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Doesn't Valve take 30% from games on Steam? But they're complaining Apple taking 30% is too much? I also don't really think the Apple/Google fee is that unreas

Doesn't Valve take 30% from games on Steam? But they're complaining Apple taking 30% is too much? I also don't really think the Apple/Google fee is that unreasonable. Considering the resources, tools, marketplaces, tutorials, payment processing, all the other All dev stuff they provide in general. Yes if your app goes big, they make a lot of money. But for every big app there's something like 9 that fail completely (it's murky due to how many apps aren't intended to profit in the first place, and are just made to attract customers to a brand). I don't know the numbers though. Maybe they could charge lots less. But just from my single viewpoint, it doesn't "feel" unreasonable.

cgriswald 8y ago
Steam does not sell me a locked down hardware platform preventing me from buying the software directly from the publisher. Nor does Steam force me to buy DLC through Steam, I am free to buy the DLC directly from the publisher. Steam gets a cut of what I buy from Steam and I am not locked into buying from Steam in order to make my PC useful. Apple sells me a locked down hardware platform that requires me to go through them for all software purchases and all data purchases made with that software. > But just from my single viewpoint, it doesn't "feel" unreasonable. It seems unreasonable to me that Apple should get a cut of my Amazon Video purchases. Apple adds no value there; they just get in the way and try to take a cut. I already have a relationship with Amazon and when I download a video from Amazon, it costs Apple nothing. The entire thing where I have to make a purchase through the Amazon website rather than the Amazon or Amazon Video app and then download it with Amazon Video app is just stupid.
- rlanday 8y ago
  > Apple adds no value there Other than inventing the modern phone, writing the operating system and developer tools, running the store, manufacturing the phones people are consuming Amazon's product on and convincing people to buy them...you can argue about what's "fair," but Apple's certainly adding value.
  - gameswithgo 8y ago
    Anything is fair, but I don't like things that only allow app stores as a first class way to get software on my machine. I have voted with my wallet. But it is getting harder to do so, soon only linux will be left.
    - dkonofalski 8y ago
      That's fine but you're not really the intended market for the App Stores. App Stores are for the people that click "Yes" to everything and end up with Internet Explorer as a strip of their screen because they have 42 toolbars installed. Those people undoubtedly like app stores precisely for being the only way to get software on their machines.
      - voltagex_ 8y ago
        I dunno - I much prefer the Microsoft app store on Windows for simple applications that I don't need to customise much. It's quicker than finding the right exe and keeping it up to date myself.
  - earenndil 8y ago
    All of those except 'running the store' are value paid for in the purchase of the phone, not the software on it.
    - bovine3dom 8y ago
      Money is fungible. I would be very surprised if Apple didn't regard revenue from the App Store as partially due to their investment in the iPhone.
    - Buge 8y ago
      Why? Is it wrong to sell a phone at low cost and charge more for apps? Video game consoles sometimes are sold at a loss in order to make money from games. It's similar to Fortnite's model: sell the game at a low cost (free actually), and then make money from inessential addons (skins).
- jimbokun 8y ago
  As I understand it, if you already have a subscription for Amazon Video through the web, then download the Amazon Video app and login to your existing account, Apple doesn't get anything. Which is why the article emphasized Netflix trying to get customers to sign up through their web site, and not the app.
  - wlesieutre 8y ago
    IIRC this is how the Kindle app works for iOS. You can't buy books, but if you own books on your account you can read them.
    - wilc0 8y ago
      You can wishlist and download samples from the app on iOS, but any purchases have to be done from the website. On android, you can buy/download full books directly from the app.
    - fpoling 8y ago
      One can even download free samples of the books which makes it very convenient to pay on kindle or the website later. But it is sad that Apple decided that apps cannot even mention that purchase has to be done at the website.
  - giovannibajo1 8y ago
    Correct. Apple gets a cut if a customer subscribes through the in-app one-click subscription, which is extremely convenient for any iPhone user (and thus app publishers) because it’s a single click rather than having to insert credit cards, 3D secure and whatnot. In this case the cut is 30% on the first year and 10% afterwards. If the user subscribes through the website, Apple gets nothing. I find this fair. What is more unfair is that Apple forbids apps to open/link websites where subscriptions can be done to “workaround” the iTunes subscription. If you take Spotify for instance and login as free user, there are absolutely zero mentions that you can upgrade to premium, because they decided to lose those potential customers and rather let them know through other channels of their purchasing options (eg: emails). On the other hand, this creates a very safe and simple environment for iPhone users. Absolutely NO app asks for a credit card, ever. You either pay one-click safely through iTunes, or nothing. There is no phishing, no mismanaged credit card handling, no credit cards “stolen by hackers from the app I installed into my iPhone”. I’m not saying this fully justifies the above unfair rule, but it’s at least a partial positive side effect.
- clay_the_ripper 8y ago
  They add value by creating a product that has massive scale, reach, usability and quality. They add value by having branded stores that fix the device for you. They add value by developing stable software that gets updated regularly. If you don’t like the product, don’t buy one, it’s that simple. Go buy a cheap Chinese knockoff that doesn’t have developer support for millions of apps, has lousy quality control, if it breaks you’re shit out of luck. It costs 1/10 the price of an iphone, but the experience is lousy. I value my iphone because it adds more value to my life than it costs to buy, and the company that makes it is entitled to charge whatever they want for it. Apple makes money because they add value and I see no reason why a company that adds value to the marketplace should not turn a profit.
  - cgriswald 8y ago
    > They add value by creating a product that has massive scale, reach, usability and quality. They add value by having branded stores that fix the device for you. They add value by developing stable software that gets updated regularly. Your rant is misplaced and you've missed the point entirely. I never said Apple adds no value. I think they add quite a bit of value, which is why I've bought a number of their products. I am talking about a specific case for which Apple thinks it is due 30%. Apple does not add value by inserting itself into a transaction I am trying to conduct with Amazon. I've already paid for all the value. First to Apple for the device, and then to Amazon for the data. Am I or Amazon supposed to pay Apple for my use of the device as well? And if so... where is the value added?
    - valuearb 8y ago
      It’s really hard to feel sorry for Amazon, or you, given your whine is you have to go to a web browser to complete your transaction. In truth, The App Store is far more than a mere payment processor, though it might be best in the world at that. The costs of hosting, distributing and updating two million apps across hundreds of localized stores, and also vetting every release and update for those millions of apps, is immense. All their work makes the App Store easy and safe to use anywhere in the world and that helps developers sell more apps.
- cbhl 8y ago
  I would bet that Apple would probably rather you not have a relationship with Amazon Video at all, getting your TV and Movies from iTunes instead. But Apple doesn't have a majority of market share (by number of devices), so, in my opinion, antitrust regulators have completely discounted their behavior. On the other hand, the experience of using Apple Pay is miles beyond Google Checkout/Wallet/Pay/Android Pay/whatever marketing's new name-of-the-week-is, and only allowing One Blessed Way of taking payment on Apple devices is a big component of that. Having one consistent flow that I can execute in three seconds from muscle memory really does make buying-from-random-apps-and-retailers experience much nicer and more predictable than it is on the web and on other mobile platforms.
  - YurtleTheTurtle 8y ago
    Apple Pay and app store/itunes payments are completely separate. I had apple pay set-up for awhile and when I went to purchase an app, itunes wouldn't accept apple pay and I had to re-enter all my CC information into itunes.
- lightwin 8y ago
  Apple does not sell to us, we buy from Apple :)
- AckSyn 8y ago
  This is not an argument against the fees but an argument against something you personally don't like. To pretend otherwise is intellectually lazy.
- madrox 8y ago
  Steam is also adding a lot of value for that rev-share. A social network...kickstart-esque backing of projects...cloud saves...great search and discoverability. There is a reason why developers choose Steam even though they operate on platforms that don't require it.
  - UncleMeat 8y ago
    And mobile stores offer search, promotion, distribution, and analytics.
    - cgriswald 8y ago
      In the absence of any alternative methods of developers getting their apps into users hands, it is difficult to say whether "search, promotion, distribution, and analytics" offered by Apple are really valued at what Apple is charging for them. It is also difficult to separate these things from things Apple is doing for its own sake, since they increase sales which benefits Apple directly. I strongly suspect that, given enough time to compensate for the existing momentum of the App Store, if an alternative App Store was an option, Apple would either improve its offerings, lower what it charges, or see a mass migration of publishers away from the App Store. Edit: Clarity of meaning.
      - dkonofalski 8y ago
        You're completely ignoring the hit to both the brand and experience that something like that would cause. There's a big reason why iOS users tend to spend more money on the platform than Android users do on the Google platform and a huge part of that is the trust built by Apple with their users. You can go into the Google Play store (which most people would think was the "official" and "safe" method of getting apps) and still get malware and/or a virus on your Android phone. Now imagine that Google offered both an official Play store and an alternative open Play store. Which do you think the majority of users would use and have a positive opinion of?
        cgriswald 8y ago
- baxtr 8y ago
  I don’t think Apple sells you anything. You buy stuff from them. You are free as a bird to buy any other products you desire
- dkonofalski 8y ago
  That's not really a fair comparison since Apple has to curate the App Store and is 100% responsible for the service as well. It's not like you're buying an iPhone or iPad without knowing that all your apps come from the App Store and that's part of the value - unlike Android, you know exactly where the app is coming from, what it is and isn't allowed to do, and have an expectation that the app has been reasonably reviewed so it's not a danger to you or the device. Steam is almost exactly the same way because it's not like you can take your Steam purchase and use it without Steam. Yes, you can buy DLC and other add-ons directly from the publisher if you wanted to but that's moreso because of how the publishers have created their products rather than how Steam works as a platform. As for your Amazon example, Apple does absolutely add value there. They manage and keep track of all your purchases and payments so that there's a single, unified method for both paying and resolving issues. Additionally, since Apple functions as the payment processor, you're also paying for the security functionality. The only reason you have to make a purchase from the Amazon website is because Amazon wants to control the purchasing and doesn't want to pay Apple for their payment processing. It's just a difference of whether you prefer the consistency of the experience that Apple prefers at the expense of other companies or whether you prefer to deal with several different experiences that could potentially open everything up for fraud and problems. People who aren't as tech savvy or who don't want to have to wade through a bunch of BS just to make a purchase may prefer Apple's method. Others may prefer digging through and doing all that in order to have a broader pool to choose from.
  - ApostleMatthew 8y ago
    I think your first paragraph is a result of you viewing this from the perspective of someone knowledgeable about technology. The vast majority of people using Android phones get their apps exclusively from the Play Store and assume Android is exactly the same as iOS in that way.
- scarface74 8y ago
  Apple sells me a locked down hardware platform that requires me to go through them for all software purchases and all data purchases made with that software. A. You can choose to buy an Android phone like 80%+ of the smart phone world. B. You can buy content outside of the Apple store and use it within the app (Amazon, Udemy, Spotify, Google Play Music, every video streaming service, etc.) It seems unreasonable to me that Apple should get a cut of my Amazon Video purchases. They don't, in fact you can't buy Amazon content within the app.
  - mrep 8y ago
    Amazon does not offer you the option because the only way they could offer it is if they gave Apple their 30% cut. Same super annoying reason you cannot buy books in the kindle app.
- scentedmeat 8y ago
  > Apple adds no value there I like having all my subscriptions in the same place so I can easily see what I'm paying and cancel.
ben_jones 8y ago
I don't know if you have a "fair" argument here. Who needs that 30% more Apple or an independent app developer? Though the same could be said for Valve, at least it's the purpose of Valve where apple sells computing devices not software as their core enterprise.
tonyedgecombe 8y ago
30% seems a lot when BlueSnap/Avangate/FastSpring provide most of the same services for 6-8%. Of course Apple would argue that they are connecting you to their customers. When there are a million apps in the store I'm not sure how true that is.
- Spivak 8y ago
  But Apple's customer base is more valuable, which is why people still publish there despite the cost. Apple and Google aren't selling infrastructure, they're selling an audience.
  - tonyedgecombe 8y ago
    That's fine, it makes sense to me that you would develop for Apple before Android because those customers are more affluent and willing to spend on software. However I question whether the App Store is connecting you to those customers in any meaningful way when there is so much competition in there. Sure if you are lucky enough to get to the front page then you can do OK but most don't.
- VikingCoder 8y ago
  BlueSnap/Avangate/FastSpring develop a free OS that's used by 85% of the smartphones in the world? The fee is paying towards the development of Android. Your comparison of "same services" isn't remotely valid.
  - tonyedgecombe 8y ago
    Is it? I though Android was subsidised by advertising.
- chipotle_coyote 8y ago
  Apple also has a large and growing editorial staff writing articles and highlights for their App Store; it's virtually becoming a house magazine. So being in their store potentially offers exposure and marketing for free that's immensely valuable. (Whether it's 30% valuable is debatable, of course. Personally I think they should drop it from 15%/30% to 10%/20%, but "Apple: always more expensive than you think they should be" has worked for them for a long time.)
javagram 8y ago
Valve takes 30% of direct sales through steam but allows developers to generate and sell separately steam keys where they get a 0% cut, as I understand it. For instance when you buy a game on humble bundle and get a steam key for it, valve makes nothing off that transaction. Unless Apple and google start allowing sales outside their stores I don’t think steam is comparable.
- pitaj 8y ago
  Google Play and the Apple App Store are completely different beasts. Unless you jailbreak your iOS device, there is no way to install apps outside the App Store. On Android, you can install entirely separate stores, like the Amazon one, and several OSS-focused stores.
  - DINKDINK 8y ago
    >Unless you jailbreak your iOS device, there is no way to install apps outside the App Store Technically this is not correct. Practically it is. You can install Apps on iOS devices without the app store (called sideloading, and it's a PITA): https://beebom.com/how-to-sideload-apps-iphone-ios-10-without-jailbreak/ https://beebom.com/how-to-sideload-apps-iphone-ios-10-withou...
  - DerDangDerDang 8y ago
    That’s not completely true, as I understand it. You can (or could a couple of years ago) get an ‘enterprise’ developer account that allows you to sign and provision apps to be sideloaded via a web link. Though iirc it’s more hassle for the end user as they have to explicitly allow it on their device.
    - jsjohnst 8y ago
      DINKDINK’s reply above is more relevant. If you try using an enterprise cert to allow general public users to install your app you’ll quickly lose your enterprise cert. The enterprise cert is only to be used for internal company apps.
- 8y ago
Spivak 8y ago
Keep in mind that the price they charge doesn't really have anything to do with the actual infrastructure despite the costs. They're not selling infrastructure, they're selling access to an audience no different than really any other publisher.
deleted 8y ago
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mywittyname 8y ago
Valve has several big competitors in the PC market. Several hugely successful games are not available on Steam. I'm not sure it's possible to create a hugely successful iPhone app that isn't on the App Store. Apple has a monopoly and is using it to squeeze excessive fees from developers.
- colechristensen 8y ago
  Using a monopoly to squeeze excessive fees that happen to be exactly the same as the fees for a competitive market? There seems to be a logic breakdown there.
  - kemitche 8y ago
    A business making an app has one choice for delivering that app to iPhone users. The iPhone owners could choose to switch to Android, but that's not a choice the business can make for the consumer. The business could choose to launch on Android only, and hope that convinces consumers to switch, but that's about it for options.
  - mywittyname 8y ago
    There's no logic breakdown at all: publishers can get better terms by going with an competitor to Steam, such as GMG, GoG, Origin, Microsoft Store, or just release the app on their own website/platform. It's functionally impossible to release an app on iOS without paying Apple. Compared to the 0% of self-publishing, Apple's fees are excessive.
    - dkonofalski 8y ago
      Sure, they can get better terms going through a competitor but then they don't get any of the value or services that Steam offers. They're paying a percentage to make use of all the benefits you get through Steam both as a company and for the end-users. Apple's fees aren't excessive because they offer their services and provide their value to every app published through their store. Yes, they could offer a way to publish the app without those features and not charge the fee but that would further complicate the experience for users. I mean, technically, companies are absolutely allowed to host apps for users to side load themselves. It's just that no one wants to do that because it's not worth it when the costs Apple are taking are actually reasonable.
stefan_ 8y ago
The modern marvel that are credit cards or debit cards run at low single digit percentages. And they are getting a ton of margin out of those; so much that in the EU, they capped fees at 0.3%. And those transaction fees actually pay for something, like customer protection, SLAs (not a shitty status site) and no, the credit card company doesn't add unskippable ads on top of the checkout process or advertise a scam clone version of what you are trying to buy to you. You tell me if the app store fees provide 100x as much.
- toasterlovin 8y ago
  In your analogy, the App Store is the store, not the credit card terminal. As somebody who sells on Amazon, I can tell you that they take more than 30% of what the customer pays.
jliptzin 8y ago
The problem is it's clearly a monopoly (or duopoly). How did they settle on 30%? Why did Apple and Google come to the same 30% number - is that a coincidence? They could easily provide the same service for less than 1/3 of the cost, but the percent never budges because it doesn't have to. There's zero competitive pressure. In fact they could move it up to 60% if they want to with nothing stopping them. Some people have managed to build a business on these app stores but in my opinion they should only be leveraged as part of an existing independent business, otherwise you're building a business on quicksand.
- jimbokun 8y ago
  "Why did Apple and Google come to the same 30% number - is that a coincidence?" Google copied Apple?
  - iainmerrick 8y ago
    Right. If this were a competitive market, they'd both be constantly refining their cut to find the optimal value. In practice the 30% was plucked out of the air and has never been changed.
akshat_h 8y ago
Does Steam take a cut for in game purchases? I think the major issue here is with companies having app stores inside app store. All the companies mentioned i.e Amazon, Steam seem to allow in-app purchases at a scale quite different than normal apps. It does seem weird that if I am purchasing an item through Steam's app store, Steam has to pay Apple. I mean it would be like Amazon paying Apple a cut, if I buy a TV from amazon. AFAIK, it is only for digital goods that Apple charges, but I am not sure how the demarcation works. On the flip side, if Apple/Google allow any app to use in-app purchases without a commission, then all apps will use in-app purchases for everything.
- cma 8y ago
  > Does Steam take a cut for in game purchases? Yes. That's why they cut out remote control purchasing feature from their iOS app, to avoid hypocrisy charges and to avoid the sticky situation where a steam app tried the same (letting you make microtransaction purchases by remoting in to your phone or something). Same as why Epic dropped their marketplace cut down from 30% something like one week before their "30% is unfair" press campaign which in turn was used to take the spotlight off criticism of Fortnite's release on Android as a timed exclusive with Samsung's new flagship.
kodablah 8y ago
> Doesn't Valve take 30% from games on Steam? But they're complaining Apple taking 30% is too much? They're complaining Apple is taking too much without alternative. If the app store provided 30% worth of value, it would be voluntarily chosen like Steam is. Why derail with such a ridiculous equivalence?
Steko 8y ago
People keep saying Apple adds no value but bringing millions of paying customers and a trusted storefront does in fact have lots of value for most apps. This is exactly the value Steam brings on PC. Being locked down or not is a red herring to the value argument, people sell on Steam because of simple math: the millions of additional paying customers outweighs the commission Valve demands.
- pascalxus 8y ago
  Yes, but there comes a point when it just becomes rent seeking. It's digital nature for there to be one portal that leads you to everything.
- binomialxenon 8y ago
  Valve has competitors in the PC games storefront market. On iOS, there is (for all practical reasons) no other storefront. People would be stuck on the App Store even if they were to charge something ridiculous like 50%, because there's no where else to go.
  - dkonofalski 8y ago
    Yes, but if that were the case, there would be no apps on the App Store.
  - Steko 8y ago
    > Valve has competitors in the PC games storefront market. On iOS, there is (for all practical reasons) no other storefront. Predictably, this is where the goalposts have moved[1] but it's really orthogonal to whether there's value or not. Also as pointed out elsewhere, Steam is in a competitive market and charges the same commission. Also in Apple's favor is the well attested to value of the App Store vs Google Play and others in terms of raw revenue. [1] 'Predictably' as in "Being locked down or not is a red herring to the value argument" in grandparent
  - bigmit37 8y ago
    I’m surprised there is no backlash from independent iOS developers. Not only do they have 30% taken away, they have the yearly $100 fee,they need expensive Apple products to make the app, apps have be priced low because consumers expect low priced amazing apps. Then you have to market the app to stand out.
apersona 8y ago
What? They're complaining about Valve too. Bethesda, for example, recently announced that they're launching Fallout 76 on their own personal launcher (https://arstechnica.com/gaming/2018/08/fallout-76s-pc-version-will-skip-steam-requires-bethesda-net-launcher/ https://arstechnica.com/gaming/2018/08/fallout-76s-pc-versio...). I've noticed this trend in the game industry. Any game company that is large enough will work on their own launcher (look at Blizzard, Epic Games, EA, etc.)
ashelmire 8y ago
Don't Apple and Google take 30% of all in-app sales as well? It's like your phone and internet company saying, "Well, guess we're gonna take 30% of all business you do over the phone or internet" or your rental company demanding 30% of your income.
tw04 8y ago
If every app I downloaded were several to several 10s of gigabytes of data, I might be more inclined to cut them some slack. 30% on a 5MB download is pretty tough to justify. The cost of storing and transferring that file is a rounding error.
- zaroth 8y ago
  What makes you think the 30% cut is to pay for the bandwidth of the file transfer? The entire platform the app runs on was created by Apple. The hardware, the OS, the programming language, the SDKs. Thousands of APIs used to build the apps, maybe a million pages of documentation on those APIs. All the toolchain to develop, build, test, and deploy apps for purchase in hundreds of countries including customer profiles, billing, and support. Billions of dollars of iCloud infrastructure for backend services to support everything from push notifications, data sync, backup, automatic updates, etc. Then you get into the actual app store and you have all the work that went into the UX there for discovering, installing, buying and reviewing apps. In-app purchases and subscription services to support different business models. Family sharing, parental controls, parental approval requirements for kids’ phones. I could go on for hours and probably still miss huge swaths of functionality that Apple invested millions of dollars into, just so that you could pull up chair and with a few lines of code start writing an app that can reach billions of devices. Not to mention all the marketing and training and support Apple does to prime their customers to be big users of the App Store. Yeah, and the bandwidth to download the app as well. Personally I think 30% is a steal for what you get in return. Oh, and I’ll just add one more thing; you can distribute your app for free and you pay Apple nothing (or nearly nothing) for the benefit of all their hard work and infrastructure and support.
radley 8y ago
> But for every big app there's something like 9 that fail completely Actually the ratio is more like 1 to 500k. There are millions of apps in both stores, but I'd bet less than 1000 make significant income exclusively from the app stores.
dkonofalski 8y ago
I agree. There's a lot that people take for granted with these App Stores, especially with Apple's. The alternative is to pass this cost onto the consumer instead and I think that's a terrible idea.
halo 8y ago
Many major PC games publishers and developers have chosen either to not to use Steam or have reduced their support including EA, Epic, Microsoft (including Mojang), Riot, Activision Blizzard and Bethesda.
OSTN 8y ago
>Doesn't Valve take 30% from games on Steam? But they're complaining Apple taking 30% is too much? Nobody is locked to valve on PC. Large game publishers have their own PC stores precisely to avoid getting ripped off by Valve. EA has Origin, Ubisoft has Uplay, Blizzard/Activision has Battle.net. MS has the Microsoft Store. There are many little indie stores with their own handling of profits, like itch.io : >itch.io costs nothing to use. You are free to create pages and upload your content without ever having to pay anything. Advertisements will never be placed on any of your pages. >You get to decide how much you want to support itch.io by choosing what percentage of your sales should go towards our operational costs and continued development of the platform. We call that open revenue sharing. Subscription MMORPGs also all have their own payment schemes and external launchers that bypass Valve's little greedy hands. Being locked to a single app store on any platform is a mistake. PCs are great because we don't suffer this, for now. Until MS decides to make Windows S the default and lock people from freely switching to a normal version of Windows.
forrestthewoods 8y ago
Steam’s 30% is also too high. There’s a reason the new Fallout 76 is skipping Steam and will be sold through a Bethesda launcher.

cgriswald 8y ago

Steam does not sell me a locked down hardware platform preventing me from buying the software directly from the publisher. Nor does Steam force me to buy DLC through Steam, I am free to buy the DLC directly from the publisher. Steam gets a cut of what I buy from Steam and I am not locked into buying from Steam in order to make my PC useful. Apple sells me a locked down hardware platform that requires me to go through them for all software purchases and all data purchases made with that software. > But just from my single viewpoint, it doesn't "feel" unreasonable. It seems unreasonable to me that Apple should get a cut of my Amazon Video purchases. Apple adds no value there; they just get in the way and try to take a cut. I already have a relationship with Amazon and when I download a video from Amazon, it costs Apple nothing. The entire thing where I have to make a purchase through the Amazon website rather than the Amazon or Amazon Video app and then download it with Amazon Video app is just stupid.

rlanday 8y ago
> Apple adds no value there Other than inventing the modern phone, writing the operating system and developer tools, running the store, manufacturing the phones people are consuming Amazon's product on and convincing people to buy them...you can argue about what's "fair," but Apple's certainly adding value.
- gameswithgo 8y ago
  Anything is fair, but I don't like things that only allow app stores as a first class way to get software on my machine. I have voted with my wallet. But it is getting harder to do so, soon only linux will be left.
  - dkonofalski 8y ago
    That's fine but you're not really the intended market for the App Stores. App Stores are for the people that click "Yes" to everything and end up with Internet Explorer as a strip of their screen because they have 42 toolbars installed. Those people undoubtedly like app stores precisely for being the only way to get software on their machines.
    - voltagex_ 8y ago
      I dunno - I much prefer the Microsoft app store on Windows for simple applications that I don't need to customise much. It's quicker than finding the right exe and keeping it up to date myself.
- earenndil 8y ago
  All of those except 'running the store' are value paid for in the purchase of the phone, not the software on it.
  - bovine3dom 8y ago
    Money is fungible. I would be very surprised if Apple didn't regard revenue from the App Store as partially due to their investment in the iPhone.
  - Buge 8y ago
    Why? Is it wrong to sell a phone at low cost and charge more for apps? Video game consoles sometimes are sold at a loss in order to make money from games. It's similar to Fortnite's model: sell the game at a low cost (free actually), and then make money from inessential addons (skins).
jimbokun 8y ago
As I understand it, if you already have a subscription for Amazon Video through the web, then download the Amazon Video app and login to your existing account, Apple doesn't get anything. Which is why the article emphasized Netflix trying to get customers to sign up through their web site, and not the app.
- wlesieutre 8y ago
  IIRC this is how the Kindle app works for iOS. You can't buy books, but if you own books on your account you can read them.
  - wilc0 8y ago
    You can wishlist and download samples from the app on iOS, but any purchases have to be done from the website. On android, you can buy/download full books directly from the app.
  - fpoling 8y ago
    One can even download free samples of the books which makes it very convenient to pay on kindle or the website later. But it is sad that Apple decided that apps cannot even mention that purchase has to be done at the website.
- giovannibajo1 8y ago
  Correct. Apple gets a cut if a customer subscribes through the in-app one-click subscription, which is extremely convenient for any iPhone user (and thus app publishers) because it’s a single click rather than having to insert credit cards, 3D secure and whatnot. In this case the cut is 30% on the first year and 10% afterwards. If the user subscribes through the website, Apple gets nothing. I find this fair. What is more unfair is that Apple forbids apps to open/link websites where subscriptions can be done to “workaround” the iTunes subscription. If you take Spotify for instance and login as free user, there are absolutely zero mentions that you can upgrade to premium, because they decided to lose those potential customers and rather let them know through other channels of their purchasing options (eg: emails). On the other hand, this creates a very safe and simple environment for iPhone users. Absolutely NO app asks for a credit card, ever. You either pay one-click safely through iTunes, or nothing. There is no phishing, no mismanaged credit card handling, no credit cards “stolen by hackers from the app I installed into my iPhone”. I’m not saying this fully justifies the above unfair rule, but it’s at least a partial positive side effect.
clay_the_ripper 8y ago
They add value by creating a product that has massive scale, reach, usability and quality. They add value by having branded stores that fix the device for you. They add value by developing stable software that gets updated regularly. If you don’t like the product, don’t buy one, it’s that simple. Go buy a cheap Chinese knockoff that doesn’t have developer support for millions of apps, has lousy quality control, if it breaks you’re shit out of luck. It costs 1/10 the price of an iphone, but the experience is lousy. I value my iphone because it adds more value to my life than it costs to buy, and the company that makes it is entitled to charge whatever they want for it. Apple makes money because they add value and I see no reason why a company that adds value to the marketplace should not turn a profit.
- cgriswald 8y ago
  > They add value by creating a product that has massive scale, reach, usability and quality. They add value by having branded stores that fix the device for you. They add value by developing stable software that gets updated regularly. Your rant is misplaced and you've missed the point entirely. I never said Apple adds no value. I think they add quite a bit of value, which is why I've bought a number of their products. I am talking about a specific case for which Apple thinks it is due 30%. Apple does not add value by inserting itself into a transaction I am trying to conduct with Amazon. I've already paid for all the value. First to Apple for the device, and then to Amazon for the data. Am I or Amazon supposed to pay Apple for my use of the device as well? And if so... where is the value added?
  - valuearb 8y ago
    It’s really hard to feel sorry for Amazon, or you, given your whine is you have to go to a web browser to complete your transaction. In truth, The App Store is far more than a mere payment processor, though it might be best in the world at that. The costs of hosting, distributing and updating two million apps across hundreds of localized stores, and also vetting every release and update for those millions of apps, is immense. All their work makes the App Store easy and safe to use anywhere in the world and that helps developers sell more apps.
cbhl 8y ago
I would bet that Apple would probably rather you not have a relationship with Amazon Video at all, getting your TV and Movies from iTunes instead. But Apple doesn't have a majority of market share (by number of devices), so, in my opinion, antitrust regulators have completely discounted their behavior. On the other hand, the experience of using Apple Pay is miles beyond Google Checkout/Wallet/Pay/Android Pay/whatever marketing's new name-of-the-week-is, and only allowing One Blessed Way of taking payment on Apple devices is a big component of that. Having one consistent flow that I can execute in three seconds from muscle memory really does make buying-from-random-apps-and-retailers experience much nicer and more predictable than it is on the web and on other mobile platforms.
- YurtleTheTurtle 8y ago
  Apple Pay and app store/itunes payments are completely separate. I had apple pay set-up for awhile and when I went to purchase an app, itunes wouldn't accept apple pay and I had to re-enter all my CC information into itunes.
lightwin 8y ago
Apple does not sell to us, we buy from Apple :)
AckSyn 8y ago
This is not an argument against the fees but an argument against something you personally don't like. To pretend otherwise is intellectually lazy.
madrox 8y ago
Steam is also adding a lot of value for that rev-share. A social network...kickstart-esque backing of projects...cloud saves...great search and discoverability. There is a reason why developers choose Steam even though they operate on platforms that don't require it.
- UncleMeat 8y ago
  And mobile stores offer search, promotion, distribution, and analytics.
  - cgriswald 8y ago
    In the absence of any alternative methods of developers getting their apps into users hands, it is difficult to say whether "search, promotion, distribution, and analytics" offered by Apple are really valued at what Apple is charging for them. It is also difficult to separate these things from things Apple is doing for its own sake, since they increase sales which benefits Apple directly. I strongly suspect that, given enough time to compensate for the existing momentum of the App Store, if an alternative App Store was an option, Apple would either improve its offerings, lower what it charges, or see a mass migration of publishers away from the App Store. Edit: Clarity of meaning.
    - dkonofalski 8y ago
      You're completely ignoring the hit to both the brand and experience that something like that would cause. There's a big reason why iOS users tend to spend more money on the platform than Android users do on the Google platform and a huge part of that is the trust built by Apple with their users. You can go into the Google Play store (which most people would think was the "official" and "safe" method of getting apps) and still get malware and/or a virus on your Android phone. Now imagine that Google offered both an official Play store and an alternative open Play store. Which do you think the majority of users would use and have a positive opinion of?
      - cgriswald 8y ago
baxtr 8y ago
I don’t think Apple sells you anything. You buy stuff from them. You are free as a bird to buy any other products you desire
dkonofalski 8y ago
That's not really a fair comparison since Apple has to curate the App Store and is 100% responsible for the service as well. It's not like you're buying an iPhone or iPad without knowing that all your apps come from the App Store and that's part of the value - unlike Android, you know exactly where the app is coming from, what it is and isn't allowed to do, and have an expectation that the app has been reasonably reviewed so it's not a danger to you or the device. Steam is almost exactly the same way because it's not like you can take your Steam purchase and use it without Steam. Yes, you can buy DLC and other add-ons directly from the publisher if you wanted to but that's moreso because of how the publishers have created their products rather than how Steam works as a platform. As for your Amazon example, Apple does absolutely add value there. They manage and keep track of all your purchases and payments so that there's a single, unified method for both paying and resolving issues. Additionally, since Apple functions as the payment processor, you're also paying for the security functionality. The only reason you have to make a purchase from the Amazon website is because Amazon wants to control the purchasing and doesn't want to pay Apple for their payment processing. It's just a difference of whether you prefer the consistency of the experience that Apple prefers at the expense of other companies or whether you prefer to deal with several different experiences that could potentially open everything up for fraud and problems. People who aren't as tech savvy or who don't want to have to wade through a bunch of BS just to make a purchase may prefer Apple's method. Others may prefer digging through and doing all that in order to have a broader pool to choose from.
- ApostleMatthew 8y ago
  I think your first paragraph is a result of you viewing this from the perspective of someone knowledgeable about technology. The vast majority of people using Android phones get their apps exclusively from the Play Store and assume Android is exactly the same as iOS in that way.
scarface74 8y ago
Apple sells me a locked down hardware platform that requires me to go through them for all software purchases and all data purchases made with that software. A. You can choose to buy an Android phone like 80%+ of the smart phone world. B. You can buy content outside of the Apple store and use it within the app (Amazon, Udemy, Spotify, Google Play Music, every video streaming service, etc.) It seems unreasonable to me that Apple should get a cut of my Amazon Video purchases. They don't, in fact you can't buy Amazon content within the app.
- mrep 8y ago
  Amazon does not offer you the option because the only way they could offer it is if they gave Apple their 30% cut. Same super annoying reason you cannot buy books in the kindle app.
scentedmeat 8y ago
> Apple adds no value there I like having all my subscriptions in the same place so I can easily see what I'm paying and cancel.

ben_jones 8y ago

I don't know if you have a "fair" argument here. Who needs that 30% more Apple or an independent app developer? Though the same could be said for Valve, at least it's the purpose of Valve where apple sells computing devices not software as their core enterprise.

tonyedgecombe 8y ago

30% seems a lot when BlueSnap/Avangate/FastSpring provide most of the same services for 6-8%. Of course Apple would argue that they are connecting you to their customers. When there are a million apps in the store I'm not sure how true that is.

Spivak 8y ago
But Apple's customer base is more valuable, which is why people still publish there despite the cost. Apple and Google aren't selling infrastructure, they're selling an audience.
- tonyedgecombe 8y ago
  That's fine, it makes sense to me that you would develop for Apple before Android because those customers are more affluent and willing to spend on software. However I question whether the App Store is connecting you to those customers in any meaningful way when there is so much competition in there. Sure if you are lucky enough to get to the front page then you can do OK but most don't.
VikingCoder 8y ago
BlueSnap/Avangate/FastSpring develop a free OS that's used by 85% of the smartphones in the world? The fee is paying towards the development of Android. Your comparison of "same services" isn't remotely valid.
- tonyedgecombe 8y ago
  Is it? I though Android was subsidised by advertising.
chipotle_coyote 8y ago
Apple also has a large and growing editorial staff writing articles and highlights for their App Store; it's virtually becoming a house magazine. So being in their store potentially offers exposure and marketing for free that's immensely valuable. (Whether it's 30% valuable is debatable, of course. Personally I think they should drop it from 15%/30% to 10%/20%, but "Apple: always more expensive than you think they should be" has worked for them for a long time.)

javagram 8y ago

Valve takes 30% of direct sales through steam but allows developers to generate and sell separately steam keys where they get a 0% cut, as I understand it. For instance when you buy a game on humble bundle and get a steam key for it, valve makes nothing off that transaction. Unless Apple and google start allowing sales outside their stores I don’t think steam is comparable.

pitaj 8y ago
Google Play and the Apple App Store are completely different beasts. Unless you jailbreak your iOS device, there is no way to install apps outside the App Store. On Android, you can install entirely separate stores, like the Amazon one, and several OSS-focused stores.
- DINKDINK 8y ago
  >Unless you jailbreak your iOS device, there is no way to install apps outside the App Store Technically this is not correct. Practically it is. You can install Apps on iOS devices without the app store (called sideloading, and it's a PITA): https://beebom.com/how-to-sideload-apps-iphone-ios-10-without-jailbreak/ https://beebom.com/how-to-sideload-apps-iphone-ios-10-withou...
- DerDangDerDang 8y ago
  That’s not completely true, as I understand it. You can (or could a couple of years ago) get an ‘enterprise’ developer account that allows you to sign and provision apps to be sideloaded via a web link. Though iirc it’s more hassle for the end user as they have to explicitly allow it on their device.
  - jsjohnst 8y ago
    DINKDINK’s reply above is more relevant. If you try using an enterprise cert to allow general public users to install your app you’ll quickly lose your enterprise cert. The enterprise cert is only to be used for internal company apps.
8y ago

Spivak 8y ago

Keep in mind that the price they charge doesn't really have anything to do with the actual infrastructure despite the costs. They're not selling infrastructure, they're selling access to an audience no different than really any other publisher.

deleted 8y ago

[deleted]

mywittyname 8y ago

Valve has several big competitors in the PC market. Several hugely successful games are not available on Steam. I'm not sure it's possible to create a hugely successful iPhone app that isn't on the App Store. Apple has a monopoly and is using it to squeeze excessive fees from developers.

colechristensen 8y ago
Using a monopoly to squeeze excessive fees that happen to be exactly the same as the fees for a competitive market? There seems to be a logic breakdown there.
- kemitche 8y ago
  A business making an app has one choice for delivering that app to iPhone users. The iPhone owners could choose to switch to Android, but that's not a choice the business can make for the consumer. The business could choose to launch on Android only, and hope that convinces consumers to switch, but that's about it for options.
- mywittyname 8y ago
  There's no logic breakdown at all: publishers can get better terms by going with an competitor to Steam, such as GMG, GoG, Origin, Microsoft Store, or just release the app on their own website/platform. It's functionally impossible to release an app on iOS without paying Apple. Compared to the 0% of self-publishing, Apple's fees are excessive.
  - dkonofalski 8y ago
    Sure, they can get better terms going through a competitor but then they don't get any of the value or services that Steam offers. They're paying a percentage to make use of all the benefits you get through Steam both as a company and for the end-users. Apple's fees aren't excessive because they offer their services and provide their value to every app published through their store. Yes, they could offer a way to publish the app without those features and not charge the fee but that would further complicate the experience for users. I mean, technically, companies are absolutely allowed to host apps for users to side load themselves. It's just that no one wants to do that because it's not worth it when the costs Apple are taking are actually reasonable.

stefan_ 8y ago

The modern marvel that are credit cards or debit cards run at low single digit percentages. And they are getting a ton of margin out of those; so much that in the EU, they capped fees at 0.3%. And those transaction fees actually pay for something, like customer protection, SLAs (not a shitty status site) and no, the credit card company doesn't add unskippable ads on top of the checkout process or advertise a scam clone version of what you are trying to buy to you. You tell me if the app store fees provide 100x as much.

toasterlovin 8y ago
In your analogy, the App Store is the store, not the credit card terminal. As somebody who sells on Amazon, I can tell you that they take more than 30% of what the customer pays.

jliptzin 8y ago

The problem is it's clearly a monopoly (or duopoly). How did they settle on 30%? Why did Apple and Google come to the same 30% number - is that a coincidence? They could easily provide the same service for less than 1/3 of the cost, but the percent never budges because it doesn't have to. There's zero competitive pressure. In fact they could move it up to 60% if they want to with nothing stopping them. Some people have managed to build a business on these app stores but in my opinion they should only be leveraged as part of an existing independent business, otherwise you're building a business on quicksand.

jimbokun 8y ago
"Why did Apple and Google come to the same 30% number - is that a coincidence?" Google copied Apple?
- iainmerrick 8y ago
  Right. If this were a competitive market, they'd both be constantly refining their cut to find the optimal value. In practice the 30% was plucked out of the air and has never been changed.

akshat_h 8y ago

Does Steam take a cut for in game purchases? I think the major issue here is with companies having app stores inside app store. All the companies mentioned i.e Amazon, Steam seem to allow in-app purchases at a scale quite different than normal apps. It does seem weird that if I am purchasing an item through Steam's app store, Steam has to pay Apple. I mean it would be like Amazon paying Apple a cut, if I buy a TV from amazon. AFAIK, it is only for digital goods that Apple charges, but I am not sure how the demarcation works. On the flip side, if Apple/Google allow any app to use in-app purchases without a commission, then all apps will use in-app purchases for everything.

cma 8y ago
> Does Steam take a cut for in game purchases? Yes. That's why they cut out remote control purchasing feature from their iOS app, to avoid hypocrisy charges and to avoid the sticky situation where a steam app tried the same (letting you make microtransaction purchases by remoting in to your phone or something). Same as why Epic dropped their marketplace cut down from 30% something like one week before their "30% is unfair" press campaign which in turn was used to take the spotlight off criticism of Fortnite's release on Android as a timed exclusive with Samsung's new flagship.

kodablah 8y ago

> Doesn't Valve take 30% from games on Steam? But they're complaining Apple taking 30% is too much? They're complaining Apple is taking too much without alternative. If the app store provided 30% worth of value, it would be voluntarily chosen like Steam is. Why derail with such a ridiculous equivalence?

Steko 8y ago

People keep saying Apple adds no value but bringing millions of paying customers and a trusted storefront does in fact have lots of value for most apps. This is exactly the value Steam brings on PC. Being locked down or not is a red herring to the value argument, people sell on Steam because of simple math: the millions of additional paying customers outweighs the commission Valve demands.

pascalxus 8y ago
Yes, but there comes a point when it just becomes rent seeking. It's digital nature for there to be one portal that leads you to everything.
binomialxenon 8y ago
Valve has competitors in the PC games storefront market. On iOS, there is (for all practical reasons) no other storefront. People would be stuck on the App Store even if they were to charge something ridiculous like 50%, because there's no where else to go.
- dkonofalski 8y ago
  Yes, but if that were the case, there would be no apps on the App Store.
- Steko 8y ago
  > Valve has competitors in the PC games storefront market. On iOS, there is (for all practical reasons) no other storefront. Predictably, this is where the goalposts have moved[1] but it's really orthogonal to whether there's value or not. Also as pointed out elsewhere, Steam is in a competitive market and charges the same commission. Also in Apple's favor is the well attested to value of the App Store vs Google Play and others in terms of raw revenue. [1] 'Predictably' as in "Being locked down or not is a red herring to the value argument" in grandparent
- bigmit37 8y ago
  I’m surprised there is no backlash from independent iOS developers. Not only do they have 30% taken away, they have the yearly $100 fee,they need expensive Apple products to make the app, apps have be priced low because consumers expect low priced amazing apps. Then you have to market the app to stand out.

apersona 8y ago

What? They're complaining about Valve too. Bethesda, for example, recently announced that they're launching Fallout 76 on their own personal launcher (https://arstechnica.com/gaming/2018/08/fallout-76s-pc-version-will-skip-steam-requires-bethesda-net-launcher/ https://arstechnica.com/gaming/2018/08/fallout-76s-pc-versio...). I've noticed this trend in the game industry. Any game company that is large enough will work on their own launcher (look at Blizzard, Epic Games, EA, etc.)

ashelmire 8y ago

Don't Apple and Google take 30% of all in-app sales as well? It's like your phone and internet company saying, "Well, guess we're gonna take 30% of all business you do over the phone or internet" or your rental company demanding 30% of your income.

tw04 8y ago

If every app I downloaded were several to several 10s of gigabytes of data, I might be more inclined to cut them some slack. 30% on a 5MB download is pretty tough to justify. The cost of storing and transferring that file is a rounding error.

zaroth 8y ago
What makes you think the 30% cut is to pay for the bandwidth of the file transfer? The entire platform the app runs on was created by Apple. The hardware, the OS, the programming language, the SDKs. Thousands of APIs used to build the apps, maybe a million pages of documentation on those APIs. All the toolchain to develop, build, test, and deploy apps for purchase in hundreds of countries including customer profiles, billing, and support. Billions of dollars of iCloud infrastructure for backend services to support everything from push notifications, data sync, backup, automatic updates, etc. Then you get into the actual app store and you have all the work that went into the UX there for discovering, installing, buying and reviewing apps. In-app purchases and subscription services to support different business models. Family sharing, parental controls, parental approval requirements for kids’ phones. I could go on for hours and probably still miss huge swaths of functionality that Apple invested millions of dollars into, just so that you could pull up chair and with a few lines of code start writing an app that can reach billions of devices. Not to mention all the marketing and training and support Apple does to prime their customers to be big users of the App Store. Yeah, and the bandwidth to download the app as well. Personally I think 30% is a steal for what you get in return. Oh, and I’ll just add one more thing; you can distribute your app for free and you pay Apple nothing (or nearly nothing) for the benefit of all their hard work and infrastructure and support.

radley 8y ago

> But for every big app there's something like 9 that fail completely Actually the ratio is more like 1 to 500k. There are millions of apps in both stores, but I'd bet less than 1000 make significant income exclusively from the app stores.

dkonofalski 8y ago

I agree. There's a lot that people take for granted with these App Stores, especially with Apple's. The alternative is to pass this cost onto the consumer instead and I think that's a terrible idea.

halo 8y ago

Many major PC games publishers and developers have chosen either to not to use Steam or have reduced their support including EA, Epic, Microsoft (including Mojang), Riot, Activision Blizzard and Bethesda.

OSTN 8y ago

>Doesn't Valve take 30% from games on Steam? But they're complaining Apple taking 30% is too much? Nobody is locked to valve on PC. Large game publishers have their own PC stores precisely to avoid getting ripped off by Valve. EA has Origin, Ubisoft has Uplay, Blizzard/Activision has Battle.net. MS has the Microsoft Store. There are many little indie stores with their own handling of profits, like itch.io : >itch.io costs nothing to use. You are free to create pages and upload your content without ever having to pay anything. Advertisements will never be placed on any of your pages. >You get to decide how much you want to support itch.io by choosing what percentage of your sales should go towards our operational costs and continued development of the platform. We call that open revenue sharing. Subscription MMORPGs also all have their own payment schemes and external launchers that bypass Valve's little greedy hands. Being locked to a single app store on any platform is a mistake. PCs are great because we don't suffer this, for now. Until MS decides to make Windows S the default and lock people from freely switching to a normal version of Windows.

forrestthewoods 8y ago

Steam’s 30% is also too high. There’s a reason the new Fallout 76 is skipping Steam and will be sold through a Bethesda launcher.