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Calling fees taxes is just bullshit. This is just dishonest politics. By this logic, there is a Grocery ‘tax’, and a haircutting ‘tax’. Spotify ‘Taxes’ you.

by zepto 6y ago

Calling fees taxes is just bullshit. This is just dishonest politics. By this logic, there is a Grocery ‘tax’, and a haircutting ‘tax’. Spotify ‘Taxes’ you. Netflix ‘Taxes’ you. The New York Times ‘taxes’ you. It’s also a lie to say that Apple charges 30%. It’s 15% for almost all developers except for a tiny percentage of themselves extremely wealthy corporations. Perhaps these are the people who are behind these moves. They are the only ones who will gain. The the idea that paying, 10% less to small app developers will do anything to make Arizonans better off is utterly stupid. There may be good reasons for tech legislation - e.g. forcing Boot Camp style installation of alternate operating systems on hardware. But it’s fairly obvious that all this talk about the App Store is just the result of other middlemen lobbying for a part of the action.

dragonwriter 6y ago
> Calling fees taxes is just bullshit. General “fees”, probably; there's a sense in which monopoly rents are tax-like, though.
- zepto 6y ago
  I’m fine with calling them ‘monopoly rents’. Then we can have a meaningful conversation about what to do about them, if that’s indeed what they are. Tax-like, is not the same as Tax. Even saying ‘tax like’ would be better. It’s still a dishonest politicization to call them taxes. If we call App Store fees ‘taxes’, why don’t we also call healthcare premiums, or bank charges, ‘taxes’?
  - pydry 6y ago
    And monopoly rents, being not impossible but still difficult to avoid are a lot like _____ ? It seems more honest than dishonest to me.
    - emteycz 6y ago
      Will police come arrest me if I don't pay? No? Then it's not a tax. I was never ever stressed out because of a company's fees - I simply cancelled the service. I can't do that with taxes. Comparing these absolutely different experiences totally seems dishonest.
    - zepto 6y ago
      Yes that would be honest. But it’s not what they are doing. They are not saying it’s ‘a lot like’ a tax, the way you are. They are saying it is a tax. What they are doing is dishonest.
      - dragonwriter 6y ago
        It's called a metaphor; most people learn about them in primary school, I believe, certainly before getting out of grade school.
        zepto 6y ago
        One of the things we learn later, is that metaphors can be used dishonestly.
        pessimizer 6y ago
        But not in this case, since you think "tax-like" is better.
        zepto 6y ago
        You think tax-like is also dishonest?
        pydry 6y ago
        Still don't understand why this is an example of a dishonestly used metaphor.
0xfaded 6y ago
Capitalism needs competition, yet capitalists hate it. There is an ongoing shift to more and more resources being dedicated to protecting the returns on existing assets instead of creating new assets. When there is no longer a realistic choice of whether or not to pay a fee, it starts to look very similar to a tax.
- zepto 6y ago
  I agree with your premise, but not your conclusion. It’s fairly obvious that Apple invests heavily in the development of iOS, the Mac and the iPad and iPhone. The people whose assets are being protected are the people sitting on large amounts of capital that they could invest in creating alternative platforms. What would it cost to build an alternative? $1BN? $2BN Epic alone has vastly more than that available to invest, and there are many others who do too. There is no reason that we shouldn’t have a third or fourth alternative given the 100s of billions of dollars sloshing around in these companies and in VCs. That would create more jobs, and would put real competitive pressure on Apple and Google. Letting a few middlemen siphon a few percent out of the App Store while degrading user experience will not. Just consider for a moment what it would take to make an actually free Linux into a viable smartphone platform (as librem and pine are trying to do). The answer is, very little for companies whose revenues are in the billions. That would create the free market they claim to want. There is no reason at all for companies and investors who think an open ecosystem would be good for them not to put $2BN into a joint venture to build an open Linux for mobile. Except that they don’t want an open platform. They just want a cut.
  - tamlin 6y ago
    MBA and business students are taught the rule of three: "The Rule of Three applies wherever competitive market forces are allowed to determine market structure with only minor regulatory and technological impediments." https://iveybusinessjournal.com/publication/competitive-markets-and-the-rule-of-three/ https://iveybusinessjournal.com/publication/competitive-mark... https://en.wikipedia.org/wiki/Rule_of_three_(economics) https://en.wikipedia.org/wiki/Rule_of_three_(economics) The costs here of developing the platform and substitute services / features is high and all investors want some return on the investment. Third place companies are often stuck in the ditch going nowhere. Microsoft has deep pockets and years of experience, but ultimately bailed on Windows Phone because #3 is not a good place to be.
whoomp12342 6y ago
high cost of food or a high cost of a hair cut is absolutely a tax on life costs. it might not be a tax that goes straight to the government but what are you going to do, not eat? how will people treat you if you stop maintaining your hygiene and look like a caveperson? its a tax because it is a necessity.
- AdrianB1 6y ago
  That first sentence is amazing: it makes me a criminal because I don't pay all my taxes! I have an electric hair cutting machine, so I pay no tax on life to cut hair - does this make sense at all? Not to me.
  - notJim 6y ago
    Well, your "hair cutting machine" presumably wasn't free, so it's more like you pay a very low tax rate. How regressive of you to dodge your taxes like that.
- zepto 6y ago
  Saying something is a cost doesn’t make it a tax. For what it’s worth, I know people who haven’t cut their hair in decades, without any serious consequences.
908B64B197 6y ago
> It’s also a lie to say that Apple charges 30%. > It’s 15% for almost all developers except for a tiny percentage of themselves extremely wealthy corporations. Remember dealing with distributors and middlemen before the App Store? I recall high schoolers getting their app on the App Store (and making money out of it) not that long after the Store launched. That was unthinkable a few years before that.
- Razengan 6y ago
  > Remember dealing with distributors and middlemen before the App Store? Uhhh.. remember hosting fees, payment processors, ad networks?
  - zepto 6y ago
    Yeah - it was vastly more difficult to deal with that patchwork than just uploading to the App Store, and the friction for consumers meant much worse sales performance.
    - jariel 6y ago
      This is false, and tons of software providers do it already today. For smaller shops in an open market, they'll be a ton of vendors willing to do the 'full stack' checkout experience for a fraction of what Apple/Google charge. For one, Shopify will open up a 'Software Goods' version of their front end to manage digital inventory and that's that. $20/month.
      - zepto 6y ago
        This is not false. Presumably Shopify will do nothing to scan the software for malware, build a privacy framework, deal with incremental downloading of content, etc. etc. The App Store is not just a bunch of urls with a paywall in front of it.
      - 908B64B197 6y ago
        > For smaller shops in an open market, they'll be a ton of vendors willing to do the 'full stack' checkout experience for a fraction of what Apple/Google charge. I suppose they also provide the ecosystem of devices and the extremely valuable higher-income market segment Apple targets.
scyAnts0 6y ago
The value of the word tax is not limited to government obligations. Not colloquially anyway; a tax is a burden. From a mathematical perspective alone, these companies have soaked up immense wealth. There’s little to go around for infrastructure projects while it’s locked up in private vaults. Many communities did not have much say in how decimated the local economy would become by the last few decades of neoliberalism. It’s placed a heavy burden on many lives.
- zepto 6y ago
  > The value of the word tax is not limited to government obligations. Not colloquially anyway; a tax is a burden. This is true. Such a colloquial definition does exist. However using that definition in a discussion about government and economic policy is a form of dissembling. > From a mathematical perspective alone, these companies have soaked up immense wealth. This makes no sense. The concept of ‘soaking up wealth’ is a completely subjective political characterization. It cannot be a mathematical perspective. > There’s little to go around for infrastructure projects while it’s locked up in private vaults. What are you talking about when you talk about infrastructure? Is this point about taxing corporations so you can build schools? If so, that’s nothing to do with what the article (written by Republican politicans) support. A generalized attack on neoliberalism has nothing to do with the points being made here. For example, I support the idea of forcing something like bootcamp to be made available for all general purpose computers.
  - ClumsyPilot 6y ago
    "The concept of ‘soaking up wealth’ is a completely subjective political characterization." It an ironclad economic reality that Apple has $200 billion literally sitting in offshore tax heavens. It has failed to effectively invest or spend it for the past decade. If you deny that this is unproductive, then you have left the realm of reasonable discourse and it's like debating Nasa's research with a flat-earther.
    - zepto 6y ago
      > It an ironclad economic reality that Apple has $200 billion literally sitting in offshore tax heavens. It’s not actual banknotes. It’s in investment vehicles. Generally that means it’s invested in things like stocks commodities etc. We can debate whether Apple is investing their money in productive vehicles or not. But it’s not literally sitting anywhere. > It has failed to effectively invest or spend it for the past decade. Has it? You may be right. You are certainly right that they have this much capital offshore. To claim that it hasn’t been invested effectively isn’t something you can say without qualification. > If you deny that this is unproductive, then you have left the realm of reasonable discourse and it's like debating Nasa's research with a flat-earther. If you say so. One reason businesses keep large amounts of securities on hand, is to mitigate risk. I’d say Apple faces some of the largest risks of any company in the world. It is dependent on China for most of its manufacturing, and Taiwan for all of almost all of it’s silicon. It’s not at all unreasonable for them to consider a future where one or both of these are the subject of political instability. The government can certainly precipitate disaster for Apple in China or Taiwan, or fail to protect Apple’s interests. What it cannot do is rebuild its supply chain or silicon vendor in such an event. For that Apple would need a large reserve in the order of 100’s of billions of dollars. Do you deny that?
jariel 6y ago
No, actually - in pure economic terms, 'Tax' is actually a reasonable term to use. Fees which can be perceived as arbitrary capture of a piece of economic activity (and monopoly pricing could be considered that in part) acts just like a tax. You can actually demonstrated the 'economic loss' (deadweight) from a tax with the supply and demand curve. The loss is usually more than that, but at least the direct math is there. [1] And this: "talk about the App Store is just the result of other middlemen lobbying for a part of the action." is just completely false. There are no 'middle men' to lobby. [1] https://www.khanacademy.org/economics-finance-domain/microeconomics/consumer-producer-surplus/deadweight-loss-tutorial/a/lesson-overview-taxation-and-deadweight-loss https://www.khanacademy.org/economics-finance-domain/microec...
- zepto 6y ago
  > No, actually - in pure economic terms, 'Tax' is actually a reasonable term to use. Fees which can be perceived as arbitrary capture of a piece of economic activity (and monopoly pricing could be considered that in part) acts just like a tax. Whether something is a tax or not has nothing to do with perception. Also these fees don’t act ‘just like a tax’. They are not taxes. They don’t act like taxes. It’s dishonest to call them taxes. It’s reasonable to compare them to taxes. It’s false to call them taxes. > There are no 'middle men' to lobby. This makes no sense. Epic is lobbying and want to be a middleman. Facebook is lobbying and wants to be a middleman. Your link is about taxes, but does nothing to support the argument that App Store fees are taxes. Edit: Here is proof that Epic is lobbying: https://appleinsider.com/articles/21/02/16/epic-games-behind-anti-apple-app-store-legislation-in-north-dakota https://appleinsider.com/articles/21/02/16/epic-games-behind...
  - jariel 6y ago
    You're missing some key points, and your comment is not a rebuttal it's just a 'refusal'. Apple, were it not a 'kind of monopoly' would have considerably different pricing structure. The difference between that 'free market price' and 'Apple's current price' - is the the part that has similar effects to a 'Tax'. Apple's fee is like a tax for exactly the reasons I highlighted - it creates 'dead-weight' in the market. This is bad for everyone, even Apple in the long run - just as carriers like AT&T and Verizon wanted to charge 10 cents per 'WAP' page back in 2002, which a price they can dictate because they had the power to, but was obviously completely stupid because it would have restricted the market. ... 'Epic' is not a 'middleman'. 'Epic' is a vendor, they are on the other side of the value chain. They are effectively having to pay a 30% tax on their business and it has nothing to do with 'middlemen'. It's unlikely Facebook wants to be a 'middleman' because they could already be doing that for Google Play - and they are not. Once we see true, independent app stores and software that supports smaller vendors - which will happen when other app stores can be on equal footing - we'll see what the 'true' free market competitive pricing for those services will be. My guess is that it's well under 10%, probably in the range of 4-8% depending on services provided. 3.5% of that will be processing fees to VISA and the networks etc..
tharne 6y ago
This is just arguing semantics. Whether you call it a tax or a fee, or whatever else, the fact remains that it's a form rent-seeking, which is clearly the point of the piece.
ClumsyPilot 6y ago
This accusation of dishonesty is bullshit - we know exactly what is being talked about, no-one is confused or deceived that Apple is a government organisation collecting 'traditional' taxes. For the same reason if I sell 'magic makeup' it's not dishonesty because anyone with a brain knows it's not literal.

by zepto 6y ago

dragonwriter 6y ago

> Calling fees taxes is just bullshit. General “fees”, probably; there's a sense in which monopoly rents are tax-like, though.

zepto 6y ago
I’m fine with calling them ‘monopoly rents’. Then we can have a meaningful conversation about what to do about them, if that’s indeed what they are. Tax-like, is not the same as Tax. Even saying ‘tax like’ would be better. It’s still a dishonest politicization to call them taxes. If we call App Store fees ‘taxes’, why don’t we also call healthcare premiums, or bank charges, ‘taxes’?
- pydry 6y ago
  And monopoly rents, being not impossible but still difficult to avoid are a lot like _____ ? It seems more honest than dishonest to me.
  - emteycz 6y ago
    Will police come arrest me if I don't pay? No? Then it's not a tax. I was never ever stressed out because of a company's fees - I simply cancelled the service. I can't do that with taxes. Comparing these absolutely different experiences totally seems dishonest.
  - zepto 6y ago
    Yes that would be honest. But it’s not what they are doing. They are not saying it’s ‘a lot like’ a tax, the way you are. They are saying it is a tax. What they are doing is dishonest.
    - dragonwriter 6y ago
      It's called a metaphor; most people learn about them in primary school, I believe, certainly before getting out of grade school.
      - zepto 6y ago
        One of the things we learn later, is that metaphors can be used dishonestly.
        pessimizer 6y ago
        But not in this case, since you think "tax-like" is better.
        zepto 6y ago
        You think tax-like is also dishonest?
        pydry 6y ago
        Still don't understand why this is an example of a dishonestly used metaphor.

0xfaded 6y ago

Capitalism needs competition, yet capitalists hate it. There is an ongoing shift to more and more resources being dedicated to protecting the returns on existing assets instead of creating new assets. When there is no longer a realistic choice of whether or not to pay a fee, it starts to look very similar to a tax.

zepto 6y ago
I agree with your premise, but not your conclusion. It’s fairly obvious that Apple invests heavily in the development of iOS, the Mac and the iPad and iPhone. The people whose assets are being protected are the people sitting on large amounts of capital that they could invest in creating alternative platforms. What would it cost to build an alternative? $1BN? $2BN Epic alone has vastly more than that available to invest, and there are many others who do too. There is no reason that we shouldn’t have a third or fourth alternative given the 100s of billions of dollars sloshing around in these companies and in VCs. That would create more jobs, and would put real competitive pressure on Apple and Google. Letting a few middlemen siphon a few percent out of the App Store while degrading user experience will not. Just consider for a moment what it would take to make an actually free Linux into a viable smartphone platform (as librem and pine are trying to do). The answer is, very little for companies whose revenues are in the billions. That would create the free market they claim to want. There is no reason at all for companies and investors who think an open ecosystem would be good for them not to put $2BN into a joint venture to build an open Linux for mobile. Except that they don’t want an open platform. They just want a cut.
- tamlin 6y ago
  MBA and business students are taught the rule of three: "The Rule of Three applies wherever competitive market forces are allowed to determine market structure with only minor regulatory and technological impediments." https://iveybusinessjournal.com/publication/competitive-markets-and-the-rule-of-three/ https://iveybusinessjournal.com/publication/competitive-mark... https://en.wikipedia.org/wiki/Rule_of_three_(economics) https://en.wikipedia.org/wiki/Rule_of_three_(economics) The costs here of developing the platform and substitute services / features is high and all investors want some return on the investment. Third place companies are often stuck in the ditch going nowhere. Microsoft has deep pockets and years of experience, but ultimately bailed on Windows Phone because #3 is not a good place to be.

whoomp12342 6y ago

high cost of food or a high cost of a hair cut is absolutely a tax on life costs. it might not be a tax that goes straight to the government but what are you going to do, not eat? how will people treat you if you stop maintaining your hygiene and look like a caveperson? its a tax because it is a necessity.

AdrianB1 6y ago
That first sentence is amazing: it makes me a criminal because I don't pay all my taxes! I have an electric hair cutting machine, so I pay no tax on life to cut hair - does this make sense at all? Not to me.
- notJim 6y ago
  Well, your "hair cutting machine" presumably wasn't free, so it's more like you pay a very low tax rate. How regressive of you to dodge your taxes like that.
zepto 6y ago
Saying something is a cost doesn’t make it a tax. For what it’s worth, I know people who haven’t cut their hair in decades, without any serious consequences.

908B64B197 6y ago

> It’s also a lie to say that Apple charges 30%. > It’s 15% for almost all developers except for a tiny percentage of themselves extremely wealthy corporations. Remember dealing with distributors and middlemen before the App Store? I recall high schoolers getting their app on the App Store (and making money out of it) not that long after the Store launched. That was unthinkable a few years before that.

Razengan 6y ago
> Remember dealing with distributors and middlemen before the App Store? Uhhh.. remember hosting fees, payment processors, ad networks?
- zepto 6y ago
  Yeah - it was vastly more difficult to deal with that patchwork than just uploading to the App Store, and the friction for consumers meant much worse sales performance.
  - jariel 6y ago
    This is false, and tons of software providers do it already today. For smaller shops in an open market, they'll be a ton of vendors willing to do the 'full stack' checkout experience for a fraction of what Apple/Google charge. For one, Shopify will open up a 'Software Goods' version of their front end to manage digital inventory and that's that. $20/month.
    - zepto 6y ago
      This is not false. Presumably Shopify will do nothing to scan the software for malware, build a privacy framework, deal with incremental downloading of content, etc. etc. The App Store is not just a bunch of urls with a paywall in front of it.
    - 908B64B197 6y ago
      > For smaller shops in an open market, they'll be a ton of vendors willing to do the 'full stack' checkout experience for a fraction of what Apple/Google charge. I suppose they also provide the ecosystem of devices and the extremely valuable higher-income market segment Apple targets.

scyAnts0 6y ago

The value of the word tax is not limited to government obligations. Not colloquially anyway; a tax is a burden. From a mathematical perspective alone, these companies have soaked up immense wealth. There’s little to go around for infrastructure projects while it’s locked up in private vaults. Many communities did not have much say in how decimated the local economy would become by the last few decades of neoliberalism. It’s placed a heavy burden on many lives.

zepto 6y ago
> The value of the word tax is not limited to government obligations. Not colloquially anyway; a tax is a burden. This is true. Such a colloquial definition does exist. However using that definition in a discussion about government and economic policy is a form of dissembling. > From a mathematical perspective alone, these companies have soaked up immense wealth. This makes no sense. The concept of ‘soaking up wealth’ is a completely subjective political characterization. It cannot be a mathematical perspective. > There’s little to go around for infrastructure projects while it’s locked up in private vaults. What are you talking about when you talk about infrastructure? Is this point about taxing corporations so you can build schools? If so, that’s nothing to do with what the article (written by Republican politicans) support. A generalized attack on neoliberalism has nothing to do with the points being made here. For example, I support the idea of forcing something like bootcamp to be made available for all general purpose computers.
- ClumsyPilot 6y ago
  "The concept of ‘soaking up wealth’ is a completely subjective political characterization." It an ironclad economic reality that Apple has $200 billion literally sitting in offshore tax heavens. It has failed to effectively invest or spend it for the past decade. If you deny that this is unproductive, then you have left the realm of reasonable discourse and it's like debating Nasa's research with a flat-earther.
  - zepto 6y ago
    > It an ironclad economic reality that Apple has $200 billion literally sitting in offshore tax heavens. It’s not actual banknotes. It’s in investment vehicles. Generally that means it’s invested in things like stocks commodities etc. We can debate whether Apple is investing their money in productive vehicles or not. But it’s not literally sitting anywhere. > It has failed to effectively invest or spend it for the past decade. Has it? You may be right. You are certainly right that they have this much capital offshore. To claim that it hasn’t been invested effectively isn’t something you can say without qualification. > If you deny that this is unproductive, then you have left the realm of reasonable discourse and it's like debating Nasa's research with a flat-earther. If you say so. One reason businesses keep large amounts of securities on hand, is to mitigate risk. I’d say Apple faces some of the largest risks of any company in the world. It is dependent on China for most of its manufacturing, and Taiwan for all of almost all of it’s silicon. It’s not at all unreasonable for them to consider a future where one or both of these are the subject of political instability. The government can certainly precipitate disaster for Apple in China or Taiwan, or fail to protect Apple’s interests. What it cannot do is rebuild its supply chain or silicon vendor in such an event. For that Apple would need a large reserve in the order of 100’s of billions of dollars. Do you deny that?

jariel 6y ago

No, actually - in pure economic terms, 'Tax' is actually a reasonable term to use. Fees which can be perceived as arbitrary capture of a piece of economic activity (and monopoly pricing could be considered that in part) acts just like a tax. You can actually demonstrated the 'economic loss' (deadweight) from a tax with the supply and demand curve. The loss is usually more than that, but at least the direct math is there. [1] And this: "talk about the App Store is just the result of other middlemen lobbying for a part of the action." is just completely false. There are no 'middle men' to lobby. [1] https://www.khanacademy.org/economics-finance-domain/microeconomics/consumer-producer-surplus/deadweight-loss-tutorial/a/lesson-overview-taxation-and-deadweight-loss https://www.khanacademy.org/economics-finance-domain/microec...

zepto 6y ago
> No, actually - in pure economic terms, 'Tax' is actually a reasonable term to use. Fees which can be perceived as arbitrary capture of a piece of economic activity (and monopoly pricing could be considered that in part) acts just like a tax. Whether something is a tax or not has nothing to do with perception. Also these fees don’t act ‘just like a tax’. They are not taxes. They don’t act like taxes. It’s dishonest to call them taxes. It’s reasonable to compare them to taxes. It’s false to call them taxes. > There are no 'middle men' to lobby. This makes no sense. Epic is lobbying and want to be a middleman. Facebook is lobbying and wants to be a middleman. Your link is about taxes, but does nothing to support the argument that App Store fees are taxes. Edit: Here is proof that Epic is lobbying: https://appleinsider.com/articles/21/02/16/epic-games-behind-anti-apple-app-store-legislation-in-north-dakota https://appleinsider.com/articles/21/02/16/epic-games-behind...
- jariel 6y ago
  You're missing some key points, and your comment is not a rebuttal it's just a 'refusal'. Apple, were it not a 'kind of monopoly' would have considerably different pricing structure. The difference between that 'free market price' and 'Apple's current price' - is the the part that has similar effects to a 'Tax'. Apple's fee is like a tax for exactly the reasons I highlighted - it creates 'dead-weight' in the market. This is bad for everyone, even Apple in the long run - just as carriers like AT&T and Verizon wanted to charge 10 cents per 'WAP' page back in 2002, which a price they can dictate because they had the power to, but was obviously completely stupid because it would have restricted the market. ... 'Epic' is not a 'middleman'. 'Epic' is a vendor, they are on the other side of the value chain. They are effectively having to pay a 30% tax on their business and it has nothing to do with 'middlemen'. It's unlikely Facebook wants to be a 'middleman' because they could already be doing that for Google Play - and they are not. Once we see true, independent app stores and software that supports smaller vendors - which will happen when other app stores can be on equal footing - we'll see what the 'true' free market competitive pricing for those services will be. My guess is that it's well under 10%, probably in the range of 4-8% depending on services provided. 3.5% of that will be processing fees to VISA and the networks etc..

tharne 6y ago

This is just arguing semantics. Whether you call it a tax or a fee, or whatever else, the fact remains that it's a form rent-seeking, which is clearly the point of the piece.

ClumsyPilot 6y ago

This accusation of dishonesty is bullshit - we know exactly what is being talked about, no-one is confused or deceived that Apple is a government organisation collecting 'traditional' taxes. For the same reason if I sell 'magic makeup' it's not dishonesty because anyone with a brain knows it's not literal.