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i wonder how much these changes are costing Apple vs how much they make in Europe. would be interesting to know if there's an amount of compliance costs and com

i wonder how much these changes are costing Apple vs how much they make in Europe. would be interesting to know if there's an amount of compliance costs and complexity that could see Apple leave the EU market!

varjag 3y ago
The EU is a huge market of people with deep pockets, I conjecture the break even point is not anywhere on the horizon.
- flenserboy 3y ago
  At some point control of one's own business future balances out a certain level of profit.
  - deleted 3y ago
    [deleted]
  - mdekkers 3y ago
    Have you seen how much they all bend over backwards for China?
    - lotsofpulp 3y ago
      As far as I know, only Apple and Microsoft operate in China.
      - techpression 3y ago
        At least iCloud is run by a third party and not Apple (GCBD). Similar to how Blizzard does with their games and why World of Warcraft disappeared over night. Important distinction to make when it comes to privacy and security (there’s none) and how Apple washes their hands clean while keeping the Chinese government happy.
        st3fan 3y ago
        It is pretty much a requirement if you want to do business in mainland China. Firefox also had a set of China-owned servers to sync data from Chinese users to. (“Had” because I think they officially stopped the relationship with Mozilla China)
    - pavlov 3y ago
      Meta doesn’t. Their products have never been available in China.
      - Rinzler89 3y ago
        Probably because the Chinese market is already full of Chinese social media companies. How do they expect to compete if they enter? It's not 2004 anymore where starting a social media on Harvard campus was a big ticket.
  - quadcore 3y ago
    I also wonder if personel/talents/headcount to handle all that crap can become an issue. VPs (CEOs even) distracted with compliance etc.
    - krzyk 3y ago
      Ones crap is anothers feature.
    - rekoil 3y ago
      When all they need to do for compliance is to enable EU users to install apps without Apple as a middle-man then not much in the way of "personell/talents/headcount to handle all that crap" is actually necessary. What's costing them resources (and eventually money in the form of fines) is not complying.
      - nozzlegear 3y ago
        You are vastly oversimplifying the issue. It’s not like there’s a bit that Apple can flip to just let EU citizens sideload apps.
        PodgieTar 3y ago
        I’d argue you’re vastly over complicating it. There’s already mechanisms to side load, and install IPAs.. Why would it be more complicated?
        akaij 3y ago
        It feels like some people don't imagine these companies to be ready for compliance. As if they don't have all the knobs ready to turn on a per-region/country/state basis as soon as the law changes and it becomes possible to lose even the smallest amount in stock value.
  - deleted 3y ago
    [deleted]
oaiey 3y ago
These DMA like changes are now coming from everywhere. It is just that EU has teeth, not to ignore and usually moves first. California has adopted GDPR, there are ongoing probes in the US just last week, etc. Time is up for regulation-free business in IT. We had 50 years of freedom (compared to let us say: drugs, medical devices, cars, airplanes, ...). It is normal cycle for a market
- brtkdotse 3y ago
  > We had 50 years of freedom More “Wild West gold rush” than “freedom”
  - oaiey 3y ago
    I think for many people that is the same ;). But I agree with your differentiation.
- rsynnott 3y ago
  > Time is up for regulation-free business in IT. We had 50 years of freedom (compared to let us say: drugs, medical devices, cars, airplanes, ...) This is an odd reading of the history, tbh. The US regulators were generally more active on competition in the industry in the 90s than today; see the Microsoft and Intel investigations, for instance.
jpambrun 3y ago
That would be a net positive as we would all benefit from new players that would emerge and fill that void. Obviously your question was rhetorical and this won't happen.
- zarathustreal 3y ago
  New players emerging in the high-end smartphone space? You seriously believe that a comparable player to *Apple* is going to emerge any time in the next decade? Lol
  - spiderfarmer 3y ago
    Normally, no. But in the hypothetical situation of Apple leaving the EU up for grabs for new players, maybe.
chippiewill 3y ago
The threshold is nowhere near close. You forget that these companies already operate in China which is a massive pain in the backside for all involved. The only reason why a company might threaten to pull out is if they wanted to stop other countries getting similar ideas.
- aurareturn 3y ago
  China isn’t threatening Apple’s entire App Store model though.
  - Rinzler89 3y ago
    The point of the EU is to protect consumers and small businesses, not the business of multi trillion dollar market leaders who engage in anti-competitive practices. Maybe Apple should focus back on making money through innovation instead of coasting on rent seeking.
    - aurareturn 3y ago
      If EU is so good at promoting innovation and competition, why couldn’t they compete at all in hardware, software, and AI? If they’re so good at dissuading gate keepers, then why is LVMH everywhere and so dominant in luxury goods? Why is it that every single glasses shop in every mall is owned by Luxottica no matter the brand. The truth is that EU is not good at promoting competition. They’re good at preventing innovation. They’re good at protectionist policies. How many more cookie prompts do people have to click because of idiotic EU laws?
      - vages 3y ago
        I recommend the article “Facing reality about the EU is a core requirement for good management”: https://news.ycombinator.com/item?id=39602417 https://news.ycombinator.com/item?id=39602417
      - viraptor 3y ago
        > why couldn’t they compete at all in hardware, Like Arm? Or raspberry pi? (Both existed pre-exit) > software, Too many companies to list. > and AI? Like Mistral? > How many more cookie prompts do people have to click because of idiotic EU laws? It's up to the companies. Every time you see a banner it means the company values selling your information more than pissing you off. We could have no banners right now.
rsynnott 3y ago
I mean, the US is also pursuing competition investigations into Apple; if the strategy is to just flee anywhere that the regulators ask them mean questions, then they're probably realistically looking at only operating in developing nations, and not all of those.
- xandrius 3y ago
  And that would literally mean that the probe was warranted.
serial_dev 3y ago
[flagged]
- Rinzler89 3y ago
  >the US is not just going to stand there and take it. What are they gonna do about it? The EU's DMA is child's play compared to what big tech had to bend over for to access the Chines market, and the US didn't do shit to China. And somehow big-tech bitches way more about the EU regulations that the Chinese ones. Hypocrisy much?
  - aurareturn 3y ago
    Because the EU is trying to fundamentally change the iPhone business. China isn’t.
    - Rinzler89 3y ago
      Please explain.
      - aurareturn 3y ago
        EU is telling Apple how to design and run its App Store, music, Pay, etc. China isn’t.
        Rinzler89 3y ago
        >EU is telling Apple how to design and run its App Store, music, Pay, etc. Are you 5 years old or just a delusional Apple fanboy? That's how it works everywhere: businesses need to comply with local regulations or fuck off. When VW and Toyota came to the US they also had to design their cars as they were told by the US legislation. It's why the Cybertruck can't be sold in Europe and why the Porsche 959 couldn't be sold in the US: they weren't compliant to legislation abroad. Similarly, nobody's forcing Apple to sell it's products and services in Europe, if they want to do that, it must adapt them to EU legislation. Simple. Why are you having difficulties with this? >China isn’t. lol OK.
alberth 3y ago
$94B https://www.businessofapps.com/data/apple-statistics/ https://www.businessofapps.com/data/apple-statistics/
- rekoil 3y ago
  Did the math, 24.5% of their global 2023 revenue.
  - microtonal 3y ago
    And Apple's iPhone market share in Europe (yes, the EU is not Europe) has been steadily growing since 2019: https://www.statista.com/statistics/639928/market-share-mobile-operating-systems-eu/ https://www.statista.com/statistics/639928/market-share-mobi... Apple would be crazy for leaving the EU. Even the suggestion would probably lead to a shareholder revolt and the removal of some executives.
t-sauer 3y ago
If they leave the EU market, Android immediately becomes a much bigger focus for every app developer which can have an effect on the quality of apps available on the app store around the world.
- mleo 3y ago
  Android is already the dominant mobile OS in Europe by market share. Why would quality increase by going from dominant to more dominant?
  - guappa 3y ago
    Companies might decide to stop bothering with ios apps altogether, which could have an effect in USA as well eventually.
  - microtonal 3y ago
    Two things: iOS has been eating into Android marketshare in Europe since 2019: https://www.statista.com/statistics/639928/market-share-mobile-operating-systems-eu/ https://www.statista.com/statistics/639928/market-share-mobi... However, more importantly, iPhone users have more disposable income [1][2]. So, if Apple would pull from the EU, all those iPhone users with a lot of disposable income would be in the market for Android phones and apps, creating a lot of opportunities in the Android market. [1] There are various studies, e.g.: https://www.prnewswire.com/news-releases/iphone-users-spend-101-every-month-on-tech-purchases-nearly-double-of-android-users-according-to-a-survey-conducted-by-slickdeals-300739582.html?c=n https://www.prnewswire.com/news-releases/iphone-users-spend-... [2] If you look at the most popular Android phones, they are often dominated by cheaper models, e.g. Samsung's A lineup. See e.g. current Android usage in France: https://www.appbrain.com/stats/top-android-phones-tablets-by-country?country=FR https://www.appbrain.com/stats/top-android-phones-tablets-by...
deleted 3y ago
[deleted]
izacus 3y ago
Remember how the US tech market went into layoff spree just for a slight dip in profits and slightly higher rates? Think what does same investors will do to the company that leaves a 300mil people market over a legal spat.
- godzillabrennus 3y ago
  Think about all of the innovations those terminated people will bring to the market when they are no longer shackled in golden handcuffs.
- kevin_thibedeau 3y ago
  They mass hired too many unqualified people in 2021.
  - izacus 3y ago
    Yeah, and if Apple stops selling to EU suddenly bunch of Apple software artisans will be marked as "unqualified" as well for people that uncritically eat that kind of BS.
northhanover 3y ago
[flagged]
sloowm 3y ago
You would not only need to consider how much it brings in but also how much it would cost to pull back. They would have to unwind a ton of legal structures, get rid of employees and live up to contracts that are already in place. This would take years and would be more than enough time for competition to smoothly make a transition. Then you are also thinking of Apple as some kind of US entity. It's a faceless shareholder owned business. The shareholders would somehow need to agree to leave a still very profitable region. They would only agree to that if they think the company can force other regions or the EU to not legislate Apple. It's a risky strategy that could work but I don't think you can get the majority of shareholders to try it. Even then it could fail and just bankrupt the company.
- rekoil 3y ago
  You also have to consider how much it costs to actually comply. The board would probably much rather Apple comply and keeps selling iPhones and services in the EU vs not getting ANY profits at all from their currently second largest region in the world.
tyingq 3y ago
I don't think it's that unusual for companies to have wildly different margins in different markets. Apple's margins leave quite a lot of room for a market to still be worth pursuing.
cqqxo4zV46cp 3y ago
Apple would first have to determine if it’s worth continuing to act like petulant children instead of just complying. They could not reasonably classify what they’re taking on now as simply “compliance expenses”. They’re doing it BECAUSE they see the worth in fighting back.
legacynl 3y ago
I'd say that it's realistically not possible for any amount of cost or complexity of compliance to make them leave the EU market. Apple has a vested interest in being able to offer their services worldwide. If one part of the world is not included, companies in that part will have a much easier time to develop and grow their own alternatives. If these alternatives gain enough traction in that part they might then be able to threaten Apples services globally. Therefore I'd assume that even if they will only break even (or operate at a manageable loss) they would still stay in the EU.
layer8 3y ago
A quarter of Apple’s total revenue comes from the EU (with Apple’s average profit margin of ~40%), but only 7% of the app store revenue. Which means that even if Apple gave up on all app store revenue from the EU, they wouldn’t lose that much. In any case, the resources they put into compliance is certainly much, much less than a quarter of their total resources.
- st3fan 3y ago
  I doubt they would leave the EU. I do think it is expected that they will design their products or features with the EU in mind and probably not even ship specific things in that region to avoid risk of being micromanaged / product managed by authorities.

varjag 3y ago

The EU is a huge market of people with deep pockets, I conjecture the break even point is not anywhere on the horizon.

flenserboy 3y ago
At some point control of one's own business future balances out a certain level of profit.
- deleted 3y ago
  [deleted]
- mdekkers 3y ago
  Have you seen how much they all bend over backwards for China?
  - lotsofpulp 3y ago
    As far as I know, only Apple and Microsoft operate in China.
    - techpression 3y ago
      At least iCloud is run by a third party and not Apple (GCBD). Similar to how Blizzard does with their games and why World of Warcraft disappeared over night. Important distinction to make when it comes to privacy and security (there’s none) and how Apple washes their hands clean while keeping the Chinese government happy.
      - st3fan 3y ago
        It is pretty much a requirement if you want to do business in mainland China. Firefox also had a set of China-owned servers to sync data from Chinese users to. (“Had” because I think they officially stopped the relationship with Mozilla China)
  - pavlov 3y ago
    Meta doesn’t. Their products have never been available in China.
    - Rinzler89 3y ago
      Probably because the Chinese market is already full of Chinese social media companies. How do they expect to compete if they enter? It's not 2004 anymore where starting a social media on Harvard campus was a big ticket.
- quadcore 3y ago
  I also wonder if personel/talents/headcount to handle all that crap can become an issue. VPs (CEOs even) distracted with compliance etc.
  - krzyk 3y ago
    Ones crap is anothers feature.
  - rekoil 3y ago
    When all they need to do for compliance is to enable EU users to install apps without Apple as a middle-man then not much in the way of "personell/talents/headcount to handle all that crap" is actually necessary. What's costing them resources (and eventually money in the form of fines) is not complying.
    - nozzlegear 3y ago
      You are vastly oversimplifying the issue. It’s not like there’s a bit that Apple can flip to just let EU citizens sideload apps.
      - PodgieTar 3y ago
        I’d argue you’re vastly over complicating it. There’s already mechanisms to side load, and install IPAs.. Why would it be more complicated?
        akaij 3y ago
        It feels like some people don't imagine these companies to be ready for compliance. As if they don't have all the knobs ready to turn on a per-region/country/state basis as soon as the law changes and it becomes possible to lose even the smallest amount in stock value.
- deleted 3y ago
  [deleted]

oaiey 3y ago

These DMA like changes are now coming from everywhere. It is just that EU has teeth, not to ignore and usually moves first. California has adopted GDPR, there are ongoing probes in the US just last week, etc. Time is up for regulation-free business in IT. We had 50 years of freedom (compared to let us say: drugs, medical devices, cars, airplanes, ...). It is normal cycle for a market

brtkdotse 3y ago
> We had 50 years of freedom More “Wild West gold rush” than “freedom”
- oaiey 3y ago
  I think for many people that is the same ;). But I agree with your differentiation.
rsynnott 3y ago
> Time is up for regulation-free business in IT. We had 50 years of freedom (compared to let us say: drugs, medical devices, cars, airplanes, ...) This is an odd reading of the history, tbh. The US regulators were generally more active on competition in the industry in the 90s than today; see the Microsoft and Intel investigations, for instance.

jpambrun 3y ago

That would be a net positive as we would all benefit from new players that would emerge and fill that void. Obviously your question was rhetorical and this won't happen.

zarathustreal 3y ago
New players emerging in the high-end smartphone space? You seriously believe that a comparable player to *Apple* is going to emerge any time in the next decade? Lol
- spiderfarmer 3y ago
  Normally, no. But in the hypothetical situation of Apple leaving the EU up for grabs for new players, maybe.

chippiewill 3y ago

The threshold is nowhere near close. You forget that these companies already operate in China which is a massive pain in the backside for all involved. The only reason why a company might threaten to pull out is if they wanted to stop other countries getting similar ideas.

aurareturn 3y ago
China isn’t threatening Apple’s entire App Store model though.
- Rinzler89 3y ago
  The point of the EU is to protect consumers and small businesses, not the business of multi trillion dollar market leaders who engage in anti-competitive practices. Maybe Apple should focus back on making money through innovation instead of coasting on rent seeking.
  - aurareturn 3y ago
    If EU is so good at promoting innovation and competition, why couldn’t they compete at all in hardware, software, and AI? If they’re so good at dissuading gate keepers, then why is LVMH everywhere and so dominant in luxury goods? Why is it that every single glasses shop in every mall is owned by Luxottica no matter the brand. The truth is that EU is not good at promoting competition. They’re good at preventing innovation. They’re good at protectionist policies. How many more cookie prompts do people have to click because of idiotic EU laws?
    - vages 3y ago
      I recommend the article “Facing reality about the EU is a core requirement for good management”: https://news.ycombinator.com/item?id=39602417 https://news.ycombinator.com/item?id=39602417
    - viraptor 3y ago
      > why couldn’t they compete at all in hardware, Like Arm? Or raspberry pi? (Both existed pre-exit) > software, Too many companies to list. > and AI? Like Mistral? > How many more cookie prompts do people have to click because of idiotic EU laws? It's up to the companies. Every time you see a banner it means the company values selling your information more than pissing you off. We could have no banners right now.

rsynnott 3y ago

I mean, the US is also pursuing competition investigations into Apple; if the strategy is to just flee anywhere that the regulators ask them mean questions, then they're probably realistically looking at only operating in developing nations, and not all of those.

xandrius 3y ago
And that would literally mean that the probe was warranted.

serial_dev 3y ago

[flagged]

Rinzler89 3y ago
>the US is not just going to stand there and take it. What are they gonna do about it? The EU's DMA is child's play compared to what big tech had to bend over for to access the Chines market, and the US didn't do shit to China. And somehow big-tech bitches way more about the EU regulations that the Chinese ones. Hypocrisy much?
- aurareturn 3y ago
  Because the EU is trying to fundamentally change the iPhone business. China isn’t.
  - Rinzler89 3y ago
    Please explain.
    - aurareturn 3y ago
      EU is telling Apple how to design and run its App Store, music, Pay, etc. China isn’t.
      - Rinzler89 3y ago
        >EU is telling Apple how to design and run its App Store, music, Pay, etc. Are you 5 years old or just a delusional Apple fanboy? That's how it works everywhere: businesses need to comply with local regulations or fuck off. When VW and Toyota came to the US they also had to design their cars as they were told by the US legislation. It's why the Cybertruck can't be sold in Europe and why the Porsche 959 couldn't be sold in the US: they weren't compliant to legislation abroad. Similarly, nobody's forcing Apple to sell it's products and services in Europe, if they want to do that, it must adapt them to EU legislation. Simple. Why are you having difficulties with this? >China isn’t. lol OK.

alberth 3y ago

$94B https://www.businessofapps.com/data/apple-statistics/ https://www.businessofapps.com/data/apple-statistics/

rekoil 3y ago
Did the math, 24.5% of their global 2023 revenue.
- microtonal 3y ago
  And Apple's iPhone market share in Europe (yes, the EU is not Europe) has been steadily growing since 2019: https://www.statista.com/statistics/639928/market-share-mobile-operating-systems-eu/ https://www.statista.com/statistics/639928/market-share-mobi... Apple would be crazy for leaving the EU. Even the suggestion would probably lead to a shareholder revolt and the removal of some executives.

t-sauer 3y ago

If they leave the EU market, Android immediately becomes a much bigger focus for every app developer which can have an effect on the quality of apps available on the app store around the world.

mleo 3y ago
Android is already the dominant mobile OS in Europe by market share. Why would quality increase by going from dominant to more dominant?
- guappa 3y ago
  Companies might decide to stop bothering with ios apps altogether, which could have an effect in USA as well eventually.
- microtonal 3y ago
  Two things: iOS has been eating into Android marketshare in Europe since 2019: https://www.statista.com/statistics/639928/market-share-mobile-operating-systems-eu/ https://www.statista.com/statistics/639928/market-share-mobi... However, more importantly, iPhone users have more disposable income [1][2]. So, if Apple would pull from the EU, all those iPhone users with a lot of disposable income would be in the market for Android phones and apps, creating a lot of opportunities in the Android market. [1] There are various studies, e.g.: https://www.prnewswire.com/news-releases/iphone-users-spend-101-every-month-on-tech-purchases-nearly-double-of-android-users-according-to-a-survey-conducted-by-slickdeals-300739582.html?c=n https://www.prnewswire.com/news-releases/iphone-users-spend-... [2] If you look at the most popular Android phones, they are often dominated by cheaper models, e.g. Samsung's A lineup. See e.g. current Android usage in France: https://www.appbrain.com/stats/top-android-phones-tablets-by-country?country=FR https://www.appbrain.com/stats/top-android-phones-tablets-by...

deleted 3y ago

[deleted]

izacus 3y ago

Remember how the US tech market went into layoff spree just for a slight dip in profits and slightly higher rates? Think what does same investors will do to the company that leaves a 300mil people market over a legal spat.

godzillabrennus 3y ago
Think about all of the innovations those terminated people will bring to the market when they are no longer shackled in golden handcuffs.
kevin_thibedeau 3y ago
They mass hired too many unqualified people in 2021.
- izacus 3y ago
  Yeah, and if Apple stops selling to EU suddenly bunch of Apple software artisans will be marked as "unqualified" as well for people that uncritically eat that kind of BS.

northhanover 3y ago

[flagged]

sloowm 3y ago

You would not only need to consider how much it brings in but also how much it would cost to pull back. They would have to unwind a ton of legal structures, get rid of employees and live up to contracts that are already in place. This would take years and would be more than enough time for competition to smoothly make a transition. Then you are also thinking of Apple as some kind of US entity. It's a faceless shareholder owned business. The shareholders would somehow need to agree to leave a still very profitable region. They would only agree to that if they think the company can force other regions or the EU to not legislate Apple. It's a risky strategy that could work but I don't think you can get the majority of shareholders to try it. Even then it could fail and just bankrupt the company.

rekoil 3y ago
You also have to consider how much it costs to actually comply. The board would probably much rather Apple comply and keeps selling iPhones and services in the EU vs not getting ANY profits at all from their currently second largest region in the world.

tyingq 3y ago

I don't think it's that unusual for companies to have wildly different margins in different markets. Apple's margins leave quite a lot of room for a market to still be worth pursuing.

cqqxo4zV46cp 3y ago

Apple would first have to determine if it’s worth continuing to act like petulant children instead of just complying. They could not reasonably classify what they’re taking on now as simply “compliance expenses”. They’re doing it BECAUSE they see the worth in fighting back.

legacynl 3y ago

I'd say that it's realistically not possible for any amount of cost or complexity of compliance to make them leave the EU market. Apple has a vested interest in being able to offer their services worldwide. If one part of the world is not included, companies in that part will have a much easier time to develop and grow their own alternatives. If these alternatives gain enough traction in that part they might then be able to threaten Apples services globally. Therefore I'd assume that even if they will only break even (or operate at a manageable loss) they would still stay in the EU.

layer8 3y ago

A quarter of Apple’s total revenue comes from the EU (with Apple’s average profit margin of ~40%), but only 7% of the app store revenue. Which means that even if Apple gave up on all app store revenue from the EU, they wouldn’t lose that much. In any case, the resources they put into compliance is certainly much, much less than a quarter of their total resources.

st3fan 3y ago
I doubt they would leave the EU. I do think it is expected that they will design their products or features with the EU in mind and probably not even ship specific things in that region to avoid risk of being micromanaged / product managed by authorities.