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Comment by nemothekid | Hacker News Reader

I assume their costs are just, Credit Card Fees, Infrastructure Fees (Bandwidth, Storage), Reviewers Salary. Not sure this adds up to 30%.

I think the real reason is that when the Apple store was started, they looked around at the current prices for "software distribution". Retail was like 70%, and other app stores; for example the Danger Hiptop / T-mobile Sidekick charged 60% for their apps store, and the carriers were worse. At the time, 30% was actually a lot cheaper than everyone else. Then I assume Google just copied Apple.

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The MAS fees add up to 3% with presumably similar service costs.

30% is just rent-seeking opportunism. 3% shows something far closer to Apple's true costs for all this when faced with the fact that the Mac App Store is (for now) not required.

Maintaining XCode, running iCloud app-facing services, building/maintaining SDKs, etc...

Apple has to pay for these somehow. They can either get the money by charging more for each iPhone or they can get the money from the real end-users of these products: Developers.

Or you know, they could get the money from the yearly fee they charge developers for exactly these reasons

$100?

20 Billion in 2018, but I read that in a similar thread here and sadly can't remember the source anymore

Apple has 200 million paying developers?

Yes, I'm sure you would buy an iPhone if Xcode didn't exist.

The iOS App Store supposedly grosses around $50 billion USD per year. Let's say that they were to halve their cut from 30% to 15% (very close to what players like Epic are asking for) - cutting Apple's take from $15 billion USD to 7.5 billion USD.

What is Apple spending 7.5 billion USD on such that they'd have to raise the price of iPhones? They have multiple other revenue sources as well, like developer program fees. None of those cover their costs either? Are you suggesting they're selling phones at a loss?

Programming languages, code editors and other developer tools exist for many platforms, without corporate backing. Developing apps for iOS would be very doable without Apple maintaining XCode.

But Apple are choosing to maintain XCode, not as a charity, but to make money selling phones -- $250 billion last year. It's not like they aren't getting paid for it…

CC processing fees may exceed this. Just using Stripe [1] as an example, 2.9% + 0.30 per transaction means $.329 for retail CC pricing. Surely Apple gets a discount, but it's price of competitive alternative that matters.

Part of the problem with this whole market is that we're talking about zero marginal cost goods. Taking away frictional costs of transaction, distribution and support, the economic argument is for prices to trend towards $0. Hence the "race to the bottom" once the App Store made distribution "free" for free apps.

[1]: https://stripe.com/pricing

$0.329 for one dollar.

$0.59 in CC fees for ten dollars. That's 5.9%

$0.735 in CC fees for $15: 4.9%

What about other countries where micro transactions are not that expensive... eg. UPI of India.

The German GiroCard payment system is 0.125%.

The EU just limited credit card inter bank exchange fees to 0.2%.

> Not sure this adds up to 30%.

It absolutely shouldn’t add up to 30% unless you believe Apple should be using the App Store as a pseudo-loss-leader for the iPhone.

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