akashs

no worries. you couldn't delete those emails if you tried. no, seriously: http://www.law.com/jsp/tal/PubArticleTAL.jsp?id=120243445084...

I think you're half correct. While Apple certainly has every right to try to put mechanisms in place to prevent you from doing certain things on your device, the fact that you purchased it gives you the right to legally circumvent any of those protections to run whatever software you would like as long as the software is also legally obtained. That's why exempt from the DMCA rules are:

"Computer programs that enable wireless telephone handsets to execute software applications, where circumvention is accomplished for the sole purpose of enabling interoperability of such applications, when they have been lawfully obtained, with computer programs on the telephone handset."

So in my mind, the reason this upsets people is this: Imagine you bought a Sony TV and all you could ever watch on it was Sony produced movies, tv shows, and Sony music unless the other studios gave them 30% of the revenue. You can even only hook up a PS3 and Sony speakers, and there's no other way to get something on the TV but by going through Sony.

Is there still tons of great content? Sure. Do the original artists have a right to go elsewhere? Sure. Could the other studios afford to take the hit? No. Would the other studios make deals with the other TV manufacturers? Probably. But because of their position, you as the owner of a Sony TV wouldn't get to watch some awesome movies and same for people who bought another type of TV. In order to reach a Sony TV customer, Sony would be forcing artists to have Sony produce their content, and that's where it's anticompetitive.

Stepping back to reality, how crazy is this analogy? Well how different really is an iPad from a 10" TV? Sony TVs play movies, music, have apps, etc, etc just like an iPad. Sure in the real world, you need a special partnership with Sony to install your apps onto the actual TV, but there's tons of other ways to get your content onto the TV. Difference here is that Apple has blocked off any of those other channels. And that's why it's an issue.

How does using their servers mean they're doing inventory and shipping? I'm not understanding how it's possible to pay UPS to ship an app. Do you think anyone would have an issue if Apple just wanted to be compensated for that piece of hosting it on their servers?

You and I are not the average person. I can jailbreak, my parents cannot. Jailbreaking then voids the warranty, which is a part of the money I paid.

And when I do jailbreak, exactly how will that enable me to get Netflix, Kindle, Last.fm, Rhapsody back?

Yes, I've read the post several times, both the original and your many reposts of it. The trouble is is that it's not clear at all.

How does Apple do any inventory management or "shipping" given we're talking about digital goods? By having a counter for number of downloads? When have they ever done advertising or promotion the 99% of apps not lucky to be featured on in the ads? I'll agree they do some distribution and payment processing, but that's about it.

And I never said I had an expectation to get my money back. But when I paid money for hardware, I expect to be whatever I please with that hardware. I didn't pay $600 just to get access to Apple's app store on a 10" screen. I paid $600 to be able to take advantage of the capabilities of the iPad. Things like netflix and Kindle were a big factor in that decision (and honestly are some of the best things you can do with it).

Apple has blocked out any way of doing anything other than the app store, so it is a big deal. The fact that they sold me hardware doesn't entitle them to 30% of revenues from everything anyone wants to use that for.

Kindly explain to me where above I made any mention of Apple having a monopoly. But if you must push me: http://www.google.com/search?btnG=1&pws=0&q=apple+mp... and http://www.google.com/search?sourceid=chrome&ie=UTF-8...

Now when you're trying to sell apps on those devices, and Apple wants to 30% of anything that is sold for those devices and intentionally blocks out perfectly reasonable businesses, that becomes anti-competitive

Edit: Btw, I have stopped. I just bought a DroidX instead of the Verizon iPhone. But that won't get me my $600 back for my iPad or the money for my iTouch. Or the money for the apps I've paid for.

Actually, before you go putting others down, you should read about how this stuff works. It's highly dependent on what the market ends up being defined as. If you're talking smartphones, Apple certainly has more than 4%. MP3 players, again more than 4%. Tablets, again more than 4%.

And if you don't like the app store, Apple prevents you from selling it to customers through other means. So you can't exactly go somewhere else. Customers also just can't pick up and move to Android because of all the money they've spent on apps and content on an iPad.

Also, there's plenty of points that have been made as to why Zach's comment isn't necessarily "spot on" across the many times it has been posted. Many of them haven't really been addressed.

Who says iOS devices are consumer only? There's plenty of business apps in the app store and plenty of large enterprises who are using the iPad and plenty of people who would love to handle their ERP through the iPad.

Even then, not all of those businesses are enterprise focused like Oracle. I'm pretty sure there's a bunch of people (myself included) who would love to have MS Office on the iPad instead of what's out there.

I think you're grossly underestimating how much 30% of revenues means. Let's look at how this could actually affect you. Lets forget for a second that Amazon is even part of this issue. Let's stick to straight software development, what HN knows best. Let's look at the profit margins of some of the best software companies: http://www.google.com/finance?catid=us-54399928&sort=ANI...

Look at what percentage of revenue that net income is, and count how many are above 30%. Now, isn't it a bit more difficult to make money on a product if your 30% margin is gone? Sure, Apple deserves some money for payment processing and distribution, maybe something for acquiring a new customer but certainly not 30% of all revenue.

Yes, you may say you can just raise price, right? Well, to compensate you would have to raise price over 40%. Meanwhile, the customers have already demonstrated the prices they are willing to bear, so that doesn't quite work.

So now, if you've started a business of developing iOS apps, you're severely hampered by this 30% revenue cut you're giving to Apple. The small guys will probably deal with it because they won't know better, but think of it this way: Apple has just taxed 30% of the value you have created for your users. That's 30% of your income.

You can argue this is a retail model and they should get a margin the same way you do if you sell something through Best Buy, but it becomes anticompetitive when they've blocked off any option you have to sell directly to a customer or through any other channel. The companies on that list do very little business through retail, and they would suffer if they had to give up 30%. Moreover, Apple's own margins would take a hit if they had to sell everything through a retail partner.

(Also don't get why it matters that Rhapsody, Netflix, Amazon don't create content. Apple doesn't create most of the stuff that goes into an iPhone, but that doesn't mean they don't add value and shouldn't be able to make money)

Don't think you need the same plans, just need to make sure that whatever plan is made available through Apple is the same rate as the plan made available through any other channel and that any plan that grants iOS access is made available through Apple. Doesn't mean you can't charge extra for iOS access or have a set of plans that has nothing to do with iOS.

err yes. or closer to 43, but yes.

That's an interesting way to get around Apple. I wonder if it will hold. You're basically saying that if you want iOS accessibility, you pay 43% more. So maybe WSJ has a newspaper version, a newspaper plus digital (including android, any non iOS device), and then a newspaper plus digital plus iOS plan.

Wonder if there's also another way to get around it, maybe by just jacking up the rate 43% everywhere to please Apple, but maybe giving some other type of promotion (loyalty points, coupons, free stuff) for people that don't use iOS. Maybe you could give 3 months free or something as a credit for anyone who doesn't use iOS?

Given the level of detail Apple has provided, it sounds like either option could work.

Edit: changed 30% to 43%

I seem to be the only one missing this, so just wondering how it's been concluded that it was strictly due to timing? Watson didn't miss many and the one's it didn't answer, it had the correct answer most of the time. Just wondering how that means it would have gotten the lowest score but managed to beat everyone to the clicker. Am I missing something?

And for those who don't need the help with payment, distribution, etc Apple is forcing them to take it. Do you think Amazon really needs Apple's help in processing or distributing any of their content? I'm pretty sure the WSJ has plenty of experience handling payments as well.

I paid several hundred dollars for my iPad, and for that price I'd like to do whatever I want with it and be able to take advantage of the greatest things people have built for it, not what Apple approves of being done. The issue I have is that Apple's feeling of entitlement inherently blocks out many incredible things from that iPad. E.g., I bought a bunch of books on the Kindle app so I could read them on any device. Apple could have done the same by getting off their asses and building iBooks for other devices, but they chose not to. And now that advantage of Kindle is gone because Apple wants to take every last dime from anyone doing anything on an iOS device? Many business models cannot survive having to give up 30% of revenues. It is a poor model.

Edit: I guess I wouldn't have an issue if there was an alternative way to get native stuff onto your device other than Apple's app store. But there isn't.

Apple's argument is that they deserve 30% of all revenue streams for getting a customer on board. For 30% of revenues, you could hire a true sales force that goes out and actively sells stuff, rather than just sitting back and hoping someone signs up. In the App store model, you still need to sell on your own, Apple just centralizes payment and distribution. Thus, I'm not sure I follow your logic.

Payments: Visa, Paypal, Amex, MasterCard, and many others would gladly handle the payments for ~2%. Not sure where you're getting anything about inventory and shipping given it's digital content. Sales: when did actually do any selling for anyone's product other than when it was mutually beneficial? You still need to sell it to people to actually use your product. Publishing: again, what is apple doing here? Distribution and a little bit of marketing, sure - but that's certainly not worth the other 28% of revenues.

Also don't see why Rhapsody repackaging stuff makes it any different. Shouldn't a true app store model work for any type of business?

Don't know if it's in any way the cause of anything related to a decline in IPO, but this spread is what the banks make money on and what enables them to do what they do, effectively a measure of their margin on trades. Going from an eighth to a hundredth just means their margins effectively were reduced, but was probably a result of an increase in volume / trading activity.

Actually reminds me more of trying to split the vote in politics (or maybe just The Wire)

But I get your point on the decoy. Although that's an awful big game to play with a few months worth of Coke sales if they knew it in advance.

I never said it was taste based, but the taste (better or worse) was part of the issue. The primary issue was they were abandoning the brand they had spent 100 years building up. But that brand was linked to the original taste, and throwing out that taste was a bad idea. The issue was not that the taste was horrible, but that it was different.

Err, sort of. The taste tests were flawed (and also the reason Pepsi repeatedly won blind taste tests over Coke around then as well).

New Coke was designed to be more Pepsi-like in that it was sweeter. In smaller quantities, people readily preferred the sweeter of the two drinks, whether it was New Coke vs Coke Classic or it was Pepsi vs Coke Classic. But what the taste tests overlooked was that people preferred Coke Classic to either New Coke or Pepsi in larger quantities (e.g. a 12oz can).

Well, yes and no. Completely agreed on your basic point that their strength lies in their brand. However, in 1985 when Coke tried to reformulate the original formula and create "New Coke", one thing that it showed was that the taste of the drink was very linked with the brand.

Coke has always built their brand by associating the drink with happiness and good memories, and when that taste changed, people were upset because the Coke they grew up with no longer existed.

But I doubt anyone would be able to steal share away from Coke simply by copying their formula.

How is this in any way different than MS and Windows Home vs Premium vs Ultimate? The code / SW you purchase is exactly the same no matter which version you buy, but MS markets them as entirely different products. You then need to pay extra to unlock features that are already built in. Does MS need to mention that there's crippling going on? Sure, you could go in and hack your way through and patch things up to unlock it, but most people don't have the time for that.

1) they do at movie theaters, restaurants, a lot of places. a 12 pack costs more than a 6 pack. etc, etc.

2) you still get the point. it's then even more clear that it has nothing to do with the underlying cost.

There's clearly people willing to pay the full price for the 595. If there wasn't, they would have cut the price already since it takes almost no effort to do so. People pay for the perceived value of the product, not the value of the underlying costs plus some margin.

Pricing based on cost is irrelevant because that has nothing to do with the value created or what people are willing to pay. E.g., why did Sony and MS sell the PS3 and 360 below cost for so long? Well, no one would have paid the $1000 plus margin that Sony would have needed.

On the other end, do you really think that bottle of Coke you buy is priced anywhere based on the cost of manufacturing? The ingredients in that cost about $0.02, but they charge $1 at the store. The 20oz bottle has maybe an extra couple cents of cost, but they charge twice as much.

To your point, Ask could have 5% share of volume, but if their ad platform was better to the point that they could charge 10x what Google could, they would be doing pretty well.