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This is great, because it serves as a basis for what Apple can be forced to reduce their commission to. What Apple has said here is "The cost of the payment pro

This is great, because it serves as a basis for what Apple can be forced to reduce their commission to. What Apple has said here is "The cost of the payment processing is 3% and the rest is our commission", which obviously opens the door to legislators then saying "Well, you said the costs of payment processing is 3%, that's what we'll cap your commission at".

endisneigh 5y ago
Should all businesses be capping their fees to their costs? If so, then that implies no profit. If no profit, why bother?
- 13415 5y ago
  Not bothering would be the equivalent of the app store closing in this case, which would mean that iPhones would have to be open. So that would be the ideal outcome (except for Apple).
- Guest42 5y ago
  It’s rather tiresome for people to alternate between general and specific in order to be argumentative as opposed to staying on topic and contributing to the issue at hand. No, the poster isn’t implying that all businesses should be capping their fees. That’s absurd. However, Apple is not all businesses and regulation is structured in a way that has a number of conditions. I for one am glad that the department of insurance makes my car insurance affordable and that when I purchase water it’s not from a private equity firm.
  - endisneigh 5y ago
    > No, the poster isn’t implying that all businesses should be calling their fees. That’s absurd. That’s literally what they said >> "Well, you said the costs of payment processing is 3%, that's what we'll cap your commission at".
    - deleted 5y ago
      [deleted]
- yokoprime 5y ago
  For payment solutions, yes. You don't see VISA charging 30% on top of each transaction.
  - endisneigh 5y ago
    - clusterfish 5y ago
      Nice whataboutism, except Mobile Safari is intentionally crippled to not support PWAs well.
      - endisneigh 5y ago
        Nobody said anything about PWAs. Your app can be a pure web app. If you don’t want to do that then pay the fees. Simple as that.
        clusterfish 5y ago
        If you don't want do do one thing do another unrelated thing, great logic, very insightful.
  - olliej 5y ago
    I don't see apple doing that either. This article says very clearly that the payment processing fee is 3%.
  - LordDragonfang 5y ago
    It's not 30%, but a very large portion of VISA's profits comes from the fees they charge; VISA's fees are not capped to their "costs" of operating. VISA exists as a literal precedent that you can profit off a commission for a financial transaction. The issue in question isn't whether Apple should be allowed to profit, it's whether they should be allowed to abuse their effective monopoly position to set their commission a literal order of magnitude higher than any other processor.
- moonchrome 5y ago
  Because it enables/sells the rest of their ecosystem and right now they are in a position where they are just rent seeking on their market position.
  - gruez 5y ago
    >they are just rent seeking on their market position. No, they're providing a service and charging for it, just like anyone else.
    - TheCoelacanth 5y ago
      What "service" are they providing? Not stopping you from using someone else's payment processor?
      - gruez 5y ago
        Providing an entire platform/ecosystem (storefront, operating system, SDK).
        int_19h 5y ago
        If SDK is funded by store commission, then what's the $99 developer fee is for?
        gruez 5y ago
        "If roads are funded by fuel taxes, then what are vehicle registration and license renewal fees for?"
    - moonchrome 5y ago
      No, they are providing exclusive service because they own the platform. If competition was allowed their insane margins would go away. Microsoft got fined for IE and this is milking it way worse.
- PeterisP 5y ago
  The big question here is why should Apple be entitled to any fee whatsoever if a user wants to buy something from a vendor without using Apple's payment infrastructure? Users should be free to transact directly with vendors without involving Apple if they don't want to involve Apple (which the court case approved) and if they aren't involving Apple, as in this case, a demand for a "commission" on non-Apple transactions is anticompetitive and should be prohibited by law.
  - lolinder 5y ago
    The fight over alternative payment methods is fraught with misunderstandings. Apple has always stated their intention to collect the 30% regardless of what payment method you use, because as far as they're concerned it's not a payment processing fee. They view it as a platform fee that you pay for access to iOS, the App Store, and other services, and so far regulators and governments have agreed with them on that. What's changed here is that Apple has now set a number to the "payment processing" portion of their fee. This gives them a way to cave on alternative payments while still retaining the bulk of their profits.
olliej 5y ago
Yes, it shows that payment processing is 3%, and the remaining 27% has nothing do to with payment processing Why do people insist on acting like the platform commission is a payment processing fee? No one says that about the platform commissions by Xbox, Playstation, Twitch, Patreon, ...
kmlx 5y ago
this makes absolutely no sense. apple never said 30% is just payment processing. they claim the infra, the testers, the approval etc etc costs a lot. so now we know it’s 27%. which is absolutely normal. should any app use their proprietary apis, without their explicit approval? of course not. the phone might be yours, but the code running on it a hard no. but at the end of the day it’s all politics so i normally assume the worst: a worse overall end-user experience because some companies spent more on lobbying than others.
- huhtenberg 5y ago
  > now we know it’s 27% Bah, we most certainly don't. They pulled that number completely out of their ass, just like the previous 30%. The only rationale behind it is because they could get away with it.
  - musicale 5y ago
    > They pulled that number completely out of their ass, just like the previous 30%. As recently as 2019, 30% was pretty common: https://www.ign.com/articles/2019/10/07/report-steams-30-cut-is-actually-the-industry-standard https://www.ign.com/articles/2019/10/07/report-steams-30-cut...
- 8note 5y ago
  the testers and approval costs are per app though, not per transaction. the infrastructure is per download. what cost does apple incur per iap on somebody else's payments service?
  - musicale 5y ago
    Clearly the incremental platform fees of Apple, Nintendo, Sony, etc.) amortize both capital and operational expenses, and also enable those companies to make tons of money. The assumption that Apple only has to pay for infrastructure when people are downloading things is incorrect. Data centers still incur ongoing operations and maintenance costs even if they're fully paid for and nobody's downloading anything.

endisneigh 5y ago

Should all businesses be capping their fees to their costs? If so, then that implies no profit. If no profit, why bother?

13415 5y ago
Not bothering would be the equivalent of the app store closing in this case, which would mean that iPhones would have to be open. So that would be the ideal outcome (except for Apple).
Guest42 5y ago
It’s rather tiresome for people to alternate between general and specific in order to be argumentative as opposed to staying on topic and contributing to the issue at hand. No, the poster isn’t implying that all businesses should be capping their fees. That’s absurd. However, Apple is not all businesses and regulation is structured in a way that has a number of conditions. I for one am glad that the department of insurance makes my car insurance affordable and that when I purchase water it’s not from a private equity firm.
- endisneigh 5y ago
  > No, the poster isn’t implying that all businesses should be calling their fees. That’s absurd. That’s literally what they said >> "Well, you said the costs of payment processing is 3%, that's what we'll cap your commission at".
  - deleted 5y ago
    [deleted]
yokoprime 5y ago
For payment solutions, yes. You don't see VISA charging 30% on top of each transaction.
- endisneigh 5y ago
  - clusterfish 5y ago
    Nice whataboutism, except Mobile Safari is intentionally crippled to not support PWAs well.
    - endisneigh 5y ago
      Nobody said anything about PWAs. Your app can be a pure web app. If you don’t want to do that then pay the fees. Simple as that.
      - clusterfish 5y ago
        If you don't want do do one thing do another unrelated thing, great logic, very insightful.
- olliej 5y ago
  I don't see apple doing that either. This article says very clearly that the payment processing fee is 3%.
- LordDragonfang 5y ago
  It's not 30%, but a very large portion of VISA's profits comes from the fees they charge; VISA's fees are not capped to their "costs" of operating. VISA exists as a literal precedent that you can profit off a commission for a financial transaction. The issue in question isn't whether Apple should be allowed to profit, it's whether they should be allowed to abuse their effective monopoly position to set their commission a literal order of magnitude higher than any other processor.
moonchrome 5y ago
Because it enables/sells the rest of their ecosystem and right now they are in a position where they are just rent seeking on their market position.
- gruez 5y ago
  >they are just rent seeking on their market position. No, they're providing a service and charging for it, just like anyone else.
  - TheCoelacanth 5y ago
    What "service" are they providing? Not stopping you from using someone else's payment processor?
    - gruez 5y ago
      Providing an entire platform/ecosystem (storefront, operating system, SDK).
      - int_19h 5y ago
        If SDK is funded by store commission, then what's the $99 developer fee is for?
        gruez 5y ago
        "If roads are funded by fuel taxes, then what are vehicle registration and license renewal fees for?"
  - moonchrome 5y ago
    No, they are providing exclusive service because they own the platform. If competition was allowed their insane margins would go away. Microsoft got fined for IE and this is milking it way worse.
PeterisP 5y ago
The big question here is why should Apple be entitled to any fee whatsoever if a user wants to buy something from a vendor without using Apple's payment infrastructure? Users should be free to transact directly with vendors without involving Apple if they don't want to involve Apple (which the court case approved) and if they aren't involving Apple, as in this case, a demand for a "commission" on non-Apple transactions is anticompetitive and should be prohibited by law.
- lolinder 5y ago
  The fight over alternative payment methods is fraught with misunderstandings. Apple has always stated their intention to collect the 30% regardless of what payment method you use, because as far as they're concerned it's not a payment processing fee. They view it as a platform fee that you pay for access to iOS, the App Store, and other services, and so far regulators and governments have agreed with them on that. What's changed here is that Apple has now set a number to the "payment processing" portion of their fee. This gives them a way to cave on alternative payments while still retaining the bulk of their profits.

olliej 5y ago

Yes, it shows that payment processing is 3%, and the remaining 27% has nothing do to with payment processing Why do people insist on acting like the platform commission is a payment processing fee? No one says that about the platform commissions by Xbox, Playstation, Twitch, Patreon, ...

kmlx 5y ago

this makes absolutely no sense. apple never said 30% is just payment processing. they claim the infra, the testers, the approval etc etc costs a lot. so now we know it’s 27%. which is absolutely normal. should any app use their proprietary apis, without their explicit approval? of course not. the phone might be yours, but the code running on it a hard no. but at the end of the day it’s all politics so i normally assume the worst: a worse overall end-user experience because some companies spent more on lobbying than others.

huhtenberg 5y ago
> now we know it’s 27% Bah, we most certainly don't. They pulled that number completely out of their ass, just like the previous 30%. The only rationale behind it is because they could get away with it.
- musicale 5y ago
  > They pulled that number completely out of their ass, just like the previous 30%. As recently as 2019, 30% was pretty common: https://www.ign.com/articles/2019/10/07/report-steams-30-cut-is-actually-the-industry-standard https://www.ign.com/articles/2019/10/07/report-steams-30-cut...
8note 5y ago
the testers and approval costs are per app though, not per transaction. the infrastructure is per download. what cost does apple incur per iap on somebody else's payments service?
- musicale 5y ago
  Clearly the incremental platform fees of Apple, Nintendo, Sony, etc.) amortize both capital and operational expenses, and also enable those companies to make tons of money. The assumption that Apple only has to pay for infrastructure when people are downloading things is incorrect. Data centers still incur ongoing operations and maintenance costs even if they're fully paid for and nobody's downloading anything.