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Some people here seem to be responding to all of this inappropriately. The simple fact is that Apple is injecting itself as an intermediary in the payment proc

Some people here seem to be responding to all of this inappropriately. The simple fact is that Apple is injecting itself as an intermediary in the payment process and extracting a preposterously oversized commission for no meaningful added value. And it's easy to see that Apple knows what they're doing is wrong. They strictly prohibit developers from signaling that there's an extra cost for purchases made through Apple's system or that there are alternative payment options available. A well-informed consumer would be a clear threat to Apple's gravy train. This system should have never emerged to begin with. It's highly unethical and, given the direction things are taking [1], will likely be found in violation of antitrust laws. [1] https://techcrunch.com/2019/05/13/supreme-court-rules-against-apple-allowing-an-app-store-antitrust-case-to-proceed/ https://techcrunch.com/2019/05/13/supreme-court-rules-agains...

Despegar 6y ago
>The simple fact is that Apple is injecting itself as an intermediary in the payment process and extracting a comically oversized commission for no meaningful added value. Frankly anyone who says this with a straight face is being absurd. Apple's commission isn't for "payment processing", promotion, any particular API, or service they provide on their platform. That they do all of those things makes it an attractive place to develop for and sell your product, but it isn't the reason why they get to charge 30%. They charge 30% because they've amassed 1 billion extremely valuable users who are willing to spend money on apps in their marketplace.
- realtalk_sp 6y ago
  > They charge 30% because they've amassed 1 billion extremely valuable users who are willing to spend money on apps in their marketplace. Apps that are made up to 42% more expensive (NOTE: the 30% fee applies to all in-app purchases and the first year of subscriptions) in a way that's entirely opaque to those users. The fact that you think this is okay is the only thing I find absurd. You also seem like someone who is for some reason predisposed to be an apologist for Apple's monopolistic business practices. You certainly don't represent what would likely be the average/majority sentiment of Apple's customers, were they sufficiently informed.
  - Hamuko 6y ago
    >Apps that are made up to 42% more expensive Well, maybe not apps, but subscriptions surely.
  - Despegar 6y ago
    >You also seem like someone who is for some reason predisposed to be an apologist for Apple's monopolistic business practices. You certainly don't represent what would likely be the average/majority sentiment of Apple's customers, were they sufficiently informed. I'm willing to defend Apple because I'm tired of disingenuous arguments from either parties with self-interest or FOSS advocates who have some ideological opposition to Apple's closed nature (and have since the beginning of the App Store and decades before that with Macs). Apple's customers don't care about the margin structure or costs of app developers. The App Store has massively increased both the supply and demand for apps, and it has actually led to a decline in prices for software. Everyone knows this because they've been complaining about how they can't charge as much for apps as they did in the packaged software days.
    - donmcronald 6y ago
      I'm sure Apple's customers care about how much money they spend. That's the whole reason Apple strongarms developers into masking the higher cost of products delivered through Apple's app store. I don't know anyone who would like the idea of paying an extra 15-30% for a product because of a do nothing middleman that's managed to monopolize a portion of the market based on demand aggregation. It's literally the definition of what I've always understood anti-trust to be. Apple is using their domination in the phone market to manipulate the software distribution market. The current tech companies (all of them) make 90s Microsoft look like a charitable organization. It's unbelievable to wander around the internet and see so many people advocating for systems that are terrible for the average consumer. Wealth inequality seems to have an inverse relationship with average intelligence.
    - kelnos 6y ago
      If Apple doesn't think their customers care about the Apple Tax, then why do they structure their rules such that app developers can't even hint that the customer might be able to pay a lower price by signing up on their website? Seems like Apple is afraid if they allowed that, customers would spend a lot less through Apple's payments platform.
- ac29 6y ago
  > They charge 30% because they've amassed 1 billion extremely valuable users who are willing to spend money on apps in their marketplace. This is almost the textbook definition of extortion. "Hey, wouldn't it be a shame if you lost access to all these potential customers? You better give us 30% of your revenue."
  - Uw7yTcf36gTc 6y ago
    You are paying to access the pool of customers. You never had the pool to begin with so you aren’t paying to not “lose access”.
    - lostmsu 6y ago
      Arguably, that's not true for a typical mail service.
    - basch 6y ago
      This makes it seem like they are apples customers to give, vs the entire population of the world who has a choice between apple or android phones, or not having a phone.
    - ac29 6y ago
      Imagine there was a certain kind of fuel required for all cars made by a certain manufacturer, and that manufacturer used DRM to restrict which companies could sell fuel to the car. In order to fuel the car, the manufacturer requires 30% of the fueler's revenue to authorize fueling. They provide no services for this fee aside from payment processing. Now imagine that that car company has 50% of the car market, and their only competitor is similar. Does this seem wrong?
_jal 6y ago
I don't disagree. But you do realize you could also be describing the credit card market?
- nrmitchi 6y ago
  I think most people understand that the parent could be describing credit card markets, and I don't think that anyone is trying to make the case that credit card companies don't also take anti-competitive actions. But the typical credit card fee is ~3%, which is literally an order of magnitude less, and Visa/Mastercard/etc also don't prohibit their merchants from accepting other forms of payment.
  - scarface74 6y ago
    What’s the typical markup between wholesale and retail? How much does every single digital store charge - including the console makers?
    - donmcronald 6y ago
      You seem to know a lot about it. How do the fees / costs work in the console market?
      - scarface74 6y ago
        Microsoft charges 30% for Xbox games. The link also mentions Windows store fees that are a lot cheaper. https://9to5mac.com/2019/03/06/microsoft-store-revenue-share/ https://9to5mac.com/2019/03/06/microsoft-store-revenue-share... As far as physical stores, the publisher gets $27 out of the $60 for a typical game. The console maker gets $7 out of the $60. I’ve seen this sane chart other places. https://www.quora.com/How-much-do-game-companies-make-from-each-game-they-sell-if-each-game-costs-60-dollars https://www.quora.com/How-much-do-game-companies-make-from-e...
        donmcronald 6y ago
scarface74 6y ago
The simple fact is that Apple is injecting itself as an intermediary in the payment process and extracting a preposterously oversized commission for no meaningful added value. You mean like every retail store - digital and physical?
- realtalk_sp 6y ago
  You're describing stores that exist in a competitive ecosystem with price variation. The analogy breaks down because "buyers of products" doesn't map one-to-one with "owners of iPhones" and because distribution of physical goods actually has significant costs. Assuming you are in fact in the tech industry, you should know that near-zero marginal distribution cost is one of the core principles underpinning software economics. I'm also not arguing that Apple shouldn't pass some of the costs it incurs to provide apps (e.g. APN, engineering costs, etc) on to developers and by extension on to consumers. But it should be priced fairly and transparently. A flat 30% fee without the ability to itemize that for customers or signal the existence of alternative payment methods is just wanton, nefarious extortion. The 'right' solution would be to charge a specific, itemized "Apple device usage fee" that's separate from and in addition to the primary fee for a service itself. Apple deserves to take a portion of revenue specific to the provision of a service to its users. I can't see an argument where it deserves to take a portion of all revenue developers receive. But Apple is not permitting this because it would pull back the curtain on their rapacious practices and their customers, having already paid a significant amount of money for their devices, would almost certainly be quite angry about it. Spotify is a good example of the distortion occurring because of this misguided system. They're charging customers $12.99 if they subscribe through the App Store instead of the $9.99 they would pay outside of it for exactly the same service. So, right now, some Spotify customers are being needlessly pillaged by Apple when, unbeknownst to them, they could get the same exact service at less cost. Spotify apparently had plans to email affected subscribers to alert them about this nonsense situation, but I don't know what became of that.
  - scarface74 6y ago
    Let’s talk about console makers then..... How many stores actually “transparently” tell you their markup?
s800 6y ago
Anyone know what console makers charge developers these days? My experience is from several decades ago, and is comparable to what Apple charges in its store.
- bilbo0s 6y ago
  But is that unethical as well? I mean, this story happens to be about Apple, but obviously other retailers could be, (obviously are), engaging in the same practice.
- dogma1138 6y ago
  Depending on the developer / publisher but the standard deal is about the same. Same goes for Steam.
  - vertis 6y ago
    Steam is a counterexample though. You don't have to deliver your PC game through Steam, and many of the big publishers have opted not to. Both Apple and Steam provide discovery and network effects, which help to justify their cut, but, as Jason Fried mentioned[1], you can't opt-out of these discovery benefits with Apple. [1]:https://twitter.com/jasonfried/status/1273655616897273858?s=20 https://twitter.com/jasonfried/status/1273655616897273858?s=...
    - sebazzz 6y ago
      > You don't have to deliver your PC game through Steam, and many of the big publishers have opted not to. A better analogue would be that you download WoW free from Steam, then take a subscription at Blizzard. Does Steam allow that?
      - LatteLazy 6y ago
        I've uploaded 3rd party CD keys to steam and they've allowed me to download the game (multiple times) and stored my saves etc...

Despegar 6y ago

>The simple fact is that Apple is injecting itself as an intermediary in the payment process and extracting a comically oversized commission for no meaningful added value. Frankly anyone who says this with a straight face is being absurd. Apple's commission isn't for "payment processing", promotion, any particular API, or service they provide on their platform. That they do all of those things makes it an attractive place to develop for and sell your product, but it isn't the reason why they get to charge 30%. They charge 30% because they've amassed 1 billion extremely valuable users who are willing to spend money on apps in their marketplace.

realtalk_sp 6y ago
> They charge 30% because they've amassed 1 billion extremely valuable users who are willing to spend money on apps in their marketplace. Apps that are made up to 42% more expensive (NOTE: the 30% fee applies to all in-app purchases and the first year of subscriptions) in a way that's entirely opaque to those users. The fact that you think this is okay is the only thing I find absurd. You also seem like someone who is for some reason predisposed to be an apologist for Apple's monopolistic business practices. You certainly don't represent what would likely be the average/majority sentiment of Apple's customers, were they sufficiently informed.
- Hamuko 6y ago
  >Apps that are made up to 42% more expensive Well, maybe not apps, but subscriptions surely.
- Despegar 6y ago
  >You also seem like someone who is for some reason predisposed to be an apologist for Apple's monopolistic business practices. You certainly don't represent what would likely be the average/majority sentiment of Apple's customers, were they sufficiently informed. I'm willing to defend Apple because I'm tired of disingenuous arguments from either parties with self-interest or FOSS advocates who have some ideological opposition to Apple's closed nature (and have since the beginning of the App Store and decades before that with Macs). Apple's customers don't care about the margin structure or costs of app developers. The App Store has massively increased both the supply and demand for apps, and it has actually led to a decline in prices for software. Everyone knows this because they've been complaining about how they can't charge as much for apps as they did in the packaged software days.
  - donmcronald 6y ago
    I'm sure Apple's customers care about how much money they spend. That's the whole reason Apple strongarms developers into masking the higher cost of products delivered through Apple's app store. I don't know anyone who would like the idea of paying an extra 15-30% for a product because of a do nothing middleman that's managed to monopolize a portion of the market based on demand aggregation. It's literally the definition of what I've always understood anti-trust to be. Apple is using their domination in the phone market to manipulate the software distribution market. The current tech companies (all of them) make 90s Microsoft look like a charitable organization. It's unbelievable to wander around the internet and see so many people advocating for systems that are terrible for the average consumer. Wealth inequality seems to have an inverse relationship with average intelligence.
  - kelnos 6y ago
    If Apple doesn't think their customers care about the Apple Tax, then why do they structure their rules such that app developers can't even hint that the customer might be able to pay a lower price by signing up on their website? Seems like Apple is afraid if they allowed that, customers would spend a lot less through Apple's payments platform.
ac29 6y ago
> They charge 30% because they've amassed 1 billion extremely valuable users who are willing to spend money on apps in their marketplace. This is almost the textbook definition of extortion. "Hey, wouldn't it be a shame if you lost access to all these potential customers? You better give us 30% of your revenue."
- Uw7yTcf36gTc 6y ago
  You are paying to access the pool of customers. You never had the pool to begin with so you aren’t paying to not “lose access”.
  - lostmsu 6y ago
    Arguably, that's not true for a typical mail service.
  - basch 6y ago
    This makes it seem like they are apples customers to give, vs the entire population of the world who has a choice between apple or android phones, or not having a phone.
  - ac29 6y ago
    Imagine there was a certain kind of fuel required for all cars made by a certain manufacturer, and that manufacturer used DRM to restrict which companies could sell fuel to the car. In order to fuel the car, the manufacturer requires 30% of the fueler's revenue to authorize fueling. They provide no services for this fee aside from payment processing. Now imagine that that car company has 50% of the car market, and their only competitor is similar. Does this seem wrong?

_jal 6y ago

I don't disagree. But you do realize you could also be describing the credit card market?

nrmitchi 6y ago
I think most people understand that the parent could be describing credit card markets, and I don't think that anyone is trying to make the case that credit card companies don't also take anti-competitive actions. But the typical credit card fee is ~3%, which is literally an order of magnitude less, and Visa/Mastercard/etc also don't prohibit their merchants from accepting other forms of payment.
- scarface74 6y ago
  What’s the typical markup between wholesale and retail? How much does every single digital store charge - including the console makers?
  - donmcronald 6y ago
    You seem to know a lot about it. How do the fees / costs work in the console market?
    - scarface74 6y ago
      Microsoft charges 30% for Xbox games. The link also mentions Windows store fees that are a lot cheaper. https://9to5mac.com/2019/03/06/microsoft-store-revenue-share/ https://9to5mac.com/2019/03/06/microsoft-store-revenue-share... As far as physical stores, the publisher gets $27 out of the $60 for a typical game. The console maker gets $7 out of the $60. I’ve seen this sane chart other places. https://www.quora.com/How-much-do-game-companies-make-from-each-game-they-sell-if-each-game-costs-60-dollars https://www.quora.com/How-much-do-game-companies-make-from-e...
      - donmcronald 6y ago

scarface74 6y ago

The simple fact is that Apple is injecting itself as an intermediary in the payment process and extracting a preposterously oversized commission for no meaningful added value. You mean like every retail store - digital and physical?

realtalk_sp 6y ago
You're describing stores that exist in a competitive ecosystem with price variation. The analogy breaks down because "buyers of products" doesn't map one-to-one with "owners of iPhones" and because distribution of physical goods actually has significant costs. Assuming you are in fact in the tech industry, you should know that near-zero marginal distribution cost is one of the core principles underpinning software economics. I'm also not arguing that Apple shouldn't pass some of the costs it incurs to provide apps (e.g. APN, engineering costs, etc) on to developers and by extension on to consumers. But it should be priced fairly and transparently. A flat 30% fee without the ability to itemize that for customers or signal the existence of alternative payment methods is just wanton, nefarious extortion. The 'right' solution would be to charge a specific, itemized "Apple device usage fee" that's separate from and in addition to the primary fee for a service itself. Apple deserves to take a portion of revenue specific to the provision of a service to its users. I can't see an argument where it deserves to take a portion of all revenue developers receive. But Apple is not permitting this because it would pull back the curtain on their rapacious practices and their customers, having already paid a significant amount of money for their devices, would almost certainly be quite angry about it. Spotify is a good example of the distortion occurring because of this misguided system. They're charging customers $12.99 if they subscribe through the App Store instead of the $9.99 they would pay outside of it for exactly the same service. So, right now, some Spotify customers are being needlessly pillaged by Apple when, unbeknownst to them, they could get the same exact service at less cost. Spotify apparently had plans to email affected subscribers to alert them about this nonsense situation, but I don't know what became of that.
- scarface74 6y ago
  Let’s talk about console makers then..... How many stores actually “transparently” tell you their markup?

s800 6y ago

Anyone know what console makers charge developers these days? My experience is from several decades ago, and is comparable to what Apple charges in its store.

bilbo0s 6y ago
But is that unethical as well? I mean, this story happens to be about Apple, but obviously other retailers could be, (obviously are), engaging in the same practice.
dogma1138 6y ago
Depending on the developer / publisher but the standard deal is about the same. Same goes for Steam.
- vertis 6y ago
  Steam is a counterexample though. You don't have to deliver your PC game through Steam, and many of the big publishers have opted not to. Both Apple and Steam provide discovery and network effects, which help to justify their cut, but, as Jason Fried mentioned[1], you can't opt-out of these discovery benefits with Apple. [1]:https://twitter.com/jasonfried/status/1273655616897273858?s=20 https://twitter.com/jasonfried/status/1273655616897273858?s=...
  - sebazzz 6y ago
    > You don't have to deliver your PC game through Steam, and many of the big publishers have opted not to. A better analogue would be that you download WoW free from Steam, then take a subscription at Blizzard. Does Steam allow that?
    - LatteLazy 6y ago
      I've uploaded 3rd party CD keys to steam and they've allowed me to download the game (multiple times) and stored my saves etc...