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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.

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.
- smachiz 6y ago
  Except they’re being new and without market share is exactly why they’re cheaper. Epic isn’t running an altruistic enterprise here. It was telling that after circumventing Apple’s 30%, they didn’t offer their goods 30% cheaper - or even 18% cheaper (reflective of the 12% they think is “fair” in their own store), they made it 10% cheaper for the user, and kept 8% more for themselves than other developers on their own Epic platform would get. Absolutely the App Store does a lot of discovery - just ask anyone what being a featured app does. I find plenty of apps by searching. Anyone whiteknighting for epic here is going to be disappointed in 5 years when they’re either successful with their store and raking other devs over the coals or they’ve shut their store down completely.

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.
smachiz 6y ago
Except they’re being new and without market share is exactly why they’re cheaper. Epic isn’t running an altruistic enterprise here. It was telling that after circumventing Apple’s 30%, they didn’t offer their goods 30% cheaper - or even 18% cheaper (reflective of the 12% they think is “fair” in their own store), they made it 10% cheaper for the user, and kept 8% more for themselves than other developers on their own Epic platform would get. Absolutely the App Store does a lot of discovery - just ask anyone what being a featured app does. I find plenty of apps by searching. Anyone whiteknighting for epic here is going to be disappointed in 5 years when they’re either successful with their store and raking other devs over the coals or they’ve shut their store down completely.