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> IPhone sales are profitable as they are The numbers don’t add up. Apple sold 6 million of iPhone 1 in 2007-2008 season before app.store launch. Assuming the

> IPhone sales are profitable as they are The numbers don’t add up. Apple sold 6 million of iPhone 1 in 2007-2008 season before app.store launch. Assuming the average price was $550 that generated $3.3B turnover. According to rumors spread by Bloomberg and other sources, Apple spent $2.6B on R&D of iPhone 1 from the moment the initial research began. Not a good business at all, this means Apple paid most of manufacturing and marketing out of their pocket. After the app.store, apple was able to sell 100 million of iPhone 4 over 2010-2011 season. That’s more than order of magnitude difference. That increase in volume is what allowed Apple recuperate initial R&D costs, earn good profits, and increase their spending on R&D of new products by more than an order of magnitude since 2007. I’m not sure people would have bought 100 million of iPhones 4 if you could run same apps on equally performing hardware that’s twice cheaper.

jojobas 6y ago
By "before" I mean "before you account for royalties from the app store. Of course you wouldn't expect R&D to pay for itself in the first year. Apple doesn't rely on the royalty revenue to make iPhones profitable (and shouldn't be allowed to).
- Const-me 6y ago
  App store being exclusive to Apple is the main reason why people are buying these devices. Without that lock, Apple wouldn’t be able to sell $500 worth of hardware for $1500, in huge quantities: https://www.digitaltrends.com/mobile/how-much-does-it-cost-to-make-iphone/ https://www.digitaltrends.com/mobile/how-much-does-it-cost-t...
  - jojobas 6y ago
    Very few apps are ios-exclusive. Do you think that the ability to use other stores would make iphones less valuable for their users?
    - Const-me 6y ago
      > Very few apps are ios-exclusive Many cross-platform apps work better on iOS, due to lack of fragmentation. > Do you think that the ability to use other stores would make iphones less valuable for their users? Initially, I answered to this: “Hardware/OS vendors should not be allowed to include app stores out of the box, much less prevent sideloading.” Now on your new question, yes, I think this may actually happen, here’s how. If such cross-platform third-party store would be allowed, and would gain traction, many developers gonna stop writing native iOS apps for 2 reasons: development/porting is expensive, and Apple taking their cut from sales. Apple’s app store has rather strict policies about software quality in general, malware, user’s personal data choices, even battery use (years ago I’ve developed for iOS on my day job). Apple won’t be able to enforce equivalent policies for other stores. For one they can’t technically do that. Even if they could, they are not going to get paid for moderating apps on other stores. Currently, they collect their cut from sales, and collect money from developers for developer program membership. These 2 sources of income pay for these reviews. Therefore, quality of apps available on iOS is going to decline. Along with security: it’s very hard to design a secure system where users are allowed to run arbitrary native code, the only somewhat reliable way is hardware-assisted hypervisor. Being able to enforce policies by reviewing and rejecting apps helps a lot with that, among other things these policies forbid usage of private APIs or running downloaded code.

jojobas 6y ago

By "before" I mean "before you account for royalties from the app store. Of course you wouldn't expect R&D to pay for itself in the first year. Apple doesn't rely on the royalty revenue to make iPhones profitable (and shouldn't be allowed to).

Const-me 6y ago
App store being exclusive to Apple is the main reason why people are buying these devices. Without that lock, Apple wouldn’t be able to sell $500 worth of hardware for $1500, in huge quantities: https://www.digitaltrends.com/mobile/how-much-does-it-cost-to-make-iphone/ https://www.digitaltrends.com/mobile/how-much-does-it-cost-t...
- jojobas 6y ago
  Very few apps are ios-exclusive. Do you think that the ability to use other stores would make iphones less valuable for their users?
  - Const-me 6y ago
    > Very few apps are ios-exclusive Many cross-platform apps work better on iOS, due to lack of fragmentation. > Do you think that the ability to use other stores would make iphones less valuable for their users? Initially, I answered to this: “Hardware/OS vendors should not be allowed to include app stores out of the box, much less prevent sideloading.” Now on your new question, yes, I think this may actually happen, here’s how. If such cross-platform third-party store would be allowed, and would gain traction, many developers gonna stop writing native iOS apps for 2 reasons: development/porting is expensive, and Apple taking their cut from sales. Apple’s app store has rather strict policies about software quality in general, malware, user’s personal data choices, even battery use (years ago I’ve developed for iOS on my day job). Apple won’t be able to enforce equivalent policies for other stores. For one they can’t technically do that. Even if they could, they are not going to get paid for moderating apps on other stores. Currently, they collect their cut from sales, and collect money from developers for developer program membership. These 2 sources of income pay for these reviews. Therefore, quality of apps available on iOS is going to decline. Along with security: it’s very hard to design a secure system where users are allowed to run arbitrary native code, the only somewhat reliable way is hardware-assisted hypervisor. Being able to enforce policies by reviewing and rejecting apps helps a lot with that, among other things these policies forbid usage of private APIs or running downloaded code.