It should be somewhere between Apple Pay levels and 1%, and the default should be to use the service provider's own billing, so Apple gets nothing by default; companies that don't have their own billing could be charged more, because Apple is providing them something of value. Even Android lets the companies link to their own web sites so you can sign up without having to pay Google some obscene tax. Myself, I would no more pay Apple a single penny for Netflix, Spotify, or whatever service than I would pay the manufacturers of my TV, BD Player, AVR, etc, which also provide the apps.
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Apple Accuses Spotify of 'Resorting to Rumors and Half-Truths', Sets Record Straight on App Rejection
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It should be somewhere between Apple Pay levels and 1%, and the default should be to use the service provider's own billing, so Apple gets nothing by default; companies that don't have their own billing could be charged more, because Apple is providing them something of value. Even Android lets the companies link to their own web sites so you can sign up without having to pay Google some obscene tax. Myself, I would no more pay Apple a single penny for Netflix, Spotify, or whatever service than I would pay the manufacturers of my TV, BD Player, AVR, etc, which also provide the apps.
Apple sells subscriptions for their music service for 10 bucks a month, because 7 bucks a month would not yield them enough profit (if any).
Apple then demands anyone else selling the same thing on their platform pays 30% of their subscriptions to Apple, so then everyone else selling the same thing would only get 7 bucks in revenue - yet selling it to customers for 10 bucks.
So Apple doesn't pay their own tax, using their platform as a leverage against any other music subscription service, no matter what it's called.
Basically Apple is treading over the line of monopolistic behavior, i.e. using their market dominance in one area to squeeze out competition in another.
Stay classy Apple.
Apple then demands anyone else selling the same thing on their platform pays 30% of their subscriptions to Apple, so then everyone else selling the same thing would only get 7 bucks in revenue - yet selling it to customers for 10 bucks.
So Apple doesn't pay their own tax, using their platform as a leverage against any other music subscription service, no matter what it's called.
Basically Apple is treading over the line of monopolistic behavior, i.e. using their market dominance in one area to squeeze out competition in another.
Stay classy Apple.
It's actually $3.897 a month. (30% of $12.99... the iOS signup price)
That's why I rounded it to $4 a month for this discussion.
Originally on iOS apps could interface directly with their own payment service. You could buy a book within the Kindle app and Apple was not involved in the purchase, there was nothing for Apple to manage because Amazon managed it. These apps are a lot of times frameworks that merely interface securely with web services anyway. But Apple chose to ban applications from interfacing with their own stores and forced all developers to use Apple's payment system for any digital download. Outside of a policy decision, there is not a good technical reason that a Spotify subscription purchase has to run through the Apple App Store when that purchase is made in an app on an iOS device. Apple chose to do it this way partially for simplicity and partially for revenue. But, like I said, it is the primary reason that I abandoned iPhone in 2010.
Don't see the big issue. Apple should get a cut for facilitating app discovery. Most people will not discover or hear about Spotify only through the App Store and therefore will get the cheap 9.99 out-app subscription. People genuinely only discovering it through the App Store and not doing any further research may take out the 12.99 in-app sub, but in that case Apple have done a job for Spotify by promoting it and so get a cut.
Yeah, except they aren't promoting it. I haven't seen Spotify featured in the music section of the app store in a long time, even though it's consistently one of the highest grossing apps (i.e. making tons of money for Apple).
Another way to look at this whole thing is this: Spotify gives around 70% of their revenue to the artists/rightholders, leaving 30% for Spotify to cover their own expenses. Apple takes 30% of the subscription fee for in-app billing. Obviously, that gives Spotify only 3 choices if they want to support iTunes billing:
- Hand their entire income over to Apple
- Pay less to the artists
- Charge a higher fee for customers who are billed through Apple
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You're right - there is no technical reason why Spotify subscriptions need to run through Apple. Oh wait, this isn't a technical issue at all - it's an issue of paying a cut for having access to the worlds largest, and most profitable ecosystem and to an audience of now around a billion devices.
You left iPhone in 2010 over Apple taking a cut? So because you weren't able to figure out how to sign up for subscriptions on websites (to avoid Apple), you left the superior OS (iOS) and moved to the inferior OS (Android)?
Wow, some people cut off their noses to spite their face. Switching to Android over this issue is like cutting off your whole head.
Yeah, too bad for you and all your buddies Apple is doing nothing wrong or illegal. Apple has been investigated by the FTC over iTunes and The App Store multiple times in the last 7 years (usually from someone like Spotify whining in public about being treated unfairly). Most recently they were investigated last summer over Apple Music vs Spotify, Rdio and others (specifically about this issue - charging 30% fees if subscriptions are purchased through Apple).
And I'm SOOOOO sorry to have to break the bad news to you, but Apple hasn't been found guilty of doing anything wrong.
As I told the ninja earlier in this thread, perhaps you also need to contact the FTC and tell them why they're wrong and you're right. Along with all those who uprooted you. Perhaps as a group you can all overturn this travesty of justice committed by the FTC not charging Apple with antitrust issues or being anticompetitive.
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But if it wasn't for Apple promoting the electricity company in your area, you may never have known they existed ...finders, promotional, secure distribution & usage fee = 30% of the first year's take, decreasing to 15% there-after.
It's a one time offer & if you don't like the deal, don't take it! see ya.
Typical response. When you can't form a cohesive argument, resort to FUD.
That makes sense. Yeah, I know some folks using Plex and whatnot and really enjoying that. AppleTV gives me a great solution for my needs though so I'm not actively looking for anything else. From the perspective of the remote I just never find myself entering text anymore. I did to initially set up some subscription apps but that hassle will go away soon with SSO. The browse interfaces are great for me in most apps I use or when I do have to search I use Siri dictation or "find" commands.
I do have the remote app on my phone (and watch) but they've been in there so long I don't recall how they were set up. I don't think it was burdensome, I though they just automatically discovered all the AppleTVs on my network and they were available to select and control.
I've been very happy with this solution but everyone has their own unique interests and priorities, thankfully there are many good solutions out there.
In the beginning, Apple wasn't in direct competition with Spotify. The rules were problematic before, but at least everybody was on a level playing field. Apple Music has at least two significant competitive advantages arising out of its ownership by Apple:
1. The app is distributed with the device, so every user has it without having to download it.
2. They don't pay 30% of the cost of every subscription to somebody else. (Yes, they have costs, but they are much, much less than 30%.)
Because the competition is no longer fair, Apple should give Spotify whatever special treatment is necessary to make the playing field level again.
Of course, Spotify could legitimately argue based on:
- 3.1.5 Physical Goods and Services Outside of the App: If your app enables people to purchase goods or services that will be consumed outside of the app, you must use purchase methods other than IAP to collect those payments, such as Apple Pay or traditional credit card entry. Apps may facilitate transmission of approved virtual currencies (e.g. Bitcoin, DogeCoin) provided that they do so in compliance with all state and federal laws for the territories in which the app functions.
It doesn't make sense. Subscriptions to a service not offered by Apple, have nothing to do with Apple. Why should they earn a percentage of every paying subscriber, for the life of that paying subscriber? Nobody is arguing they shouldn't make a profit for hosting the initial app discovery for Spotify in the App Store. Maybe take their 30% for the first month of the subscription and that's it. But forever? To 'force' Spotifys subscription prices to be different via Apple or via the web does not make sense. It's monopolizing and wrong.
Right. And coke should make their formula taste worse so Pepsi has a fair shot. I remember when Macy's raised prices so Gimbels could compete better.
Uh... Coke isn't the sole distributor for Pepsi in a geographical region. That's not a comparable situation at all.
What makes it problematic is Apple has designed their system such that they are the sole possible distributor of Spotify on the iOS platform, and Apple became a competitor. Neither one on its own is per se an antitrust concern, but when looked at in combination, they might be.
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Actually, they were... in the iBooks antitrust case. Admittedly, the two aren't even remotely identical, but they do have a number of parallels, including preventing vendors from advertising cheaper prices elsewhere (albeit in different ways). Such restrictions are very nearly a per se antitrust violation.
Moreover, in this case, you could probably argue that Apple preventing Spotify from telling their own customers about the better direct-sale price constitutes tortious interference. You wouldn't even need to resort to antitrust law to argue that; it would strictly be a civil issue between Spotify and Apple....
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The point being that companies are under no obligation to make things easier on their competition, absent an anti-trust violation. No one is alleging Apple is colluding with competitors, and Apple has far less than half the smartphone market (and less than half the music streaming market) so they aren't violating any antitrust law that anyone has been able to cite.
So what we have is two competitors competing. One competitor spent billions to create an entire platform. The other wants a free ride on that platform. Apple has no legal or moral obligation to make things "fair" in your eyes. The competition IS fair - Spotify could design its own phone and sell its stuff on that. Or if it thinks customers love it so much Spotify can just sell on android. But Apple spent the billions, including huge annual investments to provide new sdks so that Spotify has the tools to make its app, and new phones and iOS features so that money-spending customers buy the devices and become potential customers for Spotify. Apple did all that hard work. Apple built the bridge, and it charges a toll. The fact that Apple already earned back what it spent on the bridge and what it costs to maintain the bridge doesn't mean Apple no longer has the right to charge a toll. If Spotify doesn't want to pay it there is absolutely nothing stopping it from building its own bridge, or using the much more popular Google bridge a mile down the river.
And by the way the fact that Spotify and Apple are competitors is not a recent phenomenon. Each person who subscribes to Spotify is far less likely to purchase tracks on iTunes or to listen to iTunes Radio, both of which predates Spotify.
Listen, Apple deserves squat. If you believe otherwise, start sending checks to manufacturers of TVs, BD players, AVRs, etc, whichever device led you to sign up for a service. I had to rescind my upvote after reading your "30% of the first month" suggestion. Ridiculous!
It's Apple's playground; if you want to play there, you play by their rules. Not really that hard to understand given that 99% of the other developers play by the same rules. What makes Spotify so special?
Tens of thousands of developers disagree with you. If paying the 30% wasn't worth it, they wouldn't be doing it.
Well, there's precedent if they don't at least make something. Otherwise every app developer could start offering a free app and allow users to sign up via the web and purchase extras - which would completely bypass Apple. Then they'd make no money ever. There has to be some kind of trade-off. But as it stands is completely ridiculous.
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And yet Apple is lowering subscription percentages from 30 to 15%, or halving it. Clearly there is something causing them to do this. It's still wrong at 15%, but budging even a little bit hints that they know it's ludicrous.
Apple is just wrong here and always has been.
Let's say someone is a Windows user and they download iTunes. If they buy music, movies or TV shows in iTunes on Windows, should Microsoft get a 30% cut? No! They have nothing to do with the content. They just provided you with a way to obtain the app (in that case, a crappy MS web browser).
Apple should allow developers to at least put a link to their website in their app for sign-ups, like they did in the beginning. I know they don't allow this for "security" reasons, so you don't get scammed by shady apps.
But, if they're going to force developers to use an in-app purchase to get a subscription, they should only charge a 1 or 2% processing fee.
Last time I used Apple Pay at McDonalds, I'm fairly certain Apple didn't get 30% of my Quarter Pounder.
Like I said, given that you believe that Apple is right to charge a 30% recurring tax on subscriptions they have nothing to do with, subs that work across a variety of non-Apple devices, you need to start sending checks to manufacturers of TVs, BD players, AVRs, etc, whichever device led you to sign up for a service. It's only right. Right?
Now if you want to talk about a reasonable fee for Apple billing for Spotify, Netflix, and similar subscriptions, look no further than my earlier post:
It should be somewhere between Apple Pay levels and 1%, and the default should be to use the service provider's own billing, so Apple gets nothing by default; companies that don't have their own billing could be charged more, because Apple is providing them something of value. Even Android lets the companies link to their own web sites so you can sign up without having to pay Google some obscene tax. Myself, I would no more pay Apple a single penny for Netflix, Spotify, or whatever service than I would pay the manufacturers of my TV, BD Player, AVR, etc, which also provide the apps.
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Yup, not even similar. Didn't stop you from bringing it up anyway to deflect away from what I said. Which is that the FTC has looked at this for over a year and nothing has come of it. If it was so "obvious" that Apple is wrong (according to all the armchair lawyers here), then why is it taking so long for the FTC to do what they're supposed to do (crucify Apple to make everyone here happy)?
The one problem with your second comment is that developers all know Apples terms & conditions and have for some 7 years now. How can Apple be "preventing" Spotify from doing anything, when all Apple is doing is holding them up to the same standards every other single developer also has to follow? Conditions that Spotify has known about since day one when they first put an App into The App Store?
If Apple made changes to their terms recently, and those changes had an impact on Spotify, THEN I could see there being an antitrust issue. But since they've been written in stone for many years, and Spotify knew those conditions, then they have nobody to blame for their current position. A position which is absolutely, 100% a result of decisions Spotify has made over the years, NOT any changes Apple has made (because Apple hasn't made any).
Spotify should have never allowed in-App purchases to begin with, and forced everyone to go to a website. They could put up a notice (like you see on the Kindle App) when you first run their App that states: "You need a Spotify account in order to continue using this App." But they didn't because they wanted to grow their subscriber base quickly. And the easiest way to do that is through quick & easy signups within the App itself. Now that they've let the genie out of the bottle, they want to put it back in (and blame Apple for a situation that they caused).
You don't need iTunes to buy music, movies, tv shows on a Windows machine. You don't need to use Apple Pay to buy a quarter pounder.
You do NEED Apple's App Store to use Spotify on the iPhone. Don't like it? Then get an android phone. Oh you won't switch an entire platform just to use a music app? Ok.