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To clarify, Apple takes 30% of in-app subscriptions for customers < 1 year. If you retain a customer for a year, then they take 15% of the revenue after 1 year.

To clarify, Apple takes 30% of in-app subscriptions for customers < 1 year. If you retain a customer for a year, then they take 15% of the revenue after 1 year. If a customer signs up and setups payment for the service outside the app, then Apple doesn't take a cut. That's why you can't buy books in the Audible iOS app, or subscribe to Netflix via the iOS app. But you can login and watch/listen to content you've already bought or subscribed to.

teruakohatu 7y ago
What is the justification for the 30% in year one, Apple's costs don't halve after one year? Sounds like they are simply hurting competitors profitability.
- e_y_ 7y ago
  I think their argument is that they're providing you exposure through the App Store, so they deserve a referral fee for maintaining the App Store, reviewing apps, etc. Normally, user acquisition (getting a user to even think about installing your app the first time) is much more expensive than maintaining a subscription -- also why so many companies are pushing subscription models -- so Apple probably considers it to be worth more. There's also a higher risk of fraudulent purchases or refunds (and associated support costs) for the initial purchase than a subscription. In the past, developers were prohibited from telling users that they could sign up cheaper on your website, allegedly to avoid user confusion; I think it was relaxed somewhat so I don't know if it's still the case. Of course the main reason why they charge 30% for the first year is because they can, and the reason they charge 15% after that is because app/content developers have been starting to gripe about it (probably after realizing they need to make a profit and can't live entirely off VC money). It has little to no relation to how much it actually costs Apple. There's no justification for why it takes a year to get the reduced rate, instead of something like 2 months.
- lotsofpulp 7y ago
  What is the justification for a doctor making $500k? For a programmer making $500k? For a hotel maid making $30k? Supply and demand. Same with the App Store.
- monkin 7y ago
  Justification is the same as Google's: https://support.google.com/googleplay/android-developer/answer/112622?hl=en https://support.google.com/googleplay/android-developer/answ... I really don't get why everyone is bashing Apple for this like everyone else is doing the same thing. Yes, we can argue about openness of Google Play Store, but it's also full of malware, crapware, shitware and other BADware. ;)
- simonh 7y ago
  Apple makes no distinction between companies on it's platform that compete with it and those that do not, they are all treated the same, so it's hard to see an argument that this is mainly targeted at their competitors holding water. Furthermore e.g. Apple does compete with Amazon kindle store on the Apple platform, but Google doesn't compete with AMamzon yet imposes almost identical terms on the Amamzon kindle store on Android. So if it's ok for Google to apply those terms on Android, why is it not ok for Apple to apply those terms on iOS? This whole line of reasoning simply doesn't make a lick of sense. If it is reasonable for Apple to charge companies on their platform at all, then the evidence in the market is that their current charges are competitive and reasonable.
  - ajscanlan 7y ago
    > Apple makes no distinction between companies on it's platform that compete with it and those that do not, they are all treated the same, so it's hard to see an argument that this is mainly targeted at their competitors holding water. There was that story last year about them ranking their own apps above competing 3rd party apps when searching. https://www.wsj.com/articles/apple-dominates-app-store-search-results-thwarting-competitors-11563897221 https://www.wsj.com/articles/apple-dominates-app-store-searc...
    - simonh 7y ago
      Yep that was pretty skeevey, I’m glad they were held to account and stopped that, but it’s actually nothing to do with the point about not treating individual third parties differently.

teruakohatu 7y ago

What is the justification for the 30% in year one, Apple's costs don't halve after one year? Sounds like they are simply hurting competitors profitability.

e_y_ 7y ago
I think their argument is that they're providing you exposure through the App Store, so they deserve a referral fee for maintaining the App Store, reviewing apps, etc. Normally, user acquisition (getting a user to even think about installing your app the first time) is much more expensive than maintaining a subscription -- also why so many companies are pushing subscription models -- so Apple probably considers it to be worth more. There's also a higher risk of fraudulent purchases or refunds (and associated support costs) for the initial purchase than a subscription. In the past, developers were prohibited from telling users that they could sign up cheaper on your website, allegedly to avoid user confusion; I think it was relaxed somewhat so I don't know if it's still the case. Of course the main reason why they charge 30% for the first year is because they can, and the reason they charge 15% after that is because app/content developers have been starting to gripe about it (probably after realizing they need to make a profit and can't live entirely off VC money). It has little to no relation to how much it actually costs Apple. There's no justification for why it takes a year to get the reduced rate, instead of something like 2 months.
lotsofpulp 7y ago
What is the justification for a doctor making $500k? For a programmer making $500k? For a hotel maid making $30k? Supply and demand. Same with the App Store.
monkin 7y ago
Justification is the same as Google's: https://support.google.com/googleplay/android-developer/answer/112622?hl=en https://support.google.com/googleplay/android-developer/answ... I really don't get why everyone is bashing Apple for this like everyone else is doing the same thing. Yes, we can argue about openness of Google Play Store, but it's also full of malware, crapware, shitware and other BADware. ;)
simonh 7y ago
Apple makes no distinction between companies on it's platform that compete with it and those that do not, they are all treated the same, so it's hard to see an argument that this is mainly targeted at their competitors holding water. Furthermore e.g. Apple does compete with Amazon kindle store on the Apple platform, but Google doesn't compete with AMamzon yet imposes almost identical terms on the Amamzon kindle store on Android. So if it's ok for Google to apply those terms on Android, why is it not ok for Apple to apply those terms on iOS? This whole line of reasoning simply doesn't make a lick of sense. If it is reasonable for Apple to charge companies on their platform at all, then the evidence in the market is that their current charges are competitive and reasonable.
- ajscanlan 7y ago
  > Apple makes no distinction between companies on it's platform that compete with it and those that do not, they are all treated the same, so it's hard to see an argument that this is mainly targeted at their competitors holding water. There was that story last year about them ranking their own apps above competing 3rd party apps when searching. https://www.wsj.com/articles/apple-dominates-app-store-search-results-thwarting-competitors-11563897221 https://www.wsj.com/articles/apple-dominates-app-store-searc...
  - simonh 7y ago
    Yep that was pretty skeevey, I’m glad they were held to account and stopped that, but it’s actually nothing to do with the point about not treating individual third parties differently.