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In which situation does the end user not pay for everything? Even a fine or a tax on a company ends rolled up in the price paid by the end user. Same thing with

In which situation does the end user not pay for everything? Even a fine or a tax on a company ends rolled up in the price paid by the end user. Same thing with programs paid for by the government. It’s the taxpayers who foot the bill. I’m kinda split on the whole Apple situation. I’m firmly in the camp of “monopoly bad”, but apparently people are fine with apple’s practices. It’s not like they have to buy an iPhone.

eviks 1y ago
In a situation where profits decrease instead of price increase
- vladvasiliu 1y ago
  But that would only work if the end user refused to pay whatever price the company asks for. In the specific case of Apple, people line up to buy their product.
  - eviks 1y ago
    Are you saying that every single person on the planet bought /lined up to buy iPhones? Or did a lot of people refused to pay whatever price?
stale2002 1y ago
> In which situation does the end user not pay for everything? If you want to get technical about it the field of economics addresses this question. Its called Tax Incidence. The short story is that the side of the market that has the least elasticity of demand (IE, they respond to price changes the least, and don't buy more or less because of price changes) is the entity that suffers the costs of taxes and gets the benefits of subsidies. Intuitively this makes sense. Imagine if there is a luxury good that you don't need. If taxes increase significant on it, you may just choose not to buy it. That has a high elasticity of demand. Meaning that the tax incidence isn't going to be on the consumer and will instead be on the produce. Whereas, think about food. People don't eat much more or less based on how much it cost. You can't physically eat more than like twice as much, and if you don't have any you die. Meaning that its a low elasticity of demand, meaning that the consumer pays the taxes.
AnthonyMouse 1y ago
> I’m kinda split on the whole Apple situation. I’m firmly in the camp of “monopoly bad”, but apparently people are fine with apple’s practices. It’s not like they have to buy an iPhone. There are many things that now require you to have a phone that runs iOS or Google-approved Android. They both monopolize their respective markets and charge 30%, locking out competitors with attestation systems etc. Two incumbents that each divide up the customer base between them while locking out other competitors is called a cartel and it's not actually a competitive market.
- jeroenhd 1y ago
  Google-approved Android, at least for now until some judge hopefully shuts down the idiotic "verified developers" programme, has a range of app stores with different options. Unfortunately, Amazon shut theirs down, but charging a 30% convenience fee is a choice there. Inside of the EU the same is true for iOS, of course, although Apple still somehow charging developers per install makes it hard to provide apps for free.
  - AnthonyMouse 1y ago
    > Google-approved Android, at least for now until some judge hopefully shuts down the idiotic "verified developers" programme, has a range of app stores with different options. In order for such a competitor to be viable for use by developers, it has to be installed on the devices of customers, which Google has acted to prevent. Google Play has over 90% market share on Android and has constrained OEMs from shipping devices with other stores installed and used other methods to prevent any alternatives from establishing a network effect. And now that regulators are getting after them about doing those things, they've sprung this "verified developers" trap to keep it going. This has the simplest evidence of anything. If other stores are a viable alternative, why do they have ~0% market share?
    - jeroenhd 1y ago
      > has constrained OEMs from shipping devices with other stores installed Every Samsung phone comes with the Samsung Store. My Xiaomi phone came with a Xiaomi store. I don't know about any vendors that even wanted to ship app stores outside of their own, but I don't recall Google preventing them from doing that. > If alternative stores are a viable alternative, why do they have ~0% market share? Because people like Google Play? All I ever read about the app store alternatives that do exist is that people wished they could get rid of them. Personally, I find Google Play to be the best app store around, even compared to iOS' app store, in terms of search functionality and responsiveness. And that's a low bar to clear, given the absolute garbage Google will throw at you with some searches. With Amazon closing its app store, the only independent app store that has the ability to charge people money has disappeared. That doesn't mean Steam or Epic or Microsoft couldn't set up their own stores if they wanted to. Hell, even with the "verified developer" system, alternative app stores are still possible.
lopis 1y ago
> I’m kinda split on the whole Apple situation. I’m firmly in the camp of “monopoly bad”, but apparently people are fine with apple’s practices. It’s not like they have to buy an iPhone. People don't necessarily choose the option that is better for them long term. The existence of monopolies stifles innovation, so users are worse off. For example, Apple's ecosystem works great if you go all in, but what would have happened if Apple had opened the garden to every one and embraced open standards?
- LexGray 1y ago
  That sounds like a fun thought experiment. What exactly would happen? I think is why the EU and UK pushing so hard to open the gates is so they have the excuse to take control themselves and slam the gates back shut hard. I predict the outcome in even a ten year period is all apps will need governmental approval. Opening the gates is not necessarily the best long term decision either. You have to remember most governments are corrupt and it will devolve into a situation on who pays the best bribes over the current flat rate extortion.
worble 1y ago
> It’s not like they have to buy an iPhone. I'm so sick of hearing this, the current smartphone market is an american megacorp duopoly, both of whom are locking down their phones to such a degree that you cannot even claim you own the hardware anymore. There is essentially no choice. And not buying a smartphone is not a choice either, if you want to actually exist in the modern world.
- Yeul 1y ago
  Google is still held back by the fact that their Pixel line isn't selling. They can't dictate terms to Samsung or Xiaomi. Apple owns the hardware and software.
Nursie 1y ago
> In which situation does the end user not pay for everything? In situations where the company needs to continue to compete, and factoring fines into prices would push it out of competitiveness, so it needs to find other ways to offset the fine. Apple's unlikely to be in this situation, and probably has massive buckets of cash just sitting around in various offshore places anyway. I doubt a couple of billion are much danger. > apparently people are fine with apple’s practices I'm happy my mum has a phone that can only install apps and stuff that are sanctioned by apple. She's not savvy enough to know differently, she doesn't really do apps, and frankly her best defence against any sort of tech-based scammers is likely to be "Oh, well, I wouldn't know how to do that", but otherwise extra-strong rails are a really useful thing. Monopolies are bad but the current ecosystem is so good, and for me other app stores aren't that interesting. And for some less savvy users they would be an outright threat.
socalgal2 1y ago
The cases are not about the consumer's choice to buy an iPhone. They're about other companies' options to reach consumers of iPhones. Apple (and Google) can not be in the middle of 2-3 billion phone owners and every company that wants to access those phone owners. Government are not going to allow it. No companies should have that much power.
mmooss 1y ago
> In which situation does the end user not pay for everything? Even a fine or a tax on a company ends rolled up in the price paid by the end user. New costs are covered by a combination of a cut from the seller's profits and an increase in the buyer's price, and the proportion of each varies greatly depending on economic factors. For example, imagine you offer that ugly sweater in an online marketplace. Can you just charge whatever you like (cost + desired profit)? No way. You can only charge as much as someone will pay, and that may work out to be a loss - for less than your costs. If somehow your costs go up - you spill something on it and need to dry clean it - can you just charge more? You can try, but there's no reason buyers will pay you more because your costs have increased; they don't care. Now imagine an inventory of 1,000 sweaters to sell - you might get lucky with one desperate buyer, but it's even harder to raise prices when you need 1,000 buyers. Companies sell some things for huge markups, such as a bottle of soda, and for losses - even if the cost is $500, $100 is better than nothing. Think of sales and clearance sales. Like you, companies price things to maximize revenue, where R = price x volume. Theoretically, they already price things for maximum revenue before they incurred additional costs, so how can they raise the price? One way is to shift consumer perspective by blaming X for the price increase - government is a popular excuse, or oil prices - saying they must pass on the additional cost, and persuading some consumers that they must or ought to pay more. But when they say that the new tax will have to be be passed on to the consumer, they are full of $#!+ - when they buy the CEO a new private jet, do they pass that on too? - because they also can and do pass on the cost to their shareholders.

eviks 1y ago

In a situation where profits decrease instead of price increase

vladvasiliu 1y ago
But that would only work if the end user refused to pay whatever price the company asks for. In the specific case of Apple, people line up to buy their product.
- eviks 1y ago
  Are you saying that every single person on the planet bought /lined up to buy iPhones? Or did a lot of people refused to pay whatever price?

stale2002 1y ago

> In which situation does the end user not pay for everything? If you want to get technical about it the field of economics addresses this question. Its called Tax Incidence. The short story is that the side of the market that has the least elasticity of demand (IE, they respond to price changes the least, and don't buy more or less because of price changes) is the entity that suffers the costs of taxes and gets the benefits of subsidies. Intuitively this makes sense. Imagine if there is a luxury good that you don't need. If taxes increase significant on it, you may just choose not to buy it. That has a high elasticity of demand. Meaning that the tax incidence isn't going to be on the consumer and will instead be on the produce. Whereas, think about food. People don't eat much more or less based on how much it cost. You can't physically eat more than like twice as much, and if you don't have any you die. Meaning that its a low elasticity of demand, meaning that the consumer pays the taxes.

AnthonyMouse 1y ago

> I’m kinda split on the whole Apple situation. I’m firmly in the camp of “monopoly bad”, but apparently people are fine with apple’s practices. It’s not like they have to buy an iPhone. There are many things that now require you to have a phone that runs iOS or Google-approved Android. They both monopolize their respective markets and charge 30%, locking out competitors with attestation systems etc. Two incumbents that each divide up the customer base between them while locking out other competitors is called a cartel and it's not actually a competitive market.

jeroenhd 1y ago
Google-approved Android, at least for now until some judge hopefully shuts down the idiotic "verified developers" programme, has a range of app stores with different options. Unfortunately, Amazon shut theirs down, but charging a 30% convenience fee is a choice there. Inside of the EU the same is true for iOS, of course, although Apple still somehow charging developers per install makes it hard to provide apps for free.
- AnthonyMouse 1y ago
  > Google-approved Android, at least for now until some judge hopefully shuts down the idiotic "verified developers" programme, has a range of app stores with different options. In order for such a competitor to be viable for use by developers, it has to be installed on the devices of customers, which Google has acted to prevent. Google Play has over 90% market share on Android and has constrained OEMs from shipping devices with other stores installed and used other methods to prevent any alternatives from establishing a network effect. And now that regulators are getting after them about doing those things, they've sprung this "verified developers" trap to keep it going. This has the simplest evidence of anything. If other stores are a viable alternative, why do they have ~0% market share?
  - jeroenhd 1y ago
    > has constrained OEMs from shipping devices with other stores installed Every Samsung phone comes with the Samsung Store. My Xiaomi phone came with a Xiaomi store. I don't know about any vendors that even wanted to ship app stores outside of their own, but I don't recall Google preventing them from doing that. > If alternative stores are a viable alternative, why do they have ~0% market share? Because people like Google Play? All I ever read about the app store alternatives that do exist is that people wished they could get rid of them. Personally, I find Google Play to be the best app store around, even compared to iOS' app store, in terms of search functionality and responsiveness. And that's a low bar to clear, given the absolute garbage Google will throw at you with some searches. With Amazon closing its app store, the only independent app store that has the ability to charge people money has disappeared. That doesn't mean Steam or Epic or Microsoft couldn't set up their own stores if they wanted to. Hell, even with the "verified developer" system, alternative app stores are still possible.

lopis 1y ago

> I’m kinda split on the whole Apple situation. I’m firmly in the camp of “monopoly bad”, but apparently people are fine with apple’s practices. It’s not like they have to buy an iPhone. People don't necessarily choose the option that is better for them long term. The existence of monopolies stifles innovation, so users are worse off. For example, Apple's ecosystem works great if you go all in, but what would have happened if Apple had opened the garden to every one and embraced open standards?

LexGray 1y ago
That sounds like a fun thought experiment. What exactly would happen? I think is why the EU and UK pushing so hard to open the gates is so they have the excuse to take control themselves and slam the gates back shut hard. I predict the outcome in even a ten year period is all apps will need governmental approval. Opening the gates is not necessarily the best long term decision either. You have to remember most governments are corrupt and it will devolve into a situation on who pays the best bribes over the current flat rate extortion.

worble 1y ago

> It’s not like they have to buy an iPhone. I'm so sick of hearing this, the current smartphone market is an american megacorp duopoly, both of whom are locking down their phones to such a degree that you cannot even claim you own the hardware anymore. There is essentially no choice. And not buying a smartphone is not a choice either, if you want to actually exist in the modern world.

Yeul 1y ago
Google is still held back by the fact that their Pixel line isn't selling. They can't dictate terms to Samsung or Xiaomi. Apple owns the hardware and software.

Nursie 1y ago

> In which situation does the end user not pay for everything? In situations where the company needs to continue to compete, and factoring fines into prices would push it out of competitiveness, so it needs to find other ways to offset the fine. Apple's unlikely to be in this situation, and probably has massive buckets of cash just sitting around in various offshore places anyway. I doubt a couple of billion are much danger. > apparently people are fine with apple’s practices I'm happy my mum has a phone that can only install apps and stuff that are sanctioned by apple. She's not savvy enough to know differently, she doesn't really do apps, and frankly her best defence against any sort of tech-based scammers is likely to be "Oh, well, I wouldn't know how to do that", but otherwise extra-strong rails are a really useful thing. Monopolies are bad but the current ecosystem is so good, and for me other app stores aren't that interesting. And for some less savvy users they would be an outright threat.

socalgal2 1y ago

The cases are not about the consumer's choice to buy an iPhone. They're about other companies' options to reach consumers of iPhones. Apple (and Google) can not be in the middle of 2-3 billion phone owners and every company that wants to access those phone owners. Government are not going to allow it. No companies should have that much power.

mmooss 1y ago

> In which situation does the end user not pay for everything? Even a fine or a tax on a company ends rolled up in the price paid by the end user. New costs are covered by a combination of a cut from the seller's profits and an increase in the buyer's price, and the proportion of each varies greatly depending on economic factors. For example, imagine you offer that ugly sweater in an online marketplace. Can you just charge whatever you like (cost + desired profit)? No way. You can only charge as much as someone will pay, and that may work out to be a loss - for less than your costs. If somehow your costs go up - you spill something on it and need to dry clean it - can you just charge more? You can try, but there's no reason buyers will pay you more because your costs have increased; they don't care. Now imagine an inventory of 1,000 sweaters to sell - you might get lucky with one desperate buyer, but it's even harder to raise prices when you need 1,000 buyers. Companies sell some things for huge markups, such as a bottle of soda, and for losses - even if the cost is $500, $100 is better than nothing. Think of sales and clearance sales. Like you, companies price things to maximize revenue, where R = price x volume. Theoretically, they already price things for maximum revenue before they incurred additional costs, so how can they raise the price? One way is to shift consumer perspective by blaming X for the price increase - government is a popular excuse, or oil prices - saying they must pass on the additional cost, and persuading some consumers that they must or ought to pay more. But when they say that the new tax will have to be be passed on to the consumer, they are full of $#!+ - when they buy the CEO a new private jet, do they pass that on too? - because they also can and do pass on the cost to their shareholders.