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Everything you buy has markup. Everything Digital stores have settled on a 30% standard. Different industries have different standards. It's notable that even

by fooey 5y ago

Everything you buy has markup. Everything Digital stores have settled on a 30% standard. Different industries have different standards. It's notable that even on stores that don't charge 30%, like Epic Games Store, the price of the products offered are almost never at a lower price.

adam_arthur 5y ago
Sure, that's true. I have no problem with businesses making money. But when a business can run an operation in a market with 90% (or whatever) profit margins, it's an indication that the market isn't open to competition. Which is exactly why anti-trust law exists. Why? Because competitors will see how much money Apple is making and move in to capitalize. I don't think computing devices should become walled gardens where companies are free to gouge their customers. Fees are most assuredly passed onto consumers. They cut into the providers bottom line. Providers must charge at least 30% markup just to break even when offering through the app store. This is simple math, and self evident. The app store itself is not a particularly great piece of technology either... it's simply a monopoly on the iPhone user audience. Could the app store improve if it had healthy competition? e.g. better searchability/functionality? Personally I'm amazed at how bad app discovery still is on both iOS and Android app stores.
pixl97 5y ago
I'm pretty sure you'd start screaming blood murder if your grocery store put a flat 30% markup on all items tomorrow.
- pmmucsd 5y ago
  That's exactly what they do. They buy products from suppliers and mark them up, sell the the products and take the margin.
  - adam_arthur 5y ago
    Except the markup and margins are extremely low because the grocery business is competitive. Unlike the app store space (within a given device)
  - pixl97 5y ago
    https://smallbusiness.chron.com/profit-margin-supermarket-22467.html https://smallbusiness.chron.com/profit-margin-supermarket-22... That is profit margins in a competitive market.
bogwog 5y ago
> It's notable that even on stores that don't charge 30%, like Epic Games Store, the price of the products offered are almost never at a lower price. So? That's because the price of the products in that industry isn't based on the costs. What does a digital copy of a game cost? Practically nothing! People seem to be focusing too much on whether or not 30% is too high or unfair. I don't think that's important; Apple should be able to charge whatever the hell they want, but they should not be immune from the competitive forces that would normally keep those types of things in check in a free market. You might argue that, because the lower fee won't reduce game prices, the players will see the same price and won't buy from another store instead of the app store (since they cost the same). So Apple wouldn't feel "competitive forces" either way. However, the thing to keep in mind is that those customers aren't buying from Apple, they're buying from the developer. So developers will be incentivized to move customers to a more profitable store, and they have many ways to do that that benefit consumers. A discount is the most obvious, but even without that a developer could offer exclusive content, early access, a better shopping experience, community features, and pretty much anything that will *provide value to consumers* in exchange for switching stores. Alternate app stores will increase game industry profits, create jobs, provide value to consumers, lead to innovation (the damn app store has been the same boring thing for decades; there's a lot of room to innovate). There are literally no downsides whatsoever, except that Apple shareholders and fanboys will be unhappy.

by fooey 5y ago

adam_arthur 5y ago

Sure, that's true. I have no problem with businesses making money. But when a business can run an operation in a market with 90% (or whatever) profit margins, it's an indication that the market isn't open to competition. Which is exactly why anti-trust law exists. Why? Because competitors will see how much money Apple is making and move in to capitalize. I don't think computing devices should become walled gardens where companies are free to gouge their customers. Fees are most assuredly passed onto consumers. They cut into the providers bottom line. Providers must charge at least 30% markup just to break even when offering through the app store. This is simple math, and self evident. The app store itself is not a particularly great piece of technology either... it's simply a monopoly on the iPhone user audience. Could the app store improve if it had healthy competition? e.g. better searchability/functionality? Personally I'm amazed at how bad app discovery still is on both iOS and Android app stores.

pixl97 5y ago

I'm pretty sure you'd start screaming blood murder if your grocery store put a flat 30% markup on all items tomorrow.

pmmucsd 5y ago
That's exactly what they do. They buy products from suppliers and mark them up, sell the the products and take the margin.
- adam_arthur 5y ago
  Except the markup and margins are extremely low because the grocery business is competitive. Unlike the app store space (within a given device)
- pixl97 5y ago
  https://smallbusiness.chron.com/profit-margin-supermarket-22467.html https://smallbusiness.chron.com/profit-margin-supermarket-22... That is profit margins in a competitive market.

bogwog 5y ago

> It's notable that even on stores that don't charge 30%, like Epic Games Store, the price of the products offered are almost never at a lower price. So? That's because the price of the products in that industry isn't based on the costs. What does a digital copy of a game cost? Practically nothing! People seem to be focusing too much on whether or not 30% is too high or unfair. I don't think that's important; Apple should be able to charge whatever the hell they want, but they should not be immune from the competitive forces that would normally keep those types of things in check in a free market. You might argue that, because the lower fee won't reduce game prices, the players will see the same price and won't buy from another store instead of the app store (since they cost the same). So Apple wouldn't feel "competitive forces" either way. However, the thing to keep in mind is that those customers aren't buying from Apple, they're buying from the developer. So developers will be incentivized to move customers to a more profitable store, and they have many ways to do that that benefit consumers. A discount is the most obvious, but even without that a developer could offer exclusive content, early access, a better shopping experience, community features, and pretty much anything that will *provide value to consumers* in exchange for switching stores. Alternate app stores will increase game industry profits, create jobs, provide value to consumers, lead to innovation (the damn app store has been the same boring thing for decades; there's a lot of room to innovate). There are literally no downsides whatsoever, except that Apple shareholders and fanboys will be unhappy.