the initial discovery in their app store (meh), but I just don't get how anyone could think it's fair for Apple to take 30% of a subscription, when developers don't have a choice but to use the platform.
I don't think you need to be 100% anti-capitalist to see the harm. It's a bit of a false dichotomy. A purely liberal capitalist market is bad, so is communism, so what? A market is a highly dynamic non-linear system that nobody fully grasps. We are thousands and thousands of years from having a fair world. We need to keep trying to make it better, by talking about it, exploring it, trying to come up with ways to fix it.
> I don't think you need to be 100% anti-capitalist to see the harm. It's a bit of a false dichotomy
What I mean is that this is not something exceptional, literally every single billion dollar tech corp operates this way, the only way you accumulate insane amounts of profit is by cynically examining every possible angle to extract more revenue from the business.
Sort of, it would be just business if developers were allowed to release and install apps from somewhere else other than the App Store, and if there were allowed to use any type of payment system they wanted to, or even the mere fact if there were allowed to tell users to go somewhere else besides Apples IAP system to make a payment. It's monopolistic and anti-capitalist if you compound all the facts together.
You can't just say "capitalism", there are many flavors.
"Competitive capitalism" is the one which is generally best for consumers, as businesses must compete, which drives down their margins (thus passing savings to consumers).
"Free market capitalism" is effectively hands off. Monopolies can form, and without any regulation it can become quite bad for consumers. Typically monopolies rarely form, but obviously in areas like utilities it happens quite naturally.
Most people strive for competitive capitalism, when used colloquially, IMO. In the general case they are one in the same, but owning whole platforms that are broadly used is new territory, where it bleeds into anti-consumer impact IMO
I was going to comment that Steve Jobs would be turning in his grave if he would hear about this, but unfortunately Apple was already the money grabbing company today that it was back then as well.
We could start with "You Apple users are the wife whose husband keeps beating her" - that's obvious flamebait and name-calling, and quite against the site guidelines. If that isn't obvious to you, please review https://news.ycombinator.com/newsguidelines.html and recalibrate.
"pure religious flamebait" seems to me to be a very hostile reading. I simply meant to add context to the parent's argument, which I agree with. I apologies for any offense given, but it was just a religious reference, not a sneer of any kind.
I do apologize for "You Apple users", the intended lightness obviously did not come through, and it could have been more neutral.
Perhaps my comparison of an abusive corporate relationship to an abusive personal one was overly terse, but I think that the metaphor adds useful perspective.
I'll try to be more civil, sir. It wasn't my intention to be anything else. Apparently that involves avoiding the poignant as well as the malicious.
