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I have a slightly more cynical take on this than it seems most of Hacker News does. Facebook had found a way to monetize it's iOS app without Apple getting a 3

I have a slightly more cynical take on this than it seems most of Hacker News does. Facebook had found a way to monetize it's iOS app without Apple getting a 30% cut. Apple decided to cut that off to prevent Facebook from making money without Apple taking their cut. The fact that Apple can sell this to users as "privacy" is all the better for Apple. At the end of the day Apple is still a corporation. They are beholden to shareholders, not privacy advocates. Apple will maximize profits and has found a way to cut off revenue to competitor and breed goodwill at the same time. Judging by this comments thread, it is working very well.

jeremyis 5y ago
This doesn’t make a lot of sense to me. Google also makes a lot off their apps and circumvents the App Store. Airbnb too. Apple is doing what it thinks is best for its customers. Perhaps people will pick iPhones over Android due to Apples strength with privacy.
- brokenmachine 5y ago
  Google pays Apple billions to be the default search engine for iphone. They've paid their way into good graces. Privacy on iPhone, that's a laugh! The only company ever to ship phones with an automated, unverifiable on-device scanning/reporting to authorities system. As we know, CSAM is just to get the foot in the door, of course. Fuck Apple and their locked-down consumer hostile disposable garbage, and while we're at it, fuck Facebook for just about everything they do. I have no need for either of those garbage companies.
  - realityking 5y ago
    > The only company ever to ship phones with an automated, unverifiable on-device scanning/reporting to authorities system. Nitpick but so far this hasn’t shipped.
ohashi 5y ago
Apple's revenue stream isn't as tied to internet advertising as any of its large competitors. They sell products. And also an ecosystem around those products. The two for one of hurting competitors and making customers happy is about as good a play as they could make. It makes making the 'right' decision easy. Blocking facebook from tracking everything we do online is a win most people can appreciate, except Facebook (and potentially some advertisers taking advantage of it).
- deadmutex 5y ago
  > Apple's revenue stream isn't as tied to internet advertising as any of its large competitors I am curious what your take on this is: https://9to5mac.com/2021/08/25/analysts-google-to-pay-apple-15-billion-to-remain-default-safari-search-engine-in-2021/ https://9to5mac.com/2021/08/25/analysts-google-to-pay-apple-...
  - ohashi 5y ago
    Free money. They don't even have to develop the ad business.
- robocat 5y ago
  > Apple's revenue stream isn't as tied to internet advertising Actually a significant percentage of Apple’s profit comes from free-to-play iPhone games, which contain a lot of adverts. Grabbing some figures from different sources: * “Apple reported a profit of $23.6 billion in its second quarter, on record sales of $89.6” * “According to the ruling, gaming apps account for approximately 70% of all App Store revenue. That 70% is generated by less than 10% of all App” * “Barnes calculated that the App Store had hefty profit margins, which increased to 78% in 2019” * “Apple's App Store had gross sales around $64 billion last year” 78% of 64G$ is ~50G$, and 23.6G$ x4 is ~95G$, so let us say that 50% of profits come from the App Store. I would guess that at least 25% of Apple profits come indirectly from in app advertising for apps related to in-app-purchases. You know, those annoying adverts in free games, that are mostly nothing like YouTube adverts, because the highest payout for the adverts is by advertising gambling and pay to play games. The adverts pay well because the in app purchases pay developers well, and Apple takes their cut from that. Note that Apple do not provide a clear breakdown of App Store profits compared to iPhone sales profits: https://www.marketwatch.com/story/how-profitable-is-apples-app-store-even-a-landmark-antitrust-trial-couldnt-tell-us-11622224506 https://www.marketwatch.com/story/how-profitable-is-apples-a...
93po 5y ago
What services or products do Apple and Facebook share that make them competitors?
- blendergeek 5y ago
  Apple and Facebook both provides means for other apps to monetize. Facebook provides it's ads SDK and Apple provides in-app purchases/subscriptions. While these may seem like totally different markets, Apple and Facebook are directly competing for the same dollars here.
  - 93po 5y ago
    I guess I see that. If I'm an app developer I am choosing between selling my app or placing ads in the app, and I'm directing revenue to either Facebook or Apple depending on that decision.
- random314 5y ago
  iAds. The 2.5T behemoth is looking for new revenue streams.
na85 5y ago
>Apple decided to cut that off to prevent Facebook from making money without Apple taking their cut. The fact that Apple can sell this to users as "privacy" is all the better for Apple. Whatever. As long as it's damaging Facebook it's a net win for society.
- danmur 5y ago
  I agree, even though it feels a bit icky. I'm sure Apple have their eye on that advertising money in some way but anything that damages Facebook is highly likely to be a net positive.
  - kergonath 5y ago
    > I agree, even though it feels a bit icky. Giving the users the opportunity to make an educated decision feels the opposite of icky. This in itself is unambiguously good. Now, other aspects of Apple’s behaviour are less great, but let’s keep some perspective: asking for user consent should be the legal bare minimum.
    - danmur 5y ago
      I meant it feels icky to approve of anything Apple does :P. EDIT: just to clarify, I 100% agree it's a great change, it's just that "right thing for the wrong reasons" situation. But it's a very good change and I hope it continues.
      - kergonath 5y ago
        > I meant it feels icky to approve of anything Apple does :P. Oh, right. Sorry, I misread :)
r00fus 5y ago
Your cynical take would make sense if you think Apple would somehow get that 30% if Facebook were allowed to collect this data. Apple gets nothing either way. Apple isn't holding Facebook hostage, it's simply allow FB users to relinquish giving Facebook their usage patterns for free.
- deleted 5y ago
  [deleted]
- yarcob 5y ago
  Facebook might pivot towards other monetization strategies when their cross-platform web tracking ads don't work anymore. For example, Facebook offers you to pay to "increase the reach" of your posts. This happens for example when you try to post a message to a Facebook group. If you want to make sure all members see the message, you have to pay. This is a way that Facebook monetizes without tracking (targeting is based on people who opted in to join a group) and the users pay directly in the app (allowing Apple to get their 30% for the in-app payment). With Apples changes, Facebook (and others) might focus more on strategies like that.
  - annadane 5y ago
    > For example, Facebook offers you to pay to "increase the reach" of your posts. This happens for example when you try to post a message to a Facebook group. If you want to make sure all members see the message, you have to pay. That actually sounds incredibly cynical, and criminal Edit: Would the person who downvoted me within literally a minute of posting this please explain why?
    - javagram 5y ago
      I didn’t downvote you, but perhaps it’s because you didn’t back up the word “criminal” with a source. What law does it break if facebook doesn’t send your post to everyone in the group? If you wanted to send a letter to all of your friends in the traditional post, you’d have to pay 58 cents per person to do so, the business model hardly seems unusual.
HeyZuess 5y ago
I would say that a lot of this is about domination of the chat space. FB has the most used messenger app, and iMessage is a predominant feature of Apple. FB is also an easy target at the moment, so Apple can use them to sell the "privacy" of their product. That and I think Tim Apple has a bone or two to pick with Zucks.
- rsuelzer 5y ago
  It is hard to dominate the messaging space when Apple does not offer messaging service to android users.
  - HeyZuess 5y ago
    Do they need to dominate the space, or does Apple just need to dominate their own space? I would suggest that the high usage of iMessage is also a driver for new customers to come on board with iOS and remain there.
    - simonklitj 5y ago
      This right here. I think a lot of people don’t consider jumping ship at all, primarily because of iMessage (no source, just personal experience).
      - kaba0 5y ago
        That’s mostly a US thing. Where apple doesn’t have big enough market share, it doesn’t work and people use alternative chat programs (messenger, whatsapp, telegram)
        simonklitj 5y ago
        True! Having moved from Denmark to the US makes this very apparent. In DK everyone uses Facebook Messenger.
      - amatecha 5y ago
Despegar 5y ago
If Apple wants a cut, they can just change the terms of the developer agreement so they get a cut from advertising revenue. The more Facebook earns, the more Apple would earn.
celloductor 5y ago
if Apple wanted money I'm sure they could've struck a deal with FB just like how they made a pact with Google to put them as a default search engine.
- anshumankmr 5y ago
  What would they have made FB into? Default social network? Google provides a value addition for most people which is better search results than its competitors and they keep paying Apple for the privilege of being the default search engine. Facebook provides no such "value". There is no such thing as the best social media app. Twitter, Facebook, Whatsapp, Reddit, Hackernews etc provide different services to people.
random314 5y ago
Apple doesn't want a 30% cut. They want a 100% cut. Watch as Apple rolls out "privacy compliant" ads api that will route all ads through apple.com and block out other advertisers. Apple wants to be the only Ad company on iOS. Notice the hypocrisy of providing privacy for your internet shopping behavior while dumping your imessages to CCP without a thought as well as your albums to any government entity.
soheil 5y ago
Wait, what's the alternative? FB pays Apple 30% of what exactly? Its ad revenue? How is that in any shape or form feasible for Apple to demand from FB, logistically? If there is no clear way for Apple to force FB to pay it has no reason to find an excuse to hinder FB's tracking activities on iOS for monetary reasons. The world is also not black and white. Just because Apple is not beholden to privacy advocates, but instead its shareholders, doesn't mean it gives 0-fucks about privacy concerns. Of course Apple cares about privacy if it helps it sell more iPhones without lowering its profit margin.
simonh 5y ago
Apple has been vehemently against tracking their users from the start. Steve Jobs was adamant about it, it's even why they ditched Google Maps and developed their own mapping service starting in 2009. So Apple has a very long history to back this up, and have sunk billions of dollars into avoiding commercial entanglements that compromised their user's data. Imagine if Apple had gone heavily into tracking back in 2009, as a lot of analysts predicted they would. They'd have been giants in the tracking industry. Imagine how much the detailed social graph of Apple users for more than a decade must be worth? They would have hauled in tens, maybe hundreds of billions. They walked away from all of that on principle.
viktorcode 5y ago
Only the privacy changes go way beyond Facebook.
swiley 5y ago
Smartphone Apps are universally shit.
KoftaBob 5y ago
This reads like someone starting with the conclusion that Apple did this to prevent Facebook from making money without an Apple cut, and then looking hard for evidence to support that.
Voloskaya 5y ago
> Judging by this comments thread, it is working very well. Good. A company's motives don't matter. Companies are just reinforcement machines that go where they think money is. If they release a "privacy" feature, for whatever hidden motive, and users flock to it, they will infer that there is money to be made here and continue in that direction, which is good for us. It makes no difference what their reason to move there was in the first place.
deleted 5y ago
[deleted]

jeremyis 5y ago

This doesn’t make a lot of sense to me. Google also makes a lot off their apps and circumvents the App Store. Airbnb too. Apple is doing what it thinks is best for its customers. Perhaps people will pick iPhones over Android due to Apples strength with privacy.

brokenmachine 5y ago
Google pays Apple billions to be the default search engine for iphone. They've paid their way into good graces. Privacy on iPhone, that's a laugh! The only company ever to ship phones with an automated, unverifiable on-device scanning/reporting to authorities system. As we know, CSAM is just to get the foot in the door, of course. Fuck Apple and their locked-down consumer hostile disposable garbage, and while we're at it, fuck Facebook for just about everything they do. I have no need for either of those garbage companies.
- realityking 5y ago
  > The only company ever to ship phones with an automated, unverifiable on-device scanning/reporting to authorities system. Nitpick but so far this hasn’t shipped.

ohashi 5y ago

Apple's revenue stream isn't as tied to internet advertising as any of its large competitors. They sell products. And also an ecosystem around those products. The two for one of hurting competitors and making customers happy is about as good a play as they could make. It makes making the 'right' decision easy. Blocking facebook from tracking everything we do online is a win most people can appreciate, except Facebook (and potentially some advertisers taking advantage of it).

deadmutex 5y ago
> Apple's revenue stream isn't as tied to internet advertising as any of its large competitors I am curious what your take on this is: https://9to5mac.com/2021/08/25/analysts-google-to-pay-apple-15-billion-to-remain-default-safari-search-engine-in-2021/ https://9to5mac.com/2021/08/25/analysts-google-to-pay-apple-...
- ohashi 5y ago
  Free money. They don't even have to develop the ad business.
robocat 5y ago
> Apple's revenue stream isn't as tied to internet advertising Actually a significant percentage of Apple’s profit comes from free-to-play iPhone games, which contain a lot of adverts. Grabbing some figures from different sources: * “Apple reported a profit of $23.6 billion in its second quarter, on record sales of $89.6” * “According to the ruling, gaming apps account for approximately 70% of all App Store revenue. That 70% is generated by less than 10% of all App” * “Barnes calculated that the App Store had hefty profit margins, which increased to 78% in 2019” * “Apple's App Store had gross sales around $64 billion last year” 78% of 64G$ is ~50G$, and 23.6G$ x4 is ~95G$, so let us say that 50% of profits come from the App Store. I would guess that at least 25% of Apple profits come indirectly from in app advertising for apps related to in-app-purchases. You know, those annoying adverts in free games, that are mostly nothing like YouTube adverts, because the highest payout for the adverts is by advertising gambling and pay to play games. The adverts pay well because the in app purchases pay developers well, and Apple takes their cut from that. Note that Apple do not provide a clear breakdown of App Store profits compared to iPhone sales profits: https://www.marketwatch.com/story/how-profitable-is-apples-app-store-even-a-landmark-antitrust-trial-couldnt-tell-us-11622224506 https://www.marketwatch.com/story/how-profitable-is-apples-a...

93po 5y ago

What services or products do Apple and Facebook share that make them competitors?

blendergeek 5y ago
Apple and Facebook both provides means for other apps to monetize. Facebook provides it's ads SDK and Apple provides in-app purchases/subscriptions. While these may seem like totally different markets, Apple and Facebook are directly competing for the same dollars here.
- 93po 5y ago
  I guess I see that. If I'm an app developer I am choosing between selling my app or placing ads in the app, and I'm directing revenue to either Facebook or Apple depending on that decision.
random314 5y ago
iAds. The 2.5T behemoth is looking for new revenue streams.

na85 5y ago

>Apple decided to cut that off to prevent Facebook from making money without Apple taking their cut. The fact that Apple can sell this to users as "privacy" is all the better for Apple. Whatever. As long as it's damaging Facebook it's a net win for society.

danmur 5y ago
I agree, even though it feels a bit icky. I'm sure Apple have their eye on that advertising money in some way but anything that damages Facebook is highly likely to be a net positive.
- kergonath 5y ago
  > I agree, even though it feels a bit icky. Giving the users the opportunity to make an educated decision feels the opposite of icky. This in itself is unambiguously good. Now, other aspects of Apple’s behaviour are less great, but let’s keep some perspective: asking for user consent should be the legal bare minimum.
  - danmur 5y ago
    I meant it feels icky to approve of anything Apple does :P. EDIT: just to clarify, I 100% agree it's a great change, it's just that "right thing for the wrong reasons" situation. But it's a very good change and I hope it continues.
    - kergonath 5y ago
      > I meant it feels icky to approve of anything Apple does :P. Oh, right. Sorry, I misread :)

r00fus 5y ago

Your cynical take would make sense if you think Apple would somehow get that 30% if Facebook were allowed to collect this data. Apple gets nothing either way. Apple isn't holding Facebook hostage, it's simply allow FB users to relinquish giving Facebook their usage patterns for free.

deleted 5y ago
[deleted]
yarcob 5y ago
Facebook might pivot towards other monetization strategies when their cross-platform web tracking ads don't work anymore. For example, Facebook offers you to pay to "increase the reach" of your posts. This happens for example when you try to post a message to a Facebook group. If you want to make sure all members see the message, you have to pay. This is a way that Facebook monetizes without tracking (targeting is based on people who opted in to join a group) and the users pay directly in the app (allowing Apple to get their 30% for the in-app payment). With Apples changes, Facebook (and others) might focus more on strategies like that.
- annadane 5y ago
  > For example, Facebook offers you to pay to "increase the reach" of your posts. This happens for example when you try to post a message to a Facebook group. If you want to make sure all members see the message, you have to pay. That actually sounds incredibly cynical, and criminal Edit: Would the person who downvoted me within literally a minute of posting this please explain why?
  - javagram 5y ago
    I didn’t downvote you, but perhaps it’s because you didn’t back up the word “criminal” with a source. What law does it break if facebook doesn’t send your post to everyone in the group? If you wanted to send a letter to all of your friends in the traditional post, you’d have to pay 58 cents per person to do so, the business model hardly seems unusual.

HeyZuess 5y ago

I would say that a lot of this is about domination of the chat space. FB has the most used messenger app, and iMessage is a predominant feature of Apple. FB is also an easy target at the moment, so Apple can use them to sell the "privacy" of their product. That and I think Tim Apple has a bone or two to pick with Zucks.

rsuelzer 5y ago
It is hard to dominate the messaging space when Apple does not offer messaging service to android users.
- HeyZuess 5y ago
  Do they need to dominate the space, or does Apple just need to dominate their own space? I would suggest that the high usage of iMessage is also a driver for new customers to come on board with iOS and remain there.
  - simonklitj 5y ago
    This right here. I think a lot of people don’t consider jumping ship at all, primarily because of iMessage (no source, just personal experience).
    - kaba0 5y ago
      That’s mostly a US thing. Where apple doesn’t have big enough market share, it doesn’t work and people use alternative chat programs (messenger, whatsapp, telegram)
      - simonklitj 5y ago
        True! Having moved from Denmark to the US makes this very apparent. In DK everyone uses Facebook Messenger.
    - amatecha 5y ago

Despegar 5y ago

If Apple wants a cut, they can just change the terms of the developer agreement so they get a cut from advertising revenue. The more Facebook earns, the more Apple would earn.

celloductor 5y ago

if Apple wanted money I'm sure they could've struck a deal with FB just like how they made a pact with Google to put them as a default search engine.

anshumankmr 5y ago
What would they have made FB into? Default social network? Google provides a value addition for most people which is better search results than its competitors and they keep paying Apple for the privilege of being the default search engine. Facebook provides no such "value". There is no such thing as the best social media app. Twitter, Facebook, Whatsapp, Reddit, Hackernews etc provide different services to people.

random314 5y ago

Apple doesn't want a 30% cut. They want a 100% cut. Watch as Apple rolls out "privacy compliant" ads api that will route all ads through apple.com and block out other advertisers. Apple wants to be the only Ad company on iOS. Notice the hypocrisy of providing privacy for your internet shopping behavior while dumping your imessages to CCP without a thought as well as your albums to any government entity.

soheil 5y ago

Wait, what's the alternative? FB pays Apple 30% of what exactly? Its ad revenue? How is that in any shape or form feasible for Apple to demand from FB, logistically? If there is no clear way for Apple to force FB to pay it has no reason to find an excuse to hinder FB's tracking activities on iOS for monetary reasons. The world is also not black and white. Just because Apple is not beholden to privacy advocates, but instead its shareholders, doesn't mean it gives 0-fucks about privacy concerns. Of course Apple cares about privacy if it helps it sell more iPhones without lowering its profit margin.

simonh 5y ago

Apple has been vehemently against tracking their users from the start. Steve Jobs was adamant about it, it's even why they ditched Google Maps and developed their own mapping service starting in 2009. So Apple has a very long history to back this up, and have sunk billions of dollars into avoiding commercial entanglements that compromised their user's data. Imagine if Apple had gone heavily into tracking back in 2009, as a lot of analysts predicted they would. They'd have been giants in the tracking industry. Imagine how much the detailed social graph of Apple users for more than a decade must be worth? They would have hauled in tens, maybe hundreds of billions. They walked away from all of that on principle.

viktorcode 5y ago

Only the privacy changes go way beyond Facebook.

swiley 5y ago

Smartphone Apps are universally shit.

KoftaBob 5y ago

This reads like someone starting with the conclusion that Apple did this to prevent Facebook from making money without an Apple cut, and then looking hard for evidence to support that.

Voloskaya 5y ago

> Judging by this comments thread, it is working very well. Good. A company's motives don't matter. Companies are just reinforcement machines that go where they think money is. If they release a "privacy" feature, for whatever hidden motive, and users flock to it, they will infer that there is money to be made here and continue in that direction, which is good for us. It makes no difference what their reason to move there was in the first place.

deleted 5y ago

[deleted]