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Comment by nickpp | Hacker News Reader

Wonder if they could simply offer it for purchase in AppStore, at a 30% markup, clearly presented as “Apple’s cut”.

Users can then choose where to buy and they will obey the rules...

App store rules state “ You must not directly or indirectly target iOS users to use a purchasing method other than in-app purchase, and your general communications about other purchasing methods must not discourage use of in-app purchase.”

I’m pretty sure that means you’re not allowed to let the user know in any way, even on your site, that they can get a better deal than the IAP.

Besides, apple clearly intends to get a cut of hey’s business. If they find a loophole, it will be closed soon enough.

That sounds like harm to the consumer.

The issue is that the user may not even know there's an alternative price somewhere else (website).

Apple bans you from adding ANY information to your app that indicates they can pay somewhere else.

How would that work with an annual subscription, though?

Or do you mean that they have the in-app purchase of that subscription and then, instead of asking $99 they'd ask

  $99.00 Subscription + $29.70 Apple Fees = $128.70

That would be clear and transparent, indeed. But it is also a bit of a finger to iOS users, though.

It's what the likes of Spotify have had to do. either that or eat the cut themselves but no way around it if you want to be listed.

Distribution isn't free in any business. Spotify and the like might not be as profitable paying the 30/15%, but that's a Spotify problem not an Apple problem.

This would be a more compelling case if there was a market to set a competitive price for distribution instead of a monopoly. This looks more like rent seeking than a fair cost of distribution. After all, why does it cost any more on Apple's end to distribute Spotify to a paying customer than a non-paying one?

Does Apple Music have to pay that same 30% fee though? I don't think so, which makes it kind of an Apple problem.

Does the Walmart that has a McDonalds within their store need to charge themselves rent because McDonalds has to in order for it to be "fair"?

At a certain market share anti-trust kicks in. The market share does not have to be at 100%, it can even be lower than 50% if your "niche share" in this market is large enough.

Apple Music competes with Spotify with a very similar product.

Walmart and McDonald's are for more different.

That assumes that Walmart is the franchisee of the McDonalds located in their store. I cannot find any evidence to support that. I found a WSJ article[0] that indicates that Subway locations inside Walmarts are run by individual franchisees. So it would probably be fair to say that yes, restaurants located inside of Walmart stores probably pay rent.

[0] https://www.wsj.com/articles/SB118970298406826519

The specifics of their business arrangements aren't relevant to my analogy.

Apple has a monopoly on distribution on their platform. There is no second competing distributor which "Spotify and likes" could do business with, neither they can do distributing themselves (as desktop software producers have been doing since forever).

Given that, these guys are on point when calling Apple's demands "a ransom". It certainly looks like one.

They have a monopoly on their platform? It’s their platform they can do whatever they want and if you don’t like it you can take your toys elsewhere. I don’t get how a lot of HN is all about freedom of X but then when you can’t do whatever you want in Apple’s App Store it’s all about “they’re not playing fair”.

>It’s their platform they can do whatever they want and if you don’t like it you can take your toys elsewhere.

United States v. Microsoft Corp (2001).

I think there may be a valid line of reasoning here but I’m not quite feeling it. Seems like MS vs was about stifling competition via market share which isn’t the issue here, the issue here is people not waiting to pay Apple the cost of distribution on their platform.

iOS is literally the only major consumer OS which does not allow its users to install arbitrary software. I guess Hey would be happy not to use "services" of App Store and offer their users an installer to download or a link to some alternative store instead. But they can't: they have to pay Apple a ransom.

> It’s their platform they can do whatever they want

Yes, unfortunately. That's good for Apple, but not good for us, so it's in our best interests if this situation changes somehow.

I mean yea, you hit the nail on the head, Apple doesn’t offer the option to side load apps which is a huge reason why I happily suggest people use the ecosystem. If you want to side load apps there is a super available alternative, nobody is forcing your hand.

Honestly feel like I’m missing something.

Once a user buys Apple device, it is no longer 'their platform', it's a user's platform. And he should be able to do anything he wants with is, including capability to sideload apps and install third party app stores.

Refusing this right is evil and should pe punished. Also, this very much helps oppressive states like Russia or China to block their citizens from accessing certain apps.

> "Spotify and the like might not be as profitable paying the 30/15%, but that's a Spotify problem not an Apple problem."

It's an Apple problem because Apple competes directly with Spotify.

Apple's own competitor (Apple Music) can avoid those overheads while offering users the convenience of in-app subscriptions. You could argue that Apple is abusing its market power in one sector to gain dominance in another, which is monopolistic and - in many countries - illegal.

One could even argue that they compete directly with Hey because of their iCloud email service.

What are the real costs of Spotify distribution for Apple?

They can't show "Apple Fees" in the app, as per Apple's rules. They would only be able to show the total.

In many cases it's not a great idea because it makes it look like your product is a lot more expensive than it is, and the customer has no idea there's a way to get a better price. It happened to me with Youtube Premium, I thought it was expensive at €16 (instead of €12 in reality), and only found out by chance it was the iOS pricing.

>and the customer has no idea there's a way to get a better price.

Wouldn't you look for more information outside the appstore before you buy into a subscription? I mean if you do that you should stumble upon the actual price and maybe an explanation for the higher price in the appstore.

It's less a problem for Basecamp than for Spotify, who have a more mainstream product and audience.

Well if the app tells me it costs $X, I have no reason to doubt it and double-check on the web. Unless I know about that Apple policy, but most consumers don't.

Unclear to me, but this might disallow a higher price for Apple in-app purchases:

> 3.1.3(b) [...] You must not directly or indirectly target iOS users to use a purchasing method other than in-app purchase, and your general communications about other purchasing methods must not discourage use of in-app purchase.

from https://developer.apple.com/app-store/review/guidelines/#mul...

They could just price it atronomically high in the app, like a bug, which will trigger people to reach out to others or investigate.

I don't think this type of clever lawyering is going to work when you're against a corporation that rules with an iron fist.

If Apple charges a 30% fee, the total price would have to be $141.43 to get back $99 for the subscription.

> But it is also a bit of a finger to iOS users, though.

Yes, but I'd point out that it is Apple giving their own customers the finger here, not Hey.

This is such a neat idea. I think if all app developers start doing it, it will force big companies to maybe lower their cut. Like how we add VAT to final price it should say Apple/Google tax and add 30% to total.

At least it will make the non dev users aware of the app store tax bs.

I wonder if it would satisfy Apple if they offered an in-app subscription price at something like 10,000% markup? Eg, something nobody would sign up for. But the option would indeed be there...

People would realize that an email app could not cost that much, and so would look to sign up on the website.

Or bury the subscription so far in the menu that no one would ever find it?

I think that probably violates Apple's guidelines. But I'm not sure how Apple can complain about price, given there are apps that cost $1000 or more.

That is actually a very decent idea. Charge it at $9999/ Yr.

I wonder if that would work.

If they host their own ad server couldnt they just advertise their own application, linking to the website where the user would be able to find the real price?

Would apple be able to tell what content they are serving? Is that still against the ToS?

This is a very interesting workaround. Would like to know if anyone has done this.

I'm not personally an IOS developer but it sounds like a really obvious solution to the problem. I'm assuming Apple isn't this dumb

Either way, Apple loses nothing.

A potential effect is that iPhone (iOS) users see that they pay far more than people on other platforms. Which may reflect bad on either HEY or on Apple, depending on how the story is spun.

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