Apple blocked Facebook's attempt to tell users about 30% App Store 'tax' | Hacker News Reader

Apple blocked Facebook's attempt to tell users about 30% App Store 'tax'

cnet.com

123 pointsmaydemir142 comments

https://news.ycombinator.com/item?id=24301332

Also https://news.ycombinator.com/item?id=24313092

It's not a duplicate, people are just trying to create a Streisand effect by reposting this news every day.

This things are the actual problem with apple.

Having a rule which forbids you from anyhow state anything anywhere in the app which might discourage people from buying on apple is a direct restriction of the free marked.

And not the only one they have.

I still remember that apps had problems stating that they are compatible with the peblle smart watch once apple brought out a smart watch.

The free market is your ability to pick up your toys and focus on Android. That's not a commentary on whether Apple is right or wrong, mind you, but there's no questioning it's their platform.

No, this is a misconception.

There is no real choice except Android and iOs and you can't "carry over" apps (and often content in apps, too) which you have bough.

Also Phones are not cheap and you can't switch your phone os between them.

This means that there is defacto no free marked between iOs and Android (as you have no real choice and once you choose switching is problematic and expensive). So the only choice we have is to enforce a free marked IN iOs and Android.

Or with other words there is a marked for iOs apps and a different marked for Android apps. Treating them as one marked is ignoring how the world works 2020.

I am talking about developers here, not Joe Schmo who lives his life in one ecosystem or the other.

True, but Markets aren't just constrained to specialists, and if by virtue of more people becoming developer-esque, more people are buying into there being an issue with Apple's business model, then there's an issue with Apple's business model.

We're just now breaking into more widespread adoption of microelectronics as a fact of life for the public where the newer generations have no concept of there not being these things. What was okay in the early adoption phase isn't once you start getting established.

I think your emphasis on the wrong word. It's their platform. A platform is the base for other people to build their business on -- and at the point maybe the rules should be different.

As an analogy, if you own a house, you can do whatever you want you with it. But as soon as you rent out part of that house, you lose some of that ability. You can no longer do whatever you want or kick out your renters at will.

Oh, that's a good comparison. Well at last for someone from a country where there is protection for tenants.

I wonder what would happen if Facebook and the other megacorps currently objecting loudly to Apple's policies on this topic lobbied a government or two to legislate mandatory disclosure of this 'tax' at point of sale, as well as the restriction on mentioning app developers' other points of sale, overriding any contractual agreements or corporate policies to the contrary.

For example, requiring language like this on the final confirmation screen before completing each purchase:

"Legal notice: Apple will receive 30% of the price you pay to purchase this app or to make purchases within this app. Apple does not allow this app to mention or direct you to any other way of making purchases from this app's developer which does not involve paying Apple 30%."

(Naturally the law would be written not to be specific to Apple or to the 30% number, and a given app store's version of the notice could omit the parts which don't apply to that store's policies.)

Would that apply to Visa/Mastercard/Amex? Stripe/Chargify/PayPal? Would the law require a break down of how much goes to Stripe and how much to Visa? How about currency conversion, would that need to be listed? Bank processing fees would need to be in there too ...

The difference is that the examples you give directly facilitate a financial transaction, whereas Apple's situation is much closer to a tax where they charge a high fee just because they have the power to do so.

Apple facilitates the transaction - they provide the store, the user confidence, the marketplace and the users.

It's like the old saying goes: if you buy Apple, you're not the customer. You're the product, and they'll sell you to Facebook for a 30% commission.

you misspelled "Google" I think.

So, Apple provides the users? As in; Apple actually own the users as a cattle farm?

The users do not have rights at all (like cattle). Not even free speech on the phones they own?

The worst thing to me, is the number of people trying to defend this sort of thing, as if it was the most natural thing.

Looks a lot like stockholm syndrome to me.. or you know.. remind me a lot how a lot of people under fascist regimes were unaware of how wrong things had turned out.

Putting aside what's the fair amount for such a commission, how exactly are VISA or Mstercard more entitled to charge it compared to Apple? Can I use my VISA card with the burannet network for a cheaper price? Can I just pay nothing because the cash transaction is "free"?

They all provide a service, the infrastructure, the network of "clients" and "providers". They should be allowed to charge a fee. The exact amount or conditions is a different topic.

On the other hand I'm finding it next to impossible to scrape together any sympathy for Facebook, a company who's a monopoly of its own and who's sole purpose is to covertly collect even more data to monetize from users. The whole Facebook app is a Trojan horse meant to collect as much as technically possible. I'd very much support an initiative where an app would trigger an unblockable notification every time it collected anything resembling personal data without explicit user input. Every time it piked up the location, the SSID of a network, accessed BT, etc. And it should report periodically for how much money was that data sold (under any form).

If as a user you want to know exactly how much Apple charged the developer for services, then surely you want to know exactly how much data the developer takes from you and its value.

> Putting aside what's the fair amount for such a commission, how exactly are VISA or Mstercard more entitled to charge it compared to Apple?

I don't see how their comparable at all. Apple doesn't replace the role of Visa. Some payment processing company is required to process online payments - there's lots of code and infrastructure to maintain to make payments work.

Apple does not facilitate the transaction, and the transaction would get done fine without them. Hence they don't have the same level of "entitlement" as Visa.

> Apple does not facilitate the transaction

Can you take a step back and look at the bigger picture? Commissions in this world aren't exclusively charged for facilitating a money transaction and nothing more. VISA also has no hand in how a bottle of water is produced, they don't store it in their warehouse, they don't analyze the quality, and they don't ship it to me. But VISA still takes it's share simply because the payment (not product) crosses their network. It's a service, it costs. And I have no say either as a regular customer or a merchant because between VISA and MC there are no real options. Some countries may have a domestic solution but realistically you can't consider changing countries an option. And you may also need to go outside of that network one day.

Apple facilitates a transaction only it's not financial. They facilitate the "transaction" of apps and services between users and developers via the Apple platform. They make it possible by building a terminal (the iPhone), a community of users, an infrastructure to host all the apps and intermediate the services. This costs money no matter who does it.

If you want to argue that the percentage is too large, that the conditions are unreasonable, that some parts should be free, that Apple is abusing their position, etc. you may have a point. But if you're arguing that Apple shouldn't be allowed to charge for the services because they don't do exactly what VISA is doing, or that VISA shouldn't be treated in exactly the same way, you don't have a leg to stand on.

Please take a moment to really think about this and not just vent frustration because that's not constructive. How exactly is VISA different from Apple from the perspective relevant here? And don't say "because Apple doesn't process the financial transaction" again.

Apple directly facilitates the financial transaction as well. I pay Apple for all apps and in app transactions.

I get that people are upset with the high fees, but some of these suggestions are, at best, problematic.

I think the right line to draw is: "Would the general public be surprised that this cost is included, or by its magnitude, or by the impact on price paid by buyer or price received by seller as compared to other payment or purchasing methods?" Or, looking at this from another angle, "Is there a widely applicable ban on disclosing the fees which is in practice harming the ability of consumers to make properly informed purchasing decisions?"

There's no way to draw a perfect line between forced disclosure for transparency purposes and respecting the right of companies to set their own policies. But I'm okay with imperfection, since that's all that reality offers.

Why not? If their fees were transparent maybe that would start a bit of a pricing war. They WANT the cost of their service to be hidden. If I remember correctly, I think their agreements already forbid retails from adding the fee on top of the retail price.

It's the same situation.

> If I remember correctly, I think their agreements already forbid retails from adding the fee on top of the retail price.

That's what I thought, but someone posted something recently which may indicate that this is no longer true.

https://news.ycombinator.com/item?id=24302222

You think this should apply to Google Play, Xbox, Epic, Steam, and everywhere else?

As the judge who ruled against Epic on the breach of contract wrote:

”There appears to be evidence that everyone that uses these kind of platforms to sell games is charging 30%. Whether Epic likes it, the industry and not just Apple seem to be charging that. Right now, Epic is paying Apple nothing. Epic itself charges third parties.”

Every company providing any service or good could be required to provide cost/margin accounting, as well as disclaim industry norm practices such as pay-for-placement in grocery stores or advertised retail price limits at BestBuy... does that seem right?

What would this 30% notice have said for the billion free downloads of Fortnite? When IAP business model is used to underwrite free to play, should it not also underwrite free to download? Epic can’t have their cake and eat it too.

I think there's two real issues here:

* Apple does not allow other App Stores on their platform

* Apple does not allow other payment processing or even instructions on where you can purchase things outside of their platform. This reduces even big players like Netflix to just throw up a message that says "You can only use this if you're a memeber", rather than give users a helpful link where they can purchase a membership outside the app.

Neither of these are things that Android does, so the case against Apple is significantly stronger.

> * Apple does not allow other App Stores on their platform

As a consumer, I see that as a feature not a bug. On the Switch, Play Station and Xbox I don't have other stores I can use as well. I don't see how this is a problem as much as it is a feature. The fact that Android allows more than one store is much closer to how a Windows PC allows the user to install apps from anywhere. iOS isn't trying to replicate the PC experience, its not nearly as general purpose as Windows or even macOS.

For free downloads, the notice would of course not need to include the part about 30% of the app purchase price. It would still need to include the parts about 30% of the price of IAP and disclose the ban on mentioning any alternatives to IAP that might not include the 30%.

It's not typically a norm in other industries that you have no way of buying from the vendor without paying a middleman 30%, and that when such ways do exist, the vendor is restricted from telling you about them.

So, for your BestBuy example, if you want to buy from a company who sells there and not pay a cut to Best Buy and their distributors, you can always send a check (for cheapest processing costs) or use a credit card (for still far lower costs than Best Buy's cut) directly to/with the vendor. The vendor gets more of your payment, and you get exactly the same product usable in exactly the same ways as if you had bought at Best Buy. Not only that, the vendor is allowed to charge less than Best Buy charges if you buy direct. Grocery stores are broadly similar, though admittedly fewer grocery vendors are willing to deal directly with individual households (but that's up to them).

Apple creates a very different context than the above.

Apple would probably counter lobby that if one company is called out then all involved in the transaction should be. Facebook should publish their profit off of you for this page view. The seller should show the cut taken by upper management and what is pure profit for any product or service. Why should they be the only one with underwear exposed?

Anywhere you're paying money it should be disclosed!

Page views are not payments.

Any cut of money that developers and users cannot avoid when trying to transact with each other should be disclosed, yes. But Apple's is the only such cut in the entire iOS ecosystem. And it should also be disclosed when companies are forbidden from informing you of a cheaper way to purchase from them. Again, Apple's is the only such restriction in the iOS ecosystem.

If other companies fell into the above categories, certainly that would be worth disclosing as well.

I don’t understand why they haven’t arranged an iOS “blackout” for an hour or two in protest. Mildly inconveniencing all iPhone users even for a short while would surely cause Apple to change its tune.

I could see a law like that having unintended consequences for less monolithic players. Sure, for the app store it would result in a disclaimer saying "30% of your fee goes to apple", but for some indie developer selling software on their website it could be "3% goes to paypal, 4% goes to shopify, 2% goes to adnetwork..." and then you've just got an information overload that nobody pays attention to.

I think a better solution would be to make these sorts of restrictions on disclosure illegal. IIRC Visa and Mastercard also have clauses in their merchant agreements forbidding you from telling people how much their fees are. If you want to tell your customers exactly how much you're paying the app store, or your payment processor, or any other cost that's part of the final payment, you should be allowed to do that. If you would prefer your customers just see one simple price, you should be able to do that too.

This would not be information overload at all. It would be fantastic. I want to know if part of my payment is directed to middlemen, so I could seek ways to pay the author/developer/artist more directly.

Airlines have to do this and I have never heard anyone (except the airlines) say that they were bothered by the writing out of taxes and fees explicitly. Utility companies do this (including cell phone companies), and I have never heard anyone saying that those lines of text were problematic.

So I'd be very wary of preemptively trying to stop an idea like this, because of a potential unintended consequence which is itself not a big deal (and has not surfaced in similar situations).

Or just set it up to apply only to businesses doing > xx million in revenue per year.

That's a case where the developer of the app is selling through their own storefront, not being forced to use a specific middleman with a specific (and large) cut in order to reach the users. Relative to the Apple/iOS situation, that feels qualitatively different.

Apple's restrictions are even tighter than those of Visa and MasterCard, some of which have anyway been overridden by laws and/or court settlements. As just the simplest example, Visa and MasterCard have never in my lifetime forbidden offering and advertising cash discounts (even when they've forbidden credit card surcharges). Developers for iOS have no way to sell iOS apps cheaper than through the method facilitated by Apple (which would allow them to increase the app store price to compensate for the 30% fee), nor can they mention to their iOS customers alternative cheaper ways of purchasing content.

Nothing in the previous paragraph has an equivalent in the indie developer world.

McDonalds didn't want nutritional information on hamburger wrappers, cigarette companies didn't want health risks mentioned, Apple doesn't want consumers to be conscious of how they pay $150/year to Apple for every $10/week subscription. Transparency is good for consumers, not companies.

Conflating tax with profit margin is a bit muchthough don't you think? If Facebook wants this, they should be willing to indicate how much margin they make on every ad buy they happily take money for.

Their reseller margin is 100%, because they are the terminal seller.

How is this conflating tax with profit margin?

It’s ridiculous that Apple takes 30% of a transaction between two independent third parties, one of which may have no idea their virtual attendees are even using iPhones.

It’s ridiculous that people point to Apple when 5 other big platforms are doing the exact same thing and form much longer too.

People just like to pile on. If it's a general issue, make it a general quest for a general solution.

Apple started it.

Nice joke.

I don't think Apple had such a model with the Pipin game console, or a successful or global one at that. Microsoft, Sony and Nintendo do as an example. Stating that they are the first is just incorrect. One could perhaps state that they are making the most profit out of it. But unless we take a stance on profit being bad I'm wondering why this needs to be a hot topic at all.

I think Apple did start the 30% cut? Or at least standardized it. iTunes 0.99 songs is the first place I remember 30% digital cut being a thing.

That actually made sense because credit card processing fees were 0.25 + ~3%. So hey, yeah, 30% seems fair as processing fees will be 28 cents.

However when digital goods sell for $10 or $60 a 30% tax on top of a 60 cent or $2 processing fee is all of a sudden not so reasonable.

I believe their point is that Game consoles have been doing the same thing for decades, which you might or might not see as being the same thing as the AppStore does. There's also Steam and some other game stores too (although I'm not sure if he's referring to that).

His point is wrong.

iTunes store came out April 2003. Steam came out September 2003. Xbox launched Nov 2001, but Xbox Live Arcade didn't launch until Nov 2004.

Digital sales of game console games didn't become a major thing until after 2010. I shipped a $15 digital-only XBLA game on X360 in 2010. People thought we were crazy to go digital-only.

The historical economics of video game physical distribution is very very different. A 30% digital cut was a massive improvement. Physical manufacturing, storage, distribution, brick and mortar middle men, platform fee added up to well over 50%. So a 30% digital cut was much better. Digital is now the majority of sales, but that is a very recent development.

Reasonable minds can debate and disagree over what digital cut would be considered "fair". In a healthy, competitive market we wouldn't have to debate "fair". The market would decide. The cost of digital distribution has massively shrunk as technologies have progressed from specialty to commodity. The fact that the digital tax has been the exact same for 20 years is clear evidence that it is not subject to market forces. Whether it should or shouldn't be is yet another question.

Sorry, their whole point was not about digital sales or the 30% number, but more about the fact that console manufacturers have been making virtually all their money by charging a markup from game makers since the eighties (remember that consoles themselves normally sell at a loss). Once again, you might see it as being the same or not as what Apple does.

You can hate me as much you like but there was nothing there before Apple that created this kind of control over arbitrary applications that you can run on computers. Let this settle.

Sure there was. Remember cartridges for the game consoles? Or the clipper chip? (mostly about data but still a central form of control) Or HDCP. Or CSME which has PAVP. AGESA has a similar thing. Or the ACM validated by the ROM in all Intel CPUs. You can't even load an OS before you get it allowed by them.

I think you meant to say: not directly visible by the user at the scale in terms of single-vendor profits. But that's a different thing which needs different treatment. Either antitrust laws or new laws will have something to say about that, because it boils down to 'power' that is currently legal as-is.

You can be emotional about it, but that doesn't help the discussion.

I count only one other big platform (android). What are the other ones?

Android doesn't do this. By the Play Store guidelines. this kind of app would be permitted to use its own payment processing instead of in-app purchases.

The fact that every major digital platform just so happens to have the exact same fee and that it hasn’t decreased in 20 years is a clear indicator that this number is not subject to market forces.

A general solution would be great. The mobile operating system is the most important platform to discuss this issue. There are only two players in this space. And the anti-trust case against Apple is much much stronger than against Google. Therefore they rightfully get more attention.

True. IMHO, it's ridiculous to have walled garden platforms with vendor-controlled "App Stores" in the first place.

App stores, and their restrictions, aren't ridiculous. They are a consequence of an Internet filled with viruses, malware, and spam.

The only thing I blame Apple for is not allowing installing apps from third-party sources, after you tick a checkbox in settings, like Android does. I would even accept a loss of warranty on doing that, because I'm a big boy, I understand the consequences, and I want to take that risk.

Otherwise let's be honest, people actually love a curated app store, and you're in a tiny minority.

I would put a correction that Apple users specifically like walled gardens the app stores.

Things like the windows store, snap store appear to be significantly hated for reasons of taking away control and auto-updating.

Same thing I guess with steam, origin, uplay, and epic's equivalent too.

> I would put a correction that Apple users specifically like walled gardens the app stores.

I don't disagree with you, but I don't think it's specifically liking walled gardens: it's rather about hating fragmentation.

It's the same thing with gamers who complain about Epic exclusives that want their entire game library on Steam, or people who complain about Disney/Hulu/Prime licensing titles that were previously on Netflix.

People just don't want to have multiple accounts.

See a ove

@ratww: people don't like different accounts for a very good reason: it costs a lot more money to obtain the same value.

> it costs a lot more money to obtain the same value

True, this is easy to see in the Netflix/Hulu/Prime example, with requiring multiple subscriptions.

Do you also think it holds true for the Steam and Apple examples? That's a legitimate question btw, I have no opinion of my own.

You have no idea which opinion is in the minority. In reality most non-tech people don't even know that Apple rules the app store with an iron fist. One benefit of Epic's lawsuit is the publicity giving millions of young people an inkling of what's going on.

People may not know Apple's rules, but they enjoy the benefits regardless, safety being one of the clear perks of using an iOS device. And yes, Apple's devices are much safer than alternatives.

Btw, if you want to play the knowledge game, do the non-tech people know that Epic's Privacy Policy [1] explicitly allows them to sell their data for marketing purposes?

Personally, I'll always side with the company that respects my privacy.

[1] https://www.epicgames.com/site/en-US/privacypolicy

So basically under the cover of having packaged technology much of which was developed with public funds, Apple is acting as a monopolist provider of security protection. Nice linux-based networked computing device you got here, shame if something were to happen to it. Why is policing the streets a common good, and policing apps left to a pair of oligarchies?

policing apps is not left to oligarchies. It's a crime to install malware on someone's machine, and it is enforceable. But sometimes you as an individual want a "pre-crime" agency, and maybe it's best not to have the "pre-crime" agency be the state. And that's why, for better or worse, we have mallcops and neighborhood patrols.

The flaw in you comparison is thinking that whoever is in control of this will think in your well being and not actually cheat.

This exact thread is over this "good dictator" being caught cheating and thinking about their own well being first, with their users being damaged and treated as second-class citizens.

The company have a great marketing strategy that makes you and others first you are first class, while in reality their goals and objectives comes first in detriment to your expectations about it.

But somehow this marketing campaign is so good, that even when caught in the act, a lot of their users are still in denial.

BTW, about mall cops and "pre-crime"; mall cops cant arrest anybody before they commit a said "crime". Also, the definition of what is a crime and not is pretty dangerous and used by people with malice over and over to resort some form of control and manipulation over public opinion (see Bush "War on terror" for instance used to bomb Saddam and cap citizens rights and get reelection, which is basically "War on drugs" 2.0).

>The only thing I blame Apple for is not allowing installing apps from third-party sources,

So you are OK with Apple not allowing you to get informed about the 30% tax? If you are fine with this, why? is the information dangerous for you?

Yes, I'm OK with that, because it's in the contract. It's what developers sign on when joining Apple's App Store.

This isn't about being dangerous or not, but about Apple's App Store being clearly Apple's property. Like it or hate it, you don't go and shout on someone's property, against the host's rules, without expecting to be kicked out.

As a developer, if you don't like it, then don't distribute your apps on Apple's App Store. As a consumer, if you don't like it, then don't buy Apple's products. It's as simple as voting with your wallet.

And I realize that due to Apple's size, it's not easy to avoid their App Store. But complaining about it won't help.

Also, fuck Facebook, fuck Epic Games. I may regret this later, but I'm always glad when privacy-invading companies suffer.

I mean as a user not as a developer, are you fine if a judge will declare that Apple can force developers not to say certain things, not to link to certain pages that Apple does not want? If you are OK with Apple doing that then are you OK with Google and Microsoft doing the same?

Second question, why as a user you are OK with Apple preventing developer to inform you of better deals? It is just a piece of text with a link, you are not forced to click the link, is this information causing you some kind of "damage/distrss"? When the average user buys an iPhone do they get a giant EULA read to them and there it says in the clear "by using our product you agree that Apple will hide better financial deals for you because it can hurt our shareholders ?"

If judges in US will premit Apple to do whatever they want Google will have the green light to be as shitty as Apple, lock the store, do even more censorship, maybe Chrome and Google Search can also hide websites that Google does not like, you can use Safari if you don't like it.

In some android phones you don't even need that checkbox anymore instead a android dialog will pop open to ask you if you want to install the app from a untrusted source...

Through might a a vendor specific change.

Also the idea that you must "protect" you customers from "external payment services which might grab you data" is ridiculous it's assuming the user is generally incompetent and can't do any decision by themselves.

Warning them is a different matter.

Requiring a min app price of 5€ (30% cut) or 1.5 (100%) cut for apps with non apple in-app payment would also be understandable.

But having intentionally vague formulated rules for which if you brake them you often either get no usable feedback or are called by phone is not ok.

Calling by phone in such situations is not good service but a common strategy to prevent paper trails which could show abusive behaviour.

You're paying it..

It's just absurd that's any transaction

For the app? Sure. Hosting, vetoing, version control, etc. (Even if we forget that developers already have to pay $99 a year). I'm fine with that. I would be more than fine if that $99 got more expensive the more app downloads you had.

For just processing an IAP? With no volume discounts? It's ridiculous.

Sure, they don't want the "free app + unlocking IAP" but they could think this better.

It gets even more ridiculous if you consider that there are cases with price bindings (e.g. books) or small not very flexible margins (per song buying of music) and apple is them self competing in this area without this cuts.

Similar ridiculous is that they effective prevent apps which just provide the service for existing member without any payment/sign-up services in the apple app.

This is a active intrusion on the free marked undermining the fundamental concepts of it (choice and transparency). At least in my opinion.

Even for the app - if its a cost argument, then allow others to compete on a cost basis. Of course, apple will not let you set up your own app store with the same guarantees that apple provides around privacy security etc. If its a discovery and cost of marketing argument than I dont understand the perpetuity of payments, you can pay a first time purchase fee but subscriptions afterwards should not have any fees tacked on.

If they don't do IAPs, then the former charge will just be subverted by "Free App with one time IAP".

That's already the case for most games - the game is free but most of the stuff is hidden by IAPs

But you could differentiate one-off IAPs from subscription IAPs and from "added value/purchase" IAPs

What's with the obsession of calling everything 'tax'? It's not a government and it's not doing anything else than making money on provided services, and therefore it's not tax.

This whole euphemism and emotion thing is just getting in the way of reality and proper discussion.

Can you help us understand what the reality and proper discussion is?

I probably can't. But the title could have been: "Apple didn't want Facebook to bring their 30% margin to the foreground of attention".

Narratives are more important than facts. A lie repeated a million times becomes truth, and a million repetitions happen in a blink of an eye nowadays.

> 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

Apple pretty much is the government when it comes to the App Store. A single entity, monopoly powers, no competition, makes all the rules and is allowed to enforce them without penalty. “Tax” is a pretty apt term for the 30%.

You can opt out of Apple ecosystem simply by changing your phone.

You can't not opt out of your government ecosystem (Or at least, it's more complicated).

This is like calling Walmart profit margin "tax" ... just buy in another store.

> You can opt out of Apple ecosystem simply by changing your phone

The issue isn’t the end users, it’s the app owners. A single entity controls access to the large majority of paying customers (after all, Apple makes most of the profit compared to Google/Android),

I know some people that recently bought new $1000 iPhone without knowing about the 30% fee. They can't "simply change their phone" because they'd lose boat loads of money. I get sunk costs, but they feel mislead, and I don't blame them. Apple has worked very hard to lock in users, it's not very easy to just switch phones.

Not just the cost of the device, but also the cost of any applications that they've purchased. And there's the trouble of trying to get social circles to move away from FaceTime and Apple Messages. I also can't imagine that migrating data off of Apple's services to other comparable services is easy.

Yep, I don't feel like I can switch because some of my friends refuse to do normal calls, only using facetime/facetime audio. Plus the imessage data is much faster than texts. Trying to get my circle to switch to whatsapp, but until then I'm pretty stuck.

> You can't not opt out of your government ecosystem

Of course you can. If you can move from Apple to Android you can move from one country to another. It would hard to find a more perfect analogy to this situation.

It’s a fee, or a charge. It’s not a tax by the definition of the word.

Why not call it a fine? Or a bonus?

A tax is a compulsory payment levied by the government on individuals or companies to meet the expenditure which is required for public welfare.

So, it is a tax.

> Apple pretty much is the government when it comes to the App Store.

It definitely is not. The defining feature of a government is the legitimate use of violence. No actual or threatened violence, no government.

There are lots of reasons to be concerned about the App Store and Apple, but let's not blur the lines between money voluntarily given to use a service, and money given to avoid arrest and jail.

To be pedantic, a government can be a collective noun for governing and ruling bodies, state-affiliated or not. And Apple, the iPhone team, the iOS team, and the App Store team are certainly governing how developers can act.

Well in this Apple governed App store 'State' the act of violence is the forced removal of an app (a shop) from being allowed to operate, and in some case (Epic Games), completely banning the citizen from the State, let's call that Jail since Apple again may set them free, again, at their discretion.

This App Store ecosystem sits at over 1.5 billion inhabitants, larger than China.

Frankly, state tax is the perfect word to use.

A tax is a compulsory payment levied by the government on individuals or companies to meet the expenditure which is required for public welfare.

Violence being monopolised by State is the modern political philosophy given by Weber in 1919. Tax existed when individuals namely aristocracy even had legitimate use of violence.

Apple makes case it charges fees for public good by curating list and providing security to end users, that's public welfare unless it's millions of users aren't enough to be categorised as Public.

> What's with the obsession of calling everything 'tax'?

It’s a great way to get people upset that they have to pay for something because taxes have such a negative connotation in American politics. Taxation is regarded as financial oppression in some political circles, and it’s easy to co-oof that message for other purposes.

Considering the country was founded on tax related grievances, it would make sense that at least an iota of the culture grows up hating taxes.

It may not be technically correct but everyone understands what tax means here. What I don't understand is this weird impulse to always defend the two trillion dollar corporation against any slight insult.

> It may not be technically correct but everyone understands what tax means here.

That's exactly the point. Everyone understands what a tax means, so calling something that is not a tax "a tax" is intentionally misleading. People call it a tax to invoke emotions and mislead, not to clarify what is going on. Everyone also understands what a fee means.

> What I don't understand is this weird impulse to always defend the two trillion dollar corporation against any slight insult.

What I don't understand is why people think it's relevant that Apple is a two trillion dollar company. Apple is not a monopolist and operates in generally very competitive markets, yet many people still buy Apple products despite their high profit-margins. Clearly they are doing something very right in the eyes of many consumers to be a two trillion dollar company. How is that a bad thing?

It’s standard rhetoric at this point. It is pretty appropriate for this kind of rent-seeking.

IMO, this is not (economically-speaking) rent-seeking.

Apple has created something that improved the world (that created new wealth) and is charging for it. That’s definitionally not rent-seeking.

Apple indeed created new wealth by developing iOS and the App Store. Then, once they owned the market, they started exploiting it by adding new restrictions. The restrictions had no economic value, they're simply there to allow Apple to extract their unfair share of the value created by others.

For many developers, 30% of the app price is higher than what their company benefit. Thus, Apple (or Google or Valve) is making more than themselves on the product they made.

We call it a tax because there is no way to avoid it except not selling our apps. And because 30% is quite high. It would not be seen in a such a negative way if it was in the 10-15% range.

> We call it a tax because there is no way to avoid it except not selling our apps.

I’m genuinely confused by this sentiment. If you lose money after paying the 30% then you wouldn’t be in the App Store at all. But you “have to pay it” because even after the cut you’re still turning a profit. An apparently large enough profit for it to be worth the separate development and maintenance costs too. What makes you feel like you have no choice but to develop for iOS?

Don’t get me wrong it’s absolutely shitty when someone with leverage over your business squeezes but the percentage can’t be the deciding factor here. The same as every business ever, Apple charges you whatever they think they can get away with. So either it should be okay for Apple to take a percentage cut or not.

The percentage is clearly the main deciding factor here.

This is bad for the ecosystem in general, and in my opinion Apple does not need that money. And they are evading the tax laws in most countries, simply because they can...

If I buy a box of cookies from a grocery store for $3, should I expect a note in the box which says I can buy them directly from the manufacturer for only $2?

The point is Apple forbids developers from letting customers aware of the 30% tax.

And if you really want to oversimplify the discussion to a brick and mortar analogy, it's common for grocery stores to make taxes explicit in receipts: https://i.imgur.com/Lp3nwlH.png

That’s not the same thing at all. I’m saying that you bought the product from a grocery store, and the product itself contains information discouraging you from continuing to buy from the grocery store.

In the app case, you bought an IAP from Apple (I know it’s Facebook’s app, but that doesn’t change the fact that the transaction was executed by Apple) but somehow think it’s ok for there to be a note saying you can pay less if you buy it on your computer instead.

Facebook want saying they could pay less. They were saying, if you pay $10, $7 goes to the event, $3 goes to apple.

It didn't say "go to this other website and just pay $7". I think it's totally reasonable to disclose the fees, I would even argue that it's the morally correct thing to do.

I think this would be great, yes.

The store has no reason to hide the markup if its fair, reflecting the convenience they added.

By the sounds of it Facebook’s note didn’t say “buy from us”, it simply notified users that Apple will take a 30% cut.

I’m loathe to care either way here because I don’t think any giant multinational needs me to speak in their favour, but the part that grinds with me is that Apple blocked it under a rule about “irrelevant information”. Given that FB created this feature for community events the fact that 30% wouldn’t be going to the host of the event feels like very relevant information to me. If Apple wants to have a rule that says “we decide what you can and cannot say” then they should just make one rather than hide behind other rules.

This send to be a common thing that Apple does. I read an article recently about how some had a lot of unwritten rules but uses it's vaguely written public rules to enforce them, as is happening in this case. "Irrelevant" is an entirely subjective term.

The real question is, if Apple don't want to an app to talk about the 30% cut, why is there not a rule that explicitly states that?

Printing the manufacturer’s suggested price on the outside of grocery packaging is common.

I'm in the UK and things may be different here but we only get "Recommended Retail Price" which I'm sure includes a margin for the shopkeeper (although I will concede my knowledge of wholesale prices is long out of date.)

No. But you should expect (I think?) the grocery store not to ban the cookie maker from packing notes about how to order from the maker directly. (Edit: I mentioned that because, per the story, I think Apple has a policy of prohibiting you from telling users how to circumvent Apple's cut.)

I actually don't know if grocery stores generally require this -- maybe they do. I suspect it's not an issue because it's generally going to be more expensive to do one-off orders directly from the OEM, unless it's an order too large for the grocery store to want to manage anyway.

Edit 2: Earlier comment where I made your point in a different context: https://news.ycombinator.com/item?id=23162403

It's fully legal, it's called UVP.

You state the price it "freely" cost on your product.

And if it cost somewhere more because additional costs is clearly visible.

Lastly this is not about saying "you can buy it cheaper there" but saying "apple gets 30% of this". Which the difference between not so nice marketing and making prices more transparent the later one is a fundamental part of a (working) free marked...

Do you mean the mrsp?

That doesn’t tell you retailer vs. wholesaler vs. manufacturer share.

Should such a note be illegal?

No, but the grocery store can choose to not sell any product which does this.

It’s a known practice.

https://youtube.com/watch?v=hWObybWWGW4

Well, there's a reason Arizona Tea prints "99c" on the can

Isn't it $1.29 now?

You won't be able to. Minimum volume orders are a thing.

I don't think your example is right, it will be more, if you buy this box of cookie, Visa will take 25 cents + 3%, the grocery bank will take 2%, etc. Here Apple enforce that you do not have to create an account with Facebook to purchase goods and services on Facebook. That people can use their Apple ID, then that's a 30% cut.

Just let Facebook put up a banner when you visit the site using Safari, “This site is not accessible using Safari due to Apple’s failure to pay 30% of it’s revenue for you to visit.”

Have fun with the wording of course, but a simple protest along these lines to eliminate Safari use would be appropriate civil disobedience and would start dramatically reducing the usefulness of iOS over time.

Consider it along the same lines as the old “IE6 No More” banners.

Ultimately, it’s the easiest way to hit back.

So, wait. Apple forbids Facebook to be transparent about why something the customer wants to buy costs X. That's akin to saying the government would not allow you to disclose sales tax. Informing the customer with transparency about a sale should never be illegal.

Just curious - Apple's 30% App fees have been around for over 12 years. Why in last couple of months there is a huge uptick in bashing Apple for this? Literally, every day there is a story about this on HN.

The app store market is still growing exponentially as more and more people forego a normal computer and uses their phone for all their computing needs. A few years ago the market wasn't big enough for big powerful companies to complain about, but apparently it is now.

Facebook decided to fight it in the court of public opinion rather than go all in like Epic, despite having probably stronger ground to do so. I find it hard to imagine Apple terminating Facebook's developer account over this had they persisted with the notice (or simply put in something saying "event purchases are not allowed on Apple devices due to Apple's mandatory 30% processing charge.")

By way of comparison, the uber "tax" is also officiall 30%, last I checked. Though arguably since uber is orchestrating physical things, with living beings inside, their extraction of a bigger "tax" relative to apple would be, in a non-market sense, justifiable on the grounds that, assuming they are playing fair with insurance and such, they must take on greater liability per unit sale.

I'd like to say that when big corporations like this fight it seems the outcome will be beneficial for users. Not sure if that will be true but I hope it will be.

Do apple pay 30% tax in any country? No they go out of their way not to pay 30%. So why should developers pay 30% to apple?

What percentage of revenue does Apple gain from the app store?

People get annoyed by Apple doing this but Visa/Mastercard/Amex have been doing this literally for decades ...

They take 30%? More like 3% or less.

No, they block partners from telling about the fees. That’s the subject of this article.

Understood.

When the gag order on 3-5% fee, it's business. But on 30%, it's mafia level extortion.

If VISA or MC or AMEX would charge 30% they'd be out of business instantly, on a typical purchase that's all of the profit margin. The only reason Apple gets away with it is because they are virtual goods.

The thing you could compare it with is Telco's fees for using their billing mechanism for virtual purchases.

This article is about Apple blocking Facebook from telling people about the fees, which is what Visa and MC have also been doing for decades.

Yes, but those fees are 1/10th of what Apple charges (or less).

I wonder what the cost of building and running the app store is? Apart from the engineering costs and costs to run the servers, there are reviewers to be paid, marketing, gift cards to be distributed, various tax and legal problems that are hidden from app developers and the like.

And of course there's Apple's profit margin, which as capitalists I don't think many people are denying outright.

It's very hard to separate this from the costs of the iPhone, but ofc since all financial details are private anyway all we have is speculation.

What do people think would be a fair 'tax'?

Facebook gets zero sympathy from me. I don’t care how they gag unscrupulous and invasive ad tech. Apple can trash FB dev keys too, and the world would be a better place.

I mean, it's possible to dislike both. I dislike Facebook but I still think it's wrong that Apple is preventing them from informing users that that's where the money is going.

https://www.apple.com/ios/app-store/principles-practices/#:~....

Free These are apps that users pay nothing to download or use. The developer chooses to make them free or has some other business model not generated from app revenue. Apple receives no commission from supporting, hosting, and distributing these apps.

Free with advertising These apps are free for users to download and the developer generates revenue from advertisements in the apps. Apple receives no commission from supporting, hosting, and distributing these apps.

Free with in-app purchase These apps are free for users to download and users can pay for additional digital features and content in the app with Apple’s In-App Purchase system. Developers earn 70% of sales from in-app purchases and Apple collects a 30% commission.

Free with physical goods and services These apps are free for users to download and the developer generates revenue from the sale of physical goods and services, such as purchasing clothing, having food delivered, or ordering a ride from a transportation service. Apple receives no commission from supporting, hosting, and distributing these apps, or from transactions for physical goods and services in the app.

Free with subscription These apps are free to download and users can purchase auto-renewing subscriptions inside the app. If developers choose to sell digital subscriptions inside the app, they use Apple’s In-App Subscription system. In that case, developers earn 70% of subscription sales for the first subscription year, and Apple collects a 30% commission. After the first year, the developer earns 85% for all successive years that the user remains a subscriber, and Apple collects a 15% commission.

Paid These are apps that customers pay upfront to download from the store — and include free updates. Developers earn 70% of sales from paid apps and Apple collects a 30% commission.

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