4 ms·

5% Royalty past $1m for using the most high tech game engine in the world is a totally reasonable price. Just like 3% for using payment services is totally reas

by jocaal 3y ago

5% Royalty past $1m for using the most high tech game engine in the world is a totally reasonable price. Just like 3% for using payment services is totally reasonable. But 30% for using a distribution service is just absurd. The only reason the app stores can charge that much is because of their iron grip on the platforms.

TerrifiedMouse 3y ago
> But 30% for using a distribution service is just absurd. It’s the market rate. Almost all retail stores online and offline charge 30%.
- simondotau 3y ago
  Boxed software at physical retail stores was more like 70–90% of revenues, split between the retailer, distributor, publisher, and manufacturing.
  - TerrifiedMouse 3y ago
    I doubt manufacturing gets a percentage cut - doubt they want such a cut. Manufacturing likely charges by how much you ask them to produce. They will quote you a price for your order and maybe include a discount for large volumes.
    - simondotau 3y ago
      Manufacturers gets paid, and they'll expect to make a profit. No, they don't take a percentage, but that's a rather academic distinction when the unit cost for manufacturing is $5 and your product isn't marketable with a price exceeding $50.
simondotau 3y ago
By agreeing that some amount is acceptable, you've conceded the principle. As the famous saying goes, we’re just haggling over the price. As for whether 3% is reasonable, again we can look to Epic for evidence. Epic's own Steam competitor takes a 12% cut — and they admitted in court that it was a money-losing venture. That should stop and make you think. The Epic Games Store isn't even a complex ecosystem, it's just a glorified Windows app downloader and even then they couldn't make a profit at 12%. Apple argues that their 15% fee for most (30% for the ultra-successful) pays for a lot more than just payment services. It pays for absorbing the cost of fraud. It pays for dealing with refunds. It pays for developing the APIs. It pays for employing an enormous team to perform some imperfect-but-useful oversight over the 1,800,000 apps in their store. It pays for a lot of things. If you think Apple makes too much money, fine. That's a perfectly fine argument to make. That's a very different one to claiming that they're not entitled to make money. Or that the government should dictate prices at them.
- jocaal 3y ago
  But we are not haggling over the price. apple has control over an enormous portion of the market. I can't haggle because the big guy controls everything. And saying apples cut pays for more services is just hilarious. we are forced to use those services and forced to pay for them. Stripe does refunds and fraud detection. There are other app development platforms for API's like kotlin and flutter. And you and I both know that apple's margins on the app store is a joke. Thats why they dont report it seperatly in their financials. Whether epic couldnt make it is their problem.
  - simondotau 3y ago
    > But we are not haggling over the price. You argue that a 5% cut is reasonable and a 15% cut is not reasonable. You are haggling over the price.
- kaibee 3y ago
  EGS only loses money because they have to buy their customers by giving away free games, to try to dislodge Steam's position. The infrastructure costs of EGS cannot be that high.
  - simondotau 3y ago
    Apple spends billions of dollars to get customers too.

by jocaal 3y ago

TerrifiedMouse 3y ago

> But 30% for using a distribution service is just absurd. It’s the market rate. Almost all retail stores online and offline charge 30%.

simondotau 3y ago
Boxed software at physical retail stores was more like 70–90% of revenues, split between the retailer, distributor, publisher, and manufacturing.
- TerrifiedMouse 3y ago
  I doubt manufacturing gets a percentage cut - doubt they want such a cut. Manufacturing likely charges by how much you ask them to produce. They will quote you a price for your order and maybe include a discount for large volumes.
  - simondotau 3y ago
    Manufacturers gets paid, and they'll expect to make a profit. No, they don't take a percentage, but that's a rather academic distinction when the unit cost for manufacturing is $5 and your product isn't marketable with a price exceeding $50.

simondotau 3y ago

By agreeing that some amount is acceptable, you've conceded the principle. As the famous saying goes, we’re just haggling over the price. As for whether 3% is reasonable, again we can look to Epic for evidence. Epic's own Steam competitor takes a 12% cut — and they admitted in court that it was a money-losing venture. That should stop and make you think. The Epic Games Store isn't even a complex ecosystem, it's just a glorified Windows app downloader and even then they couldn't make a profit at 12%. Apple argues that their 15% fee for most (30% for the ultra-successful) pays for a lot more than just payment services. It pays for absorbing the cost of fraud. It pays for dealing with refunds. It pays for developing the APIs. It pays for employing an enormous team to perform some imperfect-but-useful oversight over the 1,800,000 apps in their store. It pays for a lot of things. If you think Apple makes too much money, fine. That's a perfectly fine argument to make. That's a very different one to claiming that they're not entitled to make money. Or that the government should dictate prices at them.

jocaal 3y ago
But we are not haggling over the price. apple has control over an enormous portion of the market. I can't haggle because the big guy controls everything. And saying apples cut pays for more services is just hilarious. we are forced to use those services and forced to pay for them. Stripe does refunds and fraud detection. There are other app development platforms for API's like kotlin and flutter. And you and I both know that apple's margins on the app store is a joke. Thats why they dont report it seperatly in their financials. Whether epic couldnt make it is their problem.
- simondotau 3y ago
  > But we are not haggling over the price. You argue that a 5% cut is reasonable and a 15% cut is not reasonable. You are haggling over the price.
kaibee 3y ago
EGS only loses money because they have to buy their customers by giving away free games, to try to dislodge Steam's position. The infrastructure costs of EGS cannot be that high.
- simondotau 3y ago
  Apple spends billions of dollars to get customers too.