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Yes, exactly. It's symbiotic because Apple needs apps to sell iPhones in the first place. Apple is already getting their cut of the symbiotic relationship by selling their massively profitable iPhone hardware, full stop. Any chance you remember the first year of the iPhone when there were no third party apps? Other than being a good phone, it was basically just a technological novelty, and that was about it. Third party apps are literally what give value to the iPhone (and other iOS devices).
Which is to say, I agree.
And developers need a solid platform with users willing to pay money. I feel like you have the wrong answer to the chicken and egg problem. The first iPhone was a marvel to pretty much everyone, and blew everything else at the time out of the water. I don't recall much sentiment of people being disappointed about the lack of apps, because there was no reason to expect that at that point. Just being able to use a lot of the web like you would on a computer was a massive leap from a RAZR or whatever.
This is not to defend the 30% tax or anything, but I don't think it does any good to downplay the value they've built. The elephant in the room with your argument is that, if it were true, app developers would simply flock to Android and Apple would be forced to course-correct.
Imagine if you sold expensive CAD software through your own sales team and advertising efforts completely offline but because some of those users were on Windows they have to get it through the Windows store and 30% of your topline revenue went to Microsoft?
Because of the way online marketing/advertising works with competitive bidding in a lot of cases I would bet that Apple is making more margin than the developers of the apps are. Your competitor who doesn't have to pay a 30% Mafia shakedown fee for their product will be able to outcompete you on clicks every time.
Can you expand on this? I prefer to use the web when I can, and every time I've begrudgingly downloaded an app, it's the service itself that was actively pushing me away from their poor/hamstrung web client. I'm still left with the impression that users are staying there and developers jump through the hoops because it's just that good. That doesn't mean it's right, but - that's Capitalism, baby!
Also, the MS of yore would have absolutely done that if they thought they could get away with it, and definitely engaged in more than their fair share of unsavory tactics.
IIRC its sales figures weren’t that great though. Of course from Apple’s perspective it was more of a prototype than the actual final product.
> Just being able to use a lot of the web like you would on a computer was a massive leap from a RAZR
IMHO not having 3G basically turned it into a toy.. also comparing it to a consumer flip-phones isn’t that fair. You you had touschscreen/stylus “smartphones” from SonyEricsson, Nokia etc. which weren’t that awful at the time (of course the UX was inferior after it actually became possible to the internet on your iPhone when the 3G was released).
The iPhone made it so there were at least 3 use cases that were worthwhile getting that : full internet browsing with decent experience and speedy enough ; real-time map download for navigation and emails. Of course the first iPhone was limited by its connectivity speed, but it didn't matter because at this point 3G was not even really there for the vas majority of peoples. Then the next year we got the 3G iPhone that actually made sense to buy with a 3G contract because it became viable in the big cities.
The other "smartphones" who had 3G before that were largely irrelevant because even if you had the connectivity, using them wasn't worth your time and that's just ignoring the fact that outise of city centers you were out of luck (I know, been there, done that...).
There is a reason before the iPhone, Blackberrys were so popular, that's because they were the only decent option for the only use case that made sense before iPhone : email/messaging.
I really don't like the recent developments at Apple, but pretending that they didn't completely changed the game at the time is bonkers...
The 3g version and when it went multi-carrier is when it started to really take off sales wise. Then the iPhone 4 (first retina phone) was the next big bump, followed by the first 'big' iPhone.
Comparing it to the first iPhone is probably valid. They saw the writing on the wall and opened the gates, but could have easily chosen the other way of doing it themselves. No one wins in this scenario - nor the devs, nor the users, nor Apple. But it's not as clear as "Apple needs apps to sell iPhones in the first place".
Idly wondering, say you don't download any third party app and neither does anyone. You can still surf the internet for the most part. You can still connect with others via FaceTime/iMessage. You can still check mails etc. Things you won't be able to do is play games, go on dates, browse tiktok, book a cab (though all that is possible through safari but not a great experience).
A caveat here: The original 30% was on infinitely reproducible digital goods only. Which is 80-90% gaming skins and artifacts and digital subscriptions. Don't know if that is still the case.
The servers do not cost 30% of all sales on the platform. Not even close.
But none of that matters. Very few businesses set their prices based on how much it costs them to provide their goods or services. They charge what the market will bear. The problem is that there is no "iOS app distribution market"; Apple controls it, 100%, so they can set prices wherever they want, without regard to competition.
Specifically, the transfer cost to download a 50MB app is approximately $0.0005. That's 200,000 downloads per $100. Even assuming a low average revenue of $1 per download, that's a $60,000 take for Apple for maybe $105 worth of hosting.
That's not to say there aren't other costs involved in running the store. But we definitely shouldn't be pretending that hosting is even relevant to the conversation. Hosting costs haven't been relevant for over a decade.
It's probably orders of magnitude smaller than that, like 2e-7 dollars per MB.
People have gotten use to AWS/Azure/GCP pricing when bandwidth is essentially free at scale. You can rent a few 100Gb/s ports for ~$500 to ~$5000 per month depending on location.
But I guess this is best case scenario and not everyone will have the capital/clout to colocate at POPs.
1. Storage for 50MB is less than $0.001 per month. So, even if you're storing and backing up every every version of an app, and they update a very high 50 times per year, and they're storing on 12 different locales, that's less than $1 per year for the typical app.
2. "Global distribution" is a one time cost per app update at approximately $0.006 per 50MB per server. For 12 updates per year spread across 12 servers, that's less than $1 per year total. Over 75% of apps are updated less than once per month.
3. Retries, re-downloads and updates are already insignificant transfer costs, per my original comment. Even if you want to attribute 90% of those downloads to being updates from the same set of users, and keep the lifetime revenue per user at a very low estimate of $1, Apple is still taking $6,000 for approximately $105 of hosting costs.
All in all, that matches my original estimate of $100 per 200k downloads for transfer and $5 for server fees. So, as I said, hosting isn't relevant to the conversation, at all.
We're looking at cents per app per user in lifetime costs.
The "Cloud" is disgustingly expensive at nearly any scale. It does require some capital investment and competent people to host your own however. Although there really is no alternative to the cloud if you are small scale but need presence globally.
Money from the App Store gets reinvested in the entire iPhone supply chain. Whereas in the case of Android, App Store money goes to Google only.
It also encourages Apple to support their phones long term as its preferred that you stay on your aging iPhone and keep spending at the App Store then risking you leaving the Apple ecosystem because Apple allows their older phones to become obsolete. Android manufacturers on the other hand have every incentive to obsolete your phone ASAP because you buying a new phone is the only way they make money.
Technically that’s the app developers who do that.
However, developers are strongly encouraged to raise their apps' minimum iOS versions since Apple does not backport any APIs to older versions, any new thing presented at WWDC is only for the new iOS version. This also applies to bugfixes in some cases (SwiftUI).
So as a developer you either stagnate your knowledge or keep moving forward. Google does backport many APIs, so the issue isn't as problematic on that end.
> Your $100 does not cover it.
There are almost 2 million apps on the app store. Assuming there is roughly 1 developer license per app, (some developers will create multiple apps with a single license, but others will have multiple licenses to develop a single app), that is at least in the ballpark of "hundreds of millions on SWE". And that doesn't include revenue from selling the devices themselves.
Huge amounts of people bought those iphones first man.
And devs complained that there's no SDK, and Apple told them they can make web-based apps, and they didn't like that.
Now the have an SDK, and they complain they can't create nice enough web-based apps.
Apple needs all their third-party developers just as much as those developers need Apple -- more than at least some of those developers need Apple.
I'd need to save some short cuts for things like Google Maps, my banks, etc but that seems like all of the hassle.
I might miss the notifications (exclusively for the messaging apps - for all other apps I don't want them to have notifications) but otherwise, the biggest annoyance would be on the airplane I wouldn't have some pre-downloaded streaming content from apps like Netflix and Youtube.
For me removing non-Apple apps would render my phone useless: losing contact with my friends on WhatsApp and Signal, no way to call an Uber/taxi, no mobile authorization for my bank accounts, no MFA apps that I use for work...
I'm not saying the App Store is infrastructure-like. But the market share of Apple is so large, and it's quasi-impossible to conduct consumer business without being required to have a native app... that it's starting to be infrastructure-like.
Can a viable B2C online business exist without being present via a native app? It seems untenable due to consumer expectations. Consumers also expect to be able to drive to coffeeshops, yet road providers don't charge 30% taxes on coffeeshop revenues.
It is infrastructure-like. Try to live in modern society without a smartphone. It will be very difficult. Not impossible, but much less convenient.
There isn't a divine commandment as to what rights we "should" have. We vote, fight, protest and get to make up our own rights.
>They spend hundreds of millions on SWE salaries to make a nice SDK for you to use. They’re also operating all the servers. Your $100 does not cover it. It’s a symbiotic relationship. At least see it and acknowledge it.
I don't feel like paying for an Apple executives BMW car payment. But you do you.
Not in America. The only venue to change you have is to spend, or not spend money somewhere. Since people think they profit more from developing apps for iOS than not developing apps for iOS, Apple’s profit is “right”.
And a century or so of indoctrination has made most Americans believe that this is just the natural order of things.
You would like others to work for nothing, or for what you care to give them, instead of the price they offer their services at, and you'd like to vote, fight and protest until they work for your price.
So like developers working on macOS or Windows? It's so horrible that Apple has allowed third party developers to exploit them for for free for over 40 years now...
So Microsoft did all of this on Windows (or Apple itself for that matter for macOS) due to entirely altruistic reasons?
Also platforms need developers a whole lot more than developers need specific platforms. You can always go and works at a bank or something. Apple would be skewed with no 3-rd party developers they always knew it.
> They’re also operating all the servers. Your $100 does not cover it. It’s a symbiotic relationship.
Maybe the ads on the app store would more than cover it? Not only do you need to pay 30% you also have to pay extra for placement so that Apple wouldn’t put your competitors apps at the top of the results when users search for your app?
I mean, let's be real here. Most people even if Apple fully allowed other payment processors would still opt into Apple's payment. Easiest to setup, most visible and familiar interface for consumers, and lets them push liability back to Apple. So they'd still get 30% from many consumers.
This angle only applies in a situation where you think 1) the pareto principle applies and 2) all of that 20% decided to roll their own payment processing, which isn't trivial nor a risk many want to take onto themselves. It'd take a lot more than a dozen megacorps doing this to make Apple sweat.
And if this does happen, it sounds like a service issue a that point. If you can offer all that convenience but people don't view it as worth 30%, then maybe the rate should be re-negotiated.
>They spend hundreds of millions on SWE salaries to make a nice SDK for you to use
they spend hundreds of millions to get other businesses to do business with them, and still charge many upfront costs along the way. Back then, we simply called that the cost to do business.
Adtech also spends hundreds of millions each on salaries to make a nice SDK for you to use. I don't exactly feel I owe those companies for their labor since I'm (the dev) not the primary point of revenue.
The most important angle is what this grows into. Apple doesn't have to make hardware. They can simply stop doing that and live on rent alone. Hardware is hard work. It might just be that they have to stop doing it.
How much they put the squeeze on who and who makes how much money isn't even important. This is not beneficial to the industry or to society.
After the age of working your ass off while starving comes the age of contributing and thriving, this period ends with the age of entitlement. You do the work, I enjoy the benefits. we can only afford so much of that before our civilization turns into a hell hole. You will be working day and night to make ends meet while I have all the time and resources in the world to figure out how I'm going to take just a little bit more from you.
It's not about wealth, people should be able to EARN whatever they EARN.
It isn't even about mortality, we can go back to the age of working your ass off while starving, we know how to do that. The bigger issue is to have people in control who cant tie their own shoes. It sets us up for total failure. It takes one small incident to end humanity.
This is what Valve discovered.
Nobody in 2004 would have thought the best developer in the world would stop making games.
I think many here do not see this since they earn enough that those considerations are kind of irrelevant, but I believe current Apple problems reveal a systemic problem across society. Apple acts like an old entitled asshole who just want to capture value for not doing much because one day they did something good and I feel in general this is exactly what the current governing generation is doing...
You can get about 1.1 terabytes of data transfer out from Amazon S3 to Internet for $100.
I'd be willing to bet that, all things being equal, most apps would save money if the developers were self-distributing them instead of using the App Store.
There must be a reason why almost all games are still published on Steam despite the 30% though. The increased customer reach almost always outweighs the additional revenue (and this also applies to major companies like EA, Ubisoft etc. who have tried building their own storefronts).
There are also plenty of big games with publishers big enough that they have their own platform (EA, Ubisoft, Epic, Microsoft) and depending on many things their games may or may not be on Steam also.
Steam also accepts keys purchased from elsewhere so in principle even if most of your sales are somewhere else, it is better to have it on Steam. I also think you Steam is offering some valuable community/platforms tools.
Not much of this applies to the Apple app store. The truth is the reason people use it is because that's the only thing allowed. If peoples could install apps from anywhere with its own self-update mechanism (like sparkle or something more modern like a hybrid web-app) I doubt it would be used as much appart from free stuff from developers that do not want to figure out distribution. If there was a large price difference, most people wouldn't use it, just like most people do not go to the more expensive supermarket unless they absolutely have to.
Yet developers still use Steam and most people prefer buying games on there than on any other platform or direct? How is this particularly different?
Of course the App Store UX is atrocious garbage (and I won't even mention the paid ads...) so maybe competition might force Apple to do something about it. However I would bet most consumers and developers will still primarily use it rather than any other platform (just like Play Store is still dominant on Android) because of discoverability, trust and other rational reasons. Of course you do have a point about IAP (Apple would likely have to cut prices to 10-15% or risk a significant proportion of apps switching to something else).
From the point of view of devs it is very worth it, because even though steam might take as big of a cut as Apple (at first, and debatable) this is on what wouldn't be sales otherwise so it ends up being better in the long run. On top of that, Steam actually lowers the cut they take if your game is successful, which makes a lot more sense than what Apple does (if you make more than a 1m you are back to 30% which makes zero sense, because the more your product is successful the less relevancy Apple has in your success...).
And it seems pretty clear that those are just what is publicly available information, considering the number of latitudes/tools and options Steam give to developers it is obvious that most even moderately successful developers get to negotiate their terms. Unlike Apple they are willing to work on a case-by-case basis, instead of going the route of a giant soulless corp that will treat everyone the same, because the rules are the rules or whatever (all the while working out deals with actually powerful corporations in the back, still maintaining that extremely wrong do-gooder better than you attitude they have).
Another reason Steam is very different is that they are not exclusive, you can very well distribute both on Steam or somewhere else cheaper, including your own solution with no issue at all (many games do this). And it means that sales on Steam maybe wouldn't have happened somewhere else, which makes the cut feel a lot fairer.
So here you have it, Steam is very different in many ways, first and foremost because it is not your only option for the platform and they cannot have monopolistic behavior. But also, even though I think it is still a big corp with many issues, they are less of a pain in the ass to work with than Apple.
I agree that most people would still primarily use Apple's App Store, but this is exactly the point and the whole reason their arguments are irrelevant and anti-competitive. If people were to start using some other solution in large numbers, it would mean that Apple is indeed doing something very wrong. And I do believe that they are way too greedy, on top of being way too controlling of the devices/systems they do not have ownership anymore. All their arguments about privacy and security are horseshit because if we accept them, it means private property is a rather vague concept and there would be no reason they get to keep their intellectual property at this point.
As for what you said about Android, I find it funny because just a few days ago I helped a friend install an ad-blocker from F-Droid to play a Tetris game (that has an insane 3euros/months subscription if you want to get rid of ads). So yeah, the majority of people use Google Play, but also the majority of people mostly use popular social media, a few utilities (cheap or free mostly) and some games. The Apple tax doesn't even apply to most cases because an app making a lot of revenue can figure out a way to make users pay in-app with no Google tax and the solution of their choosing.
And you are talking about Apple lowering rates to 10-15% and I think it seems acceptable because payments seem to be weirdly expensive in the US (because of credit card and cashback programs I have been told). But in the EU, it still seems like an absurdly high tax / cut for what is a payment solution. If you are dealing with micro-transaction (in the cents amounts) it could make sense, but with the app pricing inflation, it is largely not the case and you are talking about multiple euros amount most of the time. Payment solutions for this kind of transaction would work out to about 7% in the worst-case scenario, and mostly depending on the profile of customers, many devs could get rates as low as 3-4% if they have large volume. If you think about the market as a whole, it is a huge amount of money, which is exactly the reason Apple is making so much of it.
Since I know, some are going to argue about Apple making their dev tools available and their distribution infrastructure, I will cover this very easily. They need their dev tools for their own apps and the reason you have to use them is because they make it almost impossible to use anything else; on top of that without this their platform would be extremely uninteresting and completely irrelevant compared to Android, because who would buy a smartphone (that is just a small computer) that can only run apps from its manufacturer (they were called feature phones before...). Before Apple launched the App Store, people figured out how to make and publish apps without them just fine, without much need of Apple tooling. So, if the system was accessible as any computer system should be, the value of their tools would be almost non-existent in fact or a very low amount compared to what they take. Anyone that isn't a complete hypocrite knows they make those tools to make it easier and desirable to develop for their platform, they have a big interest in it, and every developer already paid for it when they bought their extremely expensive hardware (but modern Apple has no issues double-dipping everywhere).
As for the distribution, I actually think they should charge for it, even the "free" apps (I would say ESPECIALLY). There is no reason a small dev would have to give Apple at least 15% of all of his revenue for distribution when Facebook can distribute their app for free even though it must use an extremely large amount of bandwidth. This would have many side effects: first the apps would become slimmer (since peoples start caring when they have to pay, even more for corporations, you can be certain they would they find ways to reduce the bandwidth bill), second there would be less updates (and that in itself would be an achievement) and third it would automatically cleanup the store since devs wouldn't publish trashy/scummy apps if they had to pay for the waste of ressource they cause (can't give back the time stolen from users anyway).
In any case, I believe that those "app stores" are a modern problem created by network effect inherent to technology, and it just isn't right to let companies run a very large tax rate on economics activities happening on their platforms. Apple is being targeted more because they are by far the worst of the bunch and also the richest target. There is often a lot of talk about market value, but it is irrelevant since it can be wiped pretty fast. The fact is Apple has a mountain of cash, and they got there by stealing more than their fair share from society.