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Then let's focus on lowering that percent instead of making the situation worse for consumers. However to be clear, that percent is in the same area that game

Then let's focus on lowering that percent instead of making the situation worse for consumers. However to be clear, that percent is in the same area that game consoles and I believe Steam (someone correct me?) charge. And we accept that. When the 30% rule for the App Store came down, our smart phones were basically the same as a game console. Most people did not expect these devices to become the central part of all of our lives. At least not in this way. Now that it has, than sure the percent needs to be lowered and I am not arguing that (I said in another comment the 30% is worth it for me personally but doesn't mean I am ok with it).

rusk 5y ago
> let's focus on lowering that percent A noble position but it seems to have been going other way unfortunately. Not sure how you would do that … further regulation or introducing artificial competition in the market. I think the most pro-business approach is to quash the monopoly and open up the market.
- enos_feedler 5y ago
  Going the other way? The fee started at 30% and has only gone down from there (ex. 15% for subs active > 1 yr). I believe the fees will fragment further and give developers the option of paying less but receiving less too. For example: You can pay 5% less but you will only show up in app store search results. Or something to this effect. We will never get blanket 30% take rates again. It was a simplification when the market was early
nightski 5y ago
Steam lets developers sell keys without the tax using their own systems. In addition to this you are allowed to list your games on other storefronts for PC.
- lxgr 5y ago
  Do you know if there is any revenue sharing happening in the background in that model?
  - danielheath 5y ago
    AFAIK they do it without revenue sharing because it keeps customers using steam (running their client, seeing their ads, viewing their store, and being tied to the steam ecosystem). They don't need to turn a profit on the tiny, irrelevant volume of off-site sales.
  - SXX 5y ago
    As already already been said there is no revenue sharing. Though there is fair-use policy that Steam users shouldn't be given worse deal. E.g you're not allowed to only run 30%-off discount exclusively on your store without offering same discount for Steam store users sometime later.
tick_tock_tick 5y ago
> than sure the percent needs to be lowered and I am not arguing that Yes to 0% and any percentage of revenue should be made illegal. Google and Apple can charge whatever fixed values they want or even charge based on a wide variety of vectors but a % of revenue should be explicitly illegal that kind of blatant rent seeking is a quintessential example of something the government needs to stamp out.
- mynameisvlad 5y ago
  Apple and Google are providing a service, so why exactly should they not get a cut of revenue? To be clear, 30% is too much, but aside from payment handling and taking on fraud risk as a result of that (3-4% is generally the industry standard for card not present transactions), they provide a subscription management/payment API for IAPs, as well as app packaging and distribution, reviews, etc. That certainly is worth more than 0%.
  - jeltz 5y ago
    No, industry standard for online credit card transactions is 1-1.5% in the EU and 2.5-3% in the US. Even back in 2008 before 3d secure was common and before the EU regilations we as a tiny online casino had 2.5% fees. 30% is between 10 and 20 times a reasonable fee.
  - munk-a 5y ago
    Isn't the fraud risk still generally born by credit card companies at the end of the day? I think we can legitimately talk about the costs of maintaining the app-store as a marketplace, and we can talk about the future costs of providing updates free of charge in perpetuity and orchestrating the infrastructure to host those various downloads... but that's about where their service offering ends. App review is a joke, the rating systems on both platforms as absolute trash and often gamed by publishers (remember Uber's in app prompt about how many stars you'd give them that forwarded you to the app-store if you gave them 5 and otherwise just offered you an internal complaint form if you gave them anything else? Everyone does that). I'd question whether Apple and Google are really providing a service or just exploiting a captive market.
falcolas 5y ago
So, Spotify also reportedly takes 30% of the revenue before paying the creators. This isn't an Apple/Google/Spotify thing, it's a service thing.
- mr_aks 5y ago
  I don't understand this argument. Spotify is a service connecting listeners to the artists and infrastructure and development of said service has its cost whereas Google/Apple charge fees for the app store which Spotify subscription does not require.
  - falcolas 5y ago
    So, Spotify is allowed to charge 30% for access to the market it has created, but Google and Apple are not? An app store costs money too - the creation and maintenance of the billing platform/API, bandwidth, human curation, cross-device storage of saved configurations, user acquisition, etc. What makes musicians so different from software developers that it's perfectly acceptable for Spotify to take such a large share of the revenue their music has earned? (To make my own position clear, I don't think any of them deserve 30%)
    - thow-58d4e8b 5y ago
      The problem with this line of argumentation is - why single out phone OS providers as the only link in the very long supply chain that deserves a cut? Why not internet provider? Verizon's infrastructure costs money, too - should they also be eligible for a 30% tax? The data will be transmitted through Cisco routers or Nokia's BTS - it costs a lot of R&D to develop those What about the phone manufacturer - Xiaomi or Samsung would definitely not reject their fair share None of this would happen without electricity - power transmission companies deserve a portion There really isn't a coherent moral argument in favor of the current status quo - it's simply about market power, nothing else
      - falcolas 5y ago
        My point is: Spotify's 30% is not a fair cut. It's no more fair a cut as the Apple/Google/et.al. cut from developers. Since HN is a lot more familiar with the cuts the stores take out of developers earnings, it makes for a nice point of comparison.
xmprt 5y ago
If we want to make the situation better for customers then companies like Apple and Google should provide subscription management/payment API for IAPs for free to developers so developers are incentivized to use the centralized platform. Customers can manage and cancel payments through that centralized platform. The only reason developers come up with these roundabout methods for payment is because of the massive fees that Google and Apple have. Steam isn't a monopoly like Apple and Google are with their respective marketplaces so it doesn't make sense to compare the two. If I want to publish or play a game there are a lot of different ways to do so that don't involve Steam.
- yywwbbn 5y ago
  Well even with all the available competition most developers seem to consider the 30% fee on Steam fair enough to host their games there. So maybe that 15/30% is not as ‘massive’ as one might think, especially considering that the app store model was massive improvement over what existed before them. Not that I’m a huge fan of closed ecosystems in general, but I’m not sure the government should dictate what sort of software features manufacturers should implement on their devices. Especially considering that most consumers don’t really value the ability to freely install any software they want on their devices and seem to be fine with the closed garden approach.
  - politician 5y ago
    Governments regulate all sorts of features on all sorts of products: building codes, electrical codes, car mpg requirements, how planes work, tax requirements, how corporations are allowed to function, the rights of citizens, ... Why should software get a free pass?
    - dantheman 5y ago
      Because all of those things are about externalities?
      - politician 5y ago
michaelmrose 5y ago
You can only lower the percent with at least the credible threat of competition. Would you pay $13 for a $10 service for the privilege of doing it through the play store? Likewise would you be equally OK if the dollar figures involved were much larger for example your cable subscription?
lxgr 5y ago
> Then let's focus on lowering that percent instead of making the situation worse for consumers. The only viable path towards finding a fair price for this service (apparently deemed essential and basically a steal by Apple and Google, but worth less than nothing by many app developers) would seem to be competition. Why not offer both, explicitly allowing for different prices, special deals only for non-store subscriptions etc.?
- rswail 5y ago
  Or regulation. In Australia, the Reserve Bank regulates interchange fees and requires the end user to be made aware of card processing fees which can't exceed a percentage/value of the transaction. Similar regulation applies in the EU. There's no reason why Google/Apple/etc stores can't be similarly regulated.
  - lxgr 5y ago
    That's possible too, but I believe there's much more uncertainty about the fair market value of app store compared to out-of-band subscriptions. Of course it would also be possible to do both, i.e. to mandate either a fixed rate or alternatively allowing out-of-band payments.
ksec 5y ago
>Then let's focus on lowering that percent I dont think that is the correct way of looking at it. As you stated at the end, you think it is worth it. The question is value delivery. Not percentage. I could argue in cases where even 90% is acceptable. The question is how much value is delivered and how much of those 90% are used, or was it pure profits, i.e rent seeking. For some categories of Apps, 30% doesn't make sense.
Siira 5y ago
> And we accept that. You do. I certainly don’t. And you’re just doing that because it’s the status quo, not out of any analysis.

rusk 5y ago

> let's focus on lowering that percent A noble position but it seems to have been going other way unfortunately. Not sure how you would do that … further regulation or introducing artificial competition in the market. I think the most pro-business approach is to quash the monopoly and open up the market.

enos_feedler 5y ago
Going the other way? The fee started at 30% and has only gone down from there (ex. 15% for subs active > 1 yr). I believe the fees will fragment further and give developers the option of paying less but receiving less too. For example: You can pay 5% less but you will only show up in app store search results. Or something to this effect. We will never get blanket 30% take rates again. It was a simplification when the market was early

nightski 5y ago

Steam lets developers sell keys without the tax using their own systems. In addition to this you are allowed to list your games on other storefronts for PC.

lxgr 5y ago
Do you know if there is any revenue sharing happening in the background in that model?
- danielheath 5y ago
  AFAIK they do it without revenue sharing because it keeps customers using steam (running their client, seeing their ads, viewing their store, and being tied to the steam ecosystem). They don't need to turn a profit on the tiny, irrelevant volume of off-site sales.
- SXX 5y ago
  As already already been said there is no revenue sharing. Though there is fair-use policy that Steam users shouldn't be given worse deal. E.g you're not allowed to only run 30%-off discount exclusively on your store without offering same discount for Steam store users sometime later.

tick_tock_tick 5y ago

> than sure the percent needs to be lowered and I am not arguing that Yes to 0% and any percentage of revenue should be made illegal. Google and Apple can charge whatever fixed values they want or even charge based on a wide variety of vectors but a % of revenue should be explicitly illegal that kind of blatant rent seeking is a quintessential example of something the government needs to stamp out.

mynameisvlad 5y ago
Apple and Google are providing a service, so why exactly should they not get a cut of revenue? To be clear, 30% is too much, but aside from payment handling and taking on fraud risk as a result of that (3-4% is generally the industry standard for card not present transactions), they provide a subscription management/payment API for IAPs, as well as app packaging and distribution, reviews, etc. That certainly is worth more than 0%.
- jeltz 5y ago
  No, industry standard for online credit card transactions is 1-1.5% in the EU and 2.5-3% in the US. Even back in 2008 before 3d secure was common and before the EU regilations we as a tiny online casino had 2.5% fees. 30% is between 10 and 20 times a reasonable fee.
- munk-a 5y ago
  Isn't the fraud risk still generally born by credit card companies at the end of the day? I think we can legitimately talk about the costs of maintaining the app-store as a marketplace, and we can talk about the future costs of providing updates free of charge in perpetuity and orchestrating the infrastructure to host those various downloads... but that's about where their service offering ends. App review is a joke, the rating systems on both platforms as absolute trash and often gamed by publishers (remember Uber's in app prompt about how many stars you'd give them that forwarded you to the app-store if you gave them 5 and otherwise just offered you an internal complaint form if you gave them anything else? Everyone does that). I'd question whether Apple and Google are really providing a service or just exploiting a captive market.

falcolas 5y ago

So, Spotify also reportedly takes 30% of the revenue before paying the creators. This isn't an Apple/Google/Spotify thing, it's a service thing.

mr_aks 5y ago
I don't understand this argument. Spotify is a service connecting listeners to the artists and infrastructure and development of said service has its cost whereas Google/Apple charge fees for the app store which Spotify subscription does not require.
- falcolas 5y ago
  So, Spotify is allowed to charge 30% for access to the market it has created, but Google and Apple are not? An app store costs money too - the creation and maintenance of the billing platform/API, bandwidth, human curation, cross-device storage of saved configurations, user acquisition, etc. What makes musicians so different from software developers that it's perfectly acceptable for Spotify to take such a large share of the revenue their music has earned? (To make my own position clear, I don't think any of them deserve 30%)
  - thow-58d4e8b 5y ago
    The problem with this line of argumentation is - why single out phone OS providers as the only link in the very long supply chain that deserves a cut? Why not internet provider? Verizon's infrastructure costs money, too - should they also be eligible for a 30% tax? The data will be transmitted through Cisco routers or Nokia's BTS - it costs a lot of R&D to develop those What about the phone manufacturer - Xiaomi or Samsung would definitely not reject their fair share None of this would happen without electricity - power transmission companies deserve a portion There really isn't a coherent moral argument in favor of the current status quo - it's simply about market power, nothing else
    - falcolas 5y ago
      My point is: Spotify's 30% is not a fair cut. It's no more fair a cut as the Apple/Google/et.al. cut from developers. Since HN is a lot more familiar with the cuts the stores take out of developers earnings, it makes for a nice point of comparison.

xmprt 5y ago

If we want to make the situation better for customers then companies like Apple and Google should provide subscription management/payment API for IAPs for free to developers so developers are incentivized to use the centralized platform. Customers can manage and cancel payments through that centralized platform. The only reason developers come up with these roundabout methods for payment is because of the massive fees that Google and Apple have. Steam isn't a monopoly like Apple and Google are with their respective marketplaces so it doesn't make sense to compare the two. If I want to publish or play a game there are a lot of different ways to do so that don't involve Steam.

yywwbbn 5y ago
Well even with all the available competition most developers seem to consider the 30% fee on Steam fair enough to host their games there. So maybe that 15/30% is not as ‘massive’ as one might think, especially considering that the app store model was massive improvement over what existed before them. Not that I’m a huge fan of closed ecosystems in general, but I’m not sure the government should dictate what sort of software features manufacturers should implement on their devices. Especially considering that most consumers don’t really value the ability to freely install any software they want on their devices and seem to be fine with the closed garden approach.
- politician 5y ago
  Governments regulate all sorts of features on all sorts of products: building codes, electrical codes, car mpg requirements, how planes work, tax requirements, how corporations are allowed to function, the rights of citizens, ... Why should software get a free pass?
  - dantheman 5y ago
    Because all of those things are about externalities?
    - politician 5y ago

michaelmrose 5y ago

You can only lower the percent with at least the credible threat of competition. Would you pay $13 for a $10 service for the privilege of doing it through the play store? Likewise would you be equally OK if the dollar figures involved were much larger for example your cable subscription?

lxgr 5y ago

> Then let's focus on lowering that percent instead of making the situation worse for consumers. The only viable path towards finding a fair price for this service (apparently deemed essential and basically a steal by Apple and Google, but worth less than nothing by many app developers) would seem to be competition. Why not offer both, explicitly allowing for different prices, special deals only for non-store subscriptions etc.?

rswail 5y ago
Or regulation. In Australia, the Reserve Bank regulates interchange fees and requires the end user to be made aware of card processing fees which can't exceed a percentage/value of the transaction. Similar regulation applies in the EU. There's no reason why Google/Apple/etc stores can't be similarly regulated.
- lxgr 5y ago
  That's possible too, but I believe there's much more uncertainty about the fair market value of app store compared to out-of-band subscriptions. Of course it would also be possible to do both, i.e. to mandate either a fixed rate or alternatively allowing out-of-band payments.

ksec 5y ago

>Then let's focus on lowering that percent I dont think that is the correct way of looking at it. As you stated at the end, you think it is worth it. The question is value delivery. Not percentage. I could argue in cases where even 90% is acceptable. The question is how much value is delivered and how much of those 90% are used, or was it pure profits, i.e rent seeking. For some categories of Apps, 30% doesn't make sense.

Siira 5y ago

> And we accept that. You do. I certainly don’t. And you’re just doing that because it’s the status quo, not out of any analysis.