10 ms·

Apple execs might have convinced themselves that they are entitled to a huge cut of pretty much everything that goes on an iPhone/iPad/etc. To everyone else, t

by mikl 5y ago

Apple execs might have convinced themselves that they are entitled to a huge cut of pretty much everything that goes on an iPhone/iPad/etc. To everyone else, this just looks like mustachio-twirling, cackling evil and unfathomable greed from a company that’s already the world’s richest and sitting on a mountainous pile of cash.

fancymcpoopoo 5y ago
30% is assholeish, no doubt
taurath 5y ago
TBH, they've basically gotten away with it for years because consumers aren't effected in a way you can see, because the blackmail of the app store platform lock in is so effective. Its absolutely extortion since you literally won't be allowed to do patches on your app until you cow to whatever policy they put in place that month.
outside1234 5y ago
Yes, not sure about the evil part (lots of industries rent seek like this), but am sure of the greed part.
- toss1 5y ago
  Since the Venn diagram of this is concentric circles, with the Greed circle on the inside, you can also be sure about the Evil part (greed being a subset of types of evil) ...
  - stanmancan 5y ago
    All business is evil?
    - jessaustin 5y ago
      All business is based on greed?
    - toss1 5y ago
      To the extent that it is based on greed, particularly to the exclusion of all other goals ...
ehsankia 5y ago
It is a weird situation because it's hard to decide where to draw the line. Even right now the exceptions are weird and semi-arbitrary. Everyone paying 30% doesn't work, but neither does no one paying 30%, since every app would just switch to subscription model to avoid paying Apple. It's also tricky to change the status quo since at this point a huge chunk of their revenue is the AppStore, and any serious change in the 30% will impact that greatly, upsetting investors. Once you take the step forward, it's very hard to take a step back.
- bostonsre 5y ago
  They have to know their cash cow is under threat from legislation though don't they? Or maybe they are confident that no legislation will get through somehow... They could try to keep cutting that percentage until the majority of people aren't pissed anymore. A 15%-5% annuity forever is better than 30% bond that lasts a few more years.
Gigachad 5y ago
There are lots of conflicting opinions on this. Personally I think its fine that apple provides payment processing but not fine that it forces developers to use their payment processor. A more fair system would allow the developer to present the devs own choice as well as the apple payments and allow the developer to explain there is a 30% charge on using apples payment processor.
- bradyo 5y ago
  Part of the problem is that the in-app purchase cut isn't just for payments infra, it also includes the rest of the infrastructure and value prop for the app store(s), which is otherwise only $100/year, which is nothing for huge companies. The problem is they also force users to use the official app store. tbf this is all less true on Android. I feel like a competitive market would have decoupled these costs.
  - austinheap 5y ago
    iOS has allowed side loading for half a decade now. Companies that find $100 prohibitive have a free path that’s nearly identical to Android side loading.
    - Gigachad 5y ago
      iOS most certainly does not have real sideloading. You can if you recompile the app with your own key every 7 days. Or you can use testflight with some very serious restrictions like not being able to monetize at all.
      - austinheap 5y ago
        There are endless KYC/AML requirements for entities that can transfer or emit USD. It’s completely reasonable that side loaded applications should not be entitled to use regulated payment services. Edit: Even Android will not entitle side loaded apps for Google payment processing. Android and iOS are literally identical in this regard.
Clubber 5y ago
The 30% cut was worth it to me early on when there weren't a bazillion apps and they handled payment processing, return processing and gave you some decent visibility. Now it's just payment processing and return processing, which typically is around 3-4% using a credit card, not 30%.
- KarlKemp 5y ago
  I’m pretty sure the average spending of consumers on software today is far more than just a 30% increase from the times before the App Store. Realistically, the market easily tripled with its introduction. From that angle, it’s easily worth a 30 % fee. Not because it costs that much to run it, but because it creates that value.
  - Veuxdo 5y ago
    It's worth it to all the Legend of Heros games that are visible on the app store, certainly. For everyone else who doesn't get visibility, it means nothing.
huffmsa 5y ago
Scuzzy rent seekers
root_axis 5y ago
This is business. I don't see the mustachio-twirling evil here unless you're coming from an anti-capitalist perspective. I won't won't debate the merits of that perspective, but this seems pretty mundane strategic business planning by today's standards. Edit: To clarify further, I'm not saying "the status quo is fine", I would be in favor of legislation that would force Apple and Google to allow alternative app stores as first class citizens, but in the world we live in, I don't think trying to extract profit out of the platform you built is that crazy, this is what every big corp does.
- gkoberger 5y ago
  If they allowed 3rd party app stores or let users install apps directly on their phone, sure. But why should Apple get 30% of a subscription between me and a company? You could almost argue that it's worth 30% for the initial discovery in their app store (meh), but I just don't get how anyone could think it's fair for Apple to take 30% of a subscription, when developers don't have a choice but to use the platform.
- stefan_ 5y ago
  The most absurd take yet must be that being against forced middlemen is anti-capitalist.
  - adam_arthur 5y ago
    You can't just say "capitalism", there are many flavors. "Competitive capitalism" is the one which is generally best for consumers, as businesses must compete, which drives down their margins (thus passing savings to consumers). "Free market capitalism" is effectively hands off. Monopolies can form, and without any regulation it can become quite bad for consumers. Typically monopolies rarely form, but obviously in areas like utilities it happens quite naturally. Most people strive for competitive capitalism, when used colloquially, IMO. In the general case they are one in the same, but owning whole platforms that are broadly used is new territory, where it bleeds into anti-consumer impact IMO
- righttoolforjob 5y ago
kasey_junk 5y ago
Apple subscriptions provide me an extremely valuable service. They are easy to track, cancel & pay for. To the point I will not use an a subscription on my phone that doesn’t go through their mechanism. Is that valuable enough to charge 30%? I don’t know but it’s certainly not outside what seems reasonable by orders of magnitude to me. I’m sympathetic to the argument that they are a monopoly and should be forced to allow alternate app stores or payment processors but it’s not what they are charging that puts me over the line.
- Guest42 5y ago
  I can’t imagine willingly paying more than 5 percent for the ability to manage these subscriptions.
  - wruza 5y ago
    That is until you meet some subscription wizard like Adobe or a similar "you have a couple of weeks in December to cancel your sub" legal artist, then you likely miss it, and https://youtube.com/watch?v=8k5oAaXINX8 https://youtube.com/watch?v=8k5oAaXINX8
- adam_arthur 5y ago
  So allow for both Apple subscriptions and alternative mechanisms. Most likely the non-Apple route would be cheaper to the consumer and get 90% of the traffic for that reason alone. If that's the reality, does that not imply that Apple's practices harm most consumers? Seems self evident to me that they do. Besides, there really should be some common spec/mechanism to manage subscriptions from any vendor.
  - maerF0x0 5y ago
    I think the point is if one time purchase is 30% but subscription is 10% Then a one time purchase app just makes a lifetime subscription for the same price and cuts the fee from 30% to 10%.
- mdoms 5y ago
rvz 5y ago
> Apple execs might have convinced themselves that they are entitled to a huge cut of pretty much everything that goes on an iPhone/iPad/etc. Why would Apple agree to having its intellectual property being used for free? As long as you have an app on the App Store taking payments, Apple is still entitled to take a commission out of that regardless even if IAP is optional. Even after the Epic v Apple court case, Apple unfortunately still wins. Don't like it?, Maybe use PWAs or failing that build an alternative. Good luck.
PragmaticPulp 5y ago
> To everyone else, this just looks like mustachio-twirling, cackling evil and unfathomable greed from a company that’s already the world’s richest and sitting on a mountainous pile of cash. What’s really interesting to me is that moves like this are the embodiment of the “charge more” mantra that is (or at least was) extremely popular on Hacker News for years. For a long time it felt like every HN thread about pricing or salary negotiation was full of people insisting that you needed to “charge more” in every conceivable situation. If you made a thing that was producing a lot of money for your clients, you needed to “charge more”! If your customers weren’t complaining and leaving, you needed to “charge more”! Yet every time a company actually does a “charge more” type move, HN reaches for the pitchforks. It’s interesting to see how clear-cut this dichotomy is depending on who the reader thinks is being charged more.
- nickff 5y ago
  HN is full of these cognitive dissonances; another example is the generally pro-immigration stance when it comes to low-wage workers, which is contrasted with the anti-tech immigration stance. I used to think it was different groups of people on different threads, but I have come to believe that many maintain diametrically opposed views.
  - granshaw 5y ago
    “It is difficult to get a man to understand something, when his salary depends upon his not understanding it”
  - syshum 5y ago
    There could be solid position there, as I have argued in the manner you have stated here. "Tech Immigration" is largely H1B immigration is prefectly valid to be opposed to H1B while being pro immigration. H1B is a predatory program designed to lower wages and put immigrants in a terrible stop when in comes to the immigration status, i.e the employer holds not only their income, but their ability to remain in the nation in the palm of their hands. This created a toxic and coercive relationship with the employer. At the same time a correction to this program, and a correction to the low skilled workers is simply allowing more open immigration, if you want to come here to work you should be able to.
maerF0x0 5y ago
> Apple execs might have convinced themselves that they are entitled to ... pretty much everything Here I fixed your quote. Including in everything is the $750M bonus Tim Cook received[1]. We've seen that exec comp is inversely correlated with performance[2] and buy backs only cause greater equity packages to be issued (doesn't reduce the dilution) [1]: https://www.voanews.com/a/usa_apple-ceo-brings-home-750-million-bonus/6210058.html https://www.voanews.com/a/usa_apple-ceo-brings-home-750-mill... [2]: https://archive.fo/uSTWs https://archive.fo/uSTWs - https://www.nytimes.com/2015/06/07/business/stock-buybacks-that-hurt-shareholders.html https://www.nytimes.com/2015/06/07/business/stock-buybacks-t... [3]: https://cooleypubco.com/2016/07/25/new-study-shows-inverse-correlation-between-ceo-pay-and-performance-over-the-long-term/ https://cooleypubco.com/2016/07/25/new-study-shows-inverse-c...
arcticbull 5y ago
> ... sitting on a mountainous pile of cash. And distributing a mountainous pile of cash to shareholders. In FY2021 alone, Apple repurchased $85.5 billion dollars worth of shares and spent $14.5 billion dollars on dividend issuance. That's 1/10th of a trillion dollars per year in distributions. [1] Buffet alone collected almost $1B in dividends since taking his position. [2] [1] https://www.cnbc.com/2022/01/03/apples-3-trillion-market-cap-shows-value-of-share-buybacks-dividend.html https://www.cnbc.com/2022/01/03/apples-3-trillion-market-cap... [2] https://markets.businessinsider.com/news/stocks/warren-buffett-berkshire-hathaway-apple-stock-dividends-buybacks-shareholder-returns-2021-10 https://markets.businessinsider.com/news/stocks/warren-buffe...
jliptzin 5y ago
What bothered me as an app developer over a decade ago when Apple Facebook and Google all started taking a cut of app revenues is that they all magically decided that 30% was going to be the number. They didn’t even bother pretending to compete to undercut each other, it was as if they all decided together behind closed doors that 30% was the number and that was it. After that I realized I didn’t want to be developing apps for these platforms anymore.
ksec 5y ago
They need to collect the 30% fees, how else are they going to invest and purchase $280B from Chinese Supply Chain. While offering iPhone at a discounted whole sale price in China.
gonehome 5y ago
I think the worst outcome of their attempts to tax others this way is that it'll blow up in their face and they'll lose leverage over the app store. I'm okay with them enforcing app store policy guidelines etc. I think what they're doing here though is just a racket. They may have deluded themselves about this (seems that way from their comments about it), but I think most people outside of Apple see it for what it is. You can make a good argument about app store rules being in the interest of customers and chosen by customers. You can't really make a good argument for the profit grab they're doing here, it's just abuse.
deleted 5y ago
[deleted]
mehrdada 5y ago
Is it fundamentally any different from Google charging for clicks that direct traffic to other commercial activity on the internet? You enable some commerce through your platform and take a cut in both cases.
dang 5y ago
Ok, but please don't post this sort of shallow riler-upper to HN. We're trying for something more interesting and less repetitive here, and subthreads like this end up choking that out. Edit: for example, after I downweighted the current subthread, https://news.ycombinator.com/item?id=29914127 https://news.ycombinator.com/item?id=29914127 became the top subthread. Talk about from one extreme to the other... https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html

by mikl 5y ago

fancymcpoopoo 5y ago

30% is assholeish, no doubt

taurath 5y ago

TBH, they've basically gotten away with it for years because consumers aren't effected in a way you can see, because the blackmail of the app store platform lock in is so effective. Its absolutely extortion since you literally won't be allowed to do patches on your app until you cow to whatever policy they put in place that month.

outside1234 5y ago

Yes, not sure about the evil part (lots of industries rent seek like this), but am sure of the greed part.

toss1 5y ago
Since the Venn diagram of this is concentric circles, with the Greed circle on the inside, you can also be sure about the Evil part (greed being a subset of types of evil) ...
- stanmancan 5y ago
  All business is evil?
  - jessaustin 5y ago
    All business is based on greed?
  - toss1 5y ago
    To the extent that it is based on greed, particularly to the exclusion of all other goals ...

ehsankia 5y ago

It is a weird situation because it's hard to decide where to draw the line. Even right now the exceptions are weird and semi-arbitrary. Everyone paying 30% doesn't work, but neither does no one paying 30%, since every app would just switch to subscription model to avoid paying Apple. It's also tricky to change the status quo since at this point a huge chunk of their revenue is the AppStore, and any serious change in the 30% will impact that greatly, upsetting investors. Once you take the step forward, it's very hard to take a step back.

bostonsre 5y ago
They have to know their cash cow is under threat from legislation though don't they? Or maybe they are confident that no legislation will get through somehow... They could try to keep cutting that percentage until the majority of people aren't pissed anymore. A 15%-5% annuity forever is better than 30% bond that lasts a few more years.

Gigachad 5y ago

There are lots of conflicting opinions on this. Personally I think its fine that apple provides payment processing but not fine that it forces developers to use their payment processor. A more fair system would allow the developer to present the devs own choice as well as the apple payments and allow the developer to explain there is a 30% charge on using apples payment processor.

bradyo 5y ago
Part of the problem is that the in-app purchase cut isn't just for payments infra, it also includes the rest of the infrastructure and value prop for the app store(s), which is otherwise only $100/year, which is nothing for huge companies. The problem is they also force users to use the official app store. tbf this is all less true on Android. I feel like a competitive market would have decoupled these costs.
- austinheap 5y ago
  iOS has allowed side loading for half a decade now. Companies that find $100 prohibitive have a free path that’s nearly identical to Android side loading.
  - Gigachad 5y ago
    iOS most certainly does not have real sideloading. You can if you recompile the app with your own key every 7 days. Or you can use testflight with some very serious restrictions like not being able to monetize at all.
    - austinheap 5y ago
      There are endless KYC/AML requirements for entities that can transfer or emit USD. It’s completely reasonable that side loaded applications should not be entitled to use regulated payment services. Edit: Even Android will not entitle side loaded apps for Google payment processing. Android and iOS are literally identical in this regard.

Clubber 5y ago

The 30% cut was worth it to me early on when there weren't a bazillion apps and they handled payment processing, return processing and gave you some decent visibility. Now it's just payment processing and return processing, which typically is around 3-4% using a credit card, not 30%.

KarlKemp 5y ago
I’m pretty sure the average spending of consumers on software today is far more than just a 30% increase from the times before the App Store. Realistically, the market easily tripled with its introduction. From that angle, it’s easily worth a 30 % fee. Not because it costs that much to run it, but because it creates that value.
- Veuxdo 5y ago
  It's worth it to all the Legend of Heros games that are visible on the app store, certainly. For everyone else who doesn't get visibility, it means nothing.

huffmsa 5y ago

Scuzzy rent seekers

root_axis 5y ago

This is business. I don't see the mustachio-twirling evil here unless you're coming from an anti-capitalist perspective. I won't won't debate the merits of that perspective, but this seems pretty mundane strategic business planning by today's standards. Edit: To clarify further, I'm not saying "the status quo is fine", I would be in favor of legislation that would force Apple and Google to allow alternative app stores as first class citizens, but in the world we live in, I don't think trying to extract profit out of the platform you built is that crazy, this is what every big corp does.

gkoberger 5y ago
If they allowed 3rd party app stores or let users install apps directly on their phone, sure. But why should Apple get 30% of a subscription between me and a company? You could almost argue that it's worth 30% for the initial discovery in their app store (meh), but I just don't get how anyone could think it's fair for Apple to take 30% of a subscription, when developers don't have a choice but to use the platform.
stefan_ 5y ago
The most absurd take yet must be that being against forced middlemen is anti-capitalist.
- adam_arthur 5y ago
  You can't just say "capitalism", there are many flavors. "Competitive capitalism" is the one which is generally best for consumers, as businesses must compete, which drives down their margins (thus passing savings to consumers). "Free market capitalism" is effectively hands off. Monopolies can form, and without any regulation it can become quite bad for consumers. Typically monopolies rarely form, but obviously in areas like utilities it happens quite naturally. Most people strive for competitive capitalism, when used colloquially, IMO. In the general case they are one in the same, but owning whole platforms that are broadly used is new territory, where it bleeds into anti-consumer impact IMO
righttoolforjob 5y ago

kasey_junk 5y ago

Apple subscriptions provide me an extremely valuable service. They are easy to track, cancel & pay for. To the point I will not use an a subscription on my phone that doesn’t go through their mechanism. Is that valuable enough to charge 30%? I don’t know but it’s certainly not outside what seems reasonable by orders of magnitude to me. I’m sympathetic to the argument that they are a monopoly and should be forced to allow alternate app stores or payment processors but it’s not what they are charging that puts me over the line.

Guest42 5y ago
I can’t imagine willingly paying more than 5 percent for the ability to manage these subscriptions.
- wruza 5y ago
  That is until you meet some subscription wizard like Adobe or a similar "you have a couple of weeks in December to cancel your sub" legal artist, then you likely miss it, and https://youtube.com/watch?v=8k5oAaXINX8 https://youtube.com/watch?v=8k5oAaXINX8
adam_arthur 5y ago
So allow for both Apple subscriptions and alternative mechanisms. Most likely the non-Apple route would be cheaper to the consumer and get 90% of the traffic for that reason alone. If that's the reality, does that not imply that Apple's practices harm most consumers? Seems self evident to me that they do. Besides, there really should be some common spec/mechanism to manage subscriptions from any vendor.
- maerF0x0 5y ago
  I think the point is if one time purchase is 30% but subscription is 10% Then a one time purchase app just makes a lifetime subscription for the same price and cuts the fee from 30% to 10%.
mdoms 5y ago

rvz 5y ago

> Apple execs might have convinced themselves that they are entitled to a huge cut of pretty much everything that goes on an iPhone/iPad/etc. Why would Apple agree to having its intellectual property being used for free? As long as you have an app on the App Store taking payments, Apple is still entitled to take a commission out of that regardless even if IAP is optional. Even after the Epic v Apple court case, Apple unfortunately still wins. Don't like it?, Maybe use PWAs or failing that build an alternative. Good luck.

PragmaticPulp 5y ago

> To everyone else, this just looks like mustachio-twirling, cackling evil and unfathomable greed from a company that’s already the world’s richest and sitting on a mountainous pile of cash. What’s really interesting to me is that moves like this are the embodiment of the “charge more” mantra that is (or at least was) extremely popular on Hacker News for years. For a long time it felt like every HN thread about pricing or salary negotiation was full of people insisting that you needed to “charge more” in every conceivable situation. If you made a thing that was producing a lot of money for your clients, you needed to “charge more”! If your customers weren’t complaining and leaving, you needed to “charge more”! Yet every time a company actually does a “charge more” type move, HN reaches for the pitchforks. It’s interesting to see how clear-cut this dichotomy is depending on who the reader thinks is being charged more.

nickff 5y ago
HN is full of these cognitive dissonances; another example is the generally pro-immigration stance when it comes to low-wage workers, which is contrasted with the anti-tech immigration stance. I used to think it was different groups of people on different threads, but I have come to believe that many maintain diametrically opposed views.
- granshaw 5y ago
  “It is difficult to get a man to understand something, when his salary depends upon his not understanding it”
- syshum 5y ago
  There could be solid position there, as I have argued in the manner you have stated here. "Tech Immigration" is largely H1B immigration is prefectly valid to be opposed to H1B while being pro immigration. H1B is a predatory program designed to lower wages and put immigrants in a terrible stop when in comes to the immigration status, i.e the employer holds not only their income, but their ability to remain in the nation in the palm of their hands. This created a toxic and coercive relationship with the employer. At the same time a correction to this program, and a correction to the low skilled workers is simply allowing more open immigration, if you want to come here to work you should be able to.

maerF0x0 5y ago

> Apple execs might have convinced themselves that they are entitled to ... pretty much everything Here I fixed your quote. Including in everything is the $750M bonus Tim Cook received[1]. We've seen that exec comp is inversely correlated with performance[2] and buy backs only cause greater equity packages to be issued (doesn't reduce the dilution) [1]: https://www.voanews.com/a/usa_apple-ceo-brings-home-750-million-bonus/6210058.html https://www.voanews.com/a/usa_apple-ceo-brings-home-750-mill... [2]: https://archive.fo/uSTWs https://archive.fo/uSTWs - https://www.nytimes.com/2015/06/07/business/stock-buybacks-that-hurt-shareholders.html https://www.nytimes.com/2015/06/07/business/stock-buybacks-t... [3]: https://cooleypubco.com/2016/07/25/new-study-shows-inverse-correlation-between-ceo-pay-and-performance-over-the-long-term/ https://cooleypubco.com/2016/07/25/new-study-shows-inverse-c...

arcticbull 5y ago

> ... sitting on a mountainous pile of cash. And distributing a mountainous pile of cash to shareholders. In FY2021 alone, Apple repurchased $85.5 billion dollars worth of shares and spent $14.5 billion dollars on dividend issuance. That's 1/10th of a trillion dollars per year in distributions. [1] Buffet alone collected almost $1B in dividends since taking his position. [2] [1] https://www.cnbc.com/2022/01/03/apples-3-trillion-market-cap-shows-value-of-share-buybacks-dividend.html https://www.cnbc.com/2022/01/03/apples-3-trillion-market-cap... [2] https://markets.businessinsider.com/news/stocks/warren-buffett-berkshire-hathaway-apple-stock-dividends-buybacks-shareholder-returns-2021-10 https://markets.businessinsider.com/news/stocks/warren-buffe...

jliptzin 5y ago

What bothered me as an app developer over a decade ago when Apple Facebook and Google all started taking a cut of app revenues is that they all magically decided that 30% was going to be the number. They didn’t even bother pretending to compete to undercut each other, it was as if they all decided together behind closed doors that 30% was the number and that was it. After that I realized I didn’t want to be developing apps for these platforms anymore.

ksec 5y ago

They need to collect the 30% fees, how else are they going to invest and purchase $280B from Chinese Supply Chain. While offering iPhone at a discounted whole sale price in China.

gonehome 5y ago

I think the worst outcome of their attempts to tax others this way is that it'll blow up in their face and they'll lose leverage over the app store. I'm okay with them enforcing app store policy guidelines etc. I think what they're doing here though is just a racket. They may have deluded themselves about this (seems that way from their comments about it), but I think most people outside of Apple see it for what it is. You can make a good argument about app store rules being in the interest of customers and chosen by customers. You can't really make a good argument for the profit grab they're doing here, it's just abuse.

deleted 5y ago

[deleted]

mehrdada 5y ago

Is it fundamentally any different from Google charging for clicks that direct traffic to other commercial activity on the internet? You enable some commerce through your platform and take a cut in both cases.

dang 5y ago

Ok, but please don't post this sort of shallow riler-upper to HN. We're trying for something more interesting and less repetitive here, and subthreads like this end up choking that out. Edit: for example, after I downweighted the current subthread, https://news.ycombinator.com/item?id=29914127 https://news.ycombinator.com/item?id=29914127 became the top subthread. Talk about from one extreme to the other... https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html