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Comment by mhh__ | Hacker News Reader

As for Target, it's a brick and mortar store. Apple do have some hefty expenditures, sure, but they're luxuries (e.g. Making your own CPUs is cool but ultimately not all that for a product that most users won't have even the slightest clue of the trade-offs that went into that decision) - 30% is quite a lot for software, especially in a market like apple's.

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I would like to see some good arguments as to why a brick and mortar store deserves a significantly larger cut.

> Making your own CPUs is cool but ultimately not all that for a product that most users won't have even the slightest clue of the trade-offs that went into that decision

Is developing better hardware not a valid reason? It’s too much of a luxury to legitimize fees?

> I would like to see some good arguments as to why a brick and mortar store deserves a significantly larger cut.

They don't get a "cut" at all, they resell the product at a markup (and set their own prices, so they can even sell at a loss if they want to). Totally different dynamic vs. the App Store.

> Totally different dynamic vs. the App Store.

What's the difference?

BTW, Apple regularly sells app store "dollars" at a loss. I once bought a $200 app store gift card for $165 at Costco.

Come on, this is basic stuff. You can sell your product without selling at Target, you effectively can't sell your ios app outside the app store. It's not so much about the markup (which should come down since modern digital business capabilities should have efficiencies that reach the consumer as a benefit), but the practice of closing out alternatives.

Why would you build an iOS app with the intention of selling it somewhere other than the iOS App Store? It’s not like Apple is blindsiding any developers with the revelation that the App Store is the only way to distribute software on non-jailbroken iPhones.

That's the problem.

When you sell boxed software in a retail store, you're selling using the wholesale model: it has a retail price of $99 but you're selling it to them -- or more likely your distributor -- for about 40–50% of that price. The distributor takes another 10%, and the retail store gets the difference between that and the retail price they choose to sell it at. This is very distinct from the "agency" model that the App Store uses.

Well: actually, when you sell boxed software in a retail store in 2020, you sell nothing because nobody does that and this is a super stupid comparison for Apple to keep making. The Mac App Store isn't competing with Target and the ghost of CompUSA, it's competing with other online store systems like Paddle, which takes 50¢ + 5%. The iOS App Store is competing with... nothing, in practice, because it's literally the only way to get applications onto your iOS device. Which is kind of what's getting everyone to argue about this, right?

If Apple purchased 10,000 units of an app from the developer upfront, they can then resell each unit at whatever markup or loss they think people would buy it. This is a commission model where Apple is getting a cut of each sale.

- Nintendo charges 40-60% for the Switch.

- Microsoft charges 30% for the Xbox Store.

- Shopify charges 20% for their app marketplace.

- Valve charges 30% for the Steam store.

Can you provide evidence that Apple is charging a lot compared to its peers ?

Nintendo and Microsoft/Xbox have low margin on each device sold [1] [2]. For Valve, Steam is the only real source of income. Apple on the other hand has a lot of source of incomes. They have a margin of 60 percent just for the iPhone! [3]

[1] https://www.polygon.com/2017/4/5/15195638/nintendo-switch-co...

[2] https://www.pcmag.com/news/microsoft-not-making-any-money-on...

[3] https://www.reuters.com/article/us-apple-iphone/apples-iphon...

You have a job and an apartment you lease out. You made a great deal on the apartment. Now, your tenant suggests he should pay less, since you have another income and you already make a profit. Do you? I don't understand your point - if Nintendo or Sony could achieve larger margins, they would.

A lot compared to what? What other market is like Apple's?

As in Steam also charge 30%, but Steam don't exclusively control access to their customers. If you sell your game on the epic store it's 12%. Apple exclusively control the gates to their customers in a way not found in any other device of comparable stature (Microsoft and Sony are gatekeepers for their consoles, but they aren't a "utility" in the same way some would argue a phone is)

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