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Comment by AsyncAwait | Hacker News Reader

I don't think Epic is doing anything but trying to pocket more for themselves, yet I also think that the comments here overstate how "aware" average people are about Apple's restrictions, tax etc.

I don't think most people would consider direct payment to reputable companies like Epic to be a particular security risk. I don't think most realize why they can't subscribe to Spotify from their iPhones, they think it's simply not implemented.

The thing is, Apple now holds a tremendous amount of power over a large set of the population. All the comments saying "just buy an Android" ignore the simple fact that you buying an Android does not change the fact that a significant portion of the market is elsewhere.

I'd be more OK with this if Apple was OK with displaying a 30% Apple tax on checkout. But the fact that they prevent apps from showing it and actively try to conceal it shows that they know most of their customers would ask questions about it, at the very least, likely question if the "benefits" they get in return are worth it.

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The word "tax", when referring to Apple's fees, is a loaded and partial term. The fact that it's clear and understood and factored into the price makes it easy to complain about, but no casual customer to my knowledge has ever seriously asked what proportion of their peppermint tea and scones pays for a café's rent - overheads are overheads and margins are margins. Both companies are invoking consumers and value in their arguments and ripostes, but I only see one of them defending their customers' interests.

Many a company is upset that they have no leverage in a business deal and want to courts to hand it to them.

If a company like Spotify sells subscriptions both in the app and on the web, they have to charge 43% more to the in-app purchaser to get the same revenue, even though the user gets exactly the same experience.

I would call that a tax (informally; I know it strictly doesn't meet the definition) and as a customer I would like to know about it.

If a company sells coffee both in a shop and on the street it would have to charge 43% more to the in-shop purchaser to get the same revenue, even though the user gets exactly the same experience.

Would you call that a tax or would you call that rent?

At least you are calling Apple's behavior what it is: rent-seeking.

Well, kind of...

Conventionally, rent-seeking is a poor quality activity which doesn’t generate any new wealth, it just transfers it.

But that’s not the case here, at least from my perspective, as Apple invests huge amounts in developing their hardware and software and millions of developers around the world (ok, maybe thousands, I don’t know) and their families have benefited from this.

It’s not like they’ve inherited a vast real-estate portfolio that was amassed through violence and war (see British aristocracy, est. 1066) and have invested relatively little into it.

I’m not sure why this is being downvoted. A huge consideration into whether Apple is truly anti-competitive should be if this has caused harm to consumers.

How is harm measured, exactly? I feel harmed when a company makes huge margins on me from something.

> I’m not sure why this is being downvoted. A huge consideration into whether Apple is truly anti-competitive should be if this has caused harm to consumers.

Prior to the 1980s, monopolies were considered bad (or at least extremely dangerous and suspicious) by default, and leveraging one to privilege your entry into another market was a huge no-no (though I'm not sure leveraging a monopoly to create a monopolized adjacent market would always have been seen the same way).

Robert Bork's theory of "consumer harm" as the guiding light of anti-trust enforcement (and further conceiving of "harm" mostly in the form of higher prices, or at least "value for money") has given corporations too much wiggle room and consequently led to a lot of contorted legal and economic arguments, substantially reducing antitrust scrutiny and enforcement (which was the whole point, AFAICT).

It kind of is like rent seeking though. Apple has developed a product with some software but not the software we call Fortnite. They are now acting similar to a company like ExpressScripts, who created an organization in the form of a platform so they could extract rents from both the drug makers and the (insurance company) buyers. If Epic keeps the game off iPhone, there’s some overall loss to consumers. If they keep prices the same but pay the Apple fees, they pay rent to Apple. If they raise prices across the board to compensate, consumers pay rent to Apple and there is some deadweight loss because of a likely reduction in demand.

I'd say the difference is that the tax is not uniformly charged by a middleman. If a mall made its profit by charging 43% on every purchase, I would think of it (informally) as a tax.

But suppose that mall didn't charge for anything else? Electricity, water, security, gravity all came free, and you just paid only if you made a sale? (Ok, there's a $100 developer fee and the cost of a Mac and iOS device.)

Maybe Apple should offer two deals to publishers: 1) Pay £1,000,000 up front and keep all the revenue 2) Pay As You Earn.

If there was only one entity owning all the houses, and to operate a business you needed space, then the terms rent and tax would be practically interchangeable

One entity doesn’t own all the buildings though. Google, Microsoft, Nintendo, Sony, etc all have their own malls and properties you can go to to get your Fortnite. It’s up to the customer which they go to.

If iOS was a monopoly, how is it possible to get Fortnite on all these other platforms? That just doesn’t make any sense. The only monopoly Apple has is on selling and licensing their own products.

Fair Point but I from the viewpoint of someone who has already purchased an iOS device, Apple is the only mall. That is the problem, not the existence of the stores themselves. In the case of Sony, Microsoft and Nintendo they do operate the same kind of platforms which are equally scummy in my opinion, but honestly not on my Radar as I don't really play console games.

In the case of Google I would like to disagree, if only for the fact that I have options as where to procure my software and run it in a manner that is intended, but I must concede that it is more cumbersome that I would like. That is the key difference that makes what Apple does so egregious, and why I don't really have much problems with Google at the current time.

For me it is not about the fees or the stores, its that Apple in practice forbids anyone in the digital marketplace to do business with any of their consumers unless it goes through them, as they own the app store and for the average user, their devices only run apps that are on the app store. Epic is in no position to reject the proposition of using Apple's payment service or their store entirely and still do business with the million of customers that are playing Fortnite.

Apple should be definitely be able to charge for the access to their App store customer base, but Epic should be allowed to reject that price and still be allowed to do business with the iOS user base on their own terms, just like they did on Android with side loading before striking a deal to be on the Google Play store.

It’s just seems to me that supporting the installation of software on a computer and managing installed applications is a feature of the system. Those features are products of the manufacturer or software vendor. What would legislation restricting or mandating those features look like? Who would draw up and certify compliance with the requirements? What impact would that have on innovation or the development of new products? How would compliance against a standard set of requirements work for new and different platforms?

I’m personally opposed to Apple locking down MacOS to run only signed binaries. If they go too far with that I’ll stop buying Macs, but to what extent do I get to dictate to Apple what software they develop, what products they choose to sell and how they decide to implement them?

On balance I think it’s a good thing the US and EU are looking at these issues. Clearly at the moment there is at a consensus and I think there is a legitimate role for oversight of how these companies operate and enforce the rules on their systems. I’m not convinced though at forced openness on every platform of any kind is tenable.

I agree that it is finally good that not only the governments but us as consumers are looking at this issue. I would hope that this entire debacle will result in a shift in perspective for enough people and legislators that Apple will just give us the right to run sideloaded applications without more (or hopefully less) effort than on the Android platform. If i remember correclty, microsoft tried to emulate Apple by only allowing windows store downloaded applications on their ARM version of windows initially but yielded after backlash (and probably poor sales).

I wouldnt call it trying to dictate what Apple does.Also I would like to specify that I don't really wanna dictate what software Apple develop or what products they want to sell in their store(atleast beyond whatever code is necessary for sideloading). What I do take issue with, is Apple dictating which companies are allowed to do business with "me" as a consumer, should I be on their platform.

Walled Gardens has not been the norm of Hardware/operating system platforms in the pc/laptop market, and I don't think it should be that way on mobile either. All of the major OS vendors could have implemented similar walled gardens if they wanted to, they just couldn't get away with it. I hope this leads to Apple not getting away with it either.

I don't think that works: The customer gets vastly different experiences because in a shop you're benefitting from the rented space's protection from weather, etc.

The same is true in the case of the iPhone vs. Desktop + web experience: it's different. One way that highlights the added benefit of the iOS app store is that it's safer than the open web.

As a Spotify subscriber, I don’t really care, because it’s their job to handle their overheads, in the same way that John Lewis on Oxford Street pays different rent to John Lewis in Kingston (probably) but the prices stay the same. Cost of doing business is a thing. Capex and Opex are well-understood by businesses, or should be.

If the Spotify web store is more profitable than the Spotify iOS store, because Apple wants ITS CUSTOMERS to get the same deal and Spotify wants those customers, then this is good and fair for customers at the point of purchase.

> this is good and fair for customers at the point of purchase.

I think it is widely accepted in commerce that a deal is only fair if both parties have the relevant information.

If customers know they're paying more because of Apple's fees and are comfortable with it because they feel they get adequate benefits in return, that's fair.

If they are unaware of this however, am not sure how the deal can be considered fair, since not all parties have the relevant information to make an informed purchase.

This sounds interesting, but not convinced since we could say that fairness mainly exists in the circumstances and rarely in the courts. At some point there is an upper limit to the relevant information available for any decision.

We could test this, I mean, suppose the invoices or even the details at the checkout broke down the total into developer’s fee, apple’s fee, government tax, and so everyone could see that, would that be sufficient to fix the problem? I suspect not, because Epic, in this story, are seeking to pay Apple less, and give themselves more - that’s really their bottom line.

Are they really going to all this trouble on my behalf?

Well, hotel bills do routinely break out not just taxes but individual taxes. And it does matter. I just got back from a hotel where I was rather irritated to find that local taxes for just a 6 day stay added up to the cost of a very nice restaurant meal for two. That's worth knowing next time a politician talks about tax.

The hotel could treat such taxes as overheads and incorporate it into the price, but that's not really useful because they can't change it, only the customer can. Most business overheads aren't like that. If only a customer can affect a charge it makes sense to break it out and highlight it.

Interesting take.

What if the shoe were on the other foot? What company would hire me if I negotiated a salary and then after we shook hands and everybody had the warm and fuzzies, I said, "Well now, you'll understand this is just the rate I charge, so it is exclusive of federal and state income tax. These are additional fees that I am responsible, by law, for collecting from you on behalf of the government. I've broken the numbers down this way in the interest of full transparency."

That's pretty much how it happens in Romania. All (or almost) salaries are negotiated post tax (so what gets payed out to me) and the employer is responsible for paying the appropriate taxes to the government.

What if you have other income from investments?

I assume it’s done the same way as any other withheld tax. The only difference is negotiating salary net of tax rather than ex-tax.

In that case you have to go to the tax office and file out some documents and then you pay the taxes for the investments separately.

There is a single income tax rate, 10%, so it doesn't matter how much you earn. If your investments make more than the annual minimum wage, you also have to pay the health insurance tax and "social security" tax.

Did the hotel also break out their net profit after expenses, including how much had been paid to affiliates for booking?

Knowing that a city has a high hotel tax has driven me immediately to Airbnb in the past. Knowing the amount that I am overpaying for a service is a valuable capitalist function.

Hotel bills are broken out like that because the tax system allows many write-offs and reimbursements of many of those fees. They're broken down because they often go to different parts of the local, state and federal governments, and it's important that those seeking write off or reimbursement know who they need to claim those against.

Interestingly, many large companies use services for this kind of thing, much like Apples walled garden, where their employees can spend without worrying about tracking all these details, and the service takes care of all the (significant) legal wrangling and deal negotiation to make this simple.

That's essentially what Apple does for their money: makes it possible for users to buy things across a host of jurisdictions from an ecosystem of vendors, without risking their device security or payment security. There is a significant amount of legal and infrastructural wrangling involved, most of which the end customer, and many of the vendors don't fully understand.

But yeah, let us focus on the least important part: price.

It would be fare if it wasn’t a monopoly. Only if other companies could create their own app stores that worked on iPhone the customers would be optioning. In the current state of affairs there is no option.

Remember there was a time you could only phone people in the network you were a subscriber. It is not the same, but a similar situation here.

But it’s not a monopoly, it’s one of many, many devices. There are, at time of writing, many games platforms and many application platforms: XBox, PlayStation, Nintendo, IOS, Android, Windows, MacOS, Linux, with Google Stadia too.

Developers make a choice and everything sold on those platforms has distribution costs. Fortnite is available on most if not all of those platforms. AND, players play against one another through the internet not through a private developers network. So there’s plenty of competition. Why Epic aren’t demanding Nintendo and Sony take a lower cut is a mystery. Or maybe not?

Epic have massively, massively, overplayed their hand here. Instead of creating an amazing new game and using THAT as leverage to platform owners for a deal, they’ve made a satirical video, broken a contract, had their bluff called, and cemented their place in future business school classes as how not to go about a negotiation.

> cemented their place in future business school classes as how not to go about a negotiation

it isn't a negotiation, it's an anti-trust lawsuit. Tim Sweeney made it clear that the only 'deal' he is willing to accept is 3rd party stores.

I find it rich that a company that bleeds tons of money just so they have exclusive titles on their platform is suing someone else for anti competitive behavior.

Nintendo, Sony, and Microsoft are creating a game ecosystem by selling hardware at a loss or near loss, footing R&D, supporting devkits, and running promotions mutually beneficial for developers. The value of creating and enabling an entire ecosystem is found to be worth 30%.

An iPhone is sold for a substantial profit regardless of gaming entirely, and offers none of those services or promotional benefits to developers/publishers.

This is true, but until Free-to-play arrived, the companies would get a cut from every single piece of software that was published through licensing. The advent of downloads reduced the trade in used-games, meaning higher revenue.

The selling at a loss is just another business strategy to drive hardware sales of a limited-functionality device (ok, you can watch videos and surf the net, but it's hardly an actual computer) compared to the iPhone, where other factors drive sales and increase the user base.

I mean, I love my Switch and I'm definitely a profitable customer but it's a specialized device. If Nintendo's loss-leader strategy is worth 30%, why isn't Apple's strategy? Or really, who gets to decide what the correct % is? And how?

in theory, that is the responsibility of the markets.

but when you have a duopoly there is no one to decide the correct %, and we start to not have a functioning capitalist market.

It's almost like we're all discovering that there may be problem with the underlying system.

You compare a company ( Apple) who invested billions of dollars in ecosystem, hardware etc. In dev tools. It's not even fair to compare it with parasitic company Epic. That is leveraging platform been developed and pretty much created a market to leverage human weaknesses ( gaming). They don't bring any real in this world. And yet they dare to say they not happy with market that brought them billions. Such kind of ideas can only appear in such kind of company, that don't bring any value to the world and thinks that the world owns them something. Huge part of Epic success is apple marketplace that users trust. Even google play is a derivative from Apple's ideas due to Eric copy pasted while been a board member of apple. You got access to billions of people thanks to apple and google, using their tools. I think it's logical apple and google want their cut for that.

This may have used to be true to a degree, but the console makers don't really sell consoles at a loss anymore, or a minor loss at launch knowing that they will turn a profit soon enough on the hardware once they reach volume.

Not sure what the point is supposed to be with "The value of creating and enabling an entire ecosystem is found to be worth 30%", and making the judgment that Apple hasn't done the same. Without some harder numbers on both sides, it's not a conclusion that anyone is in the position to make. It's also worth remembering that Apple has amassed an extremely loyal customer base that has shown that they are willing to spend an immense amount of money on App Store purchases over the period of decades - Apple does deserve to cash in on that value created such as being the single point of contact for easily addressable issues with app purchases, fraud, & such for the customer, secure & frictionless payments, and most of all, creating the situation where users want to go and spend $ on their platform over alternatives.

The value created is in developers/publishers being able to make more $, which is the ultimate value.

how do you turn a profit by volume if every console is X$ and the cost to make it is Y$ where Y > X? Is that because you include NRE in the Y figure?

That seems like an incredibly arbitrary distinction for why consoles are justified in taking 30% but Apple isn't. Apple created a software platform that has made developers billions of dollars, it seems to me there has been value created there.

So did Microsoft, but win32 apps aren’t taxed and MS is doing just fine.

I'm sure Apple would be just fine as well, I just found it a little funny that the previous poster claimed Nintendo/Sony/Microsoft were justified in taking 30% because of the "value of creating and enabling an entire ecosystem"... as if Apple hadn't done the exact same thing.

Actually MS isn't doing just fine as they would gladly that everyone migrates to Windows Store, which was also part of Windows 10X plans, store only installations including Win32.

Now that Windows 10X seems to go nowhere [1], and Project Reunion is still trying to find out how to merge Windows 7 and 10 worlds [2], one more reason not to do just fine.

[1] - https://www.thurrott.com/windows/windows-10x/238014/windows-...

[2] - https://github.com/microsoft/ProjectReunion/issues

How is it remotely similar? If you want to argue their fee is predatory or too high that might make more sense but the concept of charging a fee to use a distribution channel is present in every single aspect of selling a product. Epic wants to make more money, fine. It’s not a noble endeavor with our best interest at heart. It is a calculated business move to allow them to cut down the distribution fee or remove it entirely. What is a reasonable fee for Apple to impose on the imaginary third party stores? None?

There should be some acknowledgement that the people that manufacture the hardware of your phone shouldn't be able to control every aspect of your digital life related to the phone. Choice is a thing that Apple does not provide as a business policy.

It appears there may be some pushback to that as a corporate policy. I guess it could even be suggested that maybe not everything Apple does as policy should be golden law.

Just suggesting a different pov.

It’s fine to want that but to force it is an entirely different issue. The entire premise of the law suit is that Apple is in violation of anti trust laws and actively harming the customers. Apple has been literally criticized every year for a decade regarding their restrictions and yet people still buy it. Is the thought process here that we are all naive consumers who don’t know Apple only plays nice with Apple? The damn cords clued us in years ago.

I don’t want to rob people of being able to have open hardware but I also don’t want that need to dictate all platforms. Luckily, there are a lot of phones which fit the needs of that market. If I want a phone with one App Store with authoritarian control of the system should I not be able to buy it without fear that one day it will be too popular and deemed too draconian in policy?

You can see this in action on Twitch sometimes in the chat. People ask why the subscription for a streamer via mobile app is $5.99 when it's $4.99 via the web app when there is no difference in what is being provided.

It is noticed and often people actively avoid the higher price once they are aware. Some are frustrated and unsubscribe.

This is understandable since they realize they've been paying an on-going 20% premium every month for a one-time convenience by originally pressing the subscribe button from the mobile version. And none of the extra 20% goes to the streamer they wanted to support.

That's a valid opinion about what Spotify should do, but the fact is for a time Spotify did pass some of the fee on to iOS customers by charging a higher price for IAP.

The question is, should Spotify be able to tell customers that they are getting a higher fee because they are making the purchase on an iOS device?

To me, it requires massive contortions of logic to believe that customers are better off not having this disclosed.

Yes, I had to check they were not still doing this. I don’t believe they are allowed to charge a higher fee on iOS, or is there some loophole?

Customers ought to know, but whether companies are compelled to tell them is problematic - just see the prices of fuel or snacks at motorway service stations - which reflect a local monopoly, not the true cost. Ultimately, it seems the answer over time is that nobody is forced to buy Spotify or a WHSmith sandwich. The music you can go and buy in the shops, or from Amazon, Googly, Tidal, Bandcamp. Spotify is like WHSmith at a service station and wants to use the local monopoly as an excuse to put up their prices and push the cost onto the consumer rather than factoring it into their business.

It was never disallowed for developers to charge a higher fee on iOS app store purchases. They just aren’t allowed to make the user aware that they are paying more than required or explain why.

Spotify could make a web app and bypass this whole issue. They chose not to: let them pay the Apple Tax (if you must call it that. Personally, I think it’s just a distribution cost).

https://open.spotify.com/

(OK, only appears to work on the desktop, weird)

Oh!

Ok, that’s new to me. Thanks.

> "If the Spotify web store is more profitable than the Spotify iOS store, because Apple wants ITS CUSTOMERS to get the same deal"

I am surprised how this unprecedented practice is not widely discussed - I am not aware of any situation in real life where you rent a store and you are told you cannot charge what you want.

There are established limits on what a contract can enforce, an outrageous terms are not considered valid in court. For instance a phone operator could not have penalty of £10,000 for a going over your credit.

I believe this term should be considered outrageous - if apple wants to charge 100% tax, thats fine, but their customers will pay 100% more and then they might have questipms for Apple.

Revenue share and price parity are standard clauses in most department store lease contracts and not at all unprecedented, at least in my experience. My company is routinely told that if we want the lease, we must pay a fixed percentage on sales (usually 25%) as rent, must not list a price higher than can be found elsewhere for an identical item, and all payments must be handled by the department store themselves.

I assume there's a minimum required so the landlord has all upside and no risk. That sounds like a super bad deal. The only way I can see that being practical is if you're getting space in a super exclusive location where the clientele are mega rich and the margins are insane.

I misinterpreted the rules - developers are actually allowed to charge whatever they like, they're just not allowed to say "Actually you can save five quid if you go -> HERE".

Back in the real world, sales assistants may not be allowed to offer deals unless asked first - I know that my partner was basically given very heavy hints to ask if the sales assistant "had any special offers" before he could offer a deal on a new motorbike. I guess this is the same, without the helpful hints. Some people scour the web for coupons and deals, other people pay the full price (and then get extremely cross when the first screen they see in their new app offers a 25% off coupon, yes you, Capture One, you bastards)

As a Spotify subscriber, you may wish to be familiar with Spotify's site on Apple’s anti-competitive behavior:

https://www.timetoplayfair.com/

I'm not sure i fully agree with the analogy.

John Lewis pay a different rent (again presumably) based on the more desirable location, but it's also reasonable to assume their payment provider is the same.

In this case, I would argue that Apple have the monopoly on the App Store, which is fine if they are reasonable about it. However, there's no optionality on the payment processor: they insist it's them and take 30% (from what I've read; not actually an iOS dev).

Would it not be more reasonable for them to charge a small revenue fee (rent) and allow you to choose a payment provider? They could audit the payment provider to achieve the security features that they seem to be presenting as an excuse for their charges.

> If the Spotify web store is more profitable than the Spotify iOS store, because Apple wants ITS CUSTOMERS to get the same deal and Spotify wants those customers, then this is good and fair for customers at the point of purchase.

Are you saying you think Spotify should just charge everyone extra and take extra profit from Android customers? As an Android user, why should I pay extra so you can use an iPhone?

Assume me and you are the only 2 users on Spotify and they need $10 per user in revenue. As far as I'm concerned, I should pay $10 and you should pay $14.29. Apple gets $4.29 (14.29 * .3) and Spotify gets $20.

If Spotify can't differentiate and has to charge every user the same, they won't charge everyone $14.29 because they're in a competitive industry and keeping the cost to the customer as low as possible is important. It's more likely they'll charge us both $12.15 and call it $10 average revenue per customer.

If Epic's lawsuit accomplishes only one thing, I hope Apple is forced to allow developers to advertise and charge different prices for iOS users. If you think iOS is worth +43% on everything you buy on your phone you're welcome to pay that IMO. I don't want to and I'm happy with Android.

If you don't like it then don't set up payment through Apple. Just set it on the web. Multiplatform subscriptions outside the Apple ecosystem are explicitly allowed. The reality is that users don't get to save money so they don't care.

I don't think this works in practice.

It seems Apple prevents you from embedding the website, linking to the website, directing users to that website from the app, or giving a FAQ that includes information about how the user is expected to pay via the website. Users have to guess, or already know.

Watch the struggles LTT have gone through with the Floatplane app.

And indeed, that is exactly what Epic did within Fortnite that has led to their current banning.

This is a bad analogy because there are many cafes and you can even buy tea in a supermarket and make it at home, whereas for apps the market is cornered.

Apple regulates this market, and we have to pay them a tax.

But you can buy Fornite on the Switch, or Windows, or the Mac, or PlayStation, or Xbox.

Going to another cafe to buy your coffee doesn't include a door charge of €300 just so you can start getting your coffee there. Sure you can get it from those other devices but there's a large cost up front to switching device.

I originally started on Android and moved to iOS to check the other side. I find it annoying that I can't really use Kindle like I could before.. Or tell Siri to play something from Spotify. I'm forced to use Apple alternatives and it's the reason I'm moving back to Android when my phone dies.

True, the analogy is probably broken.

You certainly can ask Siri to play music from Spotify, I don't know who said you can't. That was added last October with iOS 13. I have no idea what's happened with Kindle, but I use Google Play and Kobo books as well as Apple's Books, and everything works fine for reading. If not being able to purchase books on the device bothers you so much, fair enough, it's your choice, but nothing much has stopped me from finding the cheapest source of an ebook in epub format and reading it.

Conversely when I tip someone I like to know that they will actually get the tip (see amazon and doordash) rather than it being directed somewhere else because the point is support that entity. Consistently if I purchase an app I like to know if that money is going to the developer, or when I purchase a service from someone in-app I like to know it is going to the person providing the service and not getting misdirected.

I agree that for large companies like spotify it is just a transactional thing they could potentially bake into the price but when interacting with smaller entities it just feels wrong that they have no alternative.

> Many a company is upset that they have no leverage in a business deal and want to courts to hand it to them.

I think Epic does actually have a lot of leverage. They have clout. They're a popular, widely respected company and founder. They could easily organize a strike, where large companies frustrated by this exploitative fee all pull their apps and publicly say "move to Android" or something.

Probably the fear of such a strike itself would lead to negotiations. It would just be embarrassing. Apple would not want to be the phone without any of the apps that people want. Who would buy that? And it doesn't matter that Android currently has the same fees, because they just copy Apple and would also change after such a strike wins out.

It's not just the companies though. I've heard others online say "the company doesn't have to sue, there's probably a free market solution," 90% of the people I know shout BAD TAKE! and assume that it must/should be decided in the courts.

The saddest part to me is just the total lack of creativity. There is a way to do it without suing and it would probably even be more impactful, because Apple would know that it is wrong when it loses. Rather than simply feeling that it has to comply with a law, it would know that developers themselves have negotiating power and there is a reasonable point of exploitation that Apple has long since passed.

I wish the Epic guy would consider this.

The tactic is not very good at all. Respect and popularity doesn't get you much further than inside the front door in business, it certainly doesn't get you free money. It is quite sad to see this happen, because they had a great relationship at some point, Infinity Blade was an outstanding series and mutually beneficial. I also can't believe that all of us give s shit about this issue too and we're here discussing it.

I think we're pretty far off on our interpretations here, and you don't explain why you think the tactic isn't good. Epic is not asking for free money. And they wouldn't be asking for free help, either. This is clearly an issue that is impactful to other large companies in the app store, and they would simply be coming together to negotiate rather than stranded on their own. Hacker news is full of developers, that's part of the reason people care about this issue. Epic's problem could be our problem, too. Nobody wants to be exploited.

> no casual customer to my knowledge has ever seriously asked what proportion of their peppermint tea and scones pays for a café's rent

Furthering your café analogy:

• How many cafés do you think pay an annual amount + 30% of their revenue to their landlord, and may only use the landlord's payment system comprising of landlord dollaz

• Would consumers of a popular café be seriously concerned if their café were suddenly closed because they decided to accept cash directly?

This does exist - popup malls and experiential shopping does exactly this through mandating landlord managed payment/epos.

“Turnover rent options” -> https://www.boxpark.co.uk/enquiries/

And...

https://rew-online.com/profit-sharing-model-could-save-mom-a...

Quite a lot, sadly, just look at eateries as a concession in an institution like a museum, or as another poster said, pop-up places like Boxpark or even - slightly tangentially, event stalls at places like Kew Gardens or during Festivals.

"if Apple was OK with displaying a 30% Apple tax on checkout"

Do you know any store that adds a line showing their margin on the customer receipt ?

A while ago, debit and visa payments often had minimal orders and additional fees.

But Apple is more than a payment processor here, they are closer to a regular online store in this regard

I have a different opinion

Online stores profit from the difference between buying at volumes and selling at a higher price.

They don't charge over the market price, they buy at a discount

Apple doesn't buy anything, doesn't have a warehouse, doesn't allow publishers to discuss the terms of the agreement, they take the same fee from everyone, in this regards it is very similar to a flat tax

Apple store is more similar to a market place, a mall in the physical world, in a mall businesses rent the space

They pay in proportion on how much space they rent and the quality of the space they rent

Apple (unfairly IMO) charges the same amount for everyone, even though some apps are promoted by the store and the vast majority of them is practically undiscoverable unless you already know what to look for.

If Apple was a store it would be a store that only place orders on your behalf, just because it's the only store in town and charges a fee on every order, even if they don't do much

If you had the phone number of the supplier you could place the order yourself, but Apple prohibits customers to even ask for it and if publishers try to contact customers directly, they sue them

In this imaginary town people supporting the Apple business say to people sick and tired of their way of doing it "change town"

I hoped we would be better than tribes in 2020

> even if they don't do much

Apart from warehouse all the stock, provide check/out, provide distribution.

This is an example of having to buy B to get A

Nobody asked Apple to provide check out, distribution and warehouse

They are doing it and forcing everybody to follow along with that because it's best for Apple

In the same way Facebook hosts your pictures because it's good for them

I'm sure companies like Twitter, Facebook, Microsoft, epic, Spotify, Google etc. etc. are perfectly capable of doing all of the above, Apple simply prohibits them from even writing in their apps "this is not the only way you could buy this app"

> Nobody asked Apple to provide check out, distribution and warehouse

Maybe they didn’t ask for it, but they sure as hell use it. No-one has to make native apps.

Or course they do

They can't not use it

That's the point

PWAs are crippled on the iPhone and the fact that the only browser available is Safari is not encouraging for developers, so native it's the only option to have a good experience on iOS

Apple does want you to develop native apps, because to make native apps you have to buy Apple hardware, Apple developer licenses and Apple devices to test them

> They can't not use it

They could very well not use it.

I’ve chosen not to develop (or learn how) iOS native apps. For now. Almost everything I want to do could be a web app and I’d take the cost of maintaining servers for shelf space, distribution and offline storage. I’d have to use email for notifications. Notifications are optional at point of consumption anyway so they can’t be relied upon, so this UX impairment is minor.

The PWA argument doesn’t work for me. Most of the features I might choose to use PWA abilities for can be implemented in other ways.

> They could very well not use it.

No, they can't or they would have done it already

> I’ve chosen not to develop (or learn how) iOS native apps

I've chosen to skip writing mobile apps entirely, that doesn't mean that the company I work for can ignore their users on iOS hence they can't ignore Apple store policies

> Most of the features I might choose to use PWA abilities for can be implemented in other ways.

That's the problem

When the actor that controls 50% of the market doesn't fully implement some standard to drive adoption of their closed platform, development becomes more costly

And it reflects on both development time and price for the end user

> They are doing it and forcing everybody to follow along with that because it's best for Apple

I’ll concede the point that Apple are looking after Apple. I’ll also concede the point that Apple don’t disclose enough about their restrictions to their customers. However, I still find their App Store and fees reasonably tolerable, as a customer. Apple’s approach falls in line with much of how I want my computing to work. They’re not perfect, but compared to Google and FB, they’re by far the more appealing supplier. Compared to Microsoft, I just find Apple’s stuff nicer to use.

"How dare my corner grocery they charge me a “store tax” without displaying the amount of money they make for operating the shop, handling customer requests and complaints, and so on...

I mean seriously people, do you not realise the words you use also affect the way you think about things and not just the other way around?

The private company that sells me electricity has to charge all sorts of fees that are mandated by the various levels of government that regulate the market. These are not taxes but admin fees, riders and right-of-ways, each dutifuly detailed as a line item. Is this not exacxtly what Apple does to anyone who wants to reach a big market?

I've seen gas stations list two prices, one if you pay with cash and one if with credit. It's not quite what you asked for, but it's an example of passing optional margin related to the choice of payment on to the customer.

(Incidentally credit card companies, like Apple, really hate it; I think some states have exceptions in their laws to disallow contracting out of it?)

I remember 15y-20y ago when it was becoming a trend to fuel your own car, some gas stations had two prices. One for "self service" and one "served". I believe that majority of people were trying to avoid tipping the attendant (imagine tipping £€1 for a £€10 fill, that's 10% tip).

It's common here in the Netherlands for shops to charge extra for MasterCard/Visa card processing, and they advertise this at the till. Maestro is king in this country.

Buying airline tickets online often display the processing fee for using MasterCard/Visa too.

The important part is other options are displayed so I have a choice - iDeal, PayPal, MasterCard, Visa, bank transfer, etc.

If it was the only store in town, I'd like to know, yeah.

>Do you know any store that adds a line showing their margin on the customer receipt ?

Man i would really love this! the luxury goods market would be ruined overnight when everyone realizes that most of the time you're paying for the brand!

every regulated, monopoly or olgigopoly private company does pretty much: utilities, gas stations or anything that has one or more fees, charges or mandated expenses, for example an event ticket that adds the processing fee on top of the price. This sounds exactly like Apple and what they do to everyone in the app store.

Free market works on freedom of information and informed choice. If you entered into a contract because I mislead you, thats fraud. Sensorship is a form of market manipulation and apple is ACTIVELY SENSORING this information: https://youtu.be/jdEdGPnaDRY

Also margin is the wrong term - these are transaction fees charged by the platform.

The best comparison is Airlines and airport - every time i buy a ticket, i know how much money actually goes to the airline.

I am so amused that this debate is very American centered all while American physical stores can't figure out how to include taxes into displayed price. And everybody is okay with that.

Businesses are incentivized to not include taxes in the price since there's no laws against it, everyone else does it, and it lets them advertise better prices then they actually have. Personally, the practice really irks me and my small act of rebellion is that I pay in cash if tax is included in the price and by card if it's not. I wish people cared about it more but I suppose there's just more important things to worry about

> it lets them advertise better prices then they actually have

It’s a bit more nuanced than that. The issue is that cities will often have their own sales tax, or that states have different sales tax. This gets pretty complicated when you advertise a price near the border of a tax cliff. Well, not complicated for the customer, but for the business.

It is a laughable excuse. Literally every other country figured this out. It is not like borders and taxes exist only in the US.

Luckily, in places like here in the EU, when watching Dutch TV, I don't see prices that I'd expect in Germany. When someone buys my goods from Germany, I might pay German VAT or they might pay Netherlands VAT. It depends. Point is, I don't have to think about taxes, the business handles it.

But here's the other kicker. The Netherlands VAT is ~21%, the German VAT is/was 19%. It's a pretty simple difference that's basically negligible.

In Kentucky, sales tax is 6%, but in Ohio it's 5.75%, not that big of a difference. Oh wait, in Ohio it's 0% going through the drive thru. In Tennessee, sometimes there's no sales tax on clothing.

Tax is a political tool in the US, not so much elsewhere.

Informing users about the Apple tax would cause an outrage since users already paid for their phones, and own them.

From some. I simply don’t care. To me, Apple are keeping my highly sensitive data (my phone is my bank card, address book, post box, todo list...) secure. I’m really grateful the tools and experience is consistently so good for so long. Whether I’m paying that 30% or the software devs are, I’m not really bothered. I want the high quality to continue. I accept that multiple app stores may improve things... but from what I hear, that’s not the case on Android.

I think we only have this discussion because of Apple’s market cap. Most others are envious. Sure, Apple have a lot of power, but they do a fairly good job of using it responsibly. The interactions with the Chinese government do desire further scrutiny, however.

I’m not a shareholder.

Android is a bad comparison, because they are basically an adware based product, and rightfully many people reject it as a serious tool for managing their personal information and communication. This actually makes Apple a monopolist.

I find that a fairly twisty perspective.

I agree Google are adware. I disagree that tales them out of the discussion of monopoly.

I also think the monopoly discussion and the 30% fees discussion are separate. This relates to my interpretation that the 30% covers “shelf space, distribution, And security”.

If the fee were 5% but nothing else changed, Apple might still have a monopoly.

If the fee were 5%, then Apple wouldn't be abusing its monopoly position.

Why not?

The other poster is correct, the issue of the fee is orthogonal to the issue of app distribution. After all, even if the fee were 5%, Epic could still argue they want to put in their own store where the fee was 4%.

There is no Apple tax. It's a fee.

"A tax is a compulsory financial charge or some other type of levy imposed upon a taxpayer (an individual or legal entity) by a governmental organization in order to fund government spending and various public expenditures"

Apple is acting as a regulator. In that sense, a tax is not far from the truth.

The 30% tax that everyone have might actually be a good thing. This makes the market for another OS champion way more likely. Pop OS mobile? Amazon? The price to create an OS is humongous so the rewards has to be too.

But that's the problem with oligopolies, the reward is fictional as all that happens is the existing market players stop taking so much. This means the ROI for a new competitor is much worse than what you'd assume on it's face, it could even be negative.

It is a messy issue.

Without the in app purchase fees, developers could (and would) give away the app and take all of the revenues.

With the in app purchase fees, developers (rightfully) feel as though Apple is taking a cut for something they they did not sell.

If apps sold for $40 or $80 each, Apple would have a much harder time justifying the commission on in app purchases. The motivation to do so would still be there, but the pressure from consumers may have more bearing on the rates (though I doubt they would eliminate them).

I sort of agree and disagree. I will admit upfront I still cant articulate my thoughts very well on the subject matter.

I dont see why collecting 30% from Games is anything off limit. I consider Gaming as Non-Essential. If you dont like the Gaming Platform. Go Elsewhere. Literally every Gaming Platform collects 30% ( if not more ) on Games being sold. That is everything from early days of Nintendo, Sega, and now Playstation and Xbox. So in the case of EPIC, why are they happy with Sony and Microsoft charging them 30% on Playstation and Xbox? Whether they are losing money on the console sales is irrelevant in this context, that is their business model, and that is how the market works and accept. Nintendo is able to compete with a profits on both console and games.

However charging 30% on Apps, on productivity, business tools and when there are only One competing App Platform in the whole world ( of whole of US ) is where the question of Monopoly or Monopsony comes into play.

I dont think there is an easy answer. On one hand, changing 30% of subscription for Education and Fitness App is ridiculous. Apple being the sole buyer and pitching these client / business / partners against each other while benefiting from it is precisely the definition of Monopsony.

On the other hand, I would much rather paid this 30% extortion than having a platform where user can, no matter how difficult it may be, able to side load Apps. I dont want any of my family member doing it. If you really want the ability to side loads, Android it is.

I think Apple should just keep the 30% on Games. 15% of One Time Purchase Apps, 10% on Subscription and call it a day. I think that is a fair deal. Payment Processing, Fraud Protection, Refund and General Admin and Store Operation would have put it close to 5%. Business aren't losing much with the 10% Rent. With the lower commission Apple can better Enforce the Sign up rules. No more "Reader" App Guidelines. You are allowed to give better deals else where like on your Website. But as a consumer I am happy with the extra 10% for the safety of going through Apple.

And some additional info, it is estimated that 80% of App Store Revenue are from Gaming. So dropping the Apps and Subscription to 15% / 10% arrangement isn't going to make their services revenue collapse. Apple are also working hard on their AppleCare+ push, as you can now buy it within the first year of your purchase and Apple Store Genius has had their KPI percentage increased for AppleCare sold. ( Personally I think what is happening in Apple Retail is even worst than the App Store )

> I would much rather paid this 30% extortion than having a platform where user can, no matter how difficult it may be, able to side load Apps. I dont want any of my family member doing it.

I’m confused, why are you opposed to the option of sideloading? Are you unaware that you can sideload on iOS? (see /r/sideloaded for a thriving sub on sideloadable apps)

It takes a little setup but it is totally doable and doesn’t require jailbreak or anything.

> All the comments saying "just buy an Android" ignore the simple fact that you buying an Android does not change the fact that a significant portion of the market is elsewhere.

All the comments saying “just allow side-loading apps/third-party stores and let people decide themselves” ignore the fact that by doing so then iOS will end up with the same virus/malware issues that you see on Windows and Android. Suddenly we’ll need to help friends and family factory reset their iPhone because their search engine got hijacked, or because they get spammed with sex notifications, etc.

> All the comments saying “just allow side-loading apps/third-party stores and let people decide themselves” ignore the fact that by doing so then iOS will end up with the same virus/malware issues that you see on Windows and Android.

Why? Who is forcing YOU to sideload?

There's no reason why the default couldn't be status quo and you'd only opt in into sideloading, this way the users who want the walled garden still get it and the users who want to sideload can optionally opt into that.

Why is it always an either/or?

As for Android, I'm pretty confident in saying that F-Droid, which is a 3rd party store, is generally safer than even the Play Store.

Android's problem is the lax review of apps even on the Play Store, lack of updates soon after purchase etc. Most users on Android don't even have sideloading enabled, that's not a huge vector.

Because 99% of the user base isn’t tech savvy and will install all sorts of crap without realizing the consequences of doing so.

I may be capable of sticking to the App Store and not side-loading apps, but many of my friends, family and non-developer coworkers are not. They’ll click on random links in their mailbox, ads from apps and when browsing the web.. the end result is that they end up accidentally having their homepage, search engine and browser hijacked, they get redirected to spam websites, links on websites gets replaced with affiliate links, their sensitive information gets stolen, etc.

I’ve never had to help fix an iPhone and I don’t know anyone who’s been infected with malware (besides e.g. TikTok secretly copying clipboard and such), however for Windows and Android then I have people reach out to me on a monthly basis because they accidentally installed something that fucked up their computer/phone and they need help fixing it.

As for F-Droid, I hope you realize that their store is even more locked down than the App Store, and it’s as far as I’m aware the only secure third-party store on Android.

> I’ve never had to help fix an iPhone and I don’t know anyone who’s been infected with malware (besides e.g. TikTok secretly copying clipboard and such), however for Windows and Android then I have people reach out to me on a monthly basis because they accidentally installed something that fucked up their computer/phone and they need help fixing it.

All well and good, but this is not due to sideloading. That is an option that is disabled by default and the majority of people keep it that way. There's sketchy apps on the Play Store itself, which does not require you sideloading. I feel like you're conflating sideloading with malware here.

> As for F-Droid, I hope you realize that their store is even more locked down than the App Store

Not sure what you mean exactly, considering you can even have your own repos in F-Droid, but in any case the point is that it is a 3rd party store.

I don't think anyone is arguing no store can be locked down if you have multiple choices.

> All well and good, but this is not due to sideloading.

It is. iPhones don’t suffer from these malware issues precisely because everything is locked down and you can’t get apps to the iPhone without Apple’s manual approval. If Android was locked down and only allowed apps to be installed through F-Droid then they wouldn’t have any malware issues either.

The reason F-Droid is safe is because they’re also locked down and their approval process is even more strict than Apple’s.

> I don't think anyone is arguing no store can be locked down if you have multiple choices.

What I’m saying is that once you allow third-party app installations then malware will follow. And as we can see with Macs, not even Apple will be able to prevent it no matter how much they try to discourage people from downloading apps outside the App Store. The malware you see on Macs are a result of users downloading apps outside the App Store, and the same thing would happen to iPhones if they allowed third-party app installations.

No argument is gonna be more boring than this one...

Apple has as much malware than Android

It just uses different channels

MacOS is open and doesn't have those issues.

Actually they do, and the reason for that is precisely because they allow third-party installations on Macs, and the exact same thing would happen to iPhones if they allowed third-party installations there as well.

> Adware has become much more aggressive in 2019, heavily targeting consumer and business endpoints on Windows, Mac, and Android devices. A new team of the most active adware families have replaced the top adware family detections of 2018. In total, we saw approximately 24 million Windows adware detections and 30 million Mac detections. The top three consumer threat detections belonged to adware families and the number one business detection was also adware. The number one Mac detection, an adware family called NewTab, brought in 28 million detections itself.

https://resources.malwarebytes.com/files/2020/02/2020_State-...

That report is about users that willingly install malware.

If you're arguing that iOS should prevent ignorance too, then by that logic it should prevent users from receiving emails because of possible scams.

If you think Apple owners don’t know about this, you are mistaken. Curating the App Store is one of the main reasons why I buy Apple products. I want them to tax and restrict developers.

> If you think Apple owners don’t know about this, you are mistaken. Curating the App Store is one of the main reasons why I buy Apple products.

You're posting on a site called Hacker News so I'd expect you to know, but does you extended family know, without you telling them? Doubt ir, just as I would expect most people to think "Hacker News" has to do something with illegality or perhaps reporting on criminal hackers.

Right. Because the tens of millions of people buying Apple products are all ignorant rubes, not informed consumers purchasing superior products. /s

Of course Epic wants to keep more of their profit to themselves. Especially if they have to give a way tens of millions not just a few thousands. I think it is fair for Apple to cap their charges. If they need to take a percentage, they should take a percentage of profit rather than sales to be honest. Unity model is a good example in my opinion.

I think Apple is in the “real estate”/rent business here. if you compare that to how big malls operate it’s pretty similar. They take a fixed fee plus a cut from the revenue in exchange for foot traffic.

And they are in a sort of Las Vegas real estate market, made global. It must be difficult for them to resist the treasure, especially when stakeholders want to see greater and greater returns.

Afaik Unity royalties are based on revenue, not profit. Balance sheets are not difficult to mascarade, revenue is much harder to hide.

Though I agree a minimum revenue threshold would make sense. But that's not apples strategy. Their strategy is to subtly charge the massive amount of indie developers (developer account fee) and take 30% from the get go.

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