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When a customer refunds your paid app, Apple refunds its 30% cut [edited]

1243 points by tomduncalf 6y ago

bena 6y ago
I don't think the issue is that Apple is keeping its fee even with a return. That on some level is fair. They are providing a service to the developer. The bigger question is whether their cut should be 30% in the first place. 30% was chosen by the first store of this type and it's just never been questioned by platforms. I just read that Valve recently changed their agreement to be a sliding scale based on sales (30% to start, falling to 20% if you hit certain numbers). But as far as I know, Microsoft, Sony, Apple, and Google all do a 30/70 split on digital sales.
- sukilot 6y ago
  > all do a 30/70 split on digital sales. Consistency which is only possible in an environment of collusion.
  - dogma1138 6y ago
    Not as much collusion as simply lack of competition. You don’t have any other options for most of their respective platform and there isn’t enough incentive to compete on the pricing. Also even when there is competition there are rules that prevent you from lowering pricing in one store vs the other (there are some exceptions) so if you end up say selling a game on the PC and you set the retail price as $60 and you launch it on 3 different digital content distribution platforms while you might make more money on one platform than the other there is no difference for the end consumer so there isn’t an actual competitive incentive to reduce your cut as a digital distributor unless you think you can get an exclusivity deal.
    - bena 6y ago
      Yeah, I wouldn't call it out and out collusion. If the first store did 20%, it's likely all the stores would have followed suit on that price point. 30% is likely the most they can take that people will tolerate.
      - wolco 6y ago
        They could take 70% or 95% and there will still be posts saying that the market is 3.5 billion people and 5% isn't bad because Apple/Google do all of the marketing.
        meed2000 6y ago
        Please, be careful throwing this kind of idea out there, people at Apple/Google, who obviously have run out of ideas long ago, may be reading this.
- Marsymars 6y ago
  Other than games, MS is a 15/85 (or 5/95 split if the customer purchases via following a deep link from the publisher’s site or app) split on digital sales.
jbob2000 6y ago
Well yeah, I still need to pay shipping for amazon to send me a product even if I need to return it because it's broken. I would have no product to return if I did not pay for the shipping to receive the product. Apple would justify that 30% being non-refundable by saying "you would have never had that client to refund if you did not give us that 30%". They did their job, they got you the client, you were the one who did the bad job and made the client pursue a refund. You pay a toll to cross a bridge, but it turns out to be the wrong bridge. You don't get your toll back, you still crossed the bridge.
- samfisher83 6y ago
  Except apple's marginal cost like 0.
  - ebg13 6y ago
    Marginal cost is often not a good way to evaluate things. A person who focuses only on marginal cost will say "It only took you an hour to make that" while discounting the decades of training it took to be able to. A person who focuses only on marginal cost will say "I could have made this at home" while discounting the reasons why they didn't. Prices relate to provided value, not just cost.
    - sukilot 6y ago
      How much value is provided for a refund?
      - ebg13 6y ago
        The amount refunded minus the continuing value to the user of the returned product (absent the value already extracted from the product by the user), of course.
  - glofish 6y ago
    That is not the right reason to refund. Price should have nothing to do with marginal costs. it has to do with who is being made to carry the cost, and the griefing that can occur that way. Not worth the trouble IMHO.
gregoriol 6y ago
Not saying it's exactly the same situation, but Stripe keeps their fees when you refund a payment
- gerbal 6y ago
  This is also common for most credit card processors. But keeping 3% is very different from 30%
- dawnerd 6y ago
  It’s pretty common across the board. 30% is really high for sure, but payment processors gotta get paid at some point. I think Apple should split the fee up. Make a portion what they charge for processing payments and the rest their commission.
  - glofish 6y ago
    correct, there is a huge difference between taking 3% and 30% one is the cost of doing business, the other is predatory
    - briandear 6y ago
      You aren’t required to sell apps for Apple platforms. Has anyone even looked at what it takes to make and sell console games? Do you know how much manufacturers earn on products sold in grocery stores? Far less than 50% of the retail price. When distributors are involved, it’s even less. The company that makes a bar of soap might get paid $1, the distributor gets $1 and the retailer sells it for $3 and has the right to return unsold product. And shipping costs aren’t included in these amounts. The manufacturer gets $1 but also has to pay shipping to the distributor. People complaining about 30% have no idea how real world businesses operate. They are in some kind of fantasyland. Don’t forget, the App Store also handles your worldwide sales tax payments, fraud protection, chargebacks, hosting, distribution, your storefront, your payment processing and gives you worldwide availability for your app in the specific local currencies. If those services aren’t of value to you, then don’t sell apps for iOS. Certainly Windows Phone has some users, or perhaps create your own device and ecosystem that offers terms you find more amenable. This is Hacker News, not crybaby news: you don’t like the status quo, then get some friends, start making a better system, raise some money, then compete. If you think 30% is predatory, then make a system that only charges $what_you_think_is_fair. As far as Stripe, they take more than 3%. And for connect accounts, the percentage is closer to 3.5% not to mention you get charged $15 or $20 for a chargeback. What’s Apple charge developers for chargebacks? Zero. How often do developers have to challenge chargebacks with Apple? Zero. If you are selling using Stripe, it can become a significant expense, depending on your industry, especially gaming. It’s my feeling that people complaining about 30% have no idea of the expense of “doing it themselves.”
lolsal 6y ago
Apple is taking a cut for providing the store itself, distribution, visibility, SDKs/frameworks, etc. Why would they refund 30%?
- symkat 6y ago
  Because the customer is getting a refund because they're asking Apple to unwind the transaction. Apple makes the customer whole, Apple makes Apple more than whole, and Apple makes the developer less than whole.
- raverbashing 6y ago
  Developers do have to pay an yearly fee to just be an iOS developer, so the argument that's because of the SDKs is incorrect
  - lolsal 6y ago
    Ok, what about everything else I said? Like distribution? Millions of users?
- onion2k 6y ago
  Why would they refund 30%? Because they can afford it, and it's the right thing to do both ethically and morally.
  - deleted 6y ago
    [deleted]
  - lolsal 6y ago
    Why is it the right thing to do morally and ethically? Didn't they earn that money?
    - onion2k 6y ago
      If you went and bought a new car for $50,000 and then needed to return it and get a refund you wouldn't be very happy if the dealer gave you $45,000 back and said "Sorry, the salesperson gets to keep their commission. They earned that money." The dealer wouldn't be very happy if the salesperson said "No, I'm keeping my $5,000. I did my part and I earned that money." If there's a refund then everyone gives their part of the money back. Apple were part of the transaction, so if there's a refund they should return the money they earned. They can't just ignore the customer's wishes to get the money back, and they can't just pass the loss on to the developer. Neither would be fair.
wlesieutre 6y ago
Does this mean if there's a developer I don't like, I can buy their stuff and refund it to arbitrarily cost them money at no cost to myself and there's nothing they can do about it? That seems ... not great, especially these days. What happens when mobs of internet morons decide review bombing isn't sufficient and realize Apple will help them cause direct financial harm instead?
- zamadatix 6y ago
  If you do this often Apple will ban your account. If you don't do this often it's not a problem.
  - ejolto 6y ago
    What if you have a big Twitter following and ask them to do it?
    - SllX 6y ago
      Sounds like a lawsuit in the making if the harm is great enough.
      - vageli 6y ago
        What laws would be broken in this case?
        jfk13 6y ago
        Something about conspiracy to defraud, maybe?
        vageli 6y ago
        How is that fraud? "Everyone, buy this product and return it to the store for a full refund," doesn't sound like fraud to me. It doesn't result in personal or financial gain to the people perpetrating it, either. edit: so who is in trouble here? The person calling for people to do it with their twitter following or the twitter followers? I'm not saying that buying the app and returning it is not fraud if you entered into the transaction in bad faith and with intent to cause damage to the dev, I'm saying calling people to do that is not fraud.
bronzeage 6y ago
App stores need heavy regulations. It's not only Apple but Google and even steam to a small extent. Apple is of course the biggest offender as they heavily guard their monopoly with code signing enforcement. This shouldn't have been legal. They are the very definitions of predatory competition squashing monopolies.
- ryanlol 6y ago
  Why do app stores need separate regulations? > They are the very definitions of predatory competition squashing monopolies. But they aren’t, this is a rather competitive space.
  - bronzeage 6y ago
    The stock market is heavily regulated. Commodity markets are regulated. It's actually the slowness and corruption of the law makers that we're still without any regulations to virtual markets.
    - ryanlol 6y ago
      How are app stores like stock markets or commodity markets?
  - simion314 6y ago
    Competitive? How many places are where I can host a web page and how many app stores ? The ratio is probably much larger then 10000 : 1 .
  - _nalply 6y ago
    Competitive between developers and perhaps platforms but absolutely a monopoly for iOS.
    - ryanlol 6y ago
      This is as nonsensical as complaining about Disney having a monopoly in Disneyland.
monkey26 6y ago
This is unfortunate. I recently searched the App Store for “ssh tunnel” and Prompt 2 came up. I bought it without much thought as I heard about. Now I should have done my research but it doesn’t support tunneling or I couldn’t figure out. Some research told me that no iOS ssh client will. So I requested a refund and got it. In this case I think the blame was on Apple. Not the author of the app.
- Spooky23 6y ago
  I don’t know how you can blame either party. If my kid wants a dvd about beetles (the bugs), and I click on a Beatles (the band) documentary instead, that’s neither the seller or producers fault.
  - Brian_K_White 6y ago
    It's Apple's fault that they made a standard ssh feature impossible on ios, yet still allow apps to be called "ssh". No dvd player manufacturer created a dvd store where they sell dvds called "The Beatles" but every Beatles dvd is missing Ringo because their dvd store censors Ringo, but dvds are still named The Beatles.
    - Spooky23 6y ago
      So are you angry at the platform restrictions or the App Store? They are two different things.
oliverx0 6y ago
Seems fair to me. Apple provided with you a service and charged your for it. It is a cost associated with distributing / developing your product. Why should Apple be responsible for refunding you? It was not their fault that the customer decided their money back.
- weaksauce 6y ago
  No it’s not fair. This can be a tool that competitors use to hurt you financially. If the customer gets a refund the slate should be wiped clean. That’s fair.
  - oliverx0 6y ago
    It’s easy to think it’s fair because the cost to Apple is low. But in principle, let’s assume that it costs Apple a significant amount of money and effort to make the transaction happen, for which they charge you that 30%. Seems unfair then that Apple has to be held responsible for refunding a service they provided when it was not their fault the customer wanted the money back for your product.
    - sukilot 6y ago
      Obviously, assuming wildly false claims can lead to unreasonable conclusions.
- saagarjha 6y ago
  Apple prices the exact same things into hardware distribution too, but when you ask for your money back there they give it back in full, not minus the “service” they already provided you.
  - oliverx0 6y ago
    And I think that’s great! I just don’t think they need to be forced to do it. If I were Apple I would definitely refund. But I don’t agree that it should be an obligation for them to do it.
saagarjha 6y ago
“Sorry, we already spent it.”
toyg 6y ago
App Stores are doing to software developers what supermarkets did to food producers and most other manufacturers: moving all power and profit to distributors. It is somewhat ironic that so many people who helped so many other sectors disintermediate again (by building websites), are now busy actually intermediating their own.
- cblconfederate 6y ago
  The Web isn't. Sir TBL doesnt get a cut from your sales. Why developers even use the app stores baffles me 97% of user's time is spent using the 10 top mobile apps Average user downloads ~0 apps / month PC sales are up last year and more this year with COVID Who makes money?
  - sukilot 6y ago
    Apple actively blocks non-app-store apps.
  - oarsinsync 6y ago
    Assuming your numbers are accurate, 3% of users time is spent on non-top-10 apps. There are 3.5 billion smartphone users. [0] Smartphone usage statistics suggest that an average person spends 2 hours and 51 minutes per day on their mobile device. [1] This works out to a cumulative total of 3.6 trillion hours of use per year. 3% of that time is 109 billion hours a year in non-top-10 apps. You might not become a millionaire with your app being part of the 3%, but there's still real money there. [0] https://www.statista.com/statistics/330695/number-of-smartphone-users-worldwide/ https://www.statista.com/statistics/330695/number-of-smartph... [1] https://leftronic.com/smartphone-usage-statistics/ https://leftronic.com/smartphone-usage-statistics/
glofish 6y ago
Reading the thread here is an interesting datapoint: https://twitter.com/twolivesleft/status/1288491970248077314 https://twitter.com/twolivesleft/status/1288491970248077314 - Since 2011 Codea has had 1,768 refunds - Estimate it cost us ~$8,000 USD to pay Apple’s 30% - A single day in 2017 saw 193 returns and I have no idea why or how that’s possible later: > Yes, we’ve had a few days of negative revenue in the last few years due to people refunding Codea. Apple keeps their 30% no matter what
- deleted 6y ago
  [deleted]
bloomboom 6y ago
It’s amazing that a decade and a half later Apple still hasn’t fulfilled Steve Jobs’ original dream of merging the web and apps. He wasn’t saying third party apps should be HTML5 just to stall for time. He really believed it. And it was a good idea and still is. Processors, memory, bandwidth, and browsers have all advanced by leaps and bounds and yet the dream remains unrealized and Apple is the most to blame. They got addicted to the ill gotten gains of their walled garden and can’t bring themselves to kick the addiction. Rent seeking is a powerful force. It’s pathetic for a company so good at being honest with themselves and moving forward when they know what the best future is. The App Store shouldn’t exist at this point. It has outlived its usefulness. It’s in their users’ best interests to move beyond it. And yet maybe it’s too traumatic and daring a move for anyone other than Steve Jobs to attempt. Tim Cook could drop the headphone jack because it didn’t damage the bottom line but dropping the App Store would actually cost something in the short term even if it is the right thing to do for everyone in the long term.
- dimitrios1 6y ago
  > It’s amazing that a decade and a half later Apple still hasn’t fulfilled Steve Jobs’ original dream of merging the web and apps. Because Google exists, and is diametrically opposed to this vision. The past decade have shown constant examples of these two visions of the future clashing. Google wants more people on the internet. Apple wants more people on their devices.
- wolco 6y ago
  Apple has a history of pushing along after Steve left without any true vision until he returns. If anyone will return from the grave it's probably Steve. When he does he will probably VR Apple phones and we'll be in a new era.
- conductr 6y ago
  I think they were creating a walled garden and this was just lip service. Blaming it on state of tech/HTML5/etc was easy. The app store could be open from administration/censors and thus would function exactly like the web even if native code was required. The frustrating part of current state is they censor who, what, and how can be brought to market and the 30% cut is just egregious.
atarian 6y ago
I don't understand something here.. let's say I sold an app to someone for $100. 1. Someone pays me $100. 2. Apple takes 30%, so I only get $70. 3. Customer asks for refund and gets back $100. 4. Apple takes back the $70 from me. If Apple was skimming 30% off from the start, how does that affect me during a refund?
- sandyarmstrong 6y ago
  The tweet claims that step 4 is "Apples takes back $100 from me." So you have to cover Apple's share in the refund.
  - valuearb 6y ago
    The tweets claim is false.
    - marcinzm 6y ago
      This is Apple's US terms for developers of paid apps: > You shall reimburse, or grant Apple a credit for, an amount equal to the price for that subscription. Apple will have the right to retain its commission on the sale of that subscription, notwithstanding the refund of the price to the End-User. If you disagree, please cite a source.
      - xsmasher 6y ago
        Apple says they have that right, but I have not seen them do it. Here's apple deducting a refund from me in 2010, and the amount is exactly what they paid me. https://imgur.com/a/KwKlMXh https://imgur.com/a/KwKlMXh First screen shot is a week with one refund (-$1.40) and ten sales ($14.00 proceeds).
- FriendlyNormie 6y ago
  Relax and just go along with treating this random tweet like it’s proven to be undeniably true. We’re trying to form a libelous witch hunt against Apple to temporarily crash the stock price. Buy the dip in 30 minutes, friendo.
olliej 6y ago
What the hell?
chadlavi 6y ago
Payment processors generally don't refund fees on payments when the payments are refunded, this isn't new. It's remarkable mainly because (a) it's 30%, not 3% and (b) the App store doesn't position itself as a payments processor the way Stripe does, so it sounds really weird that they would act like one. If the app store took a 3% chunk and never refunded it regardless of the ongoing status of the transaction, that would put them right in line with other payment processors. It would also still net them billions of dollars, I think!
- seancoleman 6y ago
  Stripe does refund their fees with a transaction refund. I understand this may be novel for the payment processing industry though.
  - codegeek 6y ago
    No stripe doesn't. They used to but not for a while now. At least not for our SAAS business where we do close to 1M ARR. Am I missing something ? https://stripe.com/docs/refunds https://stripe.com/docs/refunds
    - Cerium 6y ago
      Same here, they used to but stopped about a year ago.
      - mattferderer 6y ago
        Ditto. Helping some non-profits, we were really hurt by people typo-ing a $10,000 donation when they meant to only donate $100. We quickly learned from that mistake. We also learned about how credit card thieves test credit cards. We saw hundreds of donation attempts. Stripe had us refund those that went threw, which costed us money in fees. Fortunately we were able to put some quick measures in place to stop them temporarily & then better measures for long term success.
        6y ago
cosmodisk 6y ago
It's not just Apple. Look at the state of business app stores: appExchange (Salesforce), Slack, Jira plugin marketplace,and so on. They are all milking as much as thry can.
cmurf 6y ago
Purchase: Customer pays $10. Apple keeps $3. Developer gets $7 Refund should be: Developer has $7 deducted from current owed "royalties" Apple refunds $10 to the customer. Is Apple actually taking $10 from the developer and giving it to the customer? That would be theft. The developer is not obligated to cover refunds beyond the profit/royalty they originally made on it.
- philipodonnell 6y ago
  > Is Apple actually taking $10 from the developer and giving it to the customer? That is exactly what is happening.
- RonanTheGrey 6y ago
  That's exactly what's happening. The developer actually loses 30% of the purchase price due to the refund (they are now 30% in the hole instead of break even). Frankly from my point of view this is criminal. We kept payments for our product outside the app for years, and now Apple closes that ability too, by forcing any app that accepts payments of any kind to also accept Apple Pay. We've had to basically hide the ability to find it in the app so that people will go to the website first. Apple seriously needs to be regulated.
conductr 6y ago
So, they do have an incentive to let the iTunes fraud continue. Seems like a couple times a year one of my families accounts is hacked, they spend $100s and we have to dispute. We get the money back but it's costly to the devs at 30%
- lukeramsden 6y ago
  I would assume fraud would be fully refunded, no? This is more about legitimate Apple-sanctioned returns, not fraudulent transactions. I may be wrong, but I hope I'm not lol
lupinglade 6y ago
It’s a mess. In many ways, the App Store is nothing but trouble for developers.
briandear 6y ago
Previous story from 2009: https://arstechnica.com/gadgets/2009/03/app-store-refunds-will-not-bankrupt-developers/ https://arstechnica.com/gadgets/2009/03/app-store-refunds-wi...
moogleii 6y ago
This policy apparently has been around since 2009: https://arstechnica.com/apple/news/2009/03/app-store-refunds-will-not-bankrupt-developers.ars https://arstechnica.com/apple/news/2009/03/app-store-refunds... Of note is that the developer "protection" clause in the 2009 version doesn't seem to be in the current version ("Otherwise, no refunds are available."): https://www.apple.com/legal/internet-services/itunes/us/terms.html https://www.apple.com/legal/internet-services/itunes/us/term... My memory is fuzzy, but I recall there was pressure from the EU? regarding lack of refunds, so I'm guessing this was Apple's adaptation. Regardless, it still clearly seems like the right thing to do is to refund the developer the 30%.
ikeboy 6y ago
Amazon does the same thing. You can lose more on a return than you make on a regular order. Amazon makes more on many orders than sellers do.
- ejo4041 6y ago
  Amazon FBA seller here. I came to look for the Amazon comment. Their returns are pretty messed up and hurt the sellers. Customer can return for any reason and the seller has to eat it. Often times it is very hard to track returns down if people return the wrong stuff. If it's broken or damaged, amazon will side with the customer 100% of the time. On top of all that, if you dispose of a damaged, non-sell-able item, they will list it in amazon warehouse, we agree to that in the TOS by having an FBA account. If someone knows how to work with their system better regarding returns, let me know.
  - meed2000 6y ago
    I stopped selling on Amazon nearly 10 years ago. FBA was a newly introduced feature which was the trigger for me see Amazon's disrespect for 3rd party sellers. They skim the seller for the sale (because they do the marketing for you). They skim on payment processing (it costs them less than they charge) They skim for exposure (ads are almost a must have to ever appear in search results). They then skim on delivery via FBA (they charge more than it costs them). And they skim on warehousing via FBA (the pricing was already unbelievable back then). Fast forward 10 years, they have started to skim sellers off their business analysis and risk taking effort (They have the data, and will compete with 3rd party sellers on products that sell decently enough, and even place their product before yours). I've recently taken the time to edited and publish a book that is in the public domain, on their KDP platform, a few days later I see that Amazon is selling that same book and even redirect customer clicks from my page description and book cover to their line item to buy. Amazon has no limit.
    - mthoms 6y ago
      >a few days later I see that Amazon is selling that same book and even redirect customer clicks from my page description and book cover to their line item to buy. Can you expand on this? I'm not sure what you mean exactly. Is Amazon redirecting direct links to your free book to a non-free version?
wslh 6y ago
I have mixed feelings about this and understand there are cases where it is unfair and where it is a fair penalty. I see the case where your child spend money via an in-app purchase in Roblox. Where The kid buys USD 1k in robux and the Roblox app never complain... Where we are using two factor authentication and all kind of measures to protect credit card purchases. So, I think you can blame Roblox or Apple for not adding these measures. This is like a dark pattern hidden in the "frictionless" payments via apps.
tomduncalf 6y ago
Had a look and it seems that Google do refund the transaction fee, which I think adds weight to the argument that is unfair behaviour by Apple: https://support.google.com/googleplay/android-developer/answer/2741495?hl=en-GB https://support.google.com/googleplay/android-developer/answ... "Google will return the transaction fee to you. You'll see the returned transaction fee on your next earnings report."
- benologist 6y ago
  On the Play Store there is a two hour window after purchasing apps where you can simply return to the store and refund your purchase yourself as the 'buy' button temporarily turns into a 'cancel purchase' button. This feels like the future to me, not some regressive scheme where refunds are discouraged and 'taxed'.
  - tomduncalf 6y ago
    Absolutely – I don't want to feel bad for the developers of apps I return either. Sometimes the app just isn't very good, or doesn't do what I thought it would. I shouldn't have to feel guilty about returning it.
- hn_check 6y ago
  "which I think adds weight to the argument that is unfair behaviour by Apple" Apple takes back from the developer exactly what they gave the developer. This has been verified by a number of people, and this submission is just farcically wrong. How is this nonsense front page on HN? Is this community this clueless?
  - smarnach 6y ago
    Do you have any sources for your claim? The original claim - i.e. developers lost money for each refund - is backed not only by the original post, but also by several other sources linked in the comments.
    - 6y ago
rhacker 6y ago
This blew up, but like 5 comments down in twitter someone said it wasn't true.
- ladon86 6y ago
  It is true, and I don’t see anyone on that thread saying it’s not. I see a guy confused about whether it’s the consumer or developer that eats the fee - it’s the developer. This is exactly how it works: * Customer pays $10 * Apple owes developer $7 (to be paid in 4-6 weeks) * Customer asks for refund, Apple sends them $10 back * Developer owes Apple $3
  - valuearb 6y ago
    It’s not true, I’ve been selling apps on the App Store fir ten years, never happened to me.
    - ladon86 6y ago
      I believe the real answer is that they do keep it (at least sometimes) for chargebacks but not for regular refunds. I've seen the discrepancy in our own accounting, and as mentioned elsewhere, it's in the App Store terms. But Apple's dashboard doesn't show a clear difference between chargeback and refund, and maybe that's where the story originated. HN won't let me amend my comment above, but I stand by the claim that this happens on chargebacks. Otherwise the App Store Connect numbers don't add up. I think the truth has some nuance, but that doesn't work on the internet, it's got to be either an outrageous story or "total fake news".
curiousgeorgio 6y ago
> When a customer refunds your paid app... (nitpick) The use of the verb "refund" seems confusingly wrong in this sentence. Neither the customer nor the paid app is paying back any money. I know it's Twitter, but it'd make a lot more sense to say "When Apple refunds a customer of your paid app..."
fizixer 6y ago
"When you refund a customer in full, for an app they returned, Apple doesn't refund you the 30% cut" ... ?
jmull 6y ago
I'm a little stuck on the terminology here. Does "customer refunds your paid app" mean the customer requests and gets a (full) refund from Apple for a prior app purchase? (I would say "returns" not "refunds" ... Apple is the one refunding, not the customer. The customer receives the refund. But I guess this is some kind of regional/informal usage I'm not familiar with.) If so, that's BS. Apple could reasonably keep transaction costs of something like 5%, but the full 30 is crazy.
- sbarre 6y ago
  As per the thread: You buy an app for $10, Apple gets $3, the developer gets $7. You refund the app (through the Apple App Store), you get your 10$ back, but that whole 10$ comes from the developer, unlike the 7/3 split when you first purchased it. So in the end, the developer has lost money due to the refund.
  - Spivak 6y ago
    This is just sales commission rules though. If I get a 30% commission for a sale when the customer is referred by me and at some point in the future the customer asks for a refund I don't give my commission back. Our transaction was done when the original sale was made.
    - LanceH 6y ago
      Apple doesn't refer a sale. Apple makes the sale. They are the store, something they have set up and enforced. The developer has no capacity to deny a customer, yet has the responsibility for the bad customers shopping someone else's store.
      - genidoi 6y ago
        Devils advocate argument: A refund (probably) reduces the LTV of customers, and Apple has no control of the cause of those refunds, whether it be a buggy app or misrepresenting features. The ethics of this scheme are debatable but it should be assumed that some refunds are legitimate and Apple loses tangible customer $LTV from some refunds.
andreasley 6y ago
A Statement of Tim Cook for the House of Representatives claimed that "For the vast majority of apps on the App Store , developers keep 100% of the money they make." [1] How can this be even remotely true if Apple takes a 30% commission for every sale in the App Store? [1] https://docs.house.gov/meetings/JU/JU05/20200729/110883/HHRG-116-JU05-Wstate-CookT-20200729.pdf https://docs.house.gov/meetings/JU/JU05/20200729/110883/HHRG...
- lis 6y ago
  Two options: 1) Free apps with advertisements. Paid apps are by far the minority. 2) I guess this statement is related to subscription models like spotify. If you acquire the user outside of the apple ecosystem and they subscribe on your own website and then download your free app from the app store, you get to keep 100% on the revenue that the user generates as well.
  - andreasley 6y ago
    Ah, the ad thing makes sense. It's technically true but the meaning conveyed in the statement is quite different. As for the subscription model, I've thought about that but developers that aren't huge companies have a hard time NOT integrating in-app purchases for cloud services (see "Hey", which had to use social media to get their update approved [1]), so it couldn't be the "vast majority of apps". [1] https://www.theverge.com/2020/6/18/21296180/apple-hey-email-app-basecamp-rejection-response-controversy-antitrust-regulation https://www.theverge.com/2020/6/18/21296180/apple-hey-email-...
- amscanne 6y ago
  Perhaps he means that they keep 100% of their 70% ;)
- crazygringo 6y ago
  Apple doesn't take a cut of your advertising revenue, and most apps are ad-supported rather than paid. That's why it's true.
  - 6y ago
yannikyeo 6y ago
PWA web app needs a store to be the distributor for small web apps, making it easier for small developers to monetize more than just ads. Where is Mozilla, MS, Google, Amazon?
taylodl 6y ago
Add this to the long list of how the App Store doesn't serve the needs of application producers are their customers, and because the needs of these very important members of the app ecosystem aren't being served it really isn't serving Apple as well as it could either.
- ntsplnkv2 6y ago
  Their customers are not developers, never have been, and never will be. We see what "serving developers" has done to the web in general - a genuine mess. Perhaps the fee is a bit much and the refund should come with a return, but as an apple product owner, I like the general experience of my iPhone and its app stores, and I don't want them to cater to devs over me.
GoodJokes 6y ago
Its kinda cute how tech people are just finding out about capitalism now.
josephagoss 6y ago
According to the tweet, if a $1.00 app is refunded the customer gets back $1.00 from the developer and Apple keeps $0.30. So each refund costs the dev more than they took in for the sale whilst Apple always pockets the 30%. How can a refund cost the dev $1.00 if they only took $0.70 for the sale?
deleted 6y ago
[deleted]
makecheck 6y ago
The “cost” of refunding a $9.99 app is the same as the “cost” of refunding a $0.99 app. Sure, let them keep some amount for payment processing but it should be a constant.
bawana 6y ago
What happens if I send somebody money with PayPal/cash app but then reverse/undo the transaction? Are the fees kept?
- lukeramsden 6y ago
  Most likely, but the fees are more like 30p + 2.9% (atleast in the UK, on PayPal) or something similar, which on a 99p app would be 30%, but on a $15 app it's obviously nowhere near 30%.
chourobin 6y ago
Dig a little deeper in the thread. I don't think this is accurate.
bronzeage 6y ago
I also argue that it's the heavy commissions which push nearly every App to an ad based model, or physical services Apps which don't charge anything. This in turn shifts more and more apps in the direction of invading our privacy with invasive ads libraries, leading to also worse privacy as a consequence. It's already pretty hard to convince users to pay for an app, the 30% cut almost guaranties it will be a bad business model.
8ytecoder 6y ago
A fair and equitable App Store model that also protects users would be one where it’s opt-in. Apple vetting an app should be independent of distribution. Developers can then choose whether they want to use the App Store or not.
davidwhodge 6y ago
This does not match my experience with my App, Nikola. I've been able to match up the transactions and refunds as 1 to 1, price-wise.
- christefano 6y ago
  Thank you for weighing in. Hearing from more devs is what this thread needs, IMO, not rumor mongering. Great website, by the way! https://www.nikolaapp.com/ https://www.nikolaapp.com/ Out of curiosity, can you say whether Tesla has approached you for acquisition?
- tomduncalf 6y ago
  Interesting. I wonder if it varies from region to region perhaps? Going to do a bit more research as this guy seems quite convinced they are taking the cut but evidently you’ve experienced otherwise!
  - davidwhodge 6y ago
    Yeah I'm not sure what the discrepancy is. This afternoon I'm going to dig a bit more into my records. In my data right now I see a few examples of an $80 purchase match to $56 in proceeds (70%) matched to $56 of a refund. I can't say I think the 30% fee is appropriate anymore, but this particular case being made about refunds does not appear to be accurate for me at least.
    - tomduncalf 6y ago
      Could be that this developer is confused, maybe the way Apple represent the data is confusing in the records or something... in which case my apologies for spreading false information, but he seemed pretty convinced!
    - deleted 6y ago
      [deleted]
- ntsplnkv2 6y ago
  Thanks for a different perspective. The group think on here always reaches a fever pitch when it comes to Apple - HN is particularly susceptible to it
user123ae78 6y ago
Why is it we don’t tax these companies in the same way. 30% on all income in the country where the good/service was sold
bishalb 6y ago
HNers don't seem very critical of Apple here. Imagine if Microsoft did the same, all hell would break loose.
leptoniscool 6y ago
Not surprising, since they have control of the platform and the market. But it's ethically questionable.
akerro 6y ago
Can you buy and refund and buy and refund the same app multiple times? Can you use this to ruin your competition?
arbuge 6y ago
Of note: as of last October, if a PayPal merchant refunds a customer for any reason, PayPal is no longer refunding their payment processing fee. The merchant will need to refund that to the customer at their own expense to grant the customer a full refund.
perfectstorm 6y ago
People keep talking about 30% cut but it's actually more than that if you look outside of U.S. Apple takes more than 30% cut for in-app purchases made in other countries. For example, an in-app-purchase (IAP) you sell in USD for $15.99 is translated to 1249 Indian Rupees and you get a proceed of 741 Rupees which is only 59%. So Apple keeps the rest 41%. Today's (when I wrote this) exchange rate shows approx. 76 rupees for 1 USD so the amount they charge the user is pretty accurate but Apple put so much wiggle room in their favor. This is true for other currencies as well.
brokencode 6y ago
Apple keeps on abusing their dominant market position to make huge profits at the expense of small developers. They subject apps to huge fees, then release competing apps at the same price (such as Apple Music). They prevent companies from selling ebooks on from their apps without taking a huge cut, again, despite the fact that they have a competing app in iBooks. These are perhaps the most egregious examples, but the list is very long of other complaints. How long will they get away with this before antitrust regulation kicks in? They are so focused on extracting rent that they keep on poking this sleeping bear, and it eventually will be a huge problem for them. If they don’t reverse course, expect to see large reductions in their profits and stock price when this happens.
monadic2 6y ago
Of all the chatter around anti-trust, has anyone broached the app store and apple’s monopoly on iOS software? I am using the term in a colloiquial, non-legalistic sense. My fear is that politicians are invested in tech stocks, like the rest of us and pretty much anyone with a mutual fund, so they are unlikely to act in a pro-consumer manner.
krick 6y ago
I guess in Europe iStuff isn't as overwhelmingly popular as in USA, so when I hear things like that I am always amazed at how could anyone (a developer) in their mind ever cooperate with Apple. Even writing and getting a new app to their store is a huge feat, they take a huge cuts when you make money, and when you don't they can charge you "30% of what you could make" anyway. This is just absolute nonsense.
gnicholas 6y ago
Stripe started doing this as well, as of a few months ago. Makes it tougher to be generous with refunds for people, knowing that we literally lose money doing so. Fortunately their cut isn’t the massive 30% that Apple takes.
m3kw9 6y ago
This probably lower incentives for App devs to create refund situations. For example you attempt to get people to download your app by misrepresenting it. Most will not get refunds, and the Dev gains from such behaviour.
molszanski 6y ago
How does it work in other stores? Like Google Play, Steam, Microsoft Store, Playstation / Xbox / Nintendo / Switch stores? Do they keep it?
valuearb 6y ago
This isn’t true. Source: me, I’m a developer who has been giving customers refund instructions fir ten years.
jedimind 6y ago
Tim Sweeney @TimSweeneyEpic This is a critical consideration in these 30% store fees. They come off the top, before funding any developer costs. As a result, Apple and Google make more profit from most developers' games than the developers themselves. That is terribly unfair and exploitative. https://twitter.com/TimSweeneyEpic/status/1288315775607078912 https://twitter.com/TimSweeneyEpic/status/128831577560707891...
chrisjarvis 6y ago
Has anyone confirmed this is true (or is this tweet the only source...)? https://developer.apple.com/forums/thread/105454 https://developer.apple.com/forums/thread/105454 "Apple has the RIGHT TO withhold" https://news.ycombinator.com/item?id=23989256 https://news.ycombinator.com/item?id=23989256 It seems you can only get a refund by reporting a problem, which means if your app works as described you shouldn't be able to request a refund.
- juiyout 6y ago
  I have requested several refunds by reporting a problem saying that the app didn’t work the way I thought it would. Automatically approved and refunded. Takes like 10 seconds.
- tomduncalf 6y ago
  One developer has said (below) this didn’t seem to be the case for him, so it’s possible the original tweet poster was confused. I have heard this rumour before and it does sound like Apple deserve the right to do this, so perhaps it varies on a case by case or region by region basis? But seems to be hard to find concrete information either way strangely!
- deleted 6y ago
  [deleted]
- gruez 6y ago
  Here's a second source: https://techcrunch.com/2009/03/25/apples-iphone-app-refund-policies-could-bankrupt-developers/ https://techcrunch.com/2009/03/25/apples-iphone-app-refund-p...
  - xsmasher 6y ago
    That article is also talking about what apple COULD do - it doesn't say apple is actually doing it.
- deleted 6y ago
  [deleted]
hn_check 6y ago
This isn't correct at all. This is a serious misunderstanding by someone in a pretty incredible way. Literally a single person claiming this and _multiple_ people refuting it from their own experience. Yet it's top of HN. Amazing. A lesson to never, ever trust anything here because the masses clicked an arrow.
- hn_check 6y ago
  LOL, it has since been retracted the author admitted it was their own misunderstanding. Here the post still sits on the front page. Don't ever change your adorable ignorance, HN. It's such a laugh. And this will be auto-dead. I was spot on and completely right and got pummeled down by the imbeciles of this cesspool. Hilarious.
- FabHK 6y ago
  > A lesson to never, ever trust anything here FWIW, it's been corrected in less than 18 hours. Conclusion: You can continue to blindly trust everything here (provided you check a day later) ;-)
fractal618 6y ago
That doesn’t seem fair at all
annoyingnoob 6y ago
From the perspective of an iPhone user, Apple does a reasonable job of keeping nefarious apps out of the app store (not prefect, maybe not even great, but reasonable). Most apps that have a set price and not a subscription are reasonably priced and one does not feel/notice that Apple takes a 30% cut. The end user experience is reasonable. I feel like getting rid of the app store, or even just allowing side loading, would open users up to a lot of nefarious software. If we assume that consumers like the App store and that its not going away, how do we satisfy developers but allow consumers the comfort of the walled garden?
tomduncalf 6y ago
Looks like the original tweet may be incorrect according to replies on there, or at least this doesn’t apply to every app, for example: https://mobile.twitter.com/LittleFinLLC/status/1288570444417728518 https://mobile.twitter.com/LittleFinLLC/status/1288570444417... Would be great if others could chime in with their experience if they have records to check! My apologies for posting this if it proves to be incorrect, hard one to fact check weirdly.
- xsmasher 6y ago
  The last time this came up, in 2009, I looked at my reports and concluded the same thing- when Apple reported a refund, they were deducting 70% of a sale from my future earnings, not 100%
  - xsmasher 6y ago
    This topic is generating enough heat that I went trolling through my old reports. Apple appears to be deducting just the 70% from earnings, not the full 100%. https://imgur.com/gallery/KwKlMXh https://imgur.com/gallery/KwKlMXh
tkubacki 6y ago
One more reason for society as a whole to get rid of greedy tech monsters dependency like Apple in long term. Remember You often have a choice to not support this platform and move towards web by default even if it is not easy (Apple enforce to use their web engine to make sure you are in a slave position on iOS)
ljw1001 6y ago
This is Apple exploiting it near monopoly powers, plain and simple.
neycoda 6y ago
They should refund half of the 30% to pay for their costs and whatever, like a handling service. Unfortunately that still means the seller is paying for returns, but Apple probably is legally required in most countries to refund the buyer fully, what do I know.
Waterluvian 6y ago
Wait so. I buy your app. You get $7 and Apple gets $3. I refund your app and get $10 back. Is Apple taking $10 from the developer to give to me? This smells positively rotten.
- xsmasher 6y ago
  It's not true, as far as I can tell from my reports. Apple appears to be deducting just the 70% from earnings, not the full 100%. https://imgur.com/gallery/KwKlMXh https://imgur.com/gallery/KwKlMXh
Bloggerzune 6y ago
That’s the problem with paid apps... but I also believe now it’s a problem with devs not validating the app receipt to check for refunds and prevent access. Serious question: Is this refund problem as big an issue as commenters here are implying? Is there data that shows that app developers are losing significant money due to Apple's fees not being refunded? https://www.bloggerzune.com/2020/07/Indeed-Prime.html?m=1 https://www.bloggerzune.com/2020/07/Indeed-Prime.html?m=1
mawise 6y ago
Nobody seems to be taking this to the logical conclusion. If Apple's behavior is not desirable, then don't build apps for the Apple app store. They're apparently providing enough value in giving developers access to premium customers that this aggressive behavior is worth the trade-off for many developers.
- lumost 6y ago
  Apple's app store provides value to developers and customers because it is the only method of delivering apps to iphones. If there were other app stores that charged 20% less for the apps, then developers and customers would use those. See Steam vs. Windows Store vs. Epic Games store.
person_of_color 6y ago
The tweet is now deleted. What happened to the dial a mob?
deleted 6y ago
[deleted]
rs23296008n1 6y ago
So to update and add to their old slogan: Think different... but we still keep our 30% cut Tech in general has quite a few things about itself it needs to fix. Is it ethical for Apple to write the OS, run the store, sell its own wares AND compete with people it charges, eg 30%, to compete? Same question for other stores, eg Google? Both companies have analytics to determine which of the crop is successful and therefore needs to be harvested. Is this a level playing field? Do we expect such? Should we? These aren't trivial or straightforward issues. It will be interesting to see over the next 20 years how this plays out. It would be better with a shorter time frame but... nothing involving legalities is usually fast.
- Spivak 6y ago
  Charging 30% to competitors that it doesn’t charge to itself isn’t really a problem because of opportunity cost. If an Apple product takes revenue from a competitor that’s paying them 30% then they still have all the costs of running their competing service and make less money from their 30% cut. The margins have to be really good for such a thing to be worthwhile.
stevespang 6y ago
Somebody needs to file a JUICY class action against Apple - - and also make Tim Cook sweat at the Judiciary meetings in DC by dragging him through the red hot coals on this one . . .
xhruso00 6y ago
Tweet is unavailable (deleted). Backup http://archive.is/wqWYK http://archive.is/wqWYK New twitter link: https://twitter.com/twolivesleft/status/1288625617873694721?s=21 https://twitter.com/twolivesleft/status/1288625617873694721?...
- ec109685 6y ago
  This wasn’t true: https://twitter.com/twolivesleft/status/1288625617873694721?s=21 https://twitter.com/twolivesleft/status/1288625617873694721?... Recanted there. People need to think more critically.
  - xsmasher 6y ago
    Ugh. This factoid is now stuck in a bunch of memories though, and they're swear it's true the next time it gets debated.
    - anonytrary 6y ago
      To go deeper into the rabbit hole, lots of people dislike Apple, so this tweet could have been a calculated effort to further tarnish Apple's reputation. Plan: 1. Create fake news that X people see. 2. Wait until X is large. 3. Delete fake news, use "plea ignorance" apology to save face, that Y (Y << X) people see. Congrats you now have a large number of people who now have an even worse opinion on the subject of the news. Repeat steps to cause even more damage.
      - zymhan 6y ago
        Yeah, but it's Apple. That's a drop in the ocean.
      - threeseed 6y ago
        Or be like the Hey app. Pretend to be the victim, whip up a whole lot of free PR sympathy and then make the minor change to the app and resubmit whilst no one is paying attention.
arrty88 6y ago
How come all the best tweets get deleted? C’mon
ogirginc 6y ago
Tweet can be accessed from https://web.archive.org/web/20200729052623/https://twitter.com/twolivesleft/status/1288344977169235968 https://web.archive.org/web/20200729052623/https://twitter.c...
deleted 6y ago
[deleted]
layoutIfNeeded 6y ago
This is simply not true.
elliottkember 6y ago
I was mistaken in my original (now deleted) tweet and have been corrected by a few people Apple does not keep the 30% commission on a refund the refund happens as you’d expect. I don’t know where I got the idea that it worked the way I thought it did This was a follow-up by the tweet's author. https://twitter.com/twolivesleft/status/1288625617873694721?s=21 https://twitter.com/twolivesleft/status/1288625617873694721?...
- Vervious 6y ago
  Misinformation really does spread like wildfire. Even with the number of naysayers on Hacker News we still seemed to have had a lapse in critical thinking. I've been wanting to get into research on the study of the spread of tweets like this. Anyone have pointers for reading material?
  - deleted 6y ago
    [deleted]
  - xuki 6y ago
    I have sold apps on the App Store for a decade now, and I have to admit I did believe the original tweet. I was going to go through the financial reports during the weekend to verify, but the initial reaction was “of course they would do this, it’s Apple”.
    - dhsysusbsjsi 6y ago
      The fact this tweet is so believable says something about how poorly Apple has been treating its developers the last decade.
      - mr_toad 6y ago
        Or it just says something about confirmation bias.
        6y ago

1243 points by tomduncalf 6y ago

bena 6y ago

I don't think the issue is that Apple is keeping its fee even with a return. That on some level is fair. They are providing a service to the developer. The bigger question is whether their cut should be 30% in the first place. 30% was chosen by the first store of this type and it's just never been questioned by platforms. I just read that Valve recently changed their agreement to be a sliding scale based on sales (30% to start, falling to 20% if you hit certain numbers). But as far as I know, Microsoft, Sony, Apple, and Google all do a 30/70 split on digital sales.

sukilot 6y ago
> all do a 30/70 split on digital sales. Consistency which is only possible in an environment of collusion.
- dogma1138 6y ago
  Not as much collusion as simply lack of competition. You don’t have any other options for most of their respective platform and there isn’t enough incentive to compete on the pricing. Also even when there is competition there are rules that prevent you from lowering pricing in one store vs the other (there are some exceptions) so if you end up say selling a game on the PC and you set the retail price as $60 and you launch it on 3 different digital content distribution platforms while you might make more money on one platform than the other there is no difference for the end consumer so there isn’t an actual competitive incentive to reduce your cut as a digital distributor unless you think you can get an exclusivity deal.
  - bena 6y ago
    Yeah, I wouldn't call it out and out collusion. If the first store did 20%, it's likely all the stores would have followed suit on that price point. 30% is likely the most they can take that people will tolerate.
    - wolco 6y ago
      They could take 70% or 95% and there will still be posts saying that the market is 3.5 billion people and 5% isn't bad because Apple/Google do all of the marketing.
      - meed2000 6y ago
        Please, be careful throwing this kind of idea out there, people at Apple/Google, who obviously have run out of ideas long ago, may be reading this.
Marsymars 6y ago
Other than games, MS is a 15/85 (or 5/95 split if the customer purchases via following a deep link from the publisher’s site or app) split on digital sales.

jbob2000 6y ago

Well yeah, I still need to pay shipping for amazon to send me a product even if I need to return it because it's broken. I would have no product to return if I did not pay for the shipping to receive the product. Apple would justify that 30% being non-refundable by saying "you would have never had that client to refund if you did not give us that 30%". They did their job, they got you the client, you were the one who did the bad job and made the client pursue a refund. You pay a toll to cross a bridge, but it turns out to be the wrong bridge. You don't get your toll back, you still crossed the bridge.

samfisher83 6y ago
Except apple's marginal cost like 0.
- ebg13 6y ago
  Marginal cost is often not a good way to evaluate things. A person who focuses only on marginal cost will say "It only took you an hour to make that" while discounting the decades of training it took to be able to. A person who focuses only on marginal cost will say "I could have made this at home" while discounting the reasons why they didn't. Prices relate to provided value, not just cost.
  - sukilot 6y ago
    How much value is provided for a refund?
    - ebg13 6y ago
      The amount refunded minus the continuing value to the user of the returned product (absent the value already extracted from the product by the user), of course.
- glofish 6y ago
  That is not the right reason to refund. Price should have nothing to do with marginal costs. it has to do with who is being made to carry the cost, and the griefing that can occur that way. Not worth the trouble IMHO.

gregoriol 6y ago

Not saying it's exactly the same situation, but Stripe keeps their fees when you refund a payment

gerbal 6y ago
This is also common for most credit card processors. But keeping 3% is very different from 30%
dawnerd 6y ago
It’s pretty common across the board. 30% is really high for sure, but payment processors gotta get paid at some point. I think Apple should split the fee up. Make a portion what they charge for processing payments and the rest their commission.
- glofish 6y ago
  correct, there is a huge difference between taking 3% and 30% one is the cost of doing business, the other is predatory
  - briandear 6y ago
    You aren’t required to sell apps for Apple platforms. Has anyone even looked at what it takes to make and sell console games? Do you know how much manufacturers earn on products sold in grocery stores? Far less than 50% of the retail price. When distributors are involved, it’s even less. The company that makes a bar of soap might get paid $1, the distributor gets $1 and the retailer sells it for $3 and has the right to return unsold product. And shipping costs aren’t included in these amounts. The manufacturer gets $1 but also has to pay shipping to the distributor. People complaining about 30% have no idea how real world businesses operate. They are in some kind of fantasyland. Don’t forget, the App Store also handles your worldwide sales tax payments, fraud protection, chargebacks, hosting, distribution, your storefront, your payment processing and gives you worldwide availability for your app in the specific local currencies. If those services aren’t of value to you, then don’t sell apps for iOS. Certainly Windows Phone has some users, or perhaps create your own device and ecosystem that offers terms you find more amenable. This is Hacker News, not crybaby news: you don’t like the status quo, then get some friends, start making a better system, raise some money, then compete. If you think 30% is predatory, then make a system that only charges $what_you_think_is_fair. As far as Stripe, they take more than 3%. And for connect accounts, the percentage is closer to 3.5% not to mention you get charged $15 or $20 for a chargeback. What’s Apple charge developers for chargebacks? Zero. How often do developers have to challenge chargebacks with Apple? Zero. If you are selling using Stripe, it can become a significant expense, depending on your industry, especially gaming. It’s my feeling that people complaining about 30% have no idea of the expense of “doing it themselves.”

lolsal 6y ago

Apple is taking a cut for providing the store itself, distribution, visibility, SDKs/frameworks, etc. Why would they refund 30%?

symkat 6y ago
Because the customer is getting a refund because they're asking Apple to unwind the transaction. Apple makes the customer whole, Apple makes Apple more than whole, and Apple makes the developer less than whole.
raverbashing 6y ago
Developers do have to pay an yearly fee to just be an iOS developer, so the argument that's because of the SDKs is incorrect
- lolsal 6y ago
  Ok, what about everything else I said? Like distribution? Millions of users?
onion2k 6y ago
Why would they refund 30%? Because they can afford it, and it's the right thing to do both ethically and morally.
- deleted 6y ago
  [deleted]
- lolsal 6y ago
  Why is it the right thing to do morally and ethically? Didn't they earn that money?
  - onion2k 6y ago
    If you went and bought a new car for $50,000 and then needed to return it and get a refund you wouldn't be very happy if the dealer gave you $45,000 back and said "Sorry, the salesperson gets to keep their commission. They earned that money." The dealer wouldn't be very happy if the salesperson said "No, I'm keeping my $5,000. I did my part and I earned that money." If there's a refund then everyone gives their part of the money back. Apple were part of the transaction, so if there's a refund they should return the money they earned. They can't just ignore the customer's wishes to get the money back, and they can't just pass the loss on to the developer. Neither would be fair.

wlesieutre 6y ago

Does this mean if there's a developer I don't like, I can buy their stuff and refund it to arbitrarily cost them money at no cost to myself and there's nothing they can do about it? That seems ... not great, especially these days. What happens when mobs of internet morons decide review bombing isn't sufficient and realize Apple will help them cause direct financial harm instead?

zamadatix 6y ago
If you do this often Apple will ban your account. If you don't do this often it's not a problem.
- ejolto 6y ago
  What if you have a big Twitter following and ask them to do it?
  - SllX 6y ago
    Sounds like a lawsuit in the making if the harm is great enough.
    - vageli 6y ago
      What laws would be broken in this case?
      - jfk13 6y ago
        Something about conspiracy to defraud, maybe?
        vageli 6y ago
        How is that fraud? "Everyone, buy this product and return it to the store for a full refund," doesn't sound like fraud to me. It doesn't result in personal or financial gain to the people perpetrating it, either. edit: so who is in trouble here? The person calling for people to do it with their twitter following or the twitter followers? I'm not saying that buying the app and returning it is not fraud if you entered into the transaction in bad faith and with intent to cause damage to the dev, I'm saying calling people to do that is not fraud.

bronzeage 6y ago

App stores need heavy regulations. It's not only Apple but Google and even steam to a small extent. Apple is of course the biggest offender as they heavily guard their monopoly with code signing enforcement. This shouldn't have been legal. They are the very definitions of predatory competition squashing monopolies.

ryanlol 6y ago
Why do app stores need separate regulations? > They are the very definitions of predatory competition squashing monopolies. But they aren’t, this is a rather competitive space.
- bronzeage 6y ago
  The stock market is heavily regulated. Commodity markets are regulated. It's actually the slowness and corruption of the law makers that we're still without any regulations to virtual markets.
  - ryanlol 6y ago
    How are app stores like stock markets or commodity markets?
- simion314 6y ago
  Competitive? How many places are where I can host a web page and how many app stores ? The ratio is probably much larger then 10000 : 1 .
- _nalply 6y ago
  Competitive between developers and perhaps platforms but absolutely a monopoly for iOS.
  - ryanlol 6y ago
    This is as nonsensical as complaining about Disney having a monopoly in Disneyland.

monkey26 6y ago

This is unfortunate. I recently searched the App Store for “ssh tunnel” and Prompt 2 came up. I bought it without much thought as I heard about. Now I should have done my research but it doesn’t support tunneling or I couldn’t figure out. Some research told me that no iOS ssh client will. So I requested a refund and got it. In this case I think the blame was on Apple. Not the author of the app.

Spooky23 6y ago
I don’t know how you can blame either party. If my kid wants a dvd about beetles (the bugs), and I click on a Beatles (the band) documentary instead, that’s neither the seller or producers fault.
- Brian_K_White 6y ago
  It's Apple's fault that they made a standard ssh feature impossible on ios, yet still allow apps to be called "ssh". No dvd player manufacturer created a dvd store where they sell dvds called "The Beatles" but every Beatles dvd is missing Ringo because their dvd store censors Ringo, but dvds are still named The Beatles.
  - Spooky23 6y ago
    So are you angry at the platform restrictions or the App Store? They are two different things.

oliverx0 6y ago

Seems fair to me. Apple provided with you a service and charged your for it. It is a cost associated with distributing / developing your product. Why should Apple be responsible for refunding you? It was not their fault that the customer decided their money back.

weaksauce 6y ago
No it’s not fair. This can be a tool that competitors use to hurt you financially. If the customer gets a refund the slate should be wiped clean. That’s fair.
- oliverx0 6y ago
  It’s easy to think it’s fair because the cost to Apple is low. But in principle, let’s assume that it costs Apple a significant amount of money and effort to make the transaction happen, for which they charge you that 30%. Seems unfair then that Apple has to be held responsible for refunding a service they provided when it was not their fault the customer wanted the money back for your product.
  - sukilot 6y ago
    Obviously, assuming wildly false claims can lead to unreasonable conclusions.
saagarjha 6y ago
Apple prices the exact same things into hardware distribution too, but when you ask for your money back there they give it back in full, not minus the “service” they already provided you.
- oliverx0 6y ago
  And I think that’s great! I just don’t think they need to be forced to do it. If I were Apple I would definitely refund. But I don’t agree that it should be an obligation for them to do it.

saagarjha 6y ago

“Sorry, we already spent it.”

toyg 6y ago

App Stores are doing to software developers what supermarkets did to food producers and most other manufacturers: moving all power and profit to distributors. It is somewhat ironic that so many people who helped so many other sectors disintermediate again (by building websites), are now busy actually intermediating their own.

cblconfederate 6y ago
The Web isn't. Sir TBL doesnt get a cut from your sales. Why developers even use the app stores baffles me 97% of user's time is spent using the 10 top mobile apps Average user downloads ~0 apps / month PC sales are up last year and more this year with COVID Who makes money?
- sukilot 6y ago
  Apple actively blocks non-app-store apps.
- oarsinsync 6y ago
  Assuming your numbers are accurate, 3% of users time is spent on non-top-10 apps. There are 3.5 billion smartphone users. [0] Smartphone usage statistics suggest that an average person spends 2 hours and 51 minutes per day on their mobile device. [1] This works out to a cumulative total of 3.6 trillion hours of use per year. 3% of that time is 109 billion hours a year in non-top-10 apps. You might not become a millionaire with your app being part of the 3%, but there's still real money there. [0] https://www.statista.com/statistics/330695/number-of-smartphone-users-worldwide/ https://www.statista.com/statistics/330695/number-of-smartph... [1] https://leftronic.com/smartphone-usage-statistics/ https://leftronic.com/smartphone-usage-statistics/

glofish 6y ago

Reading the thread here is an interesting datapoint: https://twitter.com/twolivesleft/status/1288491970248077314 https://twitter.com/twolivesleft/status/1288491970248077314 - Since 2011 Codea has had 1,768 refunds - Estimate it cost us ~$8,000 USD to pay Apple’s 30% - A single day in 2017 saw 193 returns and I have no idea why or how that’s possible later: > Yes, we’ve had a few days of negative revenue in the last few years due to people refunding Codea. Apple keeps their 30% no matter what

deleted 6y ago
[deleted]

bloomboom 6y ago

It’s amazing that a decade and a half later Apple still hasn’t fulfilled Steve Jobs’ original dream of merging the web and apps. He wasn’t saying third party apps should be HTML5 just to stall for time. He really believed it. And it was a good idea and still is. Processors, memory, bandwidth, and browsers have all advanced by leaps and bounds and yet the dream remains unrealized and Apple is the most to blame. They got addicted to the ill gotten gains of their walled garden and can’t bring themselves to kick the addiction. Rent seeking is a powerful force. It’s pathetic for a company so good at being honest with themselves and moving forward when they know what the best future is. The App Store shouldn’t exist at this point. It has outlived its usefulness. It’s in their users’ best interests to move beyond it. And yet maybe it’s too traumatic and daring a move for anyone other than Steve Jobs to attempt. Tim Cook could drop the headphone jack because it didn’t damage the bottom line but dropping the App Store would actually cost something in the short term even if it is the right thing to do for everyone in the long term.

dimitrios1 6y ago
> It’s amazing that a decade and a half later Apple still hasn’t fulfilled Steve Jobs’ original dream of merging the web and apps. Because Google exists, and is diametrically opposed to this vision. The past decade have shown constant examples of these two visions of the future clashing. Google wants more people on the internet. Apple wants more people on their devices.
wolco 6y ago
Apple has a history of pushing along after Steve left without any true vision until he returns. If anyone will return from the grave it's probably Steve. When he does he will probably VR Apple phones and we'll be in a new era.
conductr 6y ago
I think they were creating a walled garden and this was just lip service. Blaming it on state of tech/HTML5/etc was easy. The app store could be open from administration/censors and thus would function exactly like the web even if native code was required. The frustrating part of current state is they censor who, what, and how can be brought to market and the 30% cut is just egregious.

atarian 6y ago

I don't understand something here.. let's say I sold an app to someone for $100. 1. Someone pays me $100. 2. Apple takes 30%, so I only get $70. 3. Customer asks for refund and gets back $100. 4. Apple takes back the $70 from me. If Apple was skimming 30% off from the start, how does that affect me during a refund?

sandyarmstrong 6y ago
The tweet claims that step 4 is "Apples takes back $100 from me." So you have to cover Apple's share in the refund.
- valuearb 6y ago
  The tweets claim is false.
  - marcinzm 6y ago
    This is Apple's US terms for developers of paid apps: > You shall reimburse, or grant Apple a credit for, an amount equal to the price for that subscription. Apple will have the right to retain its commission on the sale of that subscription, notwithstanding the refund of the price to the End-User. If you disagree, please cite a source.
    - xsmasher 6y ago
      Apple says they have that right, but I have not seen them do it. Here's apple deducting a refund from me in 2010, and the amount is exactly what they paid me. https://imgur.com/a/KwKlMXh https://imgur.com/a/KwKlMXh First screen shot is a week with one refund (-$1.40) and ten sales ($14.00 proceeds).
FriendlyNormie 6y ago
Relax and just go along with treating this random tweet like it’s proven to be undeniably true. We’re trying to form a libelous witch hunt against Apple to temporarily crash the stock price. Buy the dip in 30 minutes, friendo.

olliej 6y ago

What the hell?

chadlavi 6y ago

Payment processors generally don't refund fees on payments when the payments are refunded, this isn't new. It's remarkable mainly because (a) it's 30%, not 3% and (b) the App store doesn't position itself as a payments processor the way Stripe does, so it sounds really weird that they would act like one. If the app store took a 3% chunk and never refunded it regardless of the ongoing status of the transaction, that would put them right in line with other payment processors. It would also still net them billions of dollars, I think!

seancoleman 6y ago
Stripe does refund their fees with a transaction refund. I understand this may be novel for the payment processing industry though.
- codegeek 6y ago
  No stripe doesn't. They used to but not for a while now. At least not for our SAAS business where we do close to 1M ARR. Am I missing something ? https://stripe.com/docs/refunds https://stripe.com/docs/refunds
  - Cerium 6y ago
    Same here, they used to but stopped about a year ago.
    - mattferderer 6y ago
      Ditto. Helping some non-profits, we were really hurt by people typo-ing a $10,000 donation when they meant to only donate $100. We quickly learned from that mistake. We also learned about how credit card thieves test credit cards. We saw hundreds of donation attempts. Stripe had us refund those that went threw, which costed us money in fees. Fortunately we were able to put some quick measures in place to stop them temporarily & then better measures for long term success.
      - 6y ago

cosmodisk 6y ago

It's not just Apple. Look at the state of business app stores: appExchange (Salesforce), Slack, Jira plugin marketplace,and so on. They are all milking as much as thry can.

cmurf 6y ago

Purchase: Customer pays $10. Apple keeps $3. Developer gets $7 Refund should be: Developer has $7 deducted from current owed "royalties" Apple refunds $10 to the customer. Is Apple actually taking $10 from the developer and giving it to the customer? That would be theft. The developer is not obligated to cover refunds beyond the profit/royalty they originally made on it.

philipodonnell 6y ago
> Is Apple actually taking $10 from the developer and giving it to the customer? That is exactly what is happening.
RonanTheGrey 6y ago
That's exactly what's happening. The developer actually loses 30% of the purchase price due to the refund (they are now 30% in the hole instead of break even). Frankly from my point of view this is criminal. We kept payments for our product outside the app for years, and now Apple closes that ability too, by forcing any app that accepts payments of any kind to also accept Apple Pay. We've had to basically hide the ability to find it in the app so that people will go to the website first. Apple seriously needs to be regulated.

conductr 6y ago

So, they do have an incentive to let the iTunes fraud continue. Seems like a couple times a year one of my families accounts is hacked, they spend $100s and we have to dispute. We get the money back but it's costly to the devs at 30%

lukeramsden 6y ago
I would assume fraud would be fully refunded, no? This is more about legitimate Apple-sanctioned returns, not fraudulent transactions. I may be wrong, but I hope I'm not lol

lupinglade 6y ago

It’s a mess. In many ways, the App Store is nothing but trouble for developers.

briandear 6y ago

Previous story from 2009: https://arstechnica.com/gadgets/2009/03/app-store-refunds-will-not-bankrupt-developers/ https://arstechnica.com/gadgets/2009/03/app-store-refunds-wi...

moogleii 6y ago

This policy apparently has been around since 2009: https://arstechnica.com/apple/news/2009/03/app-store-refunds-will-not-bankrupt-developers.ars https://arstechnica.com/apple/news/2009/03/app-store-refunds... Of note is that the developer "protection" clause in the 2009 version doesn't seem to be in the current version ("Otherwise, no refunds are available."): https://www.apple.com/legal/internet-services/itunes/us/terms.html https://www.apple.com/legal/internet-services/itunes/us/term... My memory is fuzzy, but I recall there was pressure from the EU? regarding lack of refunds, so I'm guessing this was Apple's adaptation. Regardless, it still clearly seems like the right thing to do is to refund the developer the 30%.

ikeboy 6y ago

Amazon does the same thing. You can lose more on a return than you make on a regular order. Amazon makes more on many orders than sellers do.

ejo4041 6y ago
Amazon FBA seller here. I came to look for the Amazon comment. Their returns are pretty messed up and hurt the sellers. Customer can return for any reason and the seller has to eat it. Often times it is very hard to track returns down if people return the wrong stuff. If it's broken or damaged, amazon will side with the customer 100% of the time. On top of all that, if you dispose of a damaged, non-sell-able item, they will list it in amazon warehouse, we agree to that in the TOS by having an FBA account. If someone knows how to work with their system better regarding returns, let me know.
- meed2000 6y ago
  I stopped selling on Amazon nearly 10 years ago. FBA was a newly introduced feature which was the trigger for me see Amazon's disrespect for 3rd party sellers. They skim the seller for the sale (because they do the marketing for you). They skim on payment processing (it costs them less than they charge) They skim for exposure (ads are almost a must have to ever appear in search results). They then skim on delivery via FBA (they charge more than it costs them). And they skim on warehousing via FBA (the pricing was already unbelievable back then). Fast forward 10 years, they have started to skim sellers off their business analysis and risk taking effort (They have the data, and will compete with 3rd party sellers on products that sell decently enough, and even place their product before yours). I've recently taken the time to edited and publish a book that is in the public domain, on their KDP platform, a few days later I see that Amazon is selling that same book and even redirect customer clicks from my page description and book cover to their line item to buy. Amazon has no limit.
  - mthoms 6y ago
    >a few days later I see that Amazon is selling that same book and even redirect customer clicks from my page description and book cover to their line item to buy. Can you expand on this? I'm not sure what you mean exactly. Is Amazon redirecting direct links to your free book to a non-free version?

wslh 6y ago

I have mixed feelings about this and understand there are cases where it is unfair and where it is a fair penalty. I see the case where your child spend money via an in-app purchase in Roblox. Where The kid buys USD 1k in robux and the Roblox app never complain... Where we are using two factor authentication and all kind of measures to protect credit card purchases. So, I think you can blame Roblox or Apple for not adding these measures. This is like a dark pattern hidden in the "frictionless" payments via apps.

tomduncalf 6y ago

Had a look and it seems that Google do refund the transaction fee, which I think adds weight to the argument that is unfair behaviour by Apple: https://support.google.com/googleplay/android-developer/answer/2741495?hl=en-GB https://support.google.com/googleplay/android-developer/answ... "Google will return the transaction fee to you. You'll see the returned transaction fee on your next earnings report."

benologist 6y ago
On the Play Store there is a two hour window after purchasing apps where you can simply return to the store and refund your purchase yourself as the 'buy' button temporarily turns into a 'cancel purchase' button. This feels like the future to me, not some regressive scheme where refunds are discouraged and 'taxed'.
- tomduncalf 6y ago
  Absolutely – I don't want to feel bad for the developers of apps I return either. Sometimes the app just isn't very good, or doesn't do what I thought it would. I shouldn't have to feel guilty about returning it.
hn_check 6y ago
"which I think adds weight to the argument that is unfair behaviour by Apple" Apple takes back from the developer exactly what they gave the developer. This has been verified by a number of people, and this submission is just farcically wrong. How is this nonsense front page on HN? Is this community this clueless?
- smarnach 6y ago
  Do you have any sources for your claim? The original claim - i.e. developers lost money for each refund - is backed not only by the original post, but also by several other sources linked in the comments.
  - 6y ago

rhacker 6y ago

This blew up, but like 5 comments down in twitter someone said it wasn't true.

ladon86 6y ago
It is true, and I don’t see anyone on that thread saying it’s not. I see a guy confused about whether it’s the consumer or developer that eats the fee - it’s the developer. This is exactly how it works: * Customer pays $10 * Apple owes developer $7 (to be paid in 4-6 weeks) * Customer asks for refund, Apple sends them $10 back * Developer owes Apple $3
- valuearb 6y ago
  It’s not true, I’ve been selling apps on the App Store fir ten years, never happened to me.
  - ladon86 6y ago
    I believe the real answer is that they do keep it (at least sometimes) for chargebacks but not for regular refunds. I've seen the discrepancy in our own accounting, and as mentioned elsewhere, it's in the App Store terms. But Apple's dashboard doesn't show a clear difference between chargeback and refund, and maybe that's where the story originated. HN won't let me amend my comment above, but I stand by the claim that this happens on chargebacks. Otherwise the App Store Connect numbers don't add up. I think the truth has some nuance, but that doesn't work on the internet, it's got to be either an outrageous story or "total fake news".

curiousgeorgio 6y ago

> When a customer refunds your paid app... (nitpick) The use of the verb "refund" seems confusingly wrong in this sentence. Neither the customer nor the paid app is paying back any money. I know it's Twitter, but it'd make a lot more sense to say "When Apple refunds a customer of your paid app..."

fizixer 6y ago

"When you refund a customer in full, for an app they returned, Apple doesn't refund you the 30% cut" ... ?

jmull 6y ago

I'm a little stuck on the terminology here. Does "customer refunds your paid app" mean the customer requests and gets a (full) refund from Apple for a prior app purchase? (I would say "returns" not "refunds" ... Apple is the one refunding, not the customer. The customer receives the refund. But I guess this is some kind of regional/informal usage I'm not familiar with.) If so, that's BS. Apple could reasonably keep transaction costs of something like 5%, but the full 30 is crazy.

sbarre 6y ago
As per the thread: You buy an app for $10, Apple gets $3, the developer gets $7. You refund the app (through the Apple App Store), you get your 10$ back, but that whole 10$ comes from the developer, unlike the 7/3 split when you first purchased it. So in the end, the developer has lost money due to the refund.
- Spivak 6y ago
  This is just sales commission rules though. If I get a 30% commission for a sale when the customer is referred by me and at some point in the future the customer asks for a refund I don't give my commission back. Our transaction was done when the original sale was made.
  - LanceH 6y ago
    Apple doesn't refer a sale. Apple makes the sale. They are the store, something they have set up and enforced. The developer has no capacity to deny a customer, yet has the responsibility for the bad customers shopping someone else's store.
    - genidoi 6y ago
      Devils advocate argument: A refund (probably) reduces the LTV of customers, and Apple has no control of the cause of those refunds, whether it be a buggy app or misrepresenting features. The ethics of this scheme are debatable but it should be assumed that some refunds are legitimate and Apple loses tangible customer $LTV from some refunds.

andreasley 6y ago

A Statement of Tim Cook for the House of Representatives claimed that "For the vast majority of apps on the App Store , developers keep 100% of the money they make." [1] How can this be even remotely true if Apple takes a 30% commission for every sale in the App Store? [1] https://docs.house.gov/meetings/JU/JU05/20200729/110883/HHRG-116-JU05-Wstate-CookT-20200729.pdf https://docs.house.gov/meetings/JU/JU05/20200729/110883/HHRG...

lis 6y ago
Two options: 1) Free apps with advertisements. Paid apps are by far the minority. 2) I guess this statement is related to subscription models like spotify. If you acquire the user outside of the apple ecosystem and they subscribe on your own website and then download your free app from the app store, you get to keep 100% on the revenue that the user generates as well.
- andreasley 6y ago
  Ah, the ad thing makes sense. It's technically true but the meaning conveyed in the statement is quite different. As for the subscription model, I've thought about that but developers that aren't huge companies have a hard time NOT integrating in-app purchases for cloud services (see "Hey", which had to use social media to get their update approved [1]), so it couldn't be the "vast majority of apps". [1] https://www.theverge.com/2020/6/18/21296180/apple-hey-email-app-basecamp-rejection-response-controversy-antitrust-regulation https://www.theverge.com/2020/6/18/21296180/apple-hey-email-...
amscanne 6y ago
Perhaps he means that they keep 100% of their 70% ;)
crazygringo 6y ago
Apple doesn't take a cut of your advertising revenue, and most apps are ad-supported rather than paid. That's why it's true.
- 6y ago

yannikyeo 6y ago

PWA web app needs a store to be the distributor for small web apps, making it easier for small developers to monetize more than just ads. Where is Mozilla, MS, Google, Amazon?

taylodl 6y ago

Add this to the long list of how the App Store doesn't serve the needs of application producers are their customers, and because the needs of these very important members of the app ecosystem aren't being served it really isn't serving Apple as well as it could either.

ntsplnkv2 6y ago
Their customers are not developers, never have been, and never will be. We see what "serving developers" has done to the web in general - a genuine mess. Perhaps the fee is a bit much and the refund should come with a return, but as an apple product owner, I like the general experience of my iPhone and its app stores, and I don't want them to cater to devs over me.

GoodJokes 6y ago

Its kinda cute how tech people are just finding out about capitalism now.

josephagoss 6y ago

According to the tweet, if a $1.00 app is refunded the customer gets back $1.00 from the developer and Apple keeps $0.30. So each refund costs the dev more than they took in for the sale whilst Apple always pockets the 30%. How can a refund cost the dev $1.00 if they only took $0.70 for the sale?

deleted 6y ago

[deleted]

makecheck 6y ago

The “cost” of refunding a $9.99 app is the same as the “cost” of refunding a $0.99 app. Sure, let them keep some amount for payment processing but it should be a constant.

bawana 6y ago

What happens if I send somebody money with PayPal/cash app but then reverse/undo the transaction? Are the fees kept?

lukeramsden 6y ago
Most likely, but the fees are more like 30p + 2.9% (atleast in the UK, on PayPal) or something similar, which on a 99p app would be 30%, but on a $15 app it's obviously nowhere near 30%.

chourobin 6y ago

Dig a little deeper in the thread. I don't think this is accurate.

bronzeage 6y ago

I also argue that it's the heavy commissions which push nearly every App to an ad based model, or physical services Apps which don't charge anything. This in turn shifts more and more apps in the direction of invading our privacy with invasive ads libraries, leading to also worse privacy as a consequence. It's already pretty hard to convince users to pay for an app, the 30% cut almost guaranties it will be a bad business model.

8ytecoder 6y ago

A fair and equitable App Store model that also protects users would be one where it’s opt-in. Apple vetting an app should be independent of distribution. Developers can then choose whether they want to use the App Store or not.

davidwhodge 6y ago

This does not match my experience with my App, Nikola. I've been able to match up the transactions and refunds as 1 to 1, price-wise.

christefano 6y ago
Thank you for weighing in. Hearing from more devs is what this thread needs, IMO, not rumor mongering. Great website, by the way! https://www.nikolaapp.com/ https://www.nikolaapp.com/ Out of curiosity, can you say whether Tesla has approached you for acquisition?
tomduncalf 6y ago
Interesting. I wonder if it varies from region to region perhaps? Going to do a bit more research as this guy seems quite convinced they are taking the cut but evidently you’ve experienced otherwise!
- davidwhodge 6y ago
  Yeah I'm not sure what the discrepancy is. This afternoon I'm going to dig a bit more into my records. In my data right now I see a few examples of an $80 purchase match to $56 in proceeds (70%) matched to $56 of a refund. I can't say I think the 30% fee is appropriate anymore, but this particular case being made about refunds does not appear to be accurate for me at least.
  - tomduncalf 6y ago
    Could be that this developer is confused, maybe the way Apple represent the data is confusing in the records or something... in which case my apologies for spreading false information, but he seemed pretty convinced!
  - deleted 6y ago
    [deleted]
ntsplnkv2 6y ago
Thanks for a different perspective. The group think on here always reaches a fever pitch when it comes to Apple - HN is particularly susceptible to it

user123ae78 6y ago

Why is it we don’t tax these companies in the same way. 30% on all income in the country where the good/service was sold

bishalb 6y ago

HNers don't seem very critical of Apple here. Imagine if Microsoft did the same, all hell would break loose.

leptoniscool 6y ago

Not surprising, since they have control of the platform and the market. But it's ethically questionable.

akerro 6y ago

Can you buy and refund and buy and refund the same app multiple times? Can you use this to ruin your competition?

arbuge 6y ago

Of note: as of last October, if a PayPal merchant refunds a customer for any reason, PayPal is no longer refunding their payment processing fee. The merchant will need to refund that to the customer at their own expense to grant the customer a full refund.

perfectstorm 6y ago

People keep talking about 30% cut but it's actually more than that if you look outside of U.S. Apple takes more than 30% cut for in-app purchases made in other countries. For example, an in-app-purchase (IAP) you sell in USD for $15.99 is translated to 1249 Indian Rupees and you get a proceed of 741 Rupees which is only 59%. So Apple keeps the rest 41%. Today's (when I wrote this) exchange rate shows approx. 76 rupees for 1 USD so the amount they charge the user is pretty accurate but Apple put so much wiggle room in their favor. This is true for other currencies as well.

brokencode 6y ago

Apple keeps on abusing their dominant market position to make huge profits at the expense of small developers. They subject apps to huge fees, then release competing apps at the same price (such as Apple Music). They prevent companies from selling ebooks on from their apps without taking a huge cut, again, despite the fact that they have a competing app in iBooks. These are perhaps the most egregious examples, but the list is very long of other complaints. How long will they get away with this before antitrust regulation kicks in? They are so focused on extracting rent that they keep on poking this sleeping bear, and it eventually will be a huge problem for them. If they don’t reverse course, expect to see large reductions in their profits and stock price when this happens.

monadic2 6y ago

Of all the chatter around anti-trust, has anyone broached the app store and apple’s monopoly on iOS software? I am using the term in a colloiquial, non-legalistic sense. My fear is that politicians are invested in tech stocks, like the rest of us and pretty much anyone with a mutual fund, so they are unlikely to act in a pro-consumer manner.

krick 6y ago

I guess in Europe iStuff isn't as overwhelmingly popular as in USA, so when I hear things like that I am always amazed at how could anyone (a developer) in their mind ever cooperate with Apple. Even writing and getting a new app to their store is a huge feat, they take a huge cuts when you make money, and when you don't they can charge you "30% of what you could make" anyway. This is just absolute nonsense.

gnicholas 6y ago

Stripe started doing this as well, as of a few months ago. Makes it tougher to be generous with refunds for people, knowing that we literally lose money doing so. Fortunately their cut isn’t the massive 30% that Apple takes.

m3kw9 6y ago

This probably lower incentives for App devs to create refund situations. For example you attempt to get people to download your app by misrepresenting it. Most will not get refunds, and the Dev gains from such behaviour.

molszanski 6y ago

How does it work in other stores? Like Google Play, Steam, Microsoft Store, Playstation / Xbox / Nintendo / Switch stores? Do they keep it?

valuearb 6y ago

This isn’t true. Source: me, I’m a developer who has been giving customers refund instructions fir ten years.

jedimind 6y ago

Tim Sweeney @TimSweeneyEpic This is a critical consideration in these 30% store fees. They come off the top, before funding any developer costs. As a result, Apple and Google make more profit from most developers' games than the developers themselves. That is terribly unfair and exploitative. https://twitter.com/TimSweeneyEpic/status/1288315775607078912 https://twitter.com/TimSweeneyEpic/status/128831577560707891...

chrisjarvis 6y ago

Has anyone confirmed this is true (or is this tweet the only source...)? https://developer.apple.com/forums/thread/105454 https://developer.apple.com/forums/thread/105454 "Apple has the RIGHT TO withhold" https://news.ycombinator.com/item?id=23989256 https://news.ycombinator.com/item?id=23989256 It seems you can only get a refund by reporting a problem, which means if your app works as described you shouldn't be able to request a refund.

juiyout 6y ago
I have requested several refunds by reporting a problem saying that the app didn’t work the way I thought it would. Automatically approved and refunded. Takes like 10 seconds.
tomduncalf 6y ago
One developer has said (below) this didn’t seem to be the case for him, so it’s possible the original tweet poster was confused. I have heard this rumour before and it does sound like Apple deserve the right to do this, so perhaps it varies on a case by case or region by region basis? But seems to be hard to find concrete information either way strangely!
deleted 6y ago
[deleted]
gruez 6y ago
Here's a second source: https://techcrunch.com/2009/03/25/apples-iphone-app-refund-policies-could-bankrupt-developers/ https://techcrunch.com/2009/03/25/apples-iphone-app-refund-p...
- xsmasher 6y ago
  That article is also talking about what apple COULD do - it doesn't say apple is actually doing it.
deleted 6y ago
[deleted]

hn_check 6y ago

This isn't correct at all. This is a serious misunderstanding by someone in a pretty incredible way. Literally a single person claiming this and _multiple_ people refuting it from their own experience. Yet it's top of HN. Amazing. A lesson to never, ever trust anything here because the masses clicked an arrow.

hn_check 6y ago
LOL, it has since been retracted the author admitted it was their own misunderstanding. Here the post still sits on the front page. Don't ever change your adorable ignorance, HN. It's such a laugh. And this will be auto-dead. I was spot on and completely right and got pummeled down by the imbeciles of this cesspool. Hilarious.
FabHK 6y ago
> A lesson to never, ever trust anything here FWIW, it's been corrected in less than 18 hours. Conclusion: You can continue to blindly trust everything here (provided you check a day later) ;-)

fractal618 6y ago

That doesn’t seem fair at all

annoyingnoob 6y ago

From the perspective of an iPhone user, Apple does a reasonable job of keeping nefarious apps out of the app store (not prefect, maybe not even great, but reasonable). Most apps that have a set price and not a subscription are reasonably priced and one does not feel/notice that Apple takes a 30% cut. The end user experience is reasonable. I feel like getting rid of the app store, or even just allowing side loading, would open users up to a lot of nefarious software. If we assume that consumers like the App store and that its not going away, how do we satisfy developers but allow consumers the comfort of the walled garden?

tomduncalf 6y ago

Looks like the original tweet may be incorrect according to replies on there, or at least this doesn’t apply to every app, for example: https://mobile.twitter.com/LittleFinLLC/status/1288570444417728518 https://mobile.twitter.com/LittleFinLLC/status/1288570444417... Would be great if others could chime in with their experience if they have records to check! My apologies for posting this if it proves to be incorrect, hard one to fact check weirdly.

xsmasher 6y ago
The last time this came up, in 2009, I looked at my reports and concluded the same thing- when Apple reported a refund, they were deducting 70% of a sale from my future earnings, not 100%
- xsmasher 6y ago
  This topic is generating enough heat that I went trolling through my old reports. Apple appears to be deducting just the 70% from earnings, not the full 100%. https://imgur.com/gallery/KwKlMXh https://imgur.com/gallery/KwKlMXh

tkubacki 6y ago

One more reason for society as a whole to get rid of greedy tech monsters dependency like Apple in long term. Remember You often have a choice to not support this platform and move towards web by default even if it is not easy (Apple enforce to use their web engine to make sure you are in a slave position on iOS)

ljw1001 6y ago

This is Apple exploiting it near monopoly powers, plain and simple.

neycoda 6y ago

They should refund half of the 30% to pay for their costs and whatever, like a handling service. Unfortunately that still means the seller is paying for returns, but Apple probably is legally required in most countries to refund the buyer fully, what do I know.

Waterluvian 6y ago

Wait so. I buy your app. You get $7 and Apple gets $3. I refund your app and get $10 back. Is Apple taking $10 from the developer to give to me? This smells positively rotten.

xsmasher 6y ago
It's not true, as far as I can tell from my reports. Apple appears to be deducting just the 70% from earnings, not the full 100%. https://imgur.com/gallery/KwKlMXh https://imgur.com/gallery/KwKlMXh

Bloggerzune 6y ago

That’s the problem with paid apps... but I also believe now it’s a problem with devs not validating the app receipt to check for refunds and prevent access. Serious question: Is this refund problem as big an issue as commenters here are implying? Is there data that shows that app developers are losing significant money due to Apple's fees not being refunded? https://www.bloggerzune.com/2020/07/Indeed-Prime.html?m=1 https://www.bloggerzune.com/2020/07/Indeed-Prime.html?m=1

mawise 6y ago

Nobody seems to be taking this to the logical conclusion. If Apple's behavior is not desirable, then don't build apps for the Apple app store. They're apparently providing enough value in giving developers access to premium customers that this aggressive behavior is worth the trade-off for many developers.

lumost 6y ago
Apple's app store provides value to developers and customers because it is the only method of delivering apps to iphones. If there were other app stores that charged 20% less for the apps, then developers and customers would use those. See Steam vs. Windows Store vs. Epic Games store.

person_of_color 6y ago

The tweet is now deleted. What happened to the dial a mob?

deleted 6y ago

[deleted]

rs23296008n1 6y ago

So to update and add to their old slogan: Think different... but we still keep our 30% cut Tech in general has quite a few things about itself it needs to fix. Is it ethical for Apple to write the OS, run the store, sell its own wares AND compete with people it charges, eg 30%, to compete? Same question for other stores, eg Google? Both companies have analytics to determine which of the crop is successful and therefore needs to be harvested. Is this a level playing field? Do we expect such? Should we? These aren't trivial or straightforward issues. It will be interesting to see over the next 20 years how this plays out. It would be better with a shorter time frame but... nothing involving legalities is usually fast.

Spivak 6y ago
Charging 30% to competitors that it doesn’t charge to itself isn’t really a problem because of opportunity cost. If an Apple product takes revenue from a competitor that’s paying them 30% then they still have all the costs of running their competing service and make less money from their 30% cut. The margins have to be really good for such a thing to be worthwhile.

stevespang 6y ago

Somebody needs to file a JUICY class action against Apple - - and also make Tim Cook sweat at the Judiciary meetings in DC by dragging him through the red hot coals on this one . . .

xhruso00 6y ago

Tweet is unavailable (deleted). Backup http://archive.is/wqWYK http://archive.is/wqWYK New twitter link: https://twitter.com/twolivesleft/status/1288625617873694721?s=21 https://twitter.com/twolivesleft/status/1288625617873694721?...

ec109685 6y ago
This wasn’t true: https://twitter.com/twolivesleft/status/1288625617873694721?s=21 https://twitter.com/twolivesleft/status/1288625617873694721?... Recanted there. People need to think more critically.
- xsmasher 6y ago
  Ugh. This factoid is now stuck in a bunch of memories though, and they're swear it's true the next time it gets debated.
  - anonytrary 6y ago
    To go deeper into the rabbit hole, lots of people dislike Apple, so this tweet could have been a calculated effort to further tarnish Apple's reputation. Plan: 1. Create fake news that X people see. 2. Wait until X is large. 3. Delete fake news, use "plea ignorance" apology to save face, that Y (Y << X) people see. Congrats you now have a large number of people who now have an even worse opinion on the subject of the news. Repeat steps to cause even more damage.
    - zymhan 6y ago
      Yeah, but it's Apple. That's a drop in the ocean.
    - threeseed 6y ago
      Or be like the Hey app. Pretend to be the victim, whip up a whole lot of free PR sympathy and then make the minor change to the app and resubmit whilst no one is paying attention.

arrty88 6y ago

How come all the best tweets get deleted? C’mon

ogirginc 6y ago

Tweet can be accessed from https://web.archive.org/web/20200729052623/https://twitter.com/twolivesleft/status/1288344977169235968 https://web.archive.org/web/20200729052623/https://twitter.c...

deleted 6y ago

[deleted]

layoutIfNeeded 6y ago

This is simply not true.

elliottkember 6y ago

I was mistaken in my original (now deleted) tweet and have been corrected by a few people Apple does not keep the 30% commission on a refund the refund happens as you’d expect. I don’t know where I got the idea that it worked the way I thought it did This was a follow-up by the tweet's author. https://twitter.com/twolivesleft/status/1288625617873694721?s=21 https://twitter.com/twolivesleft/status/1288625617873694721?...

Vervious 6y ago
Misinformation really does spread like wildfire. Even with the number of naysayers on Hacker News we still seemed to have had a lapse in critical thinking. I've been wanting to get into research on the study of the spread of tweets like this. Anyone have pointers for reading material?
- deleted 6y ago
  [deleted]
- xuki 6y ago
  I have sold apps on the App Store for a decade now, and I have to admit I did believe the original tweet. I was going to go through the financial reports during the weekend to verify, but the initial reaction was “of course they would do this, it’s Apple”.
  - dhsysusbsjsi 6y ago
    The fact this tweet is so believable says something about how poorly Apple has been treating its developers the last decade.
    - mr_toad 6y ago
      Or it just says something about confirmation bias.
      - 6y ago