Google will lose $50M or more in 2018 from Fortnite bypassing the Play Store
techcrunch.com
techcrunch.com
A better way would be "Fortnite is big enough to bypass Google and still make $180MM", rather than acting like this is Google's fault. I mean, the fact that phone OSes get a cut of everything on their platform is already an insane racket.
Now, how do you think the government makes up the difference in the tax loop holes? By raising taxes on companies like mine and restricting/regulating on how I structure my profits/income so that it can stay in business. So indirectly 30% off the revenue is affecting my tax situation with the federal government.
Again, 30% is on par with federal income tax.
Like Snapchat, this may be a case where deliberately counterintuitive behavior may actually help, since sideloading will now become "cool" for the teenagers/millennials it targets.
If it does and becomes the «new normal» then that could cost Google alot more...
Not that much interesting software is available from outside the Play Store. Only OGYoutube comes to my mind here.
Why are we still falling for this crap?
We fall for this because a subset of us has been provoked to point out the obvious flaw in the headline or the summary and another subset has been provoked into defending the part that isn't flawed.
I alternated between feeling like this was a question worth answering and feeling like a dick for answering this with your own words.
Google has abandoned more and more of the open source parts of AOSP with closed source alternatives over the years.
That’s not to mention all of the drivers that are proprietary....
Google could have easily added way more (still acceptable for most users) friction into the process in the first place. Maybe having the switch in the developer settings, maybe having to enable it over ADB. That'd surely have made Epic Games think harder about this move.
Because consoles are proprietary closed source boxen and android isn't
The fact that you can install software outside of the app store no more makes the version of Android that most people run "open source" than it does Windows or MacOS.
This did become impossible eventually as security technology improved.
That's how a platform business _works_ though.
I mean we could discuss reasonable limits or something or how a platform effects competition once it's entrenched, but you're basically just saying "The concept of a platform business is an insane racket."
Do you think building a global software distribution platform is easy? Let alone the value of compounding network effects.
Good for you, but many other people appreciate the curated platforms that Google and Apple have built and like it that way instead. They're not 'insane' for liking it a different way to you - there's benefits of both approaches.
True on Android, too. And both platforms have OS vendor app stores.
And it’s not just dumb people downloading from shady sources. Look for a printer driver online and you’re just as likely to find a fake malware site as the real site.
The need for trusted sources for downloading apps with limited permissions can easily be seen if you look at some people’s PCs - or Android devices.
After spending an insane amount of money creating and supporting these things, it seems completely justifiable that Google would then ask for a cut of the profits for applications that are built on top of the tools and infrastructure that Google provides for free.
And unfortunately, this seems to be the case with a lot of HN commenters as well.
I think asking consumers to evaluate risk of installing third party apps and manage permissions is insane. My phone runs iOS. My family the same. The volume of malware in the Play Store alone, much less in the sideloading community is mind boggling. If I ran Android I would only install software that I had written myself or come from a trusted vendor, and only use a browser (probably not Chrome even, but Firefox) for any third party content.
Any anti-walled-garden screed has to grapple with the fact that in the real world, the walled garden protects people from mass data theft and infiltration. Windows used to be like this, before many more users switched to Mac (which is harder, but not impossible) to backdoor. Replicating the internet security environment of the late 90s but on our phones would be a disaster for the technology-using world.
I'm a free software nerd and I run LineageOS-sans-Google on my mobile device. I get the vast majority of my software through F-Droid, which works like a GNU/Linux distribution - they build all packages from source and sign with their own key. Only time I would sideload a package is if it's not available in F-Droid (because it's proprietary - although I've since found out about Yalp and use that instead) or if I'm building it myself. It works well enough for me.
I think the objectionable part of a walled garden, at least to a free software nerd, is the walled part. I appreciate the option of being able to step outside if I feel I need to.
"In 2016, the annual probability that a user downloaded a PHA (potentially harmful applications) from Google Play was .04% and we reduced that by 50% in 2017 for an annual average of .02%.
In 2017, downloading a PHA from Google Play was less likely than the odds of an asteroid hitting the earth."
Source: https://source.android.com/security/reports/Google_Android_S...
Is it? What do you think billions of people using Windows have done for decades?
Now the crux is this. In the 80s, 90s and arguably most of the 00's the average Joe and average Katey didn't store 90% of their personal secrets, nude photos, diaries, drug deal receipts, etc... on their desktops and later laptop computers. It wasn't until this decade that such massive amounts of personal information started to become digital. Yes very likely I among thousands of HNs had already crazy personal lives going back to the mid-80s on a desktop hard drive sitting in some dump right now. But hey, at least they barely work and CC info is probably stale.
But today, the environment is much different. I'm not arguing that what Apple and Google is OK, but at least they got some kind of notion that free-for-all might not be appropriate right now.
It might take some time but I definitely welcome new models. For example: * Certified third party app stores * Independent Software Certifiers
It can be up to the user to decide if they want to either use a specific store or decide to specifically trust the certificate of an independent software certifier. And at that point Google could, for example, treat the app as a pass through on their own store. The software certifiers will need to keep a reputation up, for example.
I know I'm providing simple examples here - not that I want to discuss in detail on HN the finer points of these ideas - but that I want there to BE another way that can allow software to be sold online, without the 30% Apple markup that chokes the independent software vendors out there.
The problem here is not a lack of competition. Ultimately, there needs to be one default software repository that people can trust -- you can't have a free-for-all here for the same reason you can't have a free-for-all for software in general. The profit motive is the problem.
To my knowledge, this is the first time, someone uses the side-loading loophole on a commercial scale. It should be interesting to observe Google's reaction to that.
> I mean, the fact that phone OSes get a cut of everything on their platform is already an insane racket.
isn't it Google's decision to charge insane amounts for apps that they didn't create?
However on the other hand, this move by Epic sets a dangerous precedent: Factually, Google get´s economically punished for being more open than Apple. This does not feel right for me.
From a business point-of-view (when sideloading becomes more common) the "right" move for Google would be to fork AOSP, make new Android versions as closed as iOS (while still distributed for free) and prevent any sideloading. No sane CEO who is measured by increasing shareholder value could justify stayig open if this jeopardizes the revenues without providing major benefits.
I, as a user, think this is a sad and alarming development. However, apparently most comments and media do not share this opinion? Are there any reasons why Google deserves no revenues while Apple get´s 30%? When there are none, this situation can't be sustainable from an economic point of view.
If I bought a phone, it is my phone, and I am free to do what I want with it, including installing software that these companies don't approve of.
I would love to see an updated article about this whole subject.
And if they were to make Android a closed system, what would make me buy an Android phone instead of an iOS phone anymore? Openness is one of the biggest selling points for Android.
Year of Linux on the Desktop is hard to see since corporate users are so tightly coupled with MS ecosystem. If Microsoft could build at least equivalent mobile OS as Android or iOS, they would get pretty much all corporate customers to themselves and it would most definitely affect private customers as well. Oh, and Windows has gotten a lot better in the last 10 years so there's really no need for a basic user to change over to Linux.
That’s not what happened with PCs. DOS/Windows was never open but when OEMs wanted an OS, they chose Windows. By 1990, every manufacturer of computers besides Apple who tried to make thier own operating system was dead.
Before Android or iOS, there were dozens of Windows Mobile phones. Most Manufacturers were not capable of making thier own OS.
If Microsoft could build at least equivalent mobile OS as Android or iOS, they would get pretty much all corporate customers to themselves and it would most definitely affect private customers as well.
They could and they did make a good mobile OS. By the time it was released it was too late. Android had already won over all of the OEMs and developers didn’t want to develop for it.
Also, with the iPhone, the trend of the “consumerization of IT” started. Blackberry owned the corporate world before the iPhone. But between both Apple adding features that made it a decent corporate alternative and executives bringing thier iPhones to work and demanding from the IT department that they make it work, Apple basically took over the corporate mobile market.
The problem here is that while Google controls the software, it doesn't control the hardware. All the real power is in the hands of the OEMs.
If Google wanted to close Android, they'd need to either:
- Leverage/convince all the OEMs into adopting the closed fork
- Watch as they lose control completely when someone else makes a dominant fork
- Watch the Android ecosystem crumble as everyone throws out their own fork
I don't think this would work because the OEMs have no incentive to do it. They don't get any cut of the Play Store profits so they have no interest in its success. To the contrary, Samsung at least has its own store. Plus, Android's openness is one of the things differentiating it from Apple. If they closed it down, they have the compromised privacy of a Google device with the closed platform of an Apple device. Apple's closedness then ceases to be a problem and they can differentiate with their privacy-friendliness.
You mean like they already force OEMs to use thier closed source apps and force them not to make any phones that are use Android forks?
I wonder whether Google's new operating system 'Fuschia' serves this purpose...
Stuff that Google Play does, just split out from the marketing and download service.
Either way, I would imagine that the sort of market we're talking about here —Fortnite, an online-only game— would probably have a network connection available.
And even then, signature chains would still work for strong signing the APK, even if it were installed offline.
You haven’t been paying attention...
Google has been abandoning AOSP for years and making closed source equivalents.
It's not costing Google anything, and they're not losing money on this either. It's revenue that they might have expected to earn, which they're now not going to be earning.
edit: This is a question folks, I'm not sure why you're down voting a question.. ya'll are touchy as hell lol.
To put it differently, since I think my first attempt just confused you all in mass:
If Google were to lower it's take from 30% to 15% (fake numbers), for everyone, so that Epic would use their business - would that gain them money or lose them money?
It's a question, yikes ya'll.
I wouldn't say it's a high percentage, but it's not insignificant.
I'd count that as a lost sale.
But I do agree that this is a different situation. This is just a high profile application that has decided to forgo something completely optional.
It's a lost sale, but that's still not a cost. It's just money they never got. If it had actually cost them, then I'd expect it would take away money they previously had, like I say lunch costs me $15 because after the transaction I'm down $15 (but up a lunch).
At best, it's akin to opportunity cost.
I hope you're not referring to me. I never once said anything about Google losing money. I merely asked the question, would they gain or lose given a scenario.
I didn't state anything.
In other words, the claim is that Google is "losing" money by their choices which cause Fortnite to choose to not use them. But it's those same choices which make Google money.
So if Google were to, for example, take less of a cut - they might get Fortnite onto their system. But how much would they loose from all the other companies currently using Google at the current rate?
I made the question that, if Google were to make a pricing change to support Epic, would it gain them money? Or lose money due to other companies also giving less (since hypothetically that's what Epic wants, less cut taken by Google).
Solution to what?
People are sitting here being pedantic about "lost" revenue, even though I said nothing about that. My point however, is that assuming Google would want Epic's business (which seems reasonable), would they gain or lose money by changing their pricing structure to fit something Epic would put up with.
Ie, if they reduced Google's take from 30% to 15% (fake numbers), would they gain or lose money? It's a hypothetical question, one which I guess I should edit since clearly everyone is arguing about random shit lol.
I can't see any reason a company with an existing property with Fortnite's visibility would be willing to pay much of anything for App Store placement other than access to a pure walled garden like iOS.
Not sure you can write a policy that fits that kind of product and most of what actually gets delivered vis the Appstore, and which doesn't have the overhead of a human-in-the-loop on pricing decisions.
Android freely allows you to circumvent the Play Store via manual installation or a third-party app store, which is an advantage in terms of user choice but less secure than the iOS walled garden. Google decide what can go on the Play Store, but they don't control what users can install. I personally prefer the Android approach, but there are merits to both.
> In other words, the claim is that Google is "losing" money by their choices which cause Fortnite to choose to not use them. But it's those same choices which make Google money.
> So if Google were to, for example, take less of a cut - they might get Fortnite onto their system. But how much would they loose from all the other companies currently using Google at the current rate?
I'm not sure what your point is, so I can only assume you're arguing what you thought I meant. My point was simple a question, hypothetically if Google were to chance it's pricing scheme to something that would fit Epic, would it be a net gain or a loss to them?
I'm unsure how anything in your post applies to my question.
One app is not going to change Google's approach to the Play Store, even a multi-million dollar app. The vast majority of apps don't have the marketing power to profitably circumvent the Play Store, so cutting fees across the board would be a huge net loss for Google. Offering special discounts on the Play Store fee is a very slippery slope - if you offer it to anyone, everyone is going to start demanding it. It would undermine the value proposition of the Play Store and create a two-tier system, with one rule for blockbuster apps and one rule for everyone else.
App developers begrudgingly pay the Play Store tax because it's preferable to the alternatives. They'd very much prefer to get all the benefits of the Play Store at lower cost, but Google has absolutely no reason to sell their service at less than the market rate. One outlier does not change that equation.
The same "lose" language is often used when discussing tax cuts or tax breaks ("lost tax revenue"). I wonder whether those journalists misunderstand economics that much, or if it's done on purpose.
In reality it's more "this is costing us profit, because, with few exceptions, we get to skim the cream off of unspent premiums", which sure, capitalism, but they frame it from a position of "(un)fairness", as if they had some implicit entitlement to such.
>The 30% store tax is a high cost in a world where game developers' 70% must cover all the cost of developing, operating, and supporting their games. There's a rationale for this on console where there's enormous investment in hardware, often sold below cost, and marketing campaigns in broad partnership with publishers. But on open platforms, 30% is disproportionate to the cost of the services these stores perform, such as payment processing, download bandwidth, and customer service. We're intimately familiar with these costs from our experience operating Fortnite as a direct-to-customer service on PC and Mac.
https://www.eurogamer.net/articles/digitalfoundry-2018-fortn...
And another interesting quote from him
>If you look at it, the stores on the smartphone platforms actually do very little. They’ll put ads up in front of your game. When you search for Fortnite on iOS you’ll often get PUBG or Minecraft ads. Whoever bought that ad in front of us is the top result when searching for Fortnite. It’s just a bad experience. Why not just make the game available direct to users, instead of having the store get between us and our customers and inject all kinds of cruft like that? It’s a general criticism I have of the smartphone platforms right now.
https://venturebeat.com/2018/08/03/tim-sweeney-epics-ceo-on-...
Google doesn't charge them a cent for using Android. As a matter of fact if you don't like the Google Store, Maps, and Search it has to offer for free, you could have forked the whole thing and tidy up all the loose end and call it something else.
> Google doesn't charge them a cent for using Android.
Why should Epic care about Android's development costs? They don't pay Microsoft a cent for Windows, why should they pay Google for Android?
Google chose this business model, software developers certainly have no obligation to support it.
> Along with payment processing, download bandwidth, and customer service?
Epic has all this infrastructure already, they need it for their PC customers. Why overpay for Google's?
He seems to care about console makers' costs and considers their 30% there reasonable, but he does not seem to consider them reasonable here.
> Why overpay for Google's?
I don't think he's under any obligation too, but it's interesting to see platforms like Steam gain traction despite not handling most of the investment in the platform, and that's on Windows where you can get an installer.
Because the absolute majority of Android devices are not made by Google, just like the absolute majority of Windows devices are not made by Microsoft. What if Microsoft took away 30% of revenue from all software developers publishing on Windows Store?
And you have to paid for Windows License? Somewhere along the line someone will have to paid. Open Source isn't free.
Of course it is perfectly fine for EPIC to avoid the 30% charge. But to judge Google charging 30% as unreasonable while you are getting the ecosystem for free, and than compare the cost of console maker is just being hypocrite.
This is speaking as someone who doesn't like Google even before the first iPhone shipped.
Open source is free. Android is based on Linux, just like Ubuntu, and smartphone manufacturers are major contributors to AOSP[1].
[1] https://www.androidpolice.com/2012/04/26/key-android-enginee...
This is exactly how it works. Steam also takes a 30% cut.
This is literally how every app platform works now.
Allowing people to get apps that don't need these services elsewhere is also a good idea.
What percentage would not be extortion to you?
Why that percentage? What are the costs for all the services these storefronts provide?
So as i read it, the argument being made is: if Google had chosen the same path as apple did in their app store, Google would not have missed this opportunity.
It is really impressive that these companies have been able to justify a 30% cut for running a hosting service with stripped down search engine and payment processor. It's like they say in real estate: Location Location Location.
Oh the irony. Android is more open than iOS and yet its Google that EU found to be at fault with Android. How is this not a classic example that, if anything, Android provides a more open platform?
The latter is what Google got done for in the EU. You might think what Apple does is worse, and should be illegal, but that would be a separate hypothetical law.
Apple doesn't mandate any other company to change something with their product (Apple installs mail, calendar, music on their own iPhone, iPad, etc). They aren't using their market position to coerce another company to do something in Apple's favor. (as far as Android vs. iOS and the associated hardware phones and tablets).
If you only look for one thing they got in trouble for. Other things include prioritizing their shopping results on their search engine. There are cases and rulings that don't have anything to do with "coerce another company" wrt monopoly laws. You can be in trouble for only putting your own products on your own products too, no other company has to be involved...just have to be large enough (by volume).
https://stratechery.com/2018/the-european-commission-versus-...
You don't get Google Play Services without a lot of terms and conditions, and without it you can't really be a useful Android product short of trying to replace the whole store like Amazon does to questionable degrees.
The issue is that Google uses blatantly illegal terms to force bundling of various apps upon other manufacturers, and this is illegal in both the US and the EU and most other jurisdictions.
This is a business-to-business issue, not a business-to-consumer issue. Hence why Apple putting it's own software on it's own hardware is not similar. (Also, Apple is not even approaching being a monopoly, Google already is one.)
iOS is a closed platform, and Android is a more open platform, but that's 100% orthogonal to Apple or Google's _business practices_. Closed platforms are not illegal, while anticompetitive behaviour is.
Android on the other hand has a 74% share of smartphone market so anything they do impacts a majority of the market and could limit others access to the market.
And in iOS 12 any app will be able to provide a Siri shortcut.
This is a categorically false statement. I can point to a lot of places where Apple are doing quite a bit to prevent competition on their platform. I mean, browser engine choice is the easiest to see of dozens of ways Apple is doing something to prevent competition on their platform. Did you mean something else by your statement I do not understand?
Even if you mean "with their platform" vs "on their platform" as if users can go somewhere else, that's a far cry from "aren't doing anything" as they are in fact doing lots of things.
You want to be able to install another OS on an iPhone? Unless you happen to have an Android phone that has hardware that is supported by one of the forks - good luck with that.
Yes you can use scripting languages with iOS apps, games do it all of the time.
Alternate voip apps integrate well with the native iOS dialer. For instance a call using Skype looks just like a call on the native phone dialer and your Skype call history is integrated with your regular phone call history. You can even say call X using Y with Siri and it will use the alternate app - same with messages. If you use a third party VoIP app, and you’re connected to Bluetooth in your car, it uses the phone call Bluetooth protocol just like the native dialer.
Third party keyboard support has been available for 3 years and unlike Android, you can install a third party keyboard and not give it network access so you’re not installing a keylogger.
I was incorrect on the keyboard choice, but caveats about what the dialer can be used for or what system that you have to compile on remain. Again though, that's nitpicking here, they have restrictions on all sorts of places that will conveniently be ignored in responses (e.g. alternative installation methods) to make specific points. The general point stands, they actively stifle. To say they don't or that it's only 1 comes off as bias. To ask someone to list some examples to make the general, obvious point is a bit derailing.
What are the caveats with the dialer?
To ask someone to list some examples to make the general, obvious point is a bit derailing.
How is it "derailing" to ask you to give specifics and then systematically get them torn down?
That's Apple.
Google is more like the only lumberyard in the reasonable vicinity. But they'll only sell you lumber if you also buy nails, a hammer, paint, and pipe from them as well even though there are closer, cheaper, or better alternatives elsewhere for those. They're using their position to force others into deals they don't want to be in.
Only offering your software on your hardware isn't anticompetitive. It's the default for almost everything - your smart fridge isn't anticompetitive because you can't install a different web browser, your modem/router isn't anticompetitive because you can't switch to openwrt, your smart toothbrush isn't anticompetitive because you can't install custom firmware, et cetera.
What is anticompetitive on Google's end has absolutely nothing to do with the software, and everything to do with the licensing. Google have a couple simple rules that make their behaviour anticompetitive. If you want to ship an Android phone with google apps, then:
1) You may not ship any android phones without google apps 2) You may not ship a phone with google apps and a default search engine which is not Google
So, if you're a new manufacturer, Smasung, and you wish to make an Android phone, you have two choices:
1) Use Google Apps and immediately get an extremely mature operating system with a very large software library, but you may not compete with google. Not even that you may not use _that device_ to compete with google. You're not allowed to make any Android-based devices which compete, even if those themselves don't use google software.
2) Develop API-compatible replacements for everything in Google apps, or you can't access the android ecosystem because of how tightly integrated things are. Note, some of these APIs are not clearly documented and have mysterious behaviour. This option is thus only really available to megacorporations who can afford to sink a couple years of development into the project before selling a single device.
This is fundamentally different from what Apple is doing, which is simply selling a product.
I'd say that it has been upheld that only offering your software on your platform has been ruled as anticompetitive if you are large enough. Same with prioritizing your results on your platform, etc. Regardless of if that platform is hardware or any other restricted area with a majority presence.
> your smart fridge isn't anticompetitive because you can't install a different web browser
Unfortunately, I'm afraid if you have the vast majority of the fridge market, and you lock out development for it, you very likely will be accused of anticompetitive behavior.
> This is fundamentally different from what Apple is doing, which is simply selling a product.
Yes, that is very true it is fundamentally different and the specific part about the Android licensing is anticompetitive for those reasons and Apple would not be subject to those rulings. Many of the other software installation practices that Google/Microsoft have been ruled anticompetitive for, however, are very similar to what Apple is doing and only their smaller market share prevents the violation. But we shouldn't pretend that Apple isn't doing anything to prevent competition here, just not in the way that Google did with the most recent Android ruling. Apple does plenty to prevent competition with their platform as do most companies. To say it does nothing is wrong.
In general, reasonable societies don't want all businesses subjected to fairness rules, only the ones whose unfairness can be harmful. This is because being subjected to some of these fairness rules is a hindrance to small company growth. They have chosen to use volume as a metric to determine the size at which these rules kick in. It would be tough to argue that other metrics, such as revenue, should be used to determine size because volume determines the number of people affected not cost.
In no small part, because Apple doesn't license its software to other manufacturers, and doesn't have a monopoly on mobile devices operating systems in Europe.
The EU sanctioned Microsoft for forcing manfuacturers to include Internet Explorer, even though Windows is an open platform and users could download competing browsers.
On the scale of 1-10 openness, that’s a -100
https://mobile.twitter.com/arubin/status/27808662429?lang=en
the definition of open: "mkdir android ; cd android ; repo init -u git://android.git.kernel.org/platform/manifest.git ; repo sync ; make"
The only reason I downloaded Hearthstone on my ios device was so I could use store credit to purchase packs. Otherwise I would have just remained a solely F2P player.
IMO, they're not losing _anything_ - they're just not gaining the extra revenue they would have gotten had Epic chosen to go the "usual" route.
As an Indi game developer, the 30% fee is totally worth the trade for help in discovery. The play store has received about $1000, for their distribution service with my game.
But a game like Fortnite receives almost the identical service from Google and is charged 50 million? Sure some costs scale, like bandwith.... so its not exactly apples to apples, but WAY to close in my opinion.
Would Fortnite be on the Play Store if Google charged 5%, or even 10%. The real issue is the unreasonableness in this pricing structure.
And if they judged incorrectly, they can always distribute it in the store later. Much easier to add it to Google Play than remove it from Google Play from a PR standpoint.
Also, Tim Sweeney is an outspoken critic of the app store model, so it's unsurprising to see Epic go this way where they can.
As long as more than 70% are, it's a net gain for Epic.
Never having played Fortnite, I assumed that in-app purchases are specific to your account and would carry-over if you moved from Android to iOS. Is that not the case?
The Play store is just additional icing on the cake. They're not losing sleep over the one unicorn exception known as Fortnite. 99.9% of other companies do not have the word of mouth to overcome the various gates, whether it's Google or Apple or Steam.
However the article is leaning towards a "google shouldn't allow this to earn more money" kind of view, but how much is this on the total that google makes from being a middleman?
what?
They won't gain from that particular source. They'll still make fucking BILLIONS.
Epic Games will save 50M$.
If a user spends $1000, and 30% goes to Apple, that's $300 that could of bought the user a dedicated gaming device that will allow them to avoid that 30% tax.
I love Apple, but 30% for in-app purchases is something I will never find comfortable.
I get the exposure, but a game like Fortnite already has enough exposure.
Will freemium gaming companies eventually produce their own device to avoid this 30%.
Only time will tell, but I can say that if I had a game generating $300 million in revenue, and 60 million went to Apple, I wouldn't mind spending a few million in research on how to get out of paying that 60 million for the next year.
How many iOS users willing to invest $300 on a low-end Android device to play Fortnite in order to start saving 30% after spending over $700 in in-app purchases do you think exist in the world?
They're not paying the 30%, the developer is. That's just 30% more money the developer makes. The price point for the item wasn't chosen solely based on how much the lose through the app store, it was chosen based on what the customer will bear.
They know that they're only getting 69 cents on that 99 cent download. But they'd take 34 cents if the item will only move at 49 cents. And they'd happily charge $1.50 if they thought you'd buy it.
I don't want my kid to install apps from websites...
I hope that Google doesn't block this feature and turn entirely into a walled garden.