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I’m a huge fan of Apple Pay and do not begrudge the 0.15% cut they take on those transactions. The cut they take for App Store purchases is over 100x that amoun

I’m a huge fan of Apple Pay and do not begrudge the 0.15% cut they take on those transactions. The cut they take for App Store purchases is over 100x that amount, which is obscene.

CubsFan1060 6y ago
But,it's more than that. Not only do I get some security for payment, but I get: * Some level of guarantee that every app on my phone has been vetted (it's not perfect of course, but is better than nothing). It's unlikely that anything to nefarious makes can make it onto my phone, and if it does, it'll be removed. * I get a better fit and finish. Apps on the iPhone very often have a better quality to them. * I get the ability to refund when needed. * Personally, my support requirements go down. When my nephew calls me with a problem, I know that he didn't go download some random app from instructions he got from a friend. Clearly, there's also some profit in there. Edit: Perhaps to get to my point -- these were ALL known when I bought my phone, and for me, were part of the reason I bought it. If I was not ok with this, I would have bought an Android phone.
- heavyset_go 6y ago
  And I'm sure that other companies could be more efficient with the 30% App Store cut, or less than 30%, but the power of markets and competition are stifled by Apple's restrictive limitations. Bandcamp, for example, provides both digital and physical assets, and only takes a 10% - 15% cut. They provide a secure experience for their customers free of ads, malware, spyware and spam.
- benhurmarcel 6y ago
  But nobody wants to deny you the choice of paying an extra 30% to get all that. What they want is the choice.
  - stevenwliao 6y ago
    If apps decide to avoid launching on the App Store, then I have to choose between compromising my privacy and picking a worse app.
HatchedLake721 6y ago
You're comparing apples and oranges, two completely unrelated industries. One is payment processing, the other's a unified market of 155 countries and 1+ billion users where all the headache of payments, local sales taxes, APIs, etc are taken care of.
- wvenable 6y ago
  If all those oranges were worth 30%, why would Epic bother with their own payment system?
deleted 6y ago
[deleted]
valuearb 6y ago
Comparing a payment processing fee to hosting content on a store site is completely disingenuous. The costs are wildly little different and it’s unlikely any App Store like Apples could even pay for itself with only a 10% cut, for example..
- ctvo 6y ago
  Do you have access to information the rest of us don't? Apple doesn't release the operational details of its AppStore in its financial disclosures. Shocking you know a 10% fee isn't enough to maintain it. How about we do what's often suggested: we spin the AppStore off as its own non-profit governing body and they can disclose their operating costs and increase / decrease their fee as needed. The rules then apply equally to Apple vs. non-Apple companies.
  - valuearb 6y ago
    Apple breaks out a services line in their financial reports. You should read them. Services has a gross margin of around 67-68%, but that includes a $9B check from Google every year with near 100% margins. So the App Store is very likely to be less than 67%, maybe as low as 15%. It’s not just payment processing. They provide other critically valuable services to developers such as App Review, Hosting, International Distribution, CoMarketing, Store APIs, Security, etc, etc, and they all have thousands of employees and cost billions to provide.
    - ctvo 6y ago
      Please provide anything to back up these claims. Until you provide something, here's a breakdown from Forbes of an estimate of Apple's App Store revenue in 2019: https://dashboards.trefis.com/no-login-required/7JGMQ7wT/Breaking-Down-Apple-s-Services-Revenue- https://dashboards.trefis.com/no-login-required/7JGMQ7wT/Bre... (there's an adjustment to the take percentage to see their estimated revenue if it's lowered, feel free to play around with it) Apple Services: - AppStore $ 15 billion - Licencing $ 10 billion - Apple Care & Others $ 7.5 billion - Apple Music $ 5.4 billion - iCloud $ 4.5 billion - Third-Party Subscriptions $ 3.6 billion Total: $46 billion Remember, you're stating that Apple isn't able break even at a 10% fee for the App Store. Recall that Apple charges developers a yearly subscription (99 USD for non-enterprise accounts per year) to be able to submit something to the App Store. And additionally remember that your "co-marketing" cost should include the money Apple makes from advertisers on its App Store [1]. The items you mentioned as costs are standard for many similar internet service (hosting, security, customer APIs, etc. etc,.) that do not make nearly the amount of revenue Apple does with its App Store. Let's do a worst case and cut Apple's estimated App Store revenue from $15 billion to $5 billion a year to show how ridiculous the claim that they can't break even is. 1 - https://searchads.apple.com/ https://searchads.apple.com/

I’m a huge fan of Apple Pay and do not begrudge the 0.15% cut they take on those transactions. The cut they take for App Store purchases is over 100x that amount, which is obscene.

CubsFan1060 6y ago

But,it's more than that. Not only do I get some security for payment, but I get: * Some level of guarantee that every app on my phone has been vetted (it's not perfect of course, but is better than nothing). It's unlikely that anything to nefarious makes can make it onto my phone, and if it does, it'll be removed. * I get a better fit and finish. Apps on the iPhone very often have a better quality to them. * I get the ability to refund when needed. * Personally, my support requirements go down. When my nephew calls me with a problem, I know that he didn't go download some random app from instructions he got from a friend. Clearly, there's also some profit in there. Edit: Perhaps to get to my point -- these were ALL known when I bought my phone, and for me, were part of the reason I bought it. If I was not ok with this, I would have bought an Android phone.

heavyset_go 6y ago
And I'm sure that other companies could be more efficient with the 30% App Store cut, or less than 30%, but the power of markets and competition are stifled by Apple's restrictive limitations. Bandcamp, for example, provides both digital and physical assets, and only takes a 10% - 15% cut. They provide a secure experience for their customers free of ads, malware, spyware and spam.
benhurmarcel 6y ago
But nobody wants to deny you the choice of paying an extra 30% to get all that. What they want is the choice.
- stevenwliao 6y ago
  If apps decide to avoid launching on the App Store, then I have to choose between compromising my privacy and picking a worse app.

HatchedLake721 6y ago

You're comparing apples and oranges, two completely unrelated industries. One is payment processing, the other's a unified market of 155 countries and 1+ billion users where all the headache of payments, local sales taxes, APIs, etc are taken care of.

wvenable 6y ago
If all those oranges were worth 30%, why would Epic bother with their own payment system?

deleted 6y ago

[deleted]

valuearb 6y ago

Comparing a payment processing fee to hosting content on a store site is completely disingenuous. The costs are wildly little different and it’s unlikely any App Store like Apples could even pay for itself with only a 10% cut, for example..

ctvo 6y ago
Do you have access to information the rest of us don't? Apple doesn't release the operational details of its AppStore in its financial disclosures. Shocking you know a 10% fee isn't enough to maintain it. How about we do what's often suggested: we spin the AppStore off as its own non-profit governing body and they can disclose their operating costs and increase / decrease their fee as needed. The rules then apply equally to Apple vs. non-Apple companies.
- valuearb 6y ago
  Apple breaks out a services line in their financial reports. You should read them. Services has a gross margin of around 67-68%, but that includes a $9B check from Google every year with near 100% margins. So the App Store is very likely to be less than 67%, maybe as low as 15%. It’s not just payment processing. They provide other critically valuable services to developers such as App Review, Hosting, International Distribution, CoMarketing, Store APIs, Security, etc, etc, and they all have thousands of employees and cost billions to provide.
  - ctvo 6y ago
    Please provide anything to back up these claims. Until you provide something, here's a breakdown from Forbes of an estimate of Apple's App Store revenue in 2019: https://dashboards.trefis.com/no-login-required/7JGMQ7wT/Breaking-Down-Apple-s-Services-Revenue- https://dashboards.trefis.com/no-login-required/7JGMQ7wT/Bre... (there's an adjustment to the take percentage to see their estimated revenue if it's lowered, feel free to play around with it) Apple Services: - AppStore $ 15 billion - Licencing $ 10 billion - Apple Care & Others $ 7.5 billion - Apple Music $ 5.4 billion - iCloud $ 4.5 billion - Third-Party Subscriptions $ 3.6 billion Total: $46 billion Remember, you're stating that Apple isn't able break even at a 10% fee for the App Store. Recall that Apple charges developers a yearly subscription (99 USD for non-enterprise accounts per year) to be able to submit something to the App Store. And additionally remember that your "co-marketing" cost should include the money Apple makes from advertisers on its App Store [1]. The items you mentioned as costs are standard for many similar internet service (hosting, security, customer APIs, etc. etc,.) that do not make nearly the amount of revenue Apple does with its App Store. Let's do a worst case and cut Apple's estimated App Store revenue from $15 billion to $5 billion a year to show how ridiculous the claim that they can't break even is. 1 - https://searchads.apple.com/ https://searchads.apple.com/