Funnily enough, this applies to Uber and Lyft too. These middlemen companies have too much power to unilaterally dictate what cut they get from their service.
Where it get’s ugly is when Apple wants a cut of everything that happens after the sale of the app, too, like wanting a cut when I buy a new book in the Kindle app (and Amazon refusing, instead making it impossible to buy books in the app).
If the "store" is now the app then how does Steam get their cut? Do they just disallow any product that has a "store" inside of it? What constitutes a "store"?
This is the hard question. Apple has already reduced subscription cut to 15% after 1 year, but do they deserve even that?
Steam gets their cut by developers listing their games there directly. Epic already has a store app and yet Valve still makes money because the steam store and ecosystem provide value that justifies the cost even when alternatives exist.
I'd ask this instead. Would it be beneficial for society as a whole if iOS had to allow alternative app stores?
It is likely beneficial for society as a whole for iOS to allow alternative app stores, but that doesn't make it right for the government to force them to do so.
What makes it fair is that Apple is a private company, entitled to these kind of business decisions. As such, free market forces should then determine if the true cost of distribution (which is basically what App store provides) is more or less than what Apple charges for it. It does seem that this is still one of the most efficient ways to distribute an app to the end user, as witnessed by the sheer number of developers (silent majority) willing to take the 30% cut vs a loud minority (usually big companies on their own) that isn't.
And you can frame it however you want, the price for iOS distribution is not determined by market forces because there is no competition for it. Distributing an application on android is not an alternative, but complimentary. It's like if there were two delivery services in the US, each covering one part of the country. It doesn't matter that there isn't only one delivery service, both of them still have a monopoly because they're not competing in regards to what they actually sell.
> the price for iOS distribution is not determined by market forces because there is no competition for it.
Perhaps you misunderstood. The price for iOS distribution is determined by Apple; whether that price is a good value is determined by market forces. Again, it seems that it is indeed a great deal, because vast (and silent majority) of developers accept it.
> It's like if there were two delivery services in the US, each covering one part of the country.
But it is not. You can reach your user via Web or if they are mobile via Android or Windows phone. Apple can not be blamed if your user prefers to use iPhone (despite it being most expensive) and now you have 30% cost of distribution to reach them. That is exactly type of an outcome a free market would produce. The freedom here is expressed in your user's ability to pick their mobile device and by no stretch of imagination Apple has a monopoly there.
The famous monopoly cases (e.g. Standard oil or Bell system) also had tons of customers, that's what happens when demand is rather inelastic. If you want to say that artificially inflated prices due to e.g. a monopoly can still be a good deal because people are still willing to buy it, then we shouldn't be content with just good deals because they still cause harm to society overall by not being pareto efficient. Apple can't charge the rate they do purely by the strength of their distribution service - it's the device base that is the real value and only by anti-competitive measures can they keep the price up.
>But it is not. You can reach your user via Web or if they are mobile via Android or Windows phone.
What if Apple also decided that every transaction made through their browser had to give them a cut? The situation doesn't fundamentally change (you could still just offer your app to android/desktop users), but I think it's pretty clear that this would be anti-competitive. They might not have a monopoly on smartphones/devices, but they have such a large share that boycotting them isn't really an option.
Users are also currently funneled into apps due to how web is limited in functionality as determined by Apple. e.g. if your app needs long term local storage you now need an 'real' app because Apple changed it so that web app local storage gets cleared on the regular. Windows phone has also been dead for years now.
Perhaps you misread, but I am saying opposite of both. I am saying that both Apple's prices are not high, proven by number of people agreeing to pay them in a market where other options to distribute an app exist, and that Apple does not have a monopoly.
> What if Apple also decided that every transaction made through their browser had to give them a cut... but I think it's pretty clear that this would be anti-competitive.
It is not pretty clear? There are plenty other options on the market in terms of a browser.
> They might not have a monopoly on smartphones/devices, but they have such a large share that boycotting them isn't really an option.
At least we can agree that Apple does not have a monopoly. Everything else is market forces at play. My argument was that the price set by Apple for distribution is such that it is acceptable to majority of developers. If Apple set an unreasonable price instead, say 70% cut, I am sure that a lot of developers would simply not develop for iOS, nor would iOS achieve same reach it has. Thus we can only conclude that Apple carefully picked a price which is both acceptable by vast number of people and maximizes Apple's revenue at the same time. This is free market at its finest.
This discussion is about where Apple as a private company has a right to charge 30% for the distribution on its platform and I argue that it has every right to do so.
That’s your problem right there. We don’t allocate resources or make business deals based on how deserving a group or person is. They can charge it right now so they are
Physical goods have about a 100% markup between manufacturer and what a customer pays.
I think it should be less for digital goods, but you wanted a good argument. Apple charges because they are between you and the app makers, like Walmart and target and stuff.
The fascination with making Apple a boogey man on this is bizarre. Your local corner store — which you should very much support! — has a markup that makes Apple look lazy.
The two SF owners I know very well and have helped with their books aim for 300%. They routinely hit this.
Edit: for context the one in Noe did 2m last year.
Unlike a store, Apple wants the margin without doing any of the work.
According to you, I can jailbreak and sideload my iPhone 13? Or iOS 15?
Huh, doesn't appear so: https://www.getdroidtips.com/jailbreak-iphone-13-pro-max/
There is no way I'm flying to South America for a banana or to Taiwan for a toaster. Their profit is payment for this service.
Your oem provided you a device which is perfectly capable via your ISP and your vendors infrastructure of arranging products and services. Your oem is only an essential part because they insist on it.
FedEx and ford could have in theory done the same or Dell and Verizon.
Moving "across town" from the apple store involves an IT project and hundreds of dollars in order to save dozens of dollars.
Also for IT, Walmart requires IT interfaces from its suppliers.
I think people could consider Walmarts markup to be unjust or no value or whatever.
If you don't like the landlord, don't move into the building. It's not the only building in town, but just the one with the most lucrative customers. If you want them to be your customers, you gotta pay to play.
But the funny thing is that even with the premium, Apple users spend far more on app purchases than Android users. And in turn developers make more money on IOS app sales - which is why they flock to the platform.
To sum up: developers make more money on the platform, Apple makes lots of money from running the platform, and customers are indicating they are getting value on the platform (even if you personally don't see why) by spending more on the platform. I don't see grounds for outrage here.
Same with Apple, of course they will do this as long as they can. There is no moral or ethical reason why they are doing this, simply they can get away with it.
I mean if you found a hack where you could get 1% of all the world's transactions, would you really say no to that, or try to find out why you deserve it?
You are using their intellectual property? As in the App Store? Thus, as long as you are using that to distribute your app, they are entitled to collect the commission from where-ever they want and it doesn't matter if it is IAP, Web, etc.
From [0] of page 66
> Under all models, Apple would be entitled to a commission or licensing fee, even if IAP was optional.
From [0] of page 112 (b)
> The Court agrees with the general proposition that Apple is entitled to be paid for its intellectual property. The inquiry though does not end with the bald conclusion. Apple provides evidence that it invests enormous sums into developing new tools and features for iOS.
If you don't like it, There's always PWAs.
[0] https://www.courtlistener.com/docket/17442392/812/epic-games...
More like apps that also happen to use iOS as a frontend in addition to other funnels/marketplaces. Costco is one of the examples cited, and I frankly didn't even know that they had an app even though I have a membership. How exactly Apple is planning on justifying taking a cut of this membership fee is completely beyond me.
dumb
If you say “X doesn’t deserve Y”, then roughly I hear, “I don’t like that X is getting Y”. It’s like you’re asking, “Why should I like Apple’s revenue streams?” I don’t think I can answer that, but can you tell me why I should care about whether you like Apple’s revenue streams or not?
It is Apple sharing more than TWO THIRD of those revenue back to you.
If you look at demographics, iOS devices are the gateway to the most affluent and lucrative market segment. That's the value proposition of Apple, and also why app always ship first on iOS then get ported to Android.
There's an element of symbiosis between Apple and app developers.
Which is why they take a 30% cut.
If the user chose app A over app B then specifically what help has Apple provided to the App creator of A to justify the 30%? Apple's argument is they're bringing customers. But even if they do nothing one App is going to get the customer anyway. Also, Apple gets paid for advertising Apps and services to end users, so again, what are they doing to bring in customers to specific apps?
They are making all the devices your app runs on. They are putting your app in their app store. They could remove your app from the app store and 0 customers would come to your app.
>They are putting your app in their app store. They could remove your app from the app store and 0 customers would come to your app.
They're getting paid for that, so they're doing their job.
I don't know. I have released 0 apps and own 0 apple devices. I have never used their app store, so I do not have enough information to answer. I believe that question is irrelevant because apple is providing you a platform regardless about what apps they try to get people to install.