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Are they abusing market power though? 30% seems to be the standard rate for online stores. Google and Apple do it. Steam is 30%. And it’s been report that Sony,

Are they abusing market power though? 30% seems to be the standard rate for online stores. Google and Apple do it. Steam is 30%. And it’s been report that Sony, Microsoft, and Nintendo also take a 30% cut. Physical store such as GameStop, Best Buy, and Walmart take 30% too. Epic only takes 12% which is great, but they’re also locking up games in exclusive deals which I think is way worse. Edit: I pulled these numbers from IGN’s article. Although I’ve seen another report that matches the 30% in most places. https://www.ign.com/articles/2019/10/07/report-steams-30-cut-is-actually-the-industry-standard https://www.ign.com/articles/2019/10/07/report-steams-30-cut...

grumple 6y ago
It’s a _lot_ for what’s basically just payment processing (that’s all it is for in app sales). Looks like price collusion by the major players as well, which is also illegal.
- smachiz 6y ago
  That's not true, it's also discovery, trust and an ecosystem to run your apps in. Calling the app store just payment processing is a ridiculous simplification. Epic's store charges 12%, but has neither the hardware platform, or software platform - and relatively little market share. They arguably should be charging ~5% since it's actually closer to just payment processing and delivery.
  - grumple 6y ago
    Apple takes 30% for in-app sales. People already have the app, there is no discovery or trust benefit. The App Store is awful for discovery anyway. You think we need the App Store to discover the Facebook app, Amazon app, Epic app? These apps spread by network effects, not discovery in the store. Users pay for the hardware platform. I find games for the first time with the Epic Store. Market share isn’t really super relevant, they are the newest entry in the market.
    - kube-system 6y ago
      I think Apple is probably on the wrong side of anti-trust law on this, but there is certainly a trust benefit (and UX benefit) to a unified payment platform. The history of mobile/online payments is littered with instances of users being confused/defrauded. > Users pay for the hardware platform. This isn't really relevant. Not only is an iPhone worthless without software, but subsidization of hardware by services is very common.
      - grumple 6y ago
        Isn’t Visa/MasterCard the unified payment platform? Obviously the iPhone is worthless without software, except it comes with a 1k price tag. Part of that is for the OS. The hardware certainly doesn’t cost that much (comparable offerings from hardware-only manufacturers cost less). This is not a case where the hardware cost is subsidized. Numbers from various sources suggest the iPhone sells for triple the cost of manufacturing.
        sebastianmarkow 6y ago
        manufacturing cost != R&D cost
        ac29 6y ago
        Apple's net sales for Q3 were ~$60B and R&D was ~$5B. No matter how you look at it, the cost of an iPhone far exceeds Apple's cost to produce it. https://www.apple.com/newsroom/pdfs/FY20-Q3_Consolidated_Financial_Statements.pdf https://www.apple.com/newsroom/pdfs/FY20-Q3_Consolidated_Fin...
        kube-system 6y ago
        You’re still neglecting ongoing operational costs, which are neither hardware nor R&D. But it still doesn’t matter, Apple is profitable, everyone knows that already. It is legal to be profitable, and it is legal to have parts of your business subsidize other parts. What might not be legal is using a dominant market position to force out competitors.
- malshe 6y ago
  It's for the access to Apple's consumers. I refuse to buy any app/subscription outside App Store because I have had a terrible experience with companies like Blinkist.
- SyneRyder 6y ago
  If you read Apple's filing, they actually claim it's impossible to separate distribution from payment processing. I mean, it's as if Apple have never heard of Stripe or PayPal. Some of that filing is so lousy & so easily proven false, it's starting to look like Apple could lose this one hard.
  - nodamage 6y ago
    That's a pretty big oversimplification of their argument and antitrust law usually isn't so cut and dried. What they're saying is that in the market for product A, if sales of product A are usually bundled with product B, then the courts view product A and B as one product sold together. The fact that product B might be sold separately in other markets doesn't change the facts and circumstances as they pertain to product A's market. The precedent they cite in Rick-Mik Enters., Inc. v. Equilon Enters. LLC demonstrates an example of this, where credit card processing services are typically bundled with sales of gas station franchises, and therefore in the market of "gas station franchise sales", "credit card processing services" were not considered a separate product even though you can obviously purchase "credit card processing services" separately in other markets. While I don't know if this particular argument will hold up in court, it's not "so lousy & so easily proven false" either.
- threeseed 6y ago
  It's not just payment processing. It's a distribution channel similar to a physical store.
  - grumple 6y ago
    A physical store allows you to immediately deliver a physical good to a local buyer, which you could not do without a local store. Every person distributing an app can access any potential buyer of digital goods directly via their own servers, which basically every app creator has already.
awinder 6y ago
They’re also making a late push in a tight market without real differentiation (the exclusives like you said) so from a market standpoint it’s one of the last options. There’s legitimately no other reason to have that store installed other than having been forced to, so giving people a monetary break is kinda the least you could do.
IshKebab 6y ago
30% is only the standard because Apple set it so high. All of the others just copied them - "Apple charges 30% so we will look reasonable doing the same". It's basically the figure you can get away with if developers have to publish in your store. When developers don't have to publish in your store, you have to lower your cut: https://blogs.windows.com/windowsdeveloper/2018/05/07/a-new-microsoft-store-revenue-share-is-coming/ https://blogs.windows.com/windowsdeveloper/2018/05/07/a-new-... That is why Microsoft and Apple are so keen on pushing the Mac/Windows stores, and on making running unsigned code a huge pain in the arse. They want that sweet sweet 30% cut on desktop too.
- FireBeyond 6y ago
  The Mac App Store is 3%. Probably a lot closer to the real cost, when Apple has to be competitive (for now, I see it going MAS-only soon) with the ability to sell your own apps.
  - nodamage 6y ago
    Huh? No, the Mac App Store also takes 30% of each sale.
  - sebastianmarkow 6y ago
    Even if true (which it is not), the mac app store sales are negligible compared to the mobile platform in terms of volume.
    - deleted 6y ago
      [deleted]
- nodamage 6y ago
  > 30% is only the standard because Apple set it so high. Both Steam and the Xbox Games Store predate the App Store by several years so your suggestion is literally impossible.
  - deleted 6y ago
threeseed 6y ago
Nintendo takes anywhere from 40-60% for the Switch.
fastball 6y ago
To me the difference is when it comes to IAP/subscriptions. Steam / Play Store both allow the distributor of an app to let the user subscribe without going through their payment processing. Apple does not. That means Apple is taking a cut of services they are not helping to deliver.

grumple 6y ago

It’s a _lot_ for what’s basically just payment processing (that’s all it is for in app sales). Looks like price collusion by the major players as well, which is also illegal.

smachiz 6y ago
That's not true, it's also discovery, trust and an ecosystem to run your apps in. Calling the app store just payment processing is a ridiculous simplification. Epic's store charges 12%, but has neither the hardware platform, or software platform - and relatively little market share. They arguably should be charging ~5% since it's actually closer to just payment processing and delivery.
- grumple 6y ago
  Apple takes 30% for in-app sales. People already have the app, there is no discovery or trust benefit. The App Store is awful for discovery anyway. You think we need the App Store to discover the Facebook app, Amazon app, Epic app? These apps spread by network effects, not discovery in the store. Users pay for the hardware platform. I find games for the first time with the Epic Store. Market share isn’t really super relevant, they are the newest entry in the market.
  - kube-system 6y ago
    I think Apple is probably on the wrong side of anti-trust law on this, but there is certainly a trust benefit (and UX benefit) to a unified payment platform. The history of mobile/online payments is littered with instances of users being confused/defrauded. > Users pay for the hardware platform. This isn't really relevant. Not only is an iPhone worthless without software, but subsidization of hardware by services is very common.
    - grumple 6y ago
      Isn’t Visa/MasterCard the unified payment platform? Obviously the iPhone is worthless without software, except it comes with a 1k price tag. Part of that is for the OS. The hardware certainly doesn’t cost that much (comparable offerings from hardware-only manufacturers cost less). This is not a case where the hardware cost is subsidized. Numbers from various sources suggest the iPhone sells for triple the cost of manufacturing.
      - sebastianmarkow 6y ago
        manufacturing cost != R&D cost
        ac29 6y ago
        Apple's net sales for Q3 were ~$60B and R&D was ~$5B. No matter how you look at it, the cost of an iPhone far exceeds Apple's cost to produce it. https://www.apple.com/newsroom/pdfs/FY20-Q3_Consolidated_Financial_Statements.pdf https://www.apple.com/newsroom/pdfs/FY20-Q3_Consolidated_Fin...
        kube-system 6y ago
        You’re still neglecting ongoing operational costs, which are neither hardware nor R&D. But it still doesn’t matter, Apple is profitable, everyone knows that already. It is legal to be profitable, and it is legal to have parts of your business subsidize other parts. What might not be legal is using a dominant market position to force out competitors.
malshe 6y ago
It's for the access to Apple's consumers. I refuse to buy any app/subscription outside App Store because I have had a terrible experience with companies like Blinkist.
SyneRyder 6y ago
If you read Apple's filing, they actually claim it's impossible to separate distribution from payment processing. I mean, it's as if Apple have never heard of Stripe or PayPal. Some of that filing is so lousy & so easily proven false, it's starting to look like Apple could lose this one hard.
- nodamage 6y ago
  That's a pretty big oversimplification of their argument and antitrust law usually isn't so cut and dried. What they're saying is that in the market for product A, if sales of product A are usually bundled with product B, then the courts view product A and B as one product sold together. The fact that product B might be sold separately in other markets doesn't change the facts and circumstances as they pertain to product A's market. The precedent they cite in Rick-Mik Enters., Inc. v. Equilon Enters. LLC demonstrates an example of this, where credit card processing services are typically bundled with sales of gas station franchises, and therefore in the market of "gas station franchise sales", "credit card processing services" were not considered a separate product even though you can obviously purchase "credit card processing services" separately in other markets. While I don't know if this particular argument will hold up in court, it's not "so lousy & so easily proven false" either.
threeseed 6y ago
It's not just payment processing. It's a distribution channel similar to a physical store.
- grumple 6y ago
  A physical store allows you to immediately deliver a physical good to a local buyer, which you could not do without a local store. Every person distributing an app can access any potential buyer of digital goods directly via their own servers, which basically every app creator has already.

awinder 6y ago

They’re also making a late push in a tight market without real differentiation (the exclusives like you said) so from a market standpoint it’s one of the last options. There’s legitimately no other reason to have that store installed other than having been forced to, so giving people a monetary break is kinda the least you could do.

IshKebab 6y ago

30% is only the standard because Apple set it so high. All of the others just copied them - "Apple charges 30% so we will look reasonable doing the same". It's basically the figure you can get away with if developers have to publish in your store. When developers don't have to publish in your store, you have to lower your cut: https://blogs.windows.com/windowsdeveloper/2018/05/07/a-new-microsoft-store-revenue-share-is-coming/ https://blogs.windows.com/windowsdeveloper/2018/05/07/a-new-... That is why Microsoft and Apple are so keen on pushing the Mac/Windows stores, and on making running unsigned code a huge pain in the arse. They want that sweet sweet 30% cut on desktop too.

FireBeyond 6y ago
The Mac App Store is 3%. Probably a lot closer to the real cost, when Apple has to be competitive (for now, I see it going MAS-only soon) with the ability to sell your own apps.
- nodamage 6y ago
  Huh? No, the Mac App Store also takes 30% of each sale.
- sebastianmarkow 6y ago
  Even if true (which it is not), the mac app store sales are negligible compared to the mobile platform in terms of volume.
  - deleted 6y ago
    [deleted]
nodamage 6y ago
> 30% is only the standard because Apple set it so high. Both Steam and the Xbox Games Store predate the App Store by several years so your suggestion is literally impossible.
- deleted 6y ago

threeseed 6y ago

Nintendo takes anywhere from 40-60% for the Switch.

fastball 6y ago

To me the difference is when it comes to IAP/subscriptions. Steam / Play Store both allow the distributor of an app to let the user subscribe without going through their payment processing. Apple does not. That means Apple is taking a cut of services they are not helping to deliver.