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Doesn't seem a fair comparison given the far more substantial costs of brick and mortar. Brick and mortar retailers do not, traditionally, have very large margi
by dangoor 6y ago
Doesn't seem a fair comparison given the far more substantial costs of brick and mortar. Brick and mortar retailers do not, traditionally, have very large margins when all is said and done, whereas I think the App Store has quite significant margins for Apple.
- valuearb 6y agoLast I looked, Apples gross services margins were around 66%, which implies a break even for the store at a 10% fee.
- Someone 6y agoI think Apples service margins include an unspecified amount from Google for being the default search engine on iOS. And that’s a big fraction of their services. https://www.thestreet.com/investing/google-pays-apple-billions-to-be-default-search-engine-14865683 https://www.thestreet.com/investing/google-pays-apple-billio... estimates that at $9.48 billion over 2018.
- valuearb 6y agoThat implies that App Store margins are lower than I estimated, and it’s costs higher.
- edmundsauto 6y agoDumb question, but why is a vendor's cost a relevant input to evaluate fairness? Isn't a common theme around here to price based on value, not on cost?