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Comment by fredguth | Hacker News Reader

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.

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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.

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 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?

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.

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.

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

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.

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.

> 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.

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?

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