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I’m seeing a lot of positive comments on HN about this: to me it seems to be purely a cynical piece of PR on Apple’s part. They hope to significantly reduce th

by pja 6y ago

I’m seeing a lot of positive comments on HN about this: to me it seems to be purely a cynical piece of PR on Apple’s part. They hope to significantly reduce the pressure on politicians to take a close look at their App store practices by significantly reducing the absolute number of developers suffering the full impact whilst taking the minimum possible hit to their revenue. This has nothing to do with “doing the right thing” or “accelerating innovation” and everything to do with limiting the number of outraged letters to senators from devs, the number of newspaper interviews with prominent indie developers & so on. Indie devs have an outsize PR impact relative to their revenue contribution, so buy them off with a smaller revenue tax that delivers outsize returns if it prevents the 30% house rake on the majority of Apple’s App Store income coming under scrutiny. Apple / Google’s 30% take is the anti-competitive elephant in the room here, not a few crumbs thrown to small developers.

deleted 6y ago
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m463 6y ago
Apple/Google's 30% take is a tiny baby elephant in the room. Apple and Google have a model where they make lots MORE money outside the system and if the price of software is ZERO they would be happy. In Apple's case, even free software sells their phone. In Google's case, even free software funnels users to their ad platform. [1] "Smart companies try to commoditize their products’ complements." 1: https://www.joelonsoftware.com/2002/06/12/strategy-letter-v/ https://www.joelonsoftware.com/2002/06/12/strategy-letter-v/ (joel's a smart guy, he should write more often)
- _alex_ 6y ago
  Apple has no growth left in selling phones. They are now a “services” business. Their most lucrative service so far is the app store. That 30% matters to them a lot.
  - kevingadd 6y ago
    "no growth left in selling phones" is kind of the wrong way to look at it. Even if their number of units sold per year never grows, it's a very healthy revenue stream because they manage to convince existing customers to buy new hardware. Considering the cost per phone the revenue per customer is pretty high just from selling phones if they can get them to buy every 2-3 years. Naturally, the 30% take from the app store is bigger, but that's a matter of overall volume, not growth. The app store is a cash cow and will remain so even if its numbers start trending down.
  - JumpCrisscross 6y ago
    > Apple has no growth left in selling phones Increasing prices on top-of-the-line iPhones beg to differ.
- rndgermandude 6y ago
  Apple has revenues of about $275bln, and a net margin of about 21% company-wide, meaning $58bln. The app store sold about $50bln worth of stuff in 2019, Apple's 30% cut would therefore mean $15bln in revenue. If they operated the app store at a least a 70% margin (and really, if they didn't, then I'd be rather surprised), that would mean a good $10bln in net profit from the app store, or 17% of their total net profit. And that's still not accounting for the network effect the app store creates, or the business intelligence. It might not be the biggest elephant ever, but it's not what I'd call a tiny baby elephant either.
dalbasal 6y ago
Sure, being pro-indie is good PR. I don't see how this helps with antitrust though. Either way, it is an actual policy. Newsworthy, at least. Also, a comment isn't necessarily positive or negative. This isn't a poll on Apple's HN approval rating. It's an announcement of a thing Apple is doing.
- viktorcode 6y ago
  Commission size has nothing to do with anti-trust here. Apple didn't increase the rate from 2008, hence there's no basis for argument of anti-trust violation. It does undermines public (non-judicial) argument that App Store fee is bad for small developers, though.
read_if_gay_ 6y ago
> I’m seeing a lot of positive comments on HN about this To me it seems like those comments are in the minority while the popular opinion is the cynical take.
coward8675309 6y ago
And/or are you cynically interpreting this as a piece of PR to rake in the karma? Nearly every act by every person or institution can be interpreted as a cynical attempt to curry favor. Who gets the benefit of a doubt and who gets condemned?
- Dahoon 6y ago
  At least condemn those that have a history of malice. Innocent as default does not work for businesses PR. Especially not for FAANG.
  - coward8675309 6y ago
    So had Apple done this but told no one it wouldn’t be PR — and you’d be praising them right now? Would they be allowed to tell the affected developers? The FAANG are random assortment of companies that share little in common aside from being large. Facebook and Google monetize eyeballs but in very different ways. Amazon is a logistics and retail and PaaS powerhouse. Netflix streams movies. Apple sells hardware and services and, in stark contrast to Facebook and Google, temperamentally despises performance advertising. Google and Apple (and Microsoft and Salesforce and Nintendo and…) have walled garden marketplaces. Apropos a dubious assertion the grandparent made, Google and Apple are also the driving forces behind the two most feature-filled web browsers that enable ever more sophisticated web apps to run on smartphones outside of their walled gardens at no charge. So, what are the necessary and sufficient conditions to make a company a FAANG, aside for assisting with the construction of a snappy acronym, and what are the conclusions that flow from those conditions that justify your assuming every one of their acts is best assumed to have been done in bad faith?
- IshKebab 6y ago
  This is clearly a direct result of Epic's lawsuit. I wouldn't consider it a cynical attempt to curry favour if they had done it a year ago.
  - coward8675309 6y ago
    Or clearly a result of Covid. Or clearly a result of Republicans’s and Democrats’s newfound love of using tech companies as punching bags. So many single, all-encompassing theories that clearly fully account for every act.
NovemberWhiskey 6y ago
>to it seems to be purely a cynical piece of PR on Apple’s part. Oh please. Has it ever occurred in the history of the world that the selfish motives of two different parties aligned? i.e. Apple gets good press for helping smaller developers and the smaller developers get increased revenues. It happens all the times, and it's called "good business". You can keep waiting for Apple's App Store executives to cover themselves with sackcloth and ashes and repent of their terrible policies. Let me know how that works out.
- ocdtrekkie 6y ago
  If Apple didn't fear either Epic's lawsuit or Congressional action, or both, they'd never reduce their app store cut, for anyone, ever. This announcement means Apple knows that neither public opinion nor the law is on their side and they're about to lose really, really big. And they're hoping if they can flip this around a bit and get control of the narrative, they can convince regulators they will self-regulate... while continuing to get a third of the revenue from all the most lucrative developers. Google's new Gmail privacy settings fall in the same boat: They'd rather lose data from a small portion of their users if it might deter the government from taking away all of it.
  - kbutler 6y ago
    > they'd never reduce their app store cut, for anyone, ever. Why not 50%? 75%? 100%? 150%? It could also be that they are seeking the optimal rate of return, balancing developer incentives, bringing in new developers, etc. I think many factors play into the decision, including lawsuits and public scrutiny. I think it will be really interesting to watch and see if google mirrors the pricing.
  - wokwokwok 6y ago
    > they can convince regulators they will self-regulate... while continuing to get a third of the revenue from all the most lucrative developers. So what? Seriously, who cares if Epic earns 14 bzillionty dollars this month, or 20 bzillionty dollars? At that scale, the 30% is such a terrible thorn in your side? Come on. Cry me a damn river. The 'narrative' here is Epic pretending they care about anyone except themselves and that this ridiculous song and dance is about it being 'good for everyone'. Let's try something positive instead: What should they have done then to make you happy? Seriously; if this is such a cynical, terrible move, what should they have done?
csharptwdec19 6y ago
> This has nothing to do with “doing the right thing” or “accelerating innovation” Correct. True Character is what you do when nobody is watching. :)
Shivetya 6y ago
Cynical or not, putting pressure on companies works and negative attention is a valid tactic when the issue is subject to reasonable debate. Considering their volume fifteen percent should still allow them to rake in ridiculous amounts of money. However one area I still support Apple is selling of additional product within the store should still be subject to a charge; as in the Epic store selling additional games should be subject to the same rules as selling any content on the store yet you should be able to purchase outside the store and redeem codes within apps to use them; similar to how Steam allows developers to sell keys outside of Steam
indigochill 6y ago
It's along the same lines of what Microsoft did when they were being investigated as a monopoly: throw a bone to smaller developers (or in Microsoft's case, kids in school) which actually just grows their market share (in Microsoft's case, kids learn to use Microsoft products and take that to work, in Apple's case, more devs see profitability in the Mac garden). > Apple / Google’s 30% take is the anti-competitive elephant in the room here No. They both built a distribution channel on which developers build, but they're not open markets. Those app stores are the property of their respective creators (this is a flaw of the app store paradigm in general, at least for those who want full control over their software). Both Apple and Google are fully within their rights to charge whatever they want within their app store and enforce whatever capricious whims they like on apps that they distribute. It's the same as traditional book publishers writing their contracts with authors they publish. Which is why open platforms and device jailbreaking remain valuable for those of us who believe in personal ownership of our software.
- benhurmarcel 6y ago
  Should that work in that way on desktop also? With Microsoft/Apple being free to restrict apps to their store only, and taking a cut of every transaction made outside the browser? If not, what's the difference with phones/tablets?
  - simonh 6y ago
    The difference is just a historical choice. The desktop platform owners chose to be open in that way, but they didn't have to. Games console makers chose to go the locked down route at about the same time (in the grand scheme of things). The Mac launched long after many locked down games consoles existed. They just chose different strategies.
    - JumpCrisscross 6y ago
      > desktop platform owners chose to be open in that way, but they didn't have to They probably did. The industry was small. Attracting developers in significant numbers meant convincing people to become developers. That is a huge hurdle. Platforms with entry fees didn't build app ecosystems that attracted end users. By the time the iPhone was announced, developers were plenty and the software business model proven. Apple had resources to subsidize onboarding with a well-documented, rich API and good native apps.
e_proxus 6y ago
Of course there might be other reasons to scrutinize big companies like Apple, Google etc. but isn’t the best policy the one you don’t even have to implement because the actors in the market acted beforehand already?
- zerkten 6y ago
  It is when the policy enacted is reasonably close to the one you'd expect from intervention. There are multiple possible outcomes here ranging from this being insufficient progress to enough progress splintered across separate changes (which outsiders don't necessarily see a whole.)
tabs_masterrace 6y ago
Are you kidding me? This is great news for indies and small companies, to which I count myself, and I will be making 15% more money. Dude, I'm really happy reading this announcement today, thanks Apple, what else is there to say? I think some of you might have trust issues, and are stuck in a spiral of negativity, it's getting a bit weird. Now Google please follow!
- sneak 6y ago
  Unless I am misunderstanding, I believe you will be making 21.4% more money? (70% share of revenue -> 85% share of revenue)
  - valuearb 6y ago
    Even better!
    - sneak 6y ago
      Not for users who wish to use the macOS without engaging in Apple's services business. It's already impossible on iOS, due to the fact that you cannot install any software except via the App Store, which requires an Apple ID. At the moment it is possible to continue to use a mac and download and run software without an Apple ID, but if the trend of only releasing software via the App Store continues, that will become more and more difficult. Even totally free apps in the App Store require that you identify yourself to Apple to download and use them.
      - valuearb 6y ago
        Apple leadership has repeatedly said they aren't going to further restrict app installs on MacOS. Craig Fredaspaghetti just spoke about this in interviews on the Apple Silicon/Big Sur release. They use MacOS every day themselves, and deeply care about what it's different use case requires.
        tchalla 6y ago
grishka 6y ago
It's not even the 30% cut itself. It's the inevitable necessity to go through Apple if you want any presence on iOS. The only solution I see here is to allow proper sideloading. Apple keeps trying to spin the app store as a way for users to discover apps, when in reality, the reason developers publish their apps there is that it's the only way onto the millions of iOS devices worldwide.
- kmeisthax 6y ago
  Personally, I think the iOS App Store would still maintain it's market positioning even without iOS's technical lockout. Most people stay on the first app store they see and hate having to switch to new ones. First mover advantage is everything; look at the relative uptake rates of Steam vs. Origin or Epic Games Store.
  - grishka 6y ago
    I'm not even talking about alternative app stores. Just let me distribute my app to my users from my server, without Apple inserting itself where it doesn't belong.
- phn 6y ago
  Making it hard for the regular joe to pirate apps is a big part of apple's allure me as a developer. Your app/game won't be 24h on the play store without the apk popping up on some random site, ready to be downloaded. I don't see a way to do proper sideloading without opening this avenue. Maybe a mac os style notarization scheme, but apple gets a lot of flack for that too.
  - grishka 6y ago
    You can't have it both ways. Either it's as closed as iOS and apps can't be pirated, or it's as open as Android and it's possible to pirate apps. Restrictions on what can be installed and user's ultimate control of their own device are mutually exclusive. That said, I'd choose to have control, even as an app developer. Piracy is a fact of life.
mojzu 6y ago
I think it’s more targeted specifically at Epic, although maybe they thought it might help more generally with antitrust too. Epic made a big deal in their lawsuit/PR about how apples policies negatively impact smaller developers, and that they were standing up for them. With this change apple can now push back on this point against Epic, as it’s unlikely they will drop the lawsuit. It’s something I’ve been torn on for a while, on the one hand 30% seems way too high for most apps (maybe you could make an argument for a few that rely more heavily on apple infrastructure). But on the other app stores do provide a lot of benefits like auto-update, malware scanning, reviews, distribution, etc. that most apps couldn’t or wouldn’t do by themselves.
JumpCrisscross 6y ago
> significantly reducing the absolute number of developers suffering the full impact whilst taking the minimum possible hit to their revenue It also reduces their anti-competitive effect on new entrants. Now they have a beachhead. Sounds like a win-win. There should be an additional tier between e.g. $1mm and $25mm. Though that still wouldn't satisfy an absolutist constituency. So maybe this is the most efficient compromise. > This has nothing to do with “doing the right thing” Who cares? I'll take effective solutions from self-interested actors over well-intentioned bumbling. > everything to do with limiting the number of outraged letters to senators from devs Sounds like a responsive political system. If your concern is the App Store's 30% take from large developers, good news: they have the resources to find recourse in courts. Small developers don't. Given this has zero effect on Epic, it has zero effect on their case. (Just, perhaps, its lobbying effect in Congress.)
- beagle3 6y ago
  It has zero effect on Epic’s bottom line, but a potentially huge effect on their lawsuit - they were portraying themselves in the media, and likely the lawsuit as well, as “fighting for everyone, especially the little guys”. All of a sudden, they are left fighting for the fat cats.
  - deleted 6y ago
    [deleted]
valuearb 6y ago
“In today’s news Apple announced the opening of its iOS platform to allow users to install any apps they want from any alternative App Store. Posters on ycombinator.com denounced the move as a cynical attempt to generate positive PR. Said one, just because Apple has listened to us and stopped doing the evil things we asked it to stop, does not mean we won’t find new things to criticize it as evil for.”
- pja 6y ago
  That would actually be a substantive change that would genuinely change the App market dynamics. This ... is not that.
  - valuearb 6y ago
    Spoken by someone who is clearly not an Apple App Store developer. If you were an App developer like myself, you'd realize what a huge change this was. First, most Apple devs don't care about alternate app stores. Those provide nearly zero additional revenues to devs on every platform they are available. Second, most Apple devs don't want the Apple App Store to lose it's primacy, they realize that it's hugely beneficial to their revenues. The security, the app vetting, the single sign on, single purchase account, and easy subscription management and refund features, is a huge reason that we make far more from the App Store than Google Play, despite Androids SIX TIMES larger installed base. Apple attracts the best app customers and makes them super comfortable with buying and subscribing to apps. Most Apple developers by far largest concern was the large percentage of revenues Apple took. And they addressed that today. At 15% we can use App Store purchasing for far more things, and I'm already having those discussions with clients today.
    - pja 6y ago
      Apple has bought off small App vendors in order to protect the 30% rake they take from the big sellers: That you’re happy with the change is not exactly surprising is it? Who wouldn’t be happy being told they’re getting a 21% revenue increase for nothing! Meanwhile, Apple continues to use their dominant position to extract 30% of the revenue of the most profitable Apps, whilst people like you go out to bat for them. Must be great to be in Apple PR :)
danShumway 6y ago
This news doesn't mean people shouldn't continue to put pressure on Apple and legislators to address the core issue (app store competition), but it's still really good news for small developers. It should also solidly put down all of the arguments we were seeing about whether indie devs and lawsuits putting pressure on Apple and legislators are at all worthwhile. A drop in app fees by 15% is a substantial win, and the reason that drop happened is because Apple is now scared of critics, bad PR, and how that might impact future legislation against them. The number of hot takes I was seeing about how the Apple/Epic fight benefited literally no one and it was just two companies arguing about who got to take all the money... it's very clear from this program that the overall pressure on Apple has been making a difference. It's not so large a difference that devs should now stop fighting for better terms, but it's positive to see Apple at least partially show signs of cracking, or at least acknowledge on some level that they're frightened about the potential outcome of this fight. And there are a lot of small devs who are going to be making a lot more money just because of this minor victory.
- whimsicalism 6y ago
  > The number of hot takes I was seeing about how the Apple/Epic fight benefited literally no one and it was just two companies arguing about who got to take all the money... Most of the people I saw who I knew using these takes had a substantial vested interest in Apple prevailing, so I doubt it'll change their opinion. It's good news unless it diffuses the momentum for more.
- enos_feedler 6y ago
  Solidly? Not really. Still believe the Epic and Apple fight is all about Tim Sweeney being a greedy business man. Zero proof this 15% reduction has anything to do with pressure from that legal battle. Apple has made rev share changes in the past unprovoked (like 15% for sustained subs). How long do you think this change was in the works for? If this change was a response that’s great. But I would bet in that case Apple did it to take wind out of Epic’s sails around standing up for little devs. Apple just showed they cared about them in a single change. Will Epic back away now? Fat chance.
  - 6y ago
maxsilver 6y ago
Agreed. And it's frustrating to see most people getting tricked this easily. In the old days, when telecommunications devices and networks were getting monopolized like this, we'd break the company up into smaller entities, and then regulate the hell out of them, especially on monopolized/duopolized prices. In a just world, Apple would never be allowed to set the app store tax at all, a group of state or federal regulators would have strict price caps set by the public at large and enforced by state or federal law. (This is how many places still handle Electricity and Natural Gas. This is approximately what we did to AT&T, when they tried this same crap). If you own a monopoly/duopoly, you should expect to be heavily regulated like one. If you don't like that, stop monopolizing that market. This isn't rocket science, it's the conservative position on this issue.
cma 6y ago
It's the opposite of Steam's response to Epic, which was to lower the cut for larger publishers and larger selling games only. The reason is those publishers and big players could credibly threaten to leave the store. Apple has a monopoly so no one could credibly threaten to do so (without challenging the monopoly in court, like Epic did). Steam reduced it for publishers with bargaining power. No one has real bargaining power on the App Store.
strawberrypuree 6y ago
How can it be a “purely cynical PR piece” when there is an actual reduction in cost for developers? In other words, what should Apple have done here? What is the right cut, and how did you come to that figure?
- CharlesW 6y ago
  > How can it be a “purely cynical PR piece” when there is an actual reduction in cost for developers? This is a great question that assumes the responses here are mostly rational (not to minimize how anti-Apple folks feel, which is also legitimate). This is awesome news for small developers.
api 6y ago
What does Nintendo, etc., charge to develop and distribute for a console? Captive platforms are not new. iOS devices are consoles.
- psahgal 6y ago
  This IGN article from 2019 has a good summary of how much each digital storefront takes in revenue cut! 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... Nintendo also takes a 30% cut, although it used to be 35% for WiiWare games. This does NOT include the cost of acquiring development hardware, which usually sets you back $1000 at most. 30% is actually the industry standard; Steam takes 30% and Epic Games takes 30% for smaller titles. Regarding your comment on captive platforms, I think there's a bit of a difference between a home console and a smartphone. A home console is considered a luxury item, while a smartphone has quickly become a necessity in today's connected world. For home consoles, market competition is fierce. Not only is there Nintendo, Sony, and Microsoft, but there's also the PC gaming market, which includes devices in a variety of form factors. There's also multiple storefronts. You can buy console games from physical stores, in which case physical retailers take a cut, purchase Steam keys from other vendors, trade physical games, etc. In summary, there's a lot of ways to acquire your games. In contrast, smartphones are seen as a necessity by many, and there are really only two options: Android or iOS. Each has a dedicated storefront that captures almost their entire user base. This gives Apple and Google a LOT of power over what people can run on their devices, and it practically gives them a guaranteed source of income. I can see why people's attitudes are different towards the Apple/Google duopoly, and that few people are complaining about Nintendo's monopoly on the eShop.
  - samatman 6y ago
    > there are really only two options: Android or iOS Now, you subtly moved the goalposts here. I'm not even saying you did it on purpose, just drawing attention to it. Nintendo, Sony, and Microsoft, are hardware manufacturers with integrated, proprietary software stacks, just like Apple. Androids are made by dozens of manufacturers, and you can side load, use the App Store of your choice, and so on. The fact that Play Store does the lions share of business is the sum of: doing a great job, and nudging users in that direction through various defaults. Fact is, you can load what you want on an Android, and to me that undermines the case for forcing Apple to do likewise. I'd still like the ability to sideload apps on my iPhone, and think it's worth pushing on Apple to get there. But as long as there are general-purpose phones available for purchase, and there are, I don't see the anticompetitive argument in the iPhone being a console: either put up with it or don't buy one. I'm drawing a distinction between a bad business decision which customers should push Apple to change, and anticompetitive behavior which governments should force Apple to stop engaging in. I don't see the case for the latter.
jmull 6y ago
> purely a cynical piece of PR Well, this is a big change to a core part of their App Store business model. It’s hard to reduce that to a PR move. Consider the revenue at stake here.
- nhumrich 6y ago
  The revenue at stake for apple is likely almost nothing. As soon as a company (not app) makes over 1 million in purchases via apple, then they start paying the full amount. So, apple is losing 50% of the revenue from companies that dont make at least that much. Which is small potatoes to apple.
  - jmull 6y ago
    According to this App Store revenue is around $50B and developers affected by this[1] make ~5% of that revenue, or around $2.5B Cutting that in half, we're talking $1B+. Indeed, that's small potatoes for Apple. But then, everything is small potatoes compared to iPhone sales. But far, far bigger than even a big PR stunt. Orders of magnitude bigger. [1] https://www.theverge.com/2020/11/18/21572302/apple-app-store-small-business-program-commission-cut-15-percent-reduction https://www.theverge.com/2020/11/18/21572302/apple-app-store...
ponker 6y ago
Did Apple do this for craven self interest? Yes. Does it benefit a lot of people who deserve it? Also yes.
zepto 6y ago
I think it’s neither cynical nor doing the right thing. It’s small positive move, but I don’t expect it to change anything for most developers. The 30% is really not the elephant in the room. What makes it so hard to make money on the App Store is the speed at which knock offs can appear. The App Store supports deep work that is hard to copy and work where there is a backend with network effects. For everything else it’s just a lottery. 30% isn’t the issue.
- wait_a_minute 6y ago
  If someone is submitting something that can be knocked off really quickly, maybe the problem is that they're submitting something that there isn't a good market for.
  - zepto 6y ago
    Yes, that is implied by what I’m saying. A lot of people complain about how hard it is to make money on the App Store. Typically we hear only about the 30% as if that is the cause of people’s woes. Clearly the 30% is a factor, but there are other more significant factors that determine success.
ROARosen 6y ago
Cynical is an understatement, this is pure evil. Locking in developers to only use their AppStore and not anything else, taking %15 of small businesses revenue for payment processing, and all this in the middle of a pandemic and still taking credit for being "generous" and "industry leading". All this while the average payment processor take around %3. And don't forget the reason they're doing it is to diffuse criticism of their monopolistic restrictions, to help them in their fight against Epic, which is actually fighting for the same rights that these small time developers really need.
- briandear 6y ago
  The App Store is a lot more than “payment processing.” If you sell 100 installs on the App Store as a small developer. How many would you sell if there wasn’t an App Store? You’d have to advertise — people just don’t show up at your website. PPC is expensive. And you have to learn how to do it. It’s hard for someone that doesn’t spend their time learning about PPC. It’s hard to get good ROIs even when you do know what you are doing. If you spend $0.50 per click and you sell your app for $3, and you have a 25% conversion rate (which is extremely high,) how much did it cost you to get that sale? Then once they do get to your website, they have to pay. Ok, 2.9% + $0.30. Now they have to securely download the app. Where is your app hosted? Apparently that’s free and doesn’t cost you anything? Who maintains that system? How pays for that electricity? And updates? And security? Apparently all of that is free and takes zero time? Chargeback? Uh oh. That’s a $20 fee while you have to fight and document the dispute. Maybe that takes 20 minutes, but more like 45 minutes by the time you write the challenge letter. Digital products, especially games, have a high rate of fraud compared to many industries. Then there are sales taxes. Are you collecting and remitting the precise amounts to the various jurisdictions where you are selling? How about a sales tax permit? Do you have that? And trust? I’ll buy an App Store app, but installing an app from some random developer without any assurances I am not installing something nefarious? If you sold 200 downloads from your website but 300 downloads from the App Store but pay the 15-30%. What makes you more money? Have you ever sold a product to a retail store? A $10 product in a retail store is purchased from the manufacturer at $5. If there is a distributor involved, that $10 product is purchased from the manufacturer at $2.50. Physical products are obviously different than digital, but the product distribution model for any product has markup across the chain. A manufacturer selling DTC has to have the infrastructure to sell to consumers, thus they aren’t selling at $2.50 anymore. Shipping 100 cases of a product to a distributor is a lot less work than shipping that same volume to individual customers. If you think of the App Store as a distributor — 30% is a bargain. I think that many app developers don’t realize what things actually cost — when they do, they’d quickly realize they make far more money from the App Store than they would make selling it directly.
cblconfederate 6y ago
The comments are part of the PR
pietroq 6y ago
In the nineties (1990-1999) we had a distribution deal in the USA with the PowerUp! catalog for a software product that moved a few millions of copies. Of the $24.99 sticker price we received something like $0.80 and that was an USA-only deal. Giving 30% for a worldwide deal when the distributor takes care of all the billing and taxing and accounting and distribution is the deal of the century.
- TedDoesntTalk 6y ago
  But they don't need to take care of billing, taxing, and accounting. Stripe does that well. PayPal. Many others. Open it to competition. Decouple payments from the distribution (appstore).
heavyset_go 6y ago
> Apple / Google’s 30% take is the anti-competitive elephant in the room here, not a few crumbs thrown to small developers. It's not just the rate that's anti-competitive, it's that these two companies have stifled competition in mobile app distribution for over a decade now. There is no viable competition in this space because Google and Apple never allowed for real competitors to the App Store and Play Store to exist. You have to use the App Store to distribute mobile apps on iPhones and iPads, and if you want automatic updates, background updates or batch installations/upgrades on Android, you have to use the Play Store. These days, if you want to install an app whose developers didn't pay the Apple tax, macOS will make the app appear radioactive, and as if it is either broken or malicious. Same goes for Android, where apps distributed outside of the Play Store invoke scary warnings, and are hindered when it comes to automatic updates, background updates, or batch installs.
- TedDoesntTalk 6y ago
  It's not just about distribution. What about allowing payments through stripe or paypal or any other payment processor?
  - heavyset_go 6y ago
    Good point, and I agree. Developers and users should have the freedom to use the payment processors of their liking, without having their mobile operating system's vendor deciding for them.
HeavyStorm 6y ago
Agree. It is _too little, too late_, as they say. 15% is still a very high fee, and we all know that this is a movement to improve public opinion in light of recent events.
balfirevic 6y ago
> by significantly reducing the absolute number of developers suffering the full impact whilst taking the minimum possible hit to their revenue When you put it like that, it sounds pretty good!
jt2190 6y ago
> Apple / Google’s 30% take is the anti-competitive elephant in the room here, not a few crumbs thrown to small developers. This percentage is something that small businesses feel, but is not really what makes the marketplace for apps “anti-competitive”, and personally I think it’s a distraction from the main issue: Is the total addressable market for “apps” defined by and exclusive to a single platform (iOS, Android, etc.) or not? How you answer this makes the percentage either a number arrived at through a competitive market or a “tax”.
threepio 6y ago
Unfortunately — because I am a longtime Apple user & developer — I have to agree that this is a cynical gesture designed to deflect regulatory scrutiny. Moreover, I expect that this announcement is mostly paving the way for Apple to force all Mac OS apps to be distributed via the Mac App Store (as they do on iOS). The optimist in me doesn't want to believe it. But this is probably consistent with Apple's economic incentives. Especially because the major role of Macs in the world is to provide a platform for developing iOS apps. This week I ordered an M1 Macbook Air. Not because I really need it, but because a couple years from now I will be happy I have a machine that can run Big Sur, which will be remembered as the least restrictive OS of the Apple Silicon era. Apple is the biggest corporation in the world. We can like their products, but we shouldn't give them more credit than, say, ExxonMobil or Foxconn or Goldman Sachs. They will make choices based on what creates the most profit, nothing more. That's not cynicism; it's why corporations exist at all.
- mrtranscendence 6y ago
  I disagree with the assumption that restricting Macs to the MAS would be profit-maximizing for Apple. The context and expectations are different, and such restrictions -- hobbling many uses of macOS -- would drive developers away from Macs to competing platforms. I'm not even sure what those restrictions would look like; can I not execute arbitrary Python code? Can I not install Python packages from PyPI? (And how are they going to stop me, exactly?) Can I not use clang to compile a C project? To what extent can MacOS really be locked down in a way that doesn't drive away any developer who's not making iOS apps? And if the Mac software scene stagnates, Apple eventually loses their core constituency.
  - threepio 6y ago
    I'm referring to GUI apps like the kind currently sold in the app store. There has long been a path to sell these apps direct to customers. But with each OS release, it has become more onerous (codesigning and notarization and whatnot). Still, no one wanted to tolerate the 30% tax. Now it's 15%. The noise around the app store reminds me of all the complaints when Adobe said it would move its apps into the Creative Cloud on a subscription basis. Yes, a certain percentage of customers left. But the extra revenue more than made up for the loss.
anderspitman 6y ago
So you're saying it's a smart business decision?
ponker 6y ago
Flip side: what's so bad about Apple taking 30% of Zynga's iOS revenue? Why is 15% fair to Zynga and 30% not?

by pja 6y ago

deleted 6y ago

[deleted]

m463 6y ago

Apple/Google's 30% take is a tiny baby elephant in the room. Apple and Google have a model where they make lots MORE money outside the system and if the price of software is ZERO they would be happy. In Apple's case, even free software sells their phone. In Google's case, even free software funnels users to their ad platform. [1] "Smart companies try to commoditize their products’ complements." 1: https://www.joelonsoftware.com/2002/06/12/strategy-letter-v/ https://www.joelonsoftware.com/2002/06/12/strategy-letter-v/ (joel's a smart guy, he should write more often)

_alex_ 6y ago
Apple has no growth left in selling phones. They are now a “services” business. Their most lucrative service so far is the app store. That 30% matters to them a lot.
- kevingadd 6y ago
  "no growth left in selling phones" is kind of the wrong way to look at it. Even if their number of units sold per year never grows, it's a very healthy revenue stream because they manage to convince existing customers to buy new hardware. Considering the cost per phone the revenue per customer is pretty high just from selling phones if they can get them to buy every 2-3 years. Naturally, the 30% take from the app store is bigger, but that's a matter of overall volume, not growth. The app store is a cash cow and will remain so even if its numbers start trending down.
- JumpCrisscross 6y ago
  > Apple has no growth left in selling phones Increasing prices on top-of-the-line iPhones beg to differ.
rndgermandude 6y ago
Apple has revenues of about $275bln, and a net margin of about 21% company-wide, meaning $58bln. The app store sold about $50bln worth of stuff in 2019, Apple's 30% cut would therefore mean $15bln in revenue. If they operated the app store at a least a 70% margin (and really, if they didn't, then I'd be rather surprised), that would mean a good $10bln in net profit from the app store, or 17% of their total net profit. And that's still not accounting for the network effect the app store creates, or the business intelligence. It might not be the biggest elephant ever, but it's not what I'd call a tiny baby elephant either.

dalbasal 6y ago

Sure, being pro-indie is good PR. I don't see how this helps with antitrust though. Either way, it is an actual policy. Newsworthy, at least. Also, a comment isn't necessarily positive or negative. This isn't a poll on Apple's HN approval rating. It's an announcement of a thing Apple is doing.

viktorcode 6y ago
Commission size has nothing to do with anti-trust here. Apple didn't increase the rate from 2008, hence there's no basis for argument of anti-trust violation. It does undermines public (non-judicial) argument that App Store fee is bad for small developers, though.

read_if_gay_ 6y ago

> I’m seeing a lot of positive comments on HN about this To me it seems like those comments are in the minority while the popular opinion is the cynical take.

coward8675309 6y ago

And/or are you cynically interpreting this as a piece of PR to rake in the karma? Nearly every act by every person or institution can be interpreted as a cynical attempt to curry favor. Who gets the benefit of a doubt and who gets condemned?

Dahoon 6y ago
At least condemn those that have a history of malice. Innocent as default does not work for businesses PR. Especially not for FAANG.
- coward8675309 6y ago
  So had Apple done this but told no one it wouldn’t be PR — and you’d be praising them right now? Would they be allowed to tell the affected developers? The FAANG are random assortment of companies that share little in common aside from being large. Facebook and Google monetize eyeballs but in very different ways. Amazon is a logistics and retail and PaaS powerhouse. Netflix streams movies. Apple sells hardware and services and, in stark contrast to Facebook and Google, temperamentally despises performance advertising. Google and Apple (and Microsoft and Salesforce and Nintendo and…) have walled garden marketplaces. Apropos a dubious assertion the grandparent made, Google and Apple are also the driving forces behind the two most feature-filled web browsers that enable ever more sophisticated web apps to run on smartphones outside of their walled gardens at no charge. So, what are the necessary and sufficient conditions to make a company a FAANG, aside for assisting with the construction of a snappy acronym, and what are the conclusions that flow from those conditions that justify your assuming every one of their acts is best assumed to have been done in bad faith?
IshKebab 6y ago
This is clearly a direct result of Epic's lawsuit. I wouldn't consider it a cynical attempt to curry favour if they had done it a year ago.
- coward8675309 6y ago
  Or clearly a result of Covid. Or clearly a result of Republicans’s and Democrats’s newfound love of using tech companies as punching bags. So many single, all-encompassing theories that clearly fully account for every act.

NovemberWhiskey 6y ago

>to it seems to be purely a cynical piece of PR on Apple’s part. Oh please. Has it ever occurred in the history of the world that the selfish motives of two different parties aligned? i.e. Apple gets good press for helping smaller developers and the smaller developers get increased revenues. It happens all the times, and it's called "good business". You can keep waiting for Apple's App Store executives to cover themselves with sackcloth and ashes and repent of their terrible policies. Let me know how that works out.

ocdtrekkie 6y ago
If Apple didn't fear either Epic's lawsuit or Congressional action, or both, they'd never reduce their app store cut, for anyone, ever. This announcement means Apple knows that neither public opinion nor the law is on their side and they're about to lose really, really big. And they're hoping if they can flip this around a bit and get control of the narrative, they can convince regulators they will self-regulate... while continuing to get a third of the revenue from all the most lucrative developers. Google's new Gmail privacy settings fall in the same boat: They'd rather lose data from a small portion of their users if it might deter the government from taking away all of it.
- kbutler 6y ago
  > they'd never reduce their app store cut, for anyone, ever. Why not 50%? 75%? 100%? 150%? It could also be that they are seeking the optimal rate of return, balancing developer incentives, bringing in new developers, etc. I think many factors play into the decision, including lawsuits and public scrutiny. I think it will be really interesting to watch and see if google mirrors the pricing.
- wokwokwok 6y ago
  > they can convince regulators they will self-regulate... while continuing to get a third of the revenue from all the most lucrative developers. So what? Seriously, who cares if Epic earns 14 bzillionty dollars this month, or 20 bzillionty dollars? At that scale, the 30% is such a terrible thorn in your side? Come on. Cry me a damn river. The 'narrative' here is Epic pretending they care about anyone except themselves and that this ridiculous song and dance is about it being 'good for everyone'. Let's try something positive instead: What should they have done then to make you happy? Seriously; if this is such a cynical, terrible move, what should they have done?

csharptwdec19 6y ago

> This has nothing to do with “doing the right thing” or “accelerating innovation” Correct. True Character is what you do when nobody is watching. :)

Shivetya 6y ago

Cynical or not, putting pressure on companies works and negative attention is a valid tactic when the issue is subject to reasonable debate. Considering their volume fifteen percent should still allow them to rake in ridiculous amounts of money. However one area I still support Apple is selling of additional product within the store should still be subject to a charge; as in the Epic store selling additional games should be subject to the same rules as selling any content on the store yet you should be able to purchase outside the store and redeem codes within apps to use them; similar to how Steam allows developers to sell keys outside of Steam

indigochill 6y ago

It's along the same lines of what Microsoft did when they were being investigated as a monopoly: throw a bone to smaller developers (or in Microsoft's case, kids in school) which actually just grows their market share (in Microsoft's case, kids learn to use Microsoft products and take that to work, in Apple's case, more devs see profitability in the Mac garden). > Apple / Google’s 30% take is the anti-competitive elephant in the room here No. They both built a distribution channel on which developers build, but they're not open markets. Those app stores are the property of their respective creators (this is a flaw of the app store paradigm in general, at least for those who want full control over their software). Both Apple and Google are fully within their rights to charge whatever they want within their app store and enforce whatever capricious whims they like on apps that they distribute. It's the same as traditional book publishers writing their contracts with authors they publish. Which is why open platforms and device jailbreaking remain valuable for those of us who believe in personal ownership of our software.

benhurmarcel 6y ago
Should that work in that way on desktop also? With Microsoft/Apple being free to restrict apps to their store only, and taking a cut of every transaction made outside the browser? If not, what's the difference with phones/tablets?
- simonh 6y ago
  The difference is just a historical choice. The desktop platform owners chose to be open in that way, but they didn't have to. Games console makers chose to go the locked down route at about the same time (in the grand scheme of things). The Mac launched long after many locked down games consoles existed. They just chose different strategies.
  - JumpCrisscross 6y ago
    > desktop platform owners chose to be open in that way, but they didn't have to They probably did. The industry was small. Attracting developers in significant numbers meant convincing people to become developers. That is a huge hurdle. Platforms with entry fees didn't build app ecosystems that attracted end users. By the time the iPhone was announced, developers were plenty and the software business model proven. Apple had resources to subsidize onboarding with a well-documented, rich API and good native apps.

e_proxus 6y ago

Of course there might be other reasons to scrutinize big companies like Apple, Google etc. but isn’t the best policy the one you don’t even have to implement because the actors in the market acted beforehand already?

zerkten 6y ago
It is when the policy enacted is reasonably close to the one you'd expect from intervention. There are multiple possible outcomes here ranging from this being insufficient progress to enough progress splintered across separate changes (which outsiders don't necessarily see a whole.)

tabs_masterrace 6y ago

Are you kidding me? This is great news for indies and small companies, to which I count myself, and I will be making 15% more money. Dude, I'm really happy reading this announcement today, thanks Apple, what else is there to say? I think some of you might have trust issues, and are stuck in a spiral of negativity, it's getting a bit weird. Now Google please follow!

sneak 6y ago
Unless I am misunderstanding, I believe you will be making 21.4% more money? (70% share of revenue -> 85% share of revenue)
- valuearb 6y ago
  Even better!
  - sneak 6y ago
    Not for users who wish to use the macOS without engaging in Apple's services business. It's already impossible on iOS, due to the fact that you cannot install any software except via the App Store, which requires an Apple ID. At the moment it is possible to continue to use a mac and download and run software without an Apple ID, but if the trend of only releasing software via the App Store continues, that will become more and more difficult. Even totally free apps in the App Store require that you identify yourself to Apple to download and use them.
    - valuearb 6y ago
      Apple leadership has repeatedly said they aren't going to further restrict app installs on MacOS. Craig Fredaspaghetti just spoke about this in interviews on the Apple Silicon/Big Sur release. They use MacOS every day themselves, and deeply care about what it's different use case requires.
      - tchalla 6y ago

grishka 6y ago

It's not even the 30% cut itself. It's the inevitable necessity to go through Apple if you want any presence on iOS. The only solution I see here is to allow proper sideloading. Apple keeps trying to spin the app store as a way for users to discover apps, when in reality, the reason developers publish their apps there is that it's the only way onto the millions of iOS devices worldwide.

kmeisthax 6y ago
Personally, I think the iOS App Store would still maintain it's market positioning even without iOS's technical lockout. Most people stay on the first app store they see and hate having to switch to new ones. First mover advantage is everything; look at the relative uptake rates of Steam vs. Origin or Epic Games Store.
- grishka 6y ago
  I'm not even talking about alternative app stores. Just let me distribute my app to my users from my server, without Apple inserting itself where it doesn't belong.
phn 6y ago
Making it hard for the regular joe to pirate apps is a big part of apple's allure me as a developer. Your app/game won't be 24h on the play store without the apk popping up on some random site, ready to be downloaded. I don't see a way to do proper sideloading without opening this avenue. Maybe a mac os style notarization scheme, but apple gets a lot of flack for that too.
- grishka 6y ago
  You can't have it both ways. Either it's as closed as iOS and apps can't be pirated, or it's as open as Android and it's possible to pirate apps. Restrictions on what can be installed and user's ultimate control of their own device are mutually exclusive. That said, I'd choose to have control, even as an app developer. Piracy is a fact of life.

mojzu 6y ago

I think it’s more targeted specifically at Epic, although maybe they thought it might help more generally with antitrust too. Epic made a big deal in their lawsuit/PR about how apples policies negatively impact smaller developers, and that they were standing up for them. With this change apple can now push back on this point against Epic, as it’s unlikely they will drop the lawsuit. It’s something I’ve been torn on for a while, on the one hand 30% seems way too high for most apps (maybe you could make an argument for a few that rely more heavily on apple infrastructure). But on the other app stores do provide a lot of benefits like auto-update, malware scanning, reviews, distribution, etc. that most apps couldn’t or wouldn’t do by themselves.

JumpCrisscross 6y ago

> significantly reducing the absolute number of developers suffering the full impact whilst taking the minimum possible hit to their revenue It also reduces their anti-competitive effect on new entrants. Now they have a beachhead. Sounds like a win-win. There should be an additional tier between e.g. $1mm and $25mm. Though that still wouldn't satisfy an absolutist constituency. So maybe this is the most efficient compromise. > This has nothing to do with “doing the right thing” Who cares? I'll take effective solutions from self-interested actors over well-intentioned bumbling. > everything to do with limiting the number of outraged letters to senators from devs Sounds like a responsive political system. If your concern is the App Store's 30% take from large developers, good news: they have the resources to find recourse in courts. Small developers don't. Given this has zero effect on Epic, it has zero effect on their case. (Just, perhaps, its lobbying effect in Congress.)

beagle3 6y ago
It has zero effect on Epic’s bottom line, but a potentially huge effect on their lawsuit - they were portraying themselves in the media, and likely the lawsuit as well, as “fighting for everyone, especially the little guys”. All of a sudden, they are left fighting for the fat cats.
- deleted 6y ago
  [deleted]

valuearb 6y ago

“In today’s news Apple announced the opening of its iOS platform to allow users to install any apps they want from any alternative App Store. Posters on ycombinator.com denounced the move as a cynical attempt to generate positive PR. Said one, just because Apple has listened to us and stopped doing the evil things we asked it to stop, does not mean we won’t find new things to criticize it as evil for.”

pja 6y ago
That would actually be a substantive change that would genuinely change the App market dynamics. This ... is not that.
- valuearb 6y ago
  Spoken by someone who is clearly not an Apple App Store developer. If you were an App developer like myself, you'd realize what a huge change this was. First, most Apple devs don't care about alternate app stores. Those provide nearly zero additional revenues to devs on every platform they are available. Second, most Apple devs don't want the Apple App Store to lose it's primacy, they realize that it's hugely beneficial to their revenues. The security, the app vetting, the single sign on, single purchase account, and easy subscription management and refund features, is a huge reason that we make far more from the App Store than Google Play, despite Androids SIX TIMES larger installed base. Apple attracts the best app customers and makes them super comfortable with buying and subscribing to apps. Most Apple developers by far largest concern was the large percentage of revenues Apple took. And they addressed that today. At 15% we can use App Store purchasing for far more things, and I'm already having those discussions with clients today.
  - pja 6y ago
    Apple has bought off small App vendors in order to protect the 30% rake they take from the big sellers: That you’re happy with the change is not exactly surprising is it? Who wouldn’t be happy being told they’re getting a 21% revenue increase for nothing! Meanwhile, Apple continues to use their dominant position to extract 30% of the revenue of the most profitable Apps, whilst people like you go out to bat for them. Must be great to be in Apple PR :)

danShumway 6y ago

This news doesn't mean people shouldn't continue to put pressure on Apple and legislators to address the core issue (app store competition), but it's still really good news for small developers. It should also solidly put down all of the arguments we were seeing about whether indie devs and lawsuits putting pressure on Apple and legislators are at all worthwhile. A drop in app fees by 15% is a substantial win, and the reason that drop happened is because Apple is now scared of critics, bad PR, and how that might impact future legislation against them. The number of hot takes I was seeing about how the Apple/Epic fight benefited literally no one and it was just two companies arguing about who got to take all the money... it's very clear from this program that the overall pressure on Apple has been making a difference. It's not so large a difference that devs should now stop fighting for better terms, but it's positive to see Apple at least partially show signs of cracking, or at least acknowledge on some level that they're frightened about the potential outcome of this fight. And there are a lot of small devs who are going to be making a lot more money just because of this minor victory.

whimsicalism 6y ago
> The number of hot takes I was seeing about how the Apple/Epic fight benefited literally no one and it was just two companies arguing about who got to take all the money... Most of the people I saw who I knew using these takes had a substantial vested interest in Apple prevailing, so I doubt it'll change their opinion. It's good news unless it diffuses the momentum for more.
enos_feedler 6y ago
Solidly? Not really. Still believe the Epic and Apple fight is all about Tim Sweeney being a greedy business man. Zero proof this 15% reduction has anything to do with pressure from that legal battle. Apple has made rev share changes in the past unprovoked (like 15% for sustained subs). How long do you think this change was in the works for? If this change was a response that’s great. But I would bet in that case Apple did it to take wind out of Epic’s sails around standing up for little devs. Apple just showed they cared about them in a single change. Will Epic back away now? Fat chance.
- 6y ago

maxsilver 6y ago

Agreed. And it's frustrating to see most people getting tricked this easily. In the old days, when telecommunications devices and networks were getting monopolized like this, we'd break the company up into smaller entities, and then regulate the hell out of them, especially on monopolized/duopolized prices. In a just world, Apple would never be allowed to set the app store tax at all, a group of state or federal regulators would have strict price caps set by the public at large and enforced by state or federal law. (This is how many places still handle Electricity and Natural Gas. This is approximately what we did to AT&T, when they tried this same crap). If you own a monopoly/duopoly, you should expect to be heavily regulated like one. If you don't like that, stop monopolizing that market. This isn't rocket science, it's the conservative position on this issue.

cma 6y ago

It's the opposite of Steam's response to Epic, which was to lower the cut for larger publishers and larger selling games only. The reason is those publishers and big players could credibly threaten to leave the store. Apple has a monopoly so no one could credibly threaten to do so (without challenging the monopoly in court, like Epic did). Steam reduced it for publishers with bargaining power. No one has real bargaining power on the App Store.

strawberrypuree 6y ago

How can it be a “purely cynical PR piece” when there is an actual reduction in cost for developers? In other words, what should Apple have done here? What is the right cut, and how did you come to that figure?

CharlesW 6y ago
> How can it be a “purely cynical PR piece” when there is an actual reduction in cost for developers? This is a great question that assumes the responses here are mostly rational (not to minimize how anti-Apple folks feel, which is also legitimate). This is awesome news for small developers.

api 6y ago

What does Nintendo, etc., charge to develop and distribute for a console? Captive platforms are not new. iOS devices are consoles.

psahgal 6y ago
This IGN article from 2019 has a good summary of how much each digital storefront takes in revenue cut! 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... Nintendo also takes a 30% cut, although it used to be 35% for WiiWare games. This does NOT include the cost of acquiring development hardware, which usually sets you back $1000 at most. 30% is actually the industry standard; Steam takes 30% and Epic Games takes 30% for smaller titles. Regarding your comment on captive platforms, I think there's a bit of a difference between a home console and a smartphone. A home console is considered a luxury item, while a smartphone has quickly become a necessity in today's connected world. For home consoles, market competition is fierce. Not only is there Nintendo, Sony, and Microsoft, but there's also the PC gaming market, which includes devices in a variety of form factors. There's also multiple storefronts. You can buy console games from physical stores, in which case physical retailers take a cut, purchase Steam keys from other vendors, trade physical games, etc. In summary, there's a lot of ways to acquire your games. In contrast, smartphones are seen as a necessity by many, and there are really only two options: Android or iOS. Each has a dedicated storefront that captures almost their entire user base. This gives Apple and Google a LOT of power over what people can run on their devices, and it practically gives them a guaranteed source of income. I can see why people's attitudes are different towards the Apple/Google duopoly, and that few people are complaining about Nintendo's monopoly on the eShop.
- samatman 6y ago
  > there are really only two options: Android or iOS Now, you subtly moved the goalposts here. I'm not even saying you did it on purpose, just drawing attention to it. Nintendo, Sony, and Microsoft, are hardware manufacturers with integrated, proprietary software stacks, just like Apple. Androids are made by dozens of manufacturers, and you can side load, use the App Store of your choice, and so on. The fact that Play Store does the lions share of business is the sum of: doing a great job, and nudging users in that direction through various defaults. Fact is, you can load what you want on an Android, and to me that undermines the case for forcing Apple to do likewise. I'd still like the ability to sideload apps on my iPhone, and think it's worth pushing on Apple to get there. But as long as there are general-purpose phones available for purchase, and there are, I don't see the anticompetitive argument in the iPhone being a console: either put up with it or don't buy one. I'm drawing a distinction between a bad business decision which customers should push Apple to change, and anticompetitive behavior which governments should force Apple to stop engaging in. I don't see the case for the latter.

jmull 6y ago

> purely a cynical piece of PR Well, this is a big change to a core part of their App Store business model. It’s hard to reduce that to a PR move. Consider the revenue at stake here.

nhumrich 6y ago
The revenue at stake for apple is likely almost nothing. As soon as a company (not app) makes over 1 million in purchases via apple, then they start paying the full amount. So, apple is losing 50% of the revenue from companies that dont make at least that much. Which is small potatoes to apple.
- jmull 6y ago
  According to this App Store revenue is around $50B and developers affected by this[1] make ~5% of that revenue, or around $2.5B Cutting that in half, we're talking $1B+. Indeed, that's small potatoes for Apple. But then, everything is small potatoes compared to iPhone sales. But far, far bigger than even a big PR stunt. Orders of magnitude bigger. [1] https://www.theverge.com/2020/11/18/21572302/apple-app-store-small-business-program-commission-cut-15-percent-reduction https://www.theverge.com/2020/11/18/21572302/apple-app-store...

ponker 6y ago

Did Apple do this for craven self interest? Yes. Does it benefit a lot of people who deserve it? Also yes.

zepto 6y ago

I think it’s neither cynical nor doing the right thing. It’s small positive move, but I don’t expect it to change anything for most developers. The 30% is really not the elephant in the room. What makes it so hard to make money on the App Store is the speed at which knock offs can appear. The App Store supports deep work that is hard to copy and work where there is a backend with network effects. For everything else it’s just a lottery. 30% isn’t the issue.

wait_a_minute 6y ago
If someone is submitting something that can be knocked off really quickly, maybe the problem is that they're submitting something that there isn't a good market for.
- zepto 6y ago
  Yes, that is implied by what I’m saying. A lot of people complain about how hard it is to make money on the App Store. Typically we hear only about the 30% as if that is the cause of people’s woes. Clearly the 30% is a factor, but there are other more significant factors that determine success.

ROARosen 6y ago

Cynical is an understatement, this is pure evil. Locking in developers to only use their AppStore and not anything else, taking %15 of small businesses revenue for payment processing, and all this in the middle of a pandemic and still taking credit for being "generous" and "industry leading". All this while the average payment processor take around %3. And don't forget the reason they're doing it is to diffuse criticism of their monopolistic restrictions, to help them in their fight against Epic, which is actually fighting for the same rights that these small time developers really need.

briandear 6y ago
The App Store is a lot more than “payment processing.” If you sell 100 installs on the App Store as a small developer. How many would you sell if there wasn’t an App Store? You’d have to advertise — people just don’t show up at your website. PPC is expensive. And you have to learn how to do it. It’s hard for someone that doesn’t spend their time learning about PPC. It’s hard to get good ROIs even when you do know what you are doing. If you spend $0.50 per click and you sell your app for $3, and you have a 25% conversion rate (which is extremely high,) how much did it cost you to get that sale? Then once they do get to your website, they have to pay. Ok, 2.9% + $0.30. Now they have to securely download the app. Where is your app hosted? Apparently that’s free and doesn’t cost you anything? Who maintains that system? How pays for that electricity? And updates? And security? Apparently all of that is free and takes zero time? Chargeback? Uh oh. That’s a $20 fee while you have to fight and document the dispute. Maybe that takes 20 minutes, but more like 45 minutes by the time you write the challenge letter. Digital products, especially games, have a high rate of fraud compared to many industries. Then there are sales taxes. Are you collecting and remitting the precise amounts to the various jurisdictions where you are selling? How about a sales tax permit? Do you have that? And trust? I’ll buy an App Store app, but installing an app from some random developer without any assurances I am not installing something nefarious? If you sold 200 downloads from your website but 300 downloads from the App Store but pay the 15-30%. What makes you more money? Have you ever sold a product to a retail store? A $10 product in a retail store is purchased from the manufacturer at $5. If there is a distributor involved, that $10 product is purchased from the manufacturer at $2.50. Physical products are obviously different than digital, but the product distribution model for any product has markup across the chain. A manufacturer selling DTC has to have the infrastructure to sell to consumers, thus they aren’t selling at $2.50 anymore. Shipping 100 cases of a product to a distributor is a lot less work than shipping that same volume to individual customers. If you think of the App Store as a distributor — 30% is a bargain. I think that many app developers don’t realize what things actually cost — when they do, they’d quickly realize they make far more money from the App Store than they would make selling it directly.

cblconfederate 6y ago

The comments are part of the PR

pietroq 6y ago

In the nineties (1990-1999) we had a distribution deal in the USA with the PowerUp! catalog for a software product that moved a few millions of copies. Of the $24.99 sticker price we received something like $0.80 and that was an USA-only deal. Giving 30% for a worldwide deal when the distributor takes care of all the billing and taxing and accounting and distribution is the deal of the century.

TedDoesntTalk 6y ago
But they don't need to take care of billing, taxing, and accounting. Stripe does that well. PayPal. Many others. Open it to competition. Decouple payments from the distribution (appstore).

heavyset_go 6y ago

> Apple / Google’s 30% take is the anti-competitive elephant in the room here, not a few crumbs thrown to small developers. It's not just the rate that's anti-competitive, it's that these two companies have stifled competition in mobile app distribution for over a decade now. There is no viable competition in this space because Google and Apple never allowed for real competitors to the App Store and Play Store to exist. You have to use the App Store to distribute mobile apps on iPhones and iPads, and if you want automatic updates, background updates or batch installations/upgrades on Android, you have to use the Play Store. These days, if you want to install an app whose developers didn't pay the Apple tax, macOS will make the app appear radioactive, and as if it is either broken or malicious. Same goes for Android, where apps distributed outside of the Play Store invoke scary warnings, and are hindered when it comes to automatic updates, background updates, or batch installs.

TedDoesntTalk 6y ago
It's not just about distribution. What about allowing payments through stripe or paypal or any other payment processor?
- heavyset_go 6y ago
  Good point, and I agree. Developers and users should have the freedom to use the payment processors of their liking, without having their mobile operating system's vendor deciding for them.

HeavyStorm 6y ago

Agree. It is _too little, too late_, as they say. 15% is still a very high fee, and we all know that this is a movement to improve public opinion in light of recent events.

balfirevic 6y ago

> by significantly reducing the absolute number of developers suffering the full impact whilst taking the minimum possible hit to their revenue When you put it like that, it sounds pretty good!

jt2190 6y ago

> Apple / Google’s 30% take is the anti-competitive elephant in the room here, not a few crumbs thrown to small developers. This percentage is something that small businesses feel, but is not really what makes the marketplace for apps “anti-competitive”, and personally I think it’s a distraction from the main issue: Is the total addressable market for “apps” defined by and exclusive to a single platform (iOS, Android, etc.) or not? How you answer this makes the percentage either a number arrived at through a competitive market or a “tax”.

threepio 6y ago

Unfortunately — because I am a longtime Apple user & developer — I have to agree that this is a cynical gesture designed to deflect regulatory scrutiny. Moreover, I expect that this announcement is mostly paving the way for Apple to force all Mac OS apps to be distributed via the Mac App Store (as they do on iOS). The optimist in me doesn't want to believe it. But this is probably consistent with Apple's economic incentives. Especially because the major role of Macs in the world is to provide a platform for developing iOS apps. This week I ordered an M1 Macbook Air. Not because I really need it, but because a couple years from now I will be happy I have a machine that can run Big Sur, which will be remembered as the least restrictive OS of the Apple Silicon era. Apple is the biggest corporation in the world. We can like their products, but we shouldn't give them more credit than, say, ExxonMobil or Foxconn or Goldman Sachs. They will make choices based on what creates the most profit, nothing more. That's not cynicism; it's why corporations exist at all.

mrtranscendence 6y ago
I disagree with the assumption that restricting Macs to the MAS would be profit-maximizing for Apple. The context and expectations are different, and such restrictions -- hobbling many uses of macOS -- would drive developers away from Macs to competing platforms. I'm not even sure what those restrictions would look like; can I not execute arbitrary Python code? Can I not install Python packages from PyPI? (And how are they going to stop me, exactly?) Can I not use clang to compile a C project? To what extent can MacOS really be locked down in a way that doesn't drive away any developer who's not making iOS apps? And if the Mac software scene stagnates, Apple eventually loses their core constituency.
- threepio 6y ago
  I'm referring to GUI apps like the kind currently sold in the app store. There has long been a path to sell these apps direct to customers. But with each OS release, it has become more onerous (codesigning and notarization and whatnot). Still, no one wanted to tolerate the 30% tax. Now it's 15%. The noise around the app store reminds me of all the complaints when Adobe said it would move its apps into the Creative Cloud on a subscription basis. Yes, a certain percentage of customers left. But the extra revenue more than made up for the loss.

anderspitman 6y ago

So you're saying it's a smart business decision?

ponker 6y ago

Flip side: what's so bad about Apple taking 30% of Zynga's iOS revenue? Why is 15% fair to Zynga and 30% not?