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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 g

by akashs 16y ago

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?

jfb 16y ago
I think you overstate the willingness of existing payment processors to deal with, say, .99$ purchases (they likely won't bother). I'm not arguing that Apple's providing a service that's worth 30% to everybody, but building a payment processing system to handle sub-$1 charges cost-effictively isn't trivial -- and if you're not in the business of building payment processing systems, you might just pay the rent. Amazon could handle rolling their own; Packt probably can't.
- timmaah 16y ago
  They would bother if they could get 30 cents on the dollar instead of their measly 2
zach 16y ago
I'm comparing it to a retail model. So I included sales but not advertising. Every retail outlet is different, and App Store purchasing has a very particular set of advantages. If you don't need those advantages, the App Store still provides a great value by letting consumers access your service through a free app. If neither of those work with a particular economic model, then I guess it's just not App Store compatible. So yeah, there's definitely room for a better model of app store that suits more developers. But I think Apple is more concerned with getting a broad selection of content than making the economics work.
- akashs 16y ago
  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.
  - zach 16y ago
    Pretty much. Apple is pretty well known for being a one-size-fits-most company. They don't seem interested in stretching to make things work out for certain sets of customers and potential partners, and it can seem maddening. And they always keep themselves in control wherever they reasonably can. It is their strength and their weakness. So far it's served them pretty well, but I agree it's not the ultimate model for an app store or a platform. It sure does seem to cover the most profitable surface area, though.

by akashs 16y ago

jfb 16y ago

I think you overstate the willingness of existing payment processors to deal with, say, .99$ purchases (they likely won't bother). I'm not arguing that Apple's providing a service that's worth 30% to everybody, but building a payment processing system to handle sub-$1 charges cost-effictively isn't trivial -- and if you're not in the business of building payment processing systems, you might just pay the rent. Amazon could handle rolling their own; Packt probably can't.

timmaah 16y ago
They would bother if they could get 30 cents on the dollar instead of their measly 2

zach 16y ago

I'm comparing it to a retail model. So I included sales but not advertising. Every retail outlet is different, and App Store purchasing has a very particular set of advantages. If you don't need those advantages, the App Store still provides a great value by letting consumers access your service through a free app. If neither of those work with a particular economic model, then I guess it's just not App Store compatible. So yeah, there's definitely room for a better model of app store that suits more developers. But I think Apple is more concerned with getting a broad selection of content than making the economics work.

akashs 16y ago
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.
- zach 16y ago
  Pretty much. Apple is pretty well known for being a one-size-fits-most company. They don't seem interested in stretching to make things work out for certain sets of customers and potential partners, and it can seem maddening. And they always keep themselves in control wherever they reasonably can. It is their strength and their weakness. So far it's served them pretty well, but I agree it's not the ultimate model for an app store or a platform. It sure does seem to cover the most profitable surface area, though.