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Paddle announces iOS IAP alternative that avoids Apple's 30% fees
- deleted 5y ago[deleted]
- cr3ative 5y agoRather on-the-nose that the first differentiating point is "access to customer data".
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- infinityplus1 5y agoApple might still collect its 30% by asking for accounting records later.
- towawy 5y agoThere is way to little talk about this. Apple might still be entitled to the 30% (of gross purchase price paid by the customer) even if the developer is not using the IAP mechanism. The ruling did nothing to invalidate that.
- Danieru 5y agoApple would be playing with fire if they attempt that interpretation. It would detooth the ruling, and could force the judges hand to impose stricter or more vague requirements. The judge certainly not have an issue with the api design...
- CubsFan1060 5y agoThe judge outright said this was ok: “In such a hypothetical world, developers could potentially avoid the commission while benefitting from Apple’s innovation and intellectual property free of charge. The Court presumes that in such circumstances that Apple may rely on imposing and utilizing a contractual right to audit developers annual accounting to ensure compliance with its commissions, among other methods. Of course, any alternatives to IAP (including the foregoing) would seemingly impose both increased monetary and time costs to both Apple and the developers.”
- Danieru 5y agoWow, that's insane. She really did give a toothless ruling. Thanks for correcting me.
- FDSGSG 5y agoIt's not insane, there's simply no reason for why Apple shouldn't get their cut.
- Aeolun 5y agoMicrosoft doesn’t get a cut from Windows apps. Why should Apple?
- CubsFan1060 5y agoWhy are you comparing iOS to Windows? MacOS to Windows, or iOS to Android make more sense. A more fair comparison would be andorid. Or the Windows Phone, where Microsoft took 20%: https://en.wikipedia.org/wiki/Windows_Phone https://en.wikipedia.org/wiki/Windows_Phone
- Aeolun 5y agoI’m comparing a small general purpose computer to a big one. How is that an invalid comparison? Just because everyone does the same thing on a mobile phone doesn’t make it any more sensible.
- CubsFan1060 5y agoBecause it's a cherry picked example that ignores a lot of factors. I could easily make the statement "Microsoft gets a cut of everything purchased on Xbox, why shouldn't Apple?" To which I suspect your response would be waving your hands around something that is ill defied (General Purpose Computing), and then trying to define it to fit your narrative.
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- Aeolun 5y agoThey’re not doing that for existing apps though. It’s going to be a bit hard to enforce.
- endisneigh 5y agoWhy should Apple or anyone get a percentage? Let me pay at cost plus a fixed fee.
- chrisseaton 5y ago> Why should Apple or anyone get a percentage? Because it’s progressive to do so.
- bottled_poe 5y agoI think you may be living in the 90s. The global population has decided what their privacy and autonomy is worth. An individual cannot move the needle.
- rahoulb 5y agoWhy should someone who is making $100 revenue off a transaction pay the same fee as me who's making $1 revenue?
- endisneigh 5y agoBecause the costs do not scale with the revenue
- rahoulb 5y agoHow do you know their costs don't scale? Maybe there's insurance or compliance requirements that also apply? And it begs the question - is "cost-plus" the only valid pricing model?
- endisneigh 5y agoWhy would their costs scale with revenue? Cost+ certainly isn't the only valid model. Many people are fine with a 30% cut.
- mafriese 5y agothey do - the first 1m$ only cost 15% - It's btw the same with the Google Play Store
- myspy 5y agoI'm not sure if that pro Paddle list is good for me as a customer. The access to my data at least isn't.
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- jasode 5y ago>Access to customer data See customers’ emails, so you can communicate with them for upsells, offers and product news. As a seller, you understandably want that valuable buyer info. But as a customer, I'd deliberately avoid Paddle to keep my privacy and avoid spam. If anyone thinks that Paddle's 10% fee might mean the final in-app purchase price would be lower which would make it worth the tradeoff to give my data, I'm not so sure about that since an interpretation of the ruling still gives Apple the right to get 30% via Paddle: https://9to5mac.com/2021/09/14/apple-can-still-charge-its-app-store-30-fee-even-after-epic-ruling-analysts-say/ https://9to5mac.com/2021/09/14/apple-can-still-charge-its-ap... If anyone thinks getting a % of someone else's payment stream is unusual, consider how the "360" record label deals[1] with musicians are structured. All the musician's revenue (CDs, streaming, t-shirts) regardless of payment method (box office or website selling tshirts) is split with the record label. Why is that "unfair" situation even possible?!? Because the musician signed a contract agreeing to the revenue split. [1] https://en.wikipedia.org/wiki/360_deal https://en.wikipedia.org/wiki/360_deal
- 6gvONxR4sf7o 5y ago> …deliberately avoid Paddle to keep my privacy… Can apple still dictate things about the payment systems, even if they can’t force you to use theirs? As a consumer, I sure hope apple forces some kind of privacy standards compliance.
- ascagnel_ 5y ago> Can apple still dictate things about the payment systems, even if they can’t force you to use theirs? I read through the decision when it first came down, and while Apple was blocked from restricting third-party payment systems, there was no language preventing Apple from mandating their own payment system alongside third-party options. I wouldn't be surprised if Apple dropped their 30% cut for their own system, but kept a 30% commission for third-party systems.
- gondo 5y agoHow would Apple know the volume charged via 3rd party systems?
- ericyan 5y agoI am also skeptical about their claim for taking care of tax management. I had contacted Paddle for UK VAT invoice for our Setapp for Teams subscription and their incompetence is phenomenon: first they used an EU VAT number (this is post-Brexit), then they fixed the VAT number but the amounts are in the wrong currency, one of the support agents even get my name wrong once... Most importantly, I should not even have to ask for a VAT invoice in the first place.
- mikevm 5y agoUnfortunately, they're the best alternative to Stripe in countries where Stripe is not supported.
- bengale 5y agoIt will be interesting to see how this all plays out. Personally, if you bounce me out of the app to some random payment page I'll close it and delete the app.
- yholio 5y agoIt's funny you should say that, since it's exactly what Apple feels too. I'm grabbing my popcorn and anxiously wait to see how a 200 employee startup can take the bone away for a world class super-monopoly.
- soapdog 5y agoI see people here talking badly about Paddle highlighting that access to customer data is a feature. I think that many here don't realise that without customer data, they are not your customers. They're Apple customers. If you decide to move away from the App Store, or launch a product elsewhere, you have no way of contacting them. I'm not in the business of selling apps, but I enjoy writing books. The best way to sell books, is to build a mailing list of fans so that you can reach them when you have another book ready. It is not about reaching people who do not want to receive your comms. It is about having a direct and reliable connection to people who actually want to engage with you. There is no easy way to do that in the App Store. It is important that people own their own platform, that includes being able to know who your customers are. I'm not saying to spam people who purchased stuff from you with upsells, that is B.S. and I hate it as much as everyone else. But being able to reach out to them when there is a new version of an app, or something useful to say about whatever they purchased is valuable. The hardest thing this day is not how to build a great app or how to write a great book. Our main challenge is getting noticed amid all the algorithmic shenanigans. Being blind about who purchase your stuff just adds more friction to that challenge.
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- NhanH 5y agoCan't you put in a form in your app, stating "Could you please give us your email so we can contact you when we have a new product?" Of course, I will never touch that form, and most people won't, but that's not because Apple prevent us.
- pimterry 5y agoHard to say how their IAP setup will work, but this isn't far from how Paddle works for online checkouts today. They separately track your customers and your 'audience' - the people who tick the 'send me marketing' box during checkout (https://paddle.com/support/what-is-paddle-audience/ https://paddle.com/support/what-is-paddle-audience/). Customer emails are available, but it's explicit that they haven't opted-in for marketing, so if you're subject to GDPR or anything similar (most Paddle vendors, since I think the EU is Paddle's core market) then you can't use the email for anything but necessary account setup & support. Meanwhile audience emails are explicitly fair game for upsells/offers/etc.
- seanwilson 5y agoI use Paddle for taking payments for a paid Chrome extension (https://www.checkbot.io/ https://www.checkbot.io/) and they've been great with me. The big draw was the "tax management" feature where they take care of EU VAT and other complicated country specific tax regulations, unlike say Stripe and Chargebee. It makes tax returns really straightforward where all you have to process is the 12 monthly payments Paddle send you each year e.g. over the worst case of having to register for VAT in multiple countries and risk making tax mistakes. Their 5% + 0.50 cent fees are high (lower than FastSring though) but there's value in simplifying your admin especially if you're a solo founder. Related to the comments about Paddle giving you the email addresses of your users: I went with Paddle over integrated Google payments at the time because Google gave you no access to your paid users or their payment methods and I was worried about Google payments shutting down - this turned out to be a great choice when Google deprecated their Chrome payment features with minimal migration options ("There is no way to bulk export your existing user licenses, so you need to have your users help with this part of the migration"). Not predicting Apple would do this but you need to keep your options open where you can so you can keep your customers if the worst happens. 30% fees is crazy in comparison too.
- pimterry 5y agoI'm a Paddle vendor too, and they have been good! As a solo EU founder, having to do near zero accountancy is a huge deal that Stripe can't (currently) offer. That said, I wish they'd improve their API. It's very limited, poorly designed in some places and extraordinarily slow in others. The checkout & tools are good enough that you can ignore it for a long time, but eventually you want to integrate with it and it's a massive pain. Definitely the worst part of the product, and simultaneously the best thing about Stripe, which does occasionally tempt me to jump ship...
- seanwilson 5y ago> It's very limited, poorly designed in some places and extraordinarily slow in others. Which parts? I do remember the docs being quite sparse when I was doing the initial integration. Most of my support questions about "how do you do X with the API?" were answered quickly but the answer was often "you can't" for a few surprising things (like grabbing a subscription via email lookup but maybe this has changed). Saying that, once I had it set up I haven't had to touch it and haven't had any issues, but my needs aren't that complex. A basic portal to let users check and edit their subscriptions would be nice though instead of everyone having to build this themselves.
- mafriese 5y agoHonestly as a user I will avoid any app that is trying to offer me a purchase outside the App Store. Users mostly don't care about the issues between the developers and Apple and at least I am willing to pay more for my IAPs and be able to use Apple as my payment processor (sure - I can pay with Apple Pay but switching to another app for paying is a step more than needed).
- Aeolun 5y agoIsn’t everyone here a developer? Aren’t you frustrated Apple can essentially take 30% of your revenue just for the privilege of strengthening their monopoly?
- madhatte 5y agoWhen it comes to Apple privacy trumps ownership/monopoly. Its like a benevolent dictator. It can do no bad, if something is bad, then actually its good!.
- prepend 5y agoI’m a user more than I’m a developer. And there’s lots more users than developers. I’m going to pay 3-5% for payment processing no matter how I look at it. So paying apple 15% to handle that is acceptable to me. It’s one of those things that should be cheaper and is too much, but better than the alternative. The payment part is the worst part of the purchase experience for me. I play a game that has a Mac version through Epic and an iOS version. Buying on iOS is easy, one click. Buying on Mac is a pain with some modal web frame pop up to a payment processor where I have to enter my payment info every time. EVERY TIME! I’ve already logged in. They know me. Of course the price to me is the same in both situations. So alternate payment processors will just be shittier for users. Bad UX, riskier data, and the same price.
- tinus_hn 5y agoIt isn’t even 30% because you can top up your balance using discounted iTunes cards.
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- cblconfederate 5y agoOne of many. Hope more will come, this space was abandoned after facebook platform faded and there are very few competitors.
- ricardobeat 5y ago> Access to customer data And here goes one of the reasons Apple wanted control in the first place. This is not a customer friendly change.
- leodriesch 5y agoAllowing 3rd party payments in apps is a net negative for consumers IMO. The current way of paying for in-app content is extraordinarily easy and privacy-preserving. Subscriptions are listed in one spot and can easily be cancelled from there. Sure the fee is a bummer, but that’s not my problem as a consumer. If it makes the subscription more expensive I’ll just buy it on their website. But I feel this change will produce all sorts of awful web-hybrid user experiences.
- dymk 5y agoThe fee is your problem though. You’re paying a 20% premium (Apple 30% minus Paddle 10%), because those fees are being passed directly on to you.
- malshe 5y agoThe vast majority of developers are probably paying 15% to Apple and not 30%.
- fingerlocks 5y agoDid you miss the very next sentence? If it makes the subscription more expensive I’ll just buy it on their website.
- northerdome 5y agoI thought this until I tried an app with IAP and wanted a refund when it didn't work for me. The developer told me they had no way to issue one on their side since I went through IAP. Apple support gave me the runaround before eventually saying they don't do refunds, even when I showed emails from the developer saying they supported refunding me. Apple is not pro-consumer. IAP is convenient, but I don't think Apple is truly motivated by the customer as much as they are charging a tax.
- Klonoar 5y agoSo fix refunds instead of making a worse UX.
- syspec 5y agoNot sure how this would work. Apple is still entitled to a 30% commission. The commission is the licensing fee for Apple's IP From the court ruling: > At step three, Epic Games has identified no suitable less restrictive alternative for Apple’s use of IAP based on the current record. The only alternative that Epic Games proposes is that Apple be barred from restricting or deterring in any way “the use of in-app payment processors other than IAP.” This proposed alternative is deficient for several reasons: > First, and most significant, as discussed in the findings of facts, IAP is the method by which Apple collects its licensing fee from developers for the use of Apple’s intellectual property. > Even in the absence of IAP, Apple could still charge a commission on developers. It would simply be more difficult for Apple to collect that commission > Indeed, while the Court finds no basis for the specific rate chosen by Apple (i.e., the 30% rate) based on the record, the Court still concludes that Apple is entitled to some compensation for use of its intellectual property.
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- arvindrajnaidu 5y agoWhy not just use PayPal Checkout SDK?
- HatchedLake721 5y agoI’m kinda baffled by Paddle. Is this a PR stunt? Judge explicitly said Apple is allowed to collect their 30% commission even if customer uses a different payment provider.
- Razengan 5y ago> "In addition to lower fees, Paddle said benefits of its payment system will include access to customer data" Blood is in the water, and the sharks are howling.
- giarc 5y agoThe feature list says that Apple doesn't allow "Define your own pricing", "Local pricing control", "Subscription pausing", "Ability to refund". I don't manage any apps with IAP (or any apps for that matter) but I feel like these are all possible with Apple.
- chrowe 5y agoChristian, founder of Paddle here. There are a few things I’d like to try and clear up possible misunderstandings around. Paddle has been a long-term supporter of Mac apps for many years (including CleanMyMac, Framer, Tower and more) and we’re excited about the prospect of supporting iOS apps as well – something we’ve not been able to do so far. We’re heavily invested in keeping customer data safe and secure. We think app developers should be able to support and interact with their customers directly rather than having to go through Apple or another 3rd party to resolve any issues. Our solution will give app creators that opportunity – one that’s already the case for sales made on vendor websites. Any kind of marketing comms will require customers to have opted in through a checkbox in the checkout process. We’re just looking to give developers the ability to ask, like is commonly done during browser-based purchases. I’m super keen to keep an open dialogue with any developers interested in an alternative to how you currently sell your apps in iOS so don’t hesitate to reach out to me christian at paddle com
- rdsnsca 5y agoApple just announced an appeal of the decision.
- dmitrygr 5y ago“Access to customer email “ Hard pass from me. Thanks.
- musicale 5y agoSo Paddle says that they can offer an alternative iOS IAP service. But Judge Rogers wrote "Apple could still charge a commission... it would simple be more difficult for Apple to collect that commission." That indicates that if Apple decides to charge a commission on alternative IAP and figures out how to collect it, then developers may not save any money and may only benefit in terms of being able to sidestep Apple's user privacy requirements.
- nottaylorswift 5y agoWhy would I pay some no name app creator 10% of my revenue? Apple earns their cut. Who are these outsiders?