Apple adds nearly endless 20 percent fee for developers in latest EU update | Hacker News Reader

Apple adds nearly endless 20 percent fee for developers in latest EU update

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46 pointslaktak49 comments

Apple: “If you’re using our marketplace, play by our rules. You’re always free to leave.”

EU: “Sure, if you’re in our market, play by our rules. You’re always free to leave.”

Hah if I were Apple I would have. Call their bluffs.

They never will, they’re too addicted to money. The optics are also bad that they are willing to play ball in China but won’t for Europe?

But like we all know it's a bluff so there's really no risk. If the EU regulators could successfully kick Apple out without massive backlash from their own citizens it would be a win. The vacuum Apple would leave behind would be massive and give a chance, albeit maybe a small one given Google and Samsung would pounce, for EU companies to fill.

As much as it would suck personally if the internet got partitioned by political region, China absolutely got this one right by kicking out foreign companies that don't bend the knee to let their own domestic industry flourish.

This goes beyond phones, maybe this would be the opportunity as well, starting with something like the Pi, to have the European consumer electronics being based again home made hardware and OSes, like up to the early 1990's, gotta lose our dependency on US computer brands, specially if the government turns yet again.

Why would the US leave Europe alone after acquiring and destroying Europe's mobile phone manufacturing business?

For starters, the US' own government has also launched an anticompetitive inquiry into Apple's behavior. It's ongoing as we speak, and by the looks of it Apple isn't behaving like a company with nothing to hide.

You wouldn't, because the shareholders would absolutely revolt. Europe is responsible for >20% of Apple's revenue.

And Google’s newly declared monopoly threatens to stop the 20B a year in basically free money they paid Apple to have Google be the default search provider. That 20B is 25% of services profits IIRC …

The risk with Apple calling the EU's "bluff" is that the EU may then to seek to break Apple apart into hardware and software divisions, and Apple will have handed the EU the ammunition they need to guarantee it happens.

How? If Apple left the EU entirely, closed all stores, shut down all EU operations, what jurisdiction would the EU have?

If Apple actually did that, then none.

But Apple's corporate tax structure requires them to be in the EU. It's not just the loss of EU revenues at stake; Apple would owe hundreds of billions more in taxes each year as a result of this "simple" suggestion.

their irish tax shelter thing maybe they move it to the UK not part of the EU and then that fixes things?>

Looks like Apple is forcing the question: Will the EU compel Apple to give away or license their software, apis, and technology at some price other than Apple sets?

If the EU takes that position, I’d have to think the US and other governments would start to look at EU IP the same way. Something to be regulated and taken at a price that local government prefers.

> give away or license their software, apis, and technology

This is a strange concept, especially in historical context. Windows, for example, was always free to develop on unless you wanted to use MS’s tooling, in which case you could buy in a la carte or subscribe to MSDN. The owner of the device had a license to the technology and MS’s stack, and the developers licensed the developer tools if they chose to do so.

Even on iOS, the dev tools are cheap, and the device owner holds an iOS license. And the charge for distributing software is $0 — there is no charge for distributing software.

So what Apple really seems to be charging for is permission to charge money for iOS apps. And I think I’m with the EU here — Apple is gatekeeping and is charging something entirely unrelated to Apple’s costs.

I think its fair to say that Microsoft Windows is a different product entirely. Microsoft's business model literally a monopoly (100% install base) and they were willing to make different trade offs to get there. Interestingly though, the OS cost money--not free. So to run that "free" software, you had to pay MS money for the privilege.

iOS dev tools may be cheap. But that's not point. Apple has invested billions into that ecosystem. And to foster adoption, Apple's licensing model allowed for "free" software. But that was funded by the revenue collected from non-free iOS apps.

I'm not convinced.

1990s-era Windows was a sort-of monopoly -- MS had a monopoly on Windows, and Windows ran on the substantial majority of PCs, and PCs were much of the market. But users could also get a Mac or one of several Unix-ish machines or an OS/2 machine or a BeOS machine, etc. So MS's actual monopoly was on platform that developers needed to target to make software to run on Windows machines.

Right now, Apple has a monopoly on the software running on iPhones and iPads and a near-but-not-complete monopoly on software running on laptops and desktops and Mac Minis. And there are plenty of users of various Android phones and even a handful of devices that are neither iOS nor Android.

So what's the difference? Apple wants to take a cut of gross sales of software targeting iOS, even in cases where Apple is uninvolved in the distribution of that software, and even when that software actually targets a platform-agnostic system and that system knows how to target iOS. Microsoft did not.

>different trade offs

Different from who? What company in the 1980’s or 1990’s did what apple is doing now?

Is it not already paid for by the purchase of device by consumers and developer fees? Why is Apple entitled to triple dip?

Consumer pays for the hardware, or are you suggesting the software updates should be paid again?

This is a genuine question - Google pays for android updates to be free because the android business model is spyware to support Google’s ad business. Apples business model is the same as Xbox, PlayStation, etc where the developers for those platforms are paying MS, Sony, Nintendo, etc

Apple isn’t even charging high rates: their commissions match or are lower than other stores, when those other stores are literally only providing payment services.

> Apples business model is the same as Xbox, PlayStation

This would be closer to reality if Apple didn't drive hardware margins that are quite literally orders-of-magnitude larger than any comparable games console. When the Nintendo Switch launched it was shipping below-cost after accounting for shipping, whereas there has never been a modern Apple product that didn't ship with profitable hardware.

So when you scrutinize the two no, they really aren't similar. Apple cannot use the same excuse that Microsoft, Sony and Nintendo use.

Well, unless there's a regulation against it, they're allowed to both 1) charge for the device and 2) charge for additional software / upgrades you want to set on the device.

If Apple is banned from collecting revenues from the software side, then I guess they'd be stuck with either accepting the new substantially lower margin structure. Or raising the price of the phones to compensate for the missing software margin.

Lower revenue isn't "giving away". Under Apple's logic here it's a tiny leap that they should be entitled to 20% of all online purchases. They developed the web browser the customer used to navigate there after all. But it's not clear how an app is really different and some how acceptable to tithe. It's just obscene.

Imagine Tesla decided to charge you 20% of all annual income you earned by driving to work with your Tesla. Who owns your iPhone? Apple or you?

You could argue that the purchase of the device should cover the OS delivered with the device. But you certainly can’t demand that it must cover OS updates, at least not updates that add new features.

There was a time when major OS updates was something you got charged for.

The reason Apple develops free OS updates for fairly old devices now is that they still get App Store revenues from the users of those old devices.

Why is macOS free then? Why was Lion paid? Why was iPhone OS 2 free for iPhones when there was no App Store revenue?

Not really related to this argument, but for a while in that era Apple was under the impression that Sarbanes-Oxley accounting rules demanded that they charge for software enabling new features of existing products. So various software upgrades came with more or less trivial price tags.

It didn’t last long; I guess some combination of lawyers, accountants, and regulators clarified the matter.

The paid upgrade to be able to add events to the calendar in iOS was something like 20-25€ IIRC for my ipod touch first generation. I did not get it. I thought it was a rip off. It was free for iphones though.

You know macOS used to be a purchase right?

That didn’t end until Apple had the commission revenue.

You do know that iPhone updates were free prior to the App Store right? And that OS X still had paid updates even after the introduction Mac App Store? And that macOS didn't start being used until 10.12 well after upgrades went free?

Commission revenue doesn't explain Apple's free updates nor is a requirement for them. Software updates were free for many Windows Mobile handsets despite there being no central MS owned and tithed Windows Mobile software store.

EDIT: And early Mac OS releases prior to System 7 were free too!

Windows updates has always been free too. Microsoft still made quite a bit money from new sales of Windows and corporate subscriptions until they switched to ad-infested model. Why Apple cannot? They have the biggest margins in hardware sales alone compared to other hardware vendors.

While this looks like the EU tying itself up in knots, it's likely Apple will 'take another look' at this very soon and even reverse it before the year is out.

It's like a public negotiation between the EU and Apple.

Basically everyone wants Apple to forgo all fees on the platform. That's not realistic, nor likely even something a public company can do without either breaking their fiduciary responsibility to share holders or tanking the stock.

It's also not helpful that the EU's approach to legislation requires that companies implement something in market before they'll take a look at it.

The actual solution is very simple, and wouldn't even need the EU to "look at it": They charge consumers for the hardware and the OS, they charge developers the $100 per year for the tooling, they charge however much they want to sell apps on their app store, and they stop restricting and demanding to be a party to anything else.

No, software updates in the EU could just start costing money, like software updates used to.

Google would be able to continue “android updates are free” because they’re an advertising company and android exists for the sole purpose of ensuring Google has a constant revenue stream from their OS.

And then users get to choose “do I pay for an update” or “do I accept my only option is Google gets to know everything I do?”

Similarly people competing with that get to go “well do I charge money for my work so I can pay bills or do I just pay on and sell out my users?”

Obviously developers will also have to support older OSs as well because they won’t be able to rely on people updating.

Pretty much sounds like an all round win to me: Google gets to continue being a shitty company without restraint, developers have to support more platforms, and users stop updating software.

I’m also curious what you think the store commission should be capped at, because obviously the cap needs to apply to companies like steam and epic as well as the console vendors.

I suppose if Apple won't fix security vulnerabilities in software they sold, the only remedy would be a return and refund? Sounds costly for Apple.

> do I accept my only option is Google gets to know everything I do?

GDPR lets people opt-out of this, see what is going on with Facebook right now. Enforcement may not have hit Android yet but it will eventually.

> obviously the cap needs to apply to companies like steam and epic

No regulation is needed on platforms where there is competition - you aren't required to release your games on Steam to reach customers on Windows. The cap on Windows is already zero.

> as well as the console vendors

Consoles are way too insignificant a market to be counted as gatekeepers.

I really hope this comment is just trolling people, because if you believe both of these things you've been lied to by someone.

> android exists for the sole purpose of ensuring Google has a constant revenue stream from their OS.

Does it? That's funny, it seems to be the other way around. Android can be built without Google services at all. You do not need a single bit of Google telemetry, advertising or otherwise, to build, run and enjoy Android.

iOS fits that description better. Apple sues anyone that tries to modify and redistribute the OS or prevent user tracking at a software level. For fuck's sake, this is a thread about Apple trying to charge developers money for using the hyperlinking feature and you're trying to call Android the moneygrubbing OS? Methinks you're projecting your insecurity as an iOS user.

> because obviously the cap needs to apply to companies like steam and epic as well as the console vendors.

Obviously they don't, but I guess I wouldn't expect any different from someone in denial that the DMA and DSA exist. Read them; Steam, Epic, Sony, Microsoft and Nintendo are all alike in that they offer third-parties a fair opportunity to compete. Steam and Epic are very literally in direct competition with each other, so unless your point is highlighting how different these stores are from the App Store your point makes no sense.

Seriously; read the source material of what you are talking about before you take up Apple's sword and go to war for them. Your deliberate misinterpretation of the law isn't going to make people reconsider anything besides their initial support for Apple.

>The actual solution is very simple

Pretending doesn't make a problem go away. The reality of your solution is anticompetitive and would crush small developers. Your solution would also run afoul of competition legislation in the EU and beyond.

The OS and app store aren't magic, they're developed and run by people, software, hardware, and electricity. None of those are free, all of them require constant investment and training/maintenance, and a supporting management and logistical structure.

What you're asking for is for all the current cost-free items to be pay-for items. Neglecting all the other costs in the equation doesn't make them go away, but let's see your idea through: perhaps it might seem fairer to you if each individual download, update, app review and every act of moderation required a line item fee, but to rational people that seems like a hellish way to bill a service that punishes apps that are either not commercially driven or low-earners. For small developers that would be a squeeze that encourages apps to flail, decay and worsen security issues. This model could easily be seen as anticompetitive because it enforces an uneven playing field.

A $100 annual developer fee wouldn't cover an hour of professional overview, it certainly doesn't cover the cost of ongoing app review, it wouldn't cover the cost of not having a managed backup, insurance, or an up to date system. The lack of 3rd party stores on Android is because it doesn't make good business, frankly"good" and "cheap" sit at opposite ends of a service offering, no amount of "nerding harder" will fix that.

Your thoughts on a service are divorced from reality, they're frankly naive. If the cost to consumers/developers was divided out in the way you suggest, the annual dev membership would be several thousand and all interactions would be billable items. This would be fine for Microsoft, Google, etc - but present absolutely no chance for a small developer to establish a business. Working from a model that takes a slither of revenue when revenue is made is simply the fairest way to go about collecting an appropriate fee. It's also the norm with every other industry, none of which seem to get the foaming-at-the-mouth reactions that I read on here.

The fees I'm proposing are the exact fees Apple has been charging since the beginning and that have kept them extremely profitable all along. They are higher than the fees they charge for macOS, and they're doing fine with that. All the new fees Apple is introducing are extra, and they are for things that don't need to involve them.

Those fees are not new, Apple already has a cut of IAP under their regular terms.

These discussed fees apply to those which still use the App Store but choose to externalise purchase and payment.

If those developers don’t see value from being present in the App Store then there is no reason why they can’t just use a 3rd party store which has a fee structure to their liking.

This is the reality of the DMA.

I think forcing them to support pwa installs could be even better and, ironically, match the original vision of steve jobs better, with mostly webapps.

I suspect Jobs' original vision of webapps was entirely because the iphone 1 didn't have a native app development environment ready yet.

Internal emails from Apple have been released in various court trials. There is publicly available email proof that Steve Jobs had to be convinced to release public APIs and make an App Store months after the iPhone was released.

I'd have a link but it looks like techemails.com have put their archives behind a paywall...

[dupe]

Some more discussion: https://news.ycombinator.com/item?id=41194204

It's a "dupe" of a submission that never reached frontpage: https://hnrankings.info/41194204/

Nothing to do with it, go upvote it if you want. It's the same story, 2 days old now, and the discussion is over there, instead of splitting it up.

Reply on news.ycombinator.com