4 ms·

I don't understand these arguments either. It's not illegal to have high product margins, right? Why can't they charge whatever they want? It comes across as pu

I don't understand these arguments either. It's not illegal to have high product margins, right? Why can't they charge whatever they want? It comes across as pure moral "I don't like it" objection, which is fine, but don't use it as a legal argument.

Jommi 6y ago
High product margins are usually signs of monopolistic powers used, otherwise profits would slowly move towards cost as time goes forward. This has not been the case with Apple.
- CamelCaseName 6y ago
  This is only true of products with substitutes. The extreme example being commodities. Pretty much any luxury brand has high product margins, but certainly not for lack of competition.
  - Jommi 6y ago
    Exactly, and luxury brands are characterized by their electivity. While and appstore has formed to become something close to a virtual public good.
- lancepioch 6y ago
  Google has basically the same profit margins with their Pixel phones compared to Apple and Android has 85% market share. Yeah you can sideload any app you want on your Android, but I've heard of no even half serious 3rd party competitors to the Play store. Not sure what the point is here.
- askafriend 6y ago
  What do you think of coffee?
  - Jommi 6y ago
    That I can make it myself at home and it comes to around 10cents? Or get it from a cafe, and value my time at around 2-3€ per cup
yokto 6y ago
It's about balancing the market. That's why anti-trust exists. Would you want an insulin monopoly to be able to have 95% margin? Probably not. That's why it's illegal. Too many usinesses can't live without access to iPhone users.
- kbutler 6y ago
  Epi-pen approx 97% $8/injector, so $16/two-pack, selling for $700 in 2016 https://www.mercurynews.com/2016/10/01/epipen-outrage-silicon-valley-engineers-figure-true-cost-to-make-lifesaving-auto-injector-about-10/ https://www.mercurynews.com/2016/10/01/epipen-outrage-silico... Of course, software sales have much higher margin of production cost (every copy but the first is free-to-make).
  - deleted 6y ago
    [deleted]
- cwhiz 6y ago
  iOS is the minority smartphone OS in the US and in the world. In the world their share is under 20%. In the US it’s under 50%. In both cases, shrinking. If Apple/iOS is a minority that means someone else must be a majority. Who, exactly, do you think should be the target of that balancing, and why?
ct520 6y ago
It's the fact when you get large enough and force things that are considered unrealistic or anti competitive platform it becomes an issue. This isn't new to American business. It evolves. It use to be oil, steel, ATT, Microsoft.. Now it's Apple. Tech is long over due for a overhaul only a matter of time until some politician uses it to add a feather to their cap. 30% cut of a sale of a mature economy is just crazy.
- dev_tty01 6y ago
  >30% cut of a sale of a mature economy is just crazy. That is why it isn't 30% after the first year. It is 15% for subscription based software starting year 2. As I pointed out earlier, Apple also eats credit card transaction costs (~2.5%) and the costs of collecting and paying sales tax in 50 states and 155 countries, app store personnel, servers, etc...
  - fomine3 6y ago
    Just only for recurring subscription. There's very little reason to be.

Jommi 6y ago

High product margins are usually signs of monopolistic powers used, otherwise profits would slowly move towards cost as time goes forward. This has not been the case with Apple.

CamelCaseName 6y ago
This is only true of products with substitutes. The extreme example being commodities. Pretty much any luxury brand has high product margins, but certainly not for lack of competition.
- Jommi 6y ago
  Exactly, and luxury brands are characterized by their electivity. While and appstore has formed to become something close to a virtual public good.
lancepioch 6y ago
Google has basically the same profit margins with their Pixel phones compared to Apple and Android has 85% market share. Yeah you can sideload any app you want on your Android, but I've heard of no even half serious 3rd party competitors to the Play store. Not sure what the point is here.
askafriend 6y ago
What do you think of coffee?
- Jommi 6y ago
  That I can make it myself at home and it comes to around 10cents? Or get it from a cafe, and value my time at around 2-3€ per cup

yokto 6y ago

It's about balancing the market. That's why anti-trust exists. Would you want an insulin monopoly to be able to have 95% margin? Probably not. That's why it's illegal. Too many usinesses can't live without access to iPhone users.

kbutler 6y ago
Epi-pen approx 97% $8/injector, so $16/two-pack, selling for $700 in 2016 https://www.mercurynews.com/2016/10/01/epipen-outrage-silicon-valley-engineers-figure-true-cost-to-make-lifesaving-auto-injector-about-10/ https://www.mercurynews.com/2016/10/01/epipen-outrage-silico... Of course, software sales have much higher margin of production cost (every copy but the first is free-to-make).
- deleted 6y ago
  [deleted]
cwhiz 6y ago
iOS is the minority smartphone OS in the US and in the world. In the world their share is under 20%. In the US it’s under 50%. In both cases, shrinking. If Apple/iOS is a minority that means someone else must be a majority. Who, exactly, do you think should be the target of that balancing, and why?

ct520 6y ago

It's the fact when you get large enough and force things that are considered unrealistic or anti competitive platform it becomes an issue. This isn't new to American business. It evolves. It use to be oil, steel, ATT, Microsoft.. Now it's Apple. Tech is long over due for a overhaul only a matter of time until some politician uses it to add a feather to their cap. 30% cut of a sale of a mature economy is just crazy.

dev_tty01 6y ago
>30% cut of a sale of a mature economy is just crazy. That is why it isn't 30% after the first year. It is 15% for subscription based software starting year 2. As I pointed out earlier, Apple also eats credit card transaction costs (~2.5%) and the costs of collecting and paying sales tax in 50 states and 155 countries, app store personnel, servers, etc...
- fomine3 6y ago
  Just only for recurring subscription. There's very little reason to be.