7 ms·

Are you willing to spend 27% more for everything to use Apple payment gateway? Do you love it that much? At the end of the day, services have to provide value

Are you willing to spend 27% more for everything to use Apple payment gateway? Do you love it that much? At the end of the day, services have to provide value. If your customers don't want to pay for your services, they do not value them. That's a dangerous position for any company to try to maintain. The mobile software industry generally has been chaffing at the fees for quite some time now, these are the warning signs that all is not well.

zachlatta 5y ago
Honestly in some cases, yes. Subscription in-app purchases are the only subscriptions I have ever signed up for that are easy to cancel. I prefer to subscribe to services through in-app purchases over the service's website itself because it's always easy to cancel subscriptions made through Apple, and I never forget I'm getting charged because I get payment receipts.
NationalPark 5y ago
There’s tons of value in a unified payment system, which is why it’s app developers who were unhappy, not users. For instance, ease of cancellation of recurring fees is enormous. You can bet that’s going to get harder as developers get more control. And anyway, The app developers have no motivation to charge you less, the market already bears the fees, they just want to capture that profit for themselves. Personally I probably just won’t buy things that require me to sign up for a new payment system, but I don’t play mobile games so I’m probably not representative of who this impacts the most.
- madeofpalk 5y ago
  > which is why it’s app developers who were unhappy, not users The judge commented on that >> "Apple created an innovative platform but it did not disclose its rules to the average consumer. Apple has used this lack of knowledge to exploit its position. --- > Personally I probably just won’t buy things that require me to sign up for a new payment system You, as a consumer, will now have a choice, which you'll get to exercise! You will be able to send a market signal for products (either the service you might subscribe to, and Apple) to get better and attract more developers/users. This sounds like a win!
  - coldpie 5y ago
    > This sounds like a win! Not if I wasn't interested in having the choice to begin with. Now some apps will not be purchasable by me unless I go through their account flow, which I don't want to. It's strictly worse (for me).
    - madeofpalk 5y ago
      There is now a market force for Apple to make its IAP services better, which makes it more likely for developers to make apps with it (theoretically).
      - ascagnel_ 5y ago
        There will be larger players who won't bother with any cut -- they want to own the relationship with the customer, and view any intermediary with hostility.
        luckylion 5y ago
        And before, they might not have bothered developing an app, or one for iOS. Now you have choice. Choice is good.
        mrtranscendence 5y ago
        What big names haven't developed iOS apps but may do so now? I'm hard pressed to think of any. They may not always allow in-app purchases, of course, but they generally exist.
        berkes 5y ago
        Well. Fortnite for example.
        madeofpalk 5y ago
        Sure. They’re either already not on Apple’s IAP (Netflix or Spotify) or they are very sensitive to optimising conversions, and would pay a premium to give users an easier option (which Apple is now incentivised to lower)
- thebean11 5y ago
  > why it’s app developers who were unhappy, not users IIRC, Epic was offering their in game currency more cheaply outside of the App Store, which Apple didn't like. I bet plenty of people would use an alternate payment method to save money..right now they don't have that choice.
  - ApolloFortyNine 5y ago
    It was pretty genius from Epic, they knew they'd get banned, but it instantly showed how the consumer is harmed by this behavior (pay more, get less). Every mobile game with a cash store would instantly give you a discount to go through a different provider.
    - badwolf 5y ago
      I highly doubt every, or even many mobile game devs who could suddenly switch from IAP to Stripe would pass those savings on to the consumers... Let's be real here.
      - thebean11 5y ago
        That’s getting into pretty basic economic theory, costs going down across the board in a very competitive market will generally bring down prices, eventually.
- MillenialMan 5y ago
  I think if you offered the two options to users with even partial differences in price, most users would go for the cheaper option even if they had to do cartwheels to process payments.
coldpie 5y ago
> Are you willing to spend 27% more for everything to use Apple payment gateway? Do you love it that much? Honestly, yeah. I'm way more likely to click "subscribe at $5/mo using your normal payment flow" than go through a whole new account creation flow and wonder how cancellation will work somehow down the line or how trustworthy this vendor is with my data.
selykg 5y ago
I would. I'm very careful about what I pay for anyway. If you want me to pay for your product it needs to be something that brings me real value. Even then I limit myself, as I only have a certain amount to spend anyway, so you're competing with other products for my limited amount of budget. Apple's IAP makes it incredibly simple to cancel service. It's consistent as well, which means I don't have to keep hunting through your site to find it because you hid the location of canceling behind "Please contact us to cancel" type crap. Do I think Apple is charging too much for their cut? Yea, I do. But as a consumer, the benefits outweigh it. As a potential business owner, yea... I would be upset too.
- jerrycruncher 5y ago
  The ability to simply cancel any subscription without clicking through increasingly desperate "Don't go!!!" nag screens is easily worth an extra 30% for me, too.
  - selykg 5y ago
    Yup. As a consumer, Apple's IAP and Apple Pay driven experience is pretty darn good. I wish their business didn't revolve around subscriptions as much, but at the very least it does make purchasing really easy as a consumer.
  - chii 5y ago
    which means the apple IAP is going to have a competitive advantage compared to third party IAP. This means that competition is working, because you would choose apple's IAP, over the third party, even if it was more expensive.
    - gabeio 5y ago
      > This means that competition is working, because you would choose apple's IAP, over the third party, even if it was more expensive. Aren't you heavily assuming these developers would even bother integrating apple's IAP? This ruling will allow the developers to completely go around apple and never use apple's IAP at all.
bayindirh 5y ago
Some of the services I pay via Apple's subscription workflow is cheaper. Unbelievable, but true. Pocket is one, Evernote is other. However, they later synchronized their pricing to be cheaper everywhere, but it doesn't matter. It makes my life easier. If I'm paying for a cross-platform service, I can happily use their own methods, but if I'm paying for an app-store only application which either runs only on iOS or macOS, good luck to them. I won't subscribe via their methods, because it makes my life more complicated.
chipotle_coyote 5y ago
> Are you willing to spend 27% more for everything to use Apple payment gateway? This is the argument Epic's tried to make, and it isn't particularly convincing. The iOS App Store is filled with cheap apps, to the point where many people react to a one-time price of $9.99 as disturbingly expensive. Apps and games that are literally identical on iOS to other platforms are frequently cheaper in their iOS releases because that's what the market expects. So in practice, the 30% cost is usually being eaten by developers, not passed on to consumers. There's a lot of good arguments to be made for cutting that 30% share down to 15% for everyone across the board, but "now you'll only be charged $4.99 instead of $5.99 for this game you would have paid $14.99 for on the Switch version" just isn't one of them.
- BackBlast 5y ago
  > This is the argument Epic's tried to make, and it isn't particularly convincing. It's not an argument, it's a question. Some people have clearly answered it as yes, yes they would. This shows some distinct value provided to them by Apple. Value that's worth something, though perhaps not 30%. Apple's next step is to provide a compelling enough offering that developers and consumers alike pick it over the soon-to-be competing offerings. Wouldn't that be awesome if they pull it off?
r00fus 5y ago
27% more? Are you kidding - it will be 12% more, if Apple doesn't reduce their rates at all for most developers (most don't make $1m revenue).
- sebzim4500 5y ago
  What portion of payments go to people not making $1m revenue? Hard to believe it is a large portion.
falcolas 5y ago
> Are you willing to spend 27% more for everything This makes what is, IMO, an unjustified assumption: that competition in the payment scene will drive prices down for the same item based on payment method. Instead, I think we'll see the same thing we see with the cash/credit card split: The same price regardless of your payment method, with price differences lining the publisher's pockets.
- webmobdev 5y ago
  True that cheaper payment methods may not drive down the price of an app or in-app transactions. But as a user, you would be more satisfied knowing that that the $10 you are paying for an app (or for some transaction within it) is going to the creator of the app, rather than some arbitrary percentage (decided by Apple) of your money. As a user, you would even feel worse knowing that Apple simply pockets the remaining amount.
dubcanada 5y ago
Yes, if it saves me from having to call to cancel my subscription or going through a bunch of weird "are you sure", "how about 2% off", "how about 5% off", "how about we bill you $5 less", "why do you not like us? Fill out this 75 question survey to cancel". Yes it does.
ghosty141 5y ago
>Are you willing to spend 27% more for everything to use Apple payment gateway? Do you love it that much? Most in-App purchases are in the range of 1-5$. If I pay a couple of cents more to have a unified experience, yeah sure. It'd be interesting to see how much users spend on in-App purchases. For me it's almost nothing, maybe 1 purchase a year? The big money is probably in the free2play market where players spend a lot to buy booster packs or "gold".
- woko 5y ago
  You are correct. See: > Judge seems alarmed at the extent to which impulse spending by "exorbitantly high spending gamers" drives App Store revenue. > Says it's outside the scope of antitrust but says issue is "worthy of attention" [1] https://twitter.com/stephentotilo/status/1436365652164493317 https://twitter.com/stephentotilo/status/1436365652164493317 > "in most economic ways...the App Store is primarily a game store and secondarily an 'every other' app store" [2] https://twitter.com/stephentotilo/status/1436365985800507394 https://twitter.com/stephentotilo/status/1436365985800507394
avereveard 5y ago
There this weird misconception floating around the topic that if Apple where to reduce their cut, things would be cheaper for people, conveniently forgetting this is a fight between providers and distributor for margins and not between consumers and sellers for pricing.

zachlatta 5y ago

Honestly in some cases, yes. Subscription in-app purchases are the only subscriptions I have ever signed up for that are easy to cancel. I prefer to subscribe to services through in-app purchases over the service's website itself because it's always easy to cancel subscriptions made through Apple, and I never forget I'm getting charged because I get payment receipts.

NationalPark 5y ago

There’s tons of value in a unified payment system, which is why it’s app developers who were unhappy, not users. For instance, ease of cancellation of recurring fees is enormous. You can bet that’s going to get harder as developers get more control. And anyway, The app developers have no motivation to charge you less, the market already bears the fees, they just want to capture that profit for themselves. Personally I probably just won’t buy things that require me to sign up for a new payment system, but I don’t play mobile games so I’m probably not representative of who this impacts the most.

madeofpalk 5y ago
> which is why it’s app developers who were unhappy, not users The judge commented on that >> "Apple created an innovative platform but it did not disclose its rules to the average consumer. Apple has used this lack of knowledge to exploit its position. --- > Personally I probably just won’t buy things that require me to sign up for a new payment system You, as a consumer, will now have a choice, which you'll get to exercise! You will be able to send a market signal for products (either the service you might subscribe to, and Apple) to get better and attract more developers/users. This sounds like a win!
- coldpie 5y ago
  > This sounds like a win! Not if I wasn't interested in having the choice to begin with. Now some apps will not be purchasable by me unless I go through their account flow, which I don't want to. It's strictly worse (for me).
  - madeofpalk 5y ago
    There is now a market force for Apple to make its IAP services better, which makes it more likely for developers to make apps with it (theoretically).
    - ascagnel_ 5y ago
      There will be larger players who won't bother with any cut -- they want to own the relationship with the customer, and view any intermediary with hostility.
      - luckylion 5y ago
        And before, they might not have bothered developing an app, or one for iOS. Now you have choice. Choice is good.
        mrtranscendence 5y ago
        What big names haven't developed iOS apps but may do so now? I'm hard pressed to think of any. They may not always allow in-app purchases, of course, but they generally exist.
        berkes 5y ago
        Well. Fortnite for example.
      - madeofpalk 5y ago
        Sure. They’re either already not on Apple’s IAP (Netflix or Spotify) or they are very sensitive to optimising conversions, and would pay a premium to give users an easier option (which Apple is now incentivised to lower)
thebean11 5y ago
> why it’s app developers who were unhappy, not users IIRC, Epic was offering their in game currency more cheaply outside of the App Store, which Apple didn't like. I bet plenty of people would use an alternate payment method to save money..right now they don't have that choice.
- ApolloFortyNine 5y ago
  It was pretty genius from Epic, they knew they'd get banned, but it instantly showed how the consumer is harmed by this behavior (pay more, get less). Every mobile game with a cash store would instantly give you a discount to go through a different provider.
  - badwolf 5y ago
    I highly doubt every, or even many mobile game devs who could suddenly switch from IAP to Stripe would pass those savings on to the consumers... Let's be real here.
    - thebean11 5y ago
      That’s getting into pretty basic economic theory, costs going down across the board in a very competitive market will generally bring down prices, eventually.
MillenialMan 5y ago
I think if you offered the two options to users with even partial differences in price, most users would go for the cheaper option even if they had to do cartwheels to process payments.

coldpie 5y ago

> Are you willing to spend 27% more for everything to use Apple payment gateway? Do you love it that much? Honestly, yeah. I'm way more likely to click "subscribe at $5/mo using your normal payment flow" than go through a whole new account creation flow and wonder how cancellation will work somehow down the line or how trustworthy this vendor is with my data.

selykg 5y ago

I would. I'm very careful about what I pay for anyway. If you want me to pay for your product it needs to be something that brings me real value. Even then I limit myself, as I only have a certain amount to spend anyway, so you're competing with other products for my limited amount of budget. Apple's IAP makes it incredibly simple to cancel service. It's consistent as well, which means I don't have to keep hunting through your site to find it because you hid the location of canceling behind "Please contact us to cancel" type crap. Do I think Apple is charging too much for their cut? Yea, I do. But as a consumer, the benefits outweigh it. As a potential business owner, yea... I would be upset too.

jerrycruncher 5y ago
The ability to simply cancel any subscription without clicking through increasingly desperate "Don't go!!!" nag screens is easily worth an extra 30% for me, too.
- selykg 5y ago
  Yup. As a consumer, Apple's IAP and Apple Pay driven experience is pretty darn good. I wish their business didn't revolve around subscriptions as much, but at the very least it does make purchasing really easy as a consumer.
- chii 5y ago
  which means the apple IAP is going to have a competitive advantage compared to third party IAP. This means that competition is working, because you would choose apple's IAP, over the third party, even if it was more expensive.
  - gabeio 5y ago
    > This means that competition is working, because you would choose apple's IAP, over the third party, even if it was more expensive. Aren't you heavily assuming these developers would even bother integrating apple's IAP? This ruling will allow the developers to completely go around apple and never use apple's IAP at all.

bayindirh 5y ago

Some of the services I pay via Apple's subscription workflow is cheaper. Unbelievable, but true. Pocket is one, Evernote is other. However, they later synchronized their pricing to be cheaper everywhere, but it doesn't matter. It makes my life easier. If I'm paying for a cross-platform service, I can happily use their own methods, but if I'm paying for an app-store only application which either runs only on iOS or macOS, good luck to them. I won't subscribe via their methods, because it makes my life more complicated.

chipotle_coyote 5y ago

> Are you willing to spend 27% more for everything to use Apple payment gateway? This is the argument Epic's tried to make, and it isn't particularly convincing. The iOS App Store is filled with cheap apps, to the point where many people react to a one-time price of $9.99 as disturbingly expensive. Apps and games that are literally identical on iOS to other platforms are frequently cheaper in their iOS releases because that's what the market expects. So in practice, the 30% cost is usually being eaten by developers, not passed on to consumers. There's a lot of good arguments to be made for cutting that 30% share down to 15% for everyone across the board, but "now you'll only be charged $4.99 instead of $5.99 for this game you would have paid $14.99 for on the Switch version" just isn't one of them.

BackBlast 5y ago
> This is the argument Epic's tried to make, and it isn't particularly convincing. It's not an argument, it's a question. Some people have clearly answered it as yes, yes they would. This shows some distinct value provided to them by Apple. Value that's worth something, though perhaps not 30%. Apple's next step is to provide a compelling enough offering that developers and consumers alike pick it over the soon-to-be competing offerings. Wouldn't that be awesome if they pull it off?

r00fus 5y ago

27% more? Are you kidding - it will be 12% more, if Apple doesn't reduce their rates at all for most developers (most don't make $1m revenue).

sebzim4500 5y ago
What portion of payments go to people not making $1m revenue? Hard to believe it is a large portion.

falcolas 5y ago

> Are you willing to spend 27% more for everything This makes what is, IMO, an unjustified assumption: that competition in the payment scene will drive prices down for the same item based on payment method. Instead, I think we'll see the same thing we see with the cash/credit card split: The same price regardless of your payment method, with price differences lining the publisher's pockets.

webmobdev 5y ago
True that cheaper payment methods may not drive down the price of an app or in-app transactions. But as a user, you would be more satisfied knowing that that the $10 you are paying for an app (or for some transaction within it) is going to the creator of the app, rather than some arbitrary percentage (decided by Apple) of your money. As a user, you would even feel worse knowing that Apple simply pockets the remaining amount.

dubcanada 5y ago

Yes, if it saves me from having to call to cancel my subscription or going through a bunch of weird "are you sure", "how about 2% off", "how about 5% off", "how about we bill you $5 less", "why do you not like us? Fill out this 75 question survey to cancel". Yes it does.

ghosty141 5y ago

>Are you willing to spend 27% more for everything to use Apple payment gateway? Do you love it that much? Most in-App purchases are in the range of 1-5$. If I pay a couple of cents more to have a unified experience, yeah sure. It'd be interesting to see how much users spend on in-App purchases. For me it's almost nothing, maybe 1 purchase a year? The big money is probably in the free2play market where players spend a lot to buy booster packs or "gold".

woko 5y ago
You are correct. See: > Judge seems alarmed at the extent to which impulse spending by "exorbitantly high spending gamers" drives App Store revenue. > Says it's outside the scope of antitrust but says issue is "worthy of attention" [1] https://twitter.com/stephentotilo/status/1436365652164493317 https://twitter.com/stephentotilo/status/1436365652164493317 > "in most economic ways...the App Store is primarily a game store and secondarily an 'every other' app store" [2] https://twitter.com/stephentotilo/status/1436365985800507394 https://twitter.com/stephentotilo/status/1436365985800507394

avereveard 5y ago

There this weird misconception floating around the topic that if Apple where to reduce their cut, things would be cheaper for people, conveniently forgetting this is a fight between providers and distributor for margins and not between consumers and sellers for pricing.