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Comment by mortenjorck | Hacker News Reader

I’d agree with you if it weren’t for the fact that Apple blocks Spotify from offering its own subscription link in the app. By forcing businesses on the App Store to choose between Apple’s in-app purchase system for a 30% cut and using an external payment processor that they are forbidden from linking to (or even referencing!) in the app, Apple retains a substantial, anti-competitive advantage over anyone operating on its platform.

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I think this is similar to grocery store brands. Do you think that grocery stores should not be allowed to charge name brands for shelf space because they are competing against store owned private label brands?

I regularly shop at three different grocery chain stores. It's way easier for customers to switch between them compared to being locked into the Apple app store.

You’re right about the ease of switching. I think buying a wholesale club membership card is more analogous. You could buy a Costco card and a sam’s club card if you wanted, but there’s likely not many people who do. People actually prefer the shopping process at Costco for example, and they pay a yearly fee for it, just as people like the shopping/app purchasing experience on an iPhone, and they paid a substantial amount of money for the phone.

Nobody is being forced to subscribe to Spotify through the App Store. It's very easy to visit spotify.com and subscribe to Spotify Premium.

>Nobody is being forced to use Internet Explorer through Windows. It's very easy to visit Netscape.com and download Netscape Navigator.

https://en.wikipedia.org/wiki/United_States_v._Microsoft_Cor....

At a time when Windows had something like a 90% desktop OS market share. iOS never had more than 30% mobile market share.

100% of iPhone users use iOS doesn't matter what the total smartphone use percentage is. It was the same when railway Barron's started capturing the other markets when they owned the railways each railway barron owned their own track and people had alternate routes

And 100% of Spotify customers use Spotify. Should artists therefore be able to dictate their own terms to Spotify?

Sure. But it is still easy to change phones.

You can buy/sell it on eBay. Or next upgrade cycle change brands.

Change phones and then lose literally every purchase you made via Apple. That seems to be the definition of vendor lock in.

I'm not fully aware about how Google Play Store purchases work, but isn't it the same there if you switch between iOS and Android or vice versa?

The sale of apps basically died years ago. Most of the revenue from apps is either coming from in app purchases of consumables or subscription service that are cross platform.

Music that you bought from iTunes has been DRM free for ages.

Most movies purchased from iTunes are transferable to Google Play, Amazon Video and Vudu vis the Movies Anywhere app.

If there were only two grocery store chains in the entire world, and no other way for CPG companies to sell to consumers, I think it would be quite similar indeed.

That's a good argument, and I've actually discussed that issue in the past wrt grocery stores. Those grocery store brands seem to be good for consumers, but bad for a world where people can start successful companies and work for themselves. Maybe its just more efficient to have one giant megacorp make and sell every single thing, but I'd be willing to spend a bit extra so all my self employed friends wouldn't ever be forced to get 'real' jobs

edit: typo

You're missing the point.

It's a 30% cut for using Apple's distribution channel. And no Apple doesn't let app developers use the channel whilst telling their users how to bypass the 30% cut.

Just like I can't go to any retail store today and on any of the clothes or boxes find a giant sticker that says "buy this product on our website for 20% cheaper". No retailer would tolerate that.

No-one, not Spotify or the end user, has ever chosen to use the app store. Apple's vertical integration has banned all competition for iOS distribution and forced people to pay a 30% tariff top run code on their own machine.

I don't think this is a completely fair analogy.

You'd have to add that it's more like you own a car that will only take you to that one store.

You can visit a different repair shop by getting an Uber through the in car navigation.

You can visit spotify.com on an iPhone though.

It isn’t really a 30% cut because you can buy iTunes cards at pretty significant discounts, up to 25%, which comes out of that cut.

Can you actually get iTunes gift cards reliably for 25% off?

Even the dodgy ones on eBay seem to be 10% off max, and I'm fairly sure those are primarily used for money laundering and/or credit card fraud.

Can you actually get iTunes gift cards reliably for 25% off?

Yes, but like with any other purchase, you have to get it from a reputable retailer.

I usually load up at brick-and-mortar places on Black Friday weekend and then use them the rest of the year.

Isn’t this more soft handed than exclusivity deals (which is really a kind of non-compete)? And people seem quite okay with those, even though such deals smells like the product of extremely lopsided power.

I see Apple as a plaza owner who opens up a few of their own shops in that plaza. Or Safeway selling some store “generics” branded by them.

Spotify doesn’t allow in app subscriptions - so it’s not paying the 30% cut.

Should we also stop Google from surfacing reviews, hotel reservations, etc before competitors since it doesn’t have to pay itself for top placement?

Should we stop console makers from also being publishers since they don’t have to pay themselves a licensing fee - yes physicsl media from third parties have to pay a licensing fee.

Should we stop physicsl distributors from having store brands?

Apple's cut on subscriptions is 15%, not 30%.

spotify is charged 30%.

https://timetoplayfair.com/facts/

Which decreases to 15% after the first year.

I find this to be pretty elucidating on the situation of Apple/Spotify. I'll admit Warren's suggestion had me raising a bit of an eyebrow but taking the time to understand Spotify's position a bit definitely gave me some clarity and I'm certainly less incredulous than I was before.

Given the debate at hand, this link is definitely worth a read.

I love how they're comparing Spotify's 10$ vs Apple Music 10$ subscription.

Completely forgetting that Apple Music is premium only service, while Spotify' minority of paying customers carry majority of freeloaders. Very "fair" comparison.

(I know that Spotify have ads, but ad revenue is significantly less than 10$/m)

This somehow will have to change.

The top grossing iOS app (Tinder.app) somehow is not really complaining about this though, but that's because most their revenue comes from the iOS in app purchases.

apple doesn’t have a competing tinder app. apple forced the 30% upon spotify, causing a price increase for spotify, but then apple released apple music at spotify’s old price, undercutting them.

Again, subscriptions are 15% after the first year. Spotify is acting quite disingenuously in their claim.

that isn't entirely clear to me.

https://www.theverge.com/2018/8/21/17764424/netflix-feature-...

this article implies that no, it is indeed 30% for any new user, at least for netflix, but then that matches up with what spotify claims. spotify also claims that apple changes what policy applies to each company. it does mention the second year reduction, but that seems to be for other apps?

i think it's at least clear that apple makes it a little unclear what they exactly do. i have heard from more than one app developer (from big companies) complain about apple's arbitrary app store processes.

Apple has premium only streaming service. No surprise it's better than freemium Spotify. Reportedly from what I googled Spotify has about third of active users paying any subscription fee, while it's 100% for Apple.

Spotify hasn’t allowed in app purchases of subscriptions for years.

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