Once someone downloads an app to their phone and opens it up are they still in Apple’s store?
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Apple Allows Spotify to Show Pricing Info to EU Users in iPhone App
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Pretty soon Apple is going to pull an Al Gore and say they invented the internet (or invented buying things digitally). Fine, pay Apple for the developer tools and support used to build an iOS app. Pay Apple whatever the bandwidth costs are for being able to download it via Apple’s App Store.
But paying Apple as though Apple is responsible for customer acquisition? When their App Store is the only way to download apps? And Apple really believes this as the press release they put out earlier this year basically said Spotify wouldn’t exist without them. I don’t use Spotify now but when I did it had nothing to do with Apple. Sure I downloaded the app from the App Store but not because of anything Apple did.
😂
They’re even able to subsidise it without the revenue generated from commissions, given how much they’re making on developer subscriptions and hardware sales. They certainly don’t require that commission revenue.
Also, let’s not forget that Apple would have a profitable App Store business even when charging developers competitive rates in a competitive market (that is, one that allows for other, alternative purchasing options).
Apple certainly don’t need commissions enforced as a monopoly or through their anticompetitive steering policies (such as the CTF and their other anti-DMA shenanigans) to provide free apps.
Neither does Google - and their hosting more apps at lower per-user revenue.
Does reading Apple’s financial filings regularly - along with some third-party resources about their business - count as “some research”? 😂
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Apple remains, as ever, convinced they are the key to success here. I’d argue developers hold every bit of that success in their hands today. Look at the tepid developer story around AVP. Apple would be nothing were it not for developers. And we saw how bad those times were in the 90s. Lack of software nearly killed the company along with out-of-touch management making many of the same mistakes we see today (pencil product matrix anyone)… difference is the market cap insulates them from their arrogance.
I see no one touching on or challenging the fees related to dev tools. I’d say at 100$ yearly for Xcode that’s it’s barely worth the cost as it stands. A buggy mess. If this were a best of breed IDE well then you’d have a leg to stand on but developing for their platforms is not pleasant for any seasoned developer and their tools have been and continue to remain a stale, bug-ridden mess. True to Tim Cook’s Apple is the implied “don’t like it, fine leave” attitude. I’m sure this is too nuanced for the folks that want to blindly support Apple but you can admire or even love a platform but call out their insane antics and crappy tools. Those of us critical of Apple want them to do better because we’ve seen what Apple at the top of its game is like. This is a far cry from those days sadly.
I see no one touching on or challenging the fees related to dev tools. I’d say at 100$ yearly for Xcode that’s it’s barely worth the cost as it stands. A buggy mess. If this were a best of breed IDE well then you’d have a leg to stand on but developing for their platforms is not pleasant for any seasoned developer and their tools have been and continue to remain a stale, bug-ridden mess. True to Tim Cook’s Apple is the implied “don’t like it, fine leave” attitude. I’m sure this is too nuanced for the folks that want to blindly support Apple but you can admire or even love a platform but call out their insane antics and crappy tools. Those of us critical of Apple want them to do better because we’ve seen what Apple at the top of its game is like. This is a far cry from those days sadly.
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Says he won't respond to us again (😭), then responds again, immediately. Truly a man of convictions. 😂LOL
True, and I largely agree with the rest of your posts on this as well. Apple does make a lot of money from other fees. Apple and Google both take a ridiculously large commission. They certainly have a duopoly. They should be regulated, and they only have themselves to blame. But, I don’t agree with the idea that they should have to allow competitors to advertise their prices within Apple’s App Store. I also don’t believe Apple should be permitted to prevent a developer from advertising their own prices within their own app. I see your icon seems to indicate you a strong proponent of the DMA, and while I agree that these large tech companies should be regulated, the EU is going too far in many other areas.
DMA fans like to point out that revenue for the Apple App Store is higher than that for Android apps. In fact, the App Store garners a majority of the revenue even though iPhone accounts for only 30% of the smartphone usage in the EU.
Why is this the case? Because Apple has provided a premium product. It has a more affluent customer base that is willing to spend money on things they want. That makes the Apple customer base very attractive to app makers.
The question every business faces when it sells a good or service is how much they spend on customer acquisition. Do they build a terrestrial sales team, do they do email marketing, do they pay a service for messaging or a commission on sales, etc.? There are many ways to proceed, with each sales channel offering a different pricing structure.
Apple's customer base is an asset that Apple has built. Any direct marketing company would pay tons of money to get their hands on it. Indeed the internet is rife with companies that try to track users so that they can build such lists. You can buy a mailing list of Apple customers (certainly not complete nor accurate nor completely current) for $200 to $400 dollars. But that is a one-time access. You will pay each time you use it.
Apple, on the other hand, provides 100% accurate and up-to-date access to active iPhone users on a sales-commission basis. If you don’t like that, find another channel. Perhaps go to Android, where people don’t buy stuff. It isn’t a good customer base, but you get what you pay (or freeload) for.
The question you should ask yourself is, given that direct marketing is a multi-billion-dollar-per-year market, why should Apple not be allowed to monetize its customer-base as an asset? Almost every other company on the internet does it, even if only indirectly by selling media space for ads. If you understand business, you know that the customer base is the most valuable asset a company has.
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There is a whole bunch of misunderstanding out there on Google v Oracle.
The Supreme Court ruled that Google’s use of Java APIs was fair use in that specific case. The decision did establish that the “fair use” test should be used to determine whether the copying of code is allowed, but completely punted on whether or not APIs can be copyrighted.
It most certainly did not say all APIs “can be used without payment or permission.”
That’s not to say Apple would win if it sued a developer for using its APIs without following the terms and conditions of the developer agreement, but it isn’t a slam dunk case like I see repeated on here all the time.
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Anti-steering is to prevent or limit business users from guiding their customers or end-users towards alternative services. It’s a text book example of it.
This doesn’t make any sense. Why should a different product from a different company advertise inside a store that doesn’t even sell their product?
Go to Costco/Walmart or whatever relevant store. When Apple products are sold or Microsoft products or any random product. They always advertise their own store inside the product
It hasn’t, it’s just been in a grey zone as it hasn’t been brought to court. But as most legal cases we can see a clear distinction that apples behavior have been illegal from the beginning. Apple say it’s their IP.
EU thinks it’s the users property because they bought it, and downstream from that it logically follows that it’s not a right of Apple to be the middleman between two separate entities.
Well this has already been settled. You own iOS as it’s an integral component of the iPhone hardware you purchase, and therefore constitutes a sale.
1. Sale of Goods Directive (2019/771):
• The Sale of Goods Directive (applicable from January 2022) provides some clarity by addressing the inclusion of digital content with physical goods. According to this directive, if digital content (such as an operating system) is essential for the proper functioning of the hardware and is pre-installed, the entire package (hardware + software) is treated as a single unit for purposes of sale.
• This means that when digital content is integrated or required for the goods to function properly, the consumer has rights over the entire package as a purchased item. This suggests that, from a consumer protection perspective, the sale includes both hardware and software, at least as far as the buyer’s rights to a functioning product are concerned.
2. Bundled Software as Integral to Hardware:
• EU law recognizes that certain software is essential for the functioning of hardware. When software is pre-installed and integral to the functioning of the device (e.g., an operating system on a phone or computer), courts and legislators have generally treated the entire package (hardware + software) as a single unit for legal purposes, even though the software might technically be “licensed.”
• For example, in the Case C-166/15, David Ginés Ruiz v. Samsung Electronics Iberia (2016), the CJEU ruled that pre-installed software could not be dissociated from the hardware, and thus the two are treated together as part of the sale.
EU law and case law tend to approach bundled hardware and software on a case-by-case basis, but the general principle is that if the software is essential to the functioning of the hardware, the sale of the hardware may be interpreted as including the sale (or at least a form of transfer) of the software, especially under the doctrine of exhaustion of rights. However, if the software is licensed separately or has unique licensing terms, it may not automatically be treated as part of the hardware sale. The UsedSoft v. Oracle case provides critical guidance on how software licensing is treated in the context of sales in the EU.
I’m sorry but it’s actually what it heavily implies.
But we already have other rulings and laws in EU that is more clear and more relevant.
European Court of Justice ruled in (CJEU, 2 May 2012, Case C‑406/10) that application programming interfaces (APIs) and other functional characteristics of computer software are not eligible for copyright protection. Users have the right to examine computer software in order to clone its functionality—and vendors cannot override these user rights with a license agreement, the court said.
As the Court reminds, copyright in a computer program cannot be infringed where the lawful acquirer of the license did not have access to the source code of the computer program to which that license relates, but merely studied, observed and tested that program in order to reproduce its functionality in a second program.
Oh, I fully agree with that.
Does or did anyone expect or demand to advertise their non-app-store pricing in Apple‘s App Store though? I‘m not aware of that. The crux of the discussion is third-party developers being prevented from doing it in their own apps (the equivalent of the opened product box, once it‘s been delivered to the customers by the store). Whereas Apple intends to demand commissions even months after a consumer has downloaded and interacted with an app and even when pricing information has been sent to him by email or other channels.
Apple does not "acquire" customers for Spotify. Especially not given how blatant they're advertising their own streaming service competitor over and above Spotify's. And neither does Apple acquire them after the Spotify app has been downloaded to a consumers' device and used by that consumer.
Likewise, the European Union and its Digital Markets Act prohibits Apple from monetising access or IP in a few specific cases and circumstances.
They certainly do not say or mean Apple's intellectual property or operating system have to be "given away for free".
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As you well know, we vehemently disagree here.
It appears the EU is going to tell Apple they can't charge developers for the use of iOS if the developers don't put their apps on the App Store; that the CTF will not be allowed to be charged. Under the DMA, how is Apple allowed to charge developers who are not listing their app on the App Store for the use of Apple's IP? If Apple is not allowed to charge these developers to use its property, how is that not theft of Apple's IP?
Because we've argued this on several threads now, I know you'll say "Apple can charge the $99 developer fee and that counts as charging for their IP". We've already established that that is not what the $99 is for. But, for the purposes of the argument, fine you win - the annual developer fee is the payment to license Apple's IP.
Given everything that has happened with the EU and DMA to date, what makes you think the EU is going to be ok with Apple forcing developers to join the Apple developer program, especially if they are not using the App Store? You really mean to tell me the EU is going to say a developer has to pay up if they're using NO other Apple services? Especially after Apple changes the annual cost of the developer program in Europe to something like "Individual Developers and Companies with <$1m in global revenue: $99. Companies with $1m to $10m in global revenue: $50,000; Companies with $10m to $100m: $200,000 Companies with $100m to $1 billion in global revenue: $5m", Companies with over $1 billion in global revenue: $50m? Because that is absolutely where we are going when Apple is told it can't charge the CTF.
Nope - I promise you the EU, and its defenders on here, will say "that's not reasonable; the fee has always been $99 and so it has to stay $99." Maybe if Apple is lucky the EU will let them raise it slightly, or index it to inflation. Or they'll say "the fee can be as high as Apple wants, but it has to be the same for every developer and company regardless of size" knowing full well that means Apple will keep it low because Apple wants students, hobbyists and small businesses to be able to develop for iOS. So yes - the EU will be telling Apple that it has to give away its IP for free (or close to it).
I mean, the same EU Commissioners are laughably warning
The Commissioners told Meta "you have to offer a version of Facebook without ad tracking." And then when Meta does so, and offers no tracking Facebook at a price where most analyst think that Facebook is making less money than they do with tracking, rather than saying "thanks for complying," the EU immediately says "WRONG! You can't just offer two options: Facebook for free with tracking or paid with no tracking, you also have to offer it for free with no tracking" And how much do you want to bet the EU will say Facebook can't increase the number of non-tracked ads shown to users who select that option to offset the fact that non-tracked ads will earn Meta almost nothing, because what company wants to use non-tracked ads.
If the EU decides the CTF is allowed, or Apple can charge developers who create iOS apps a fee that Apple finds reasonable to develop for iOS, then sure I'll agree that they are "prohibiting Apple from monetizing access or IP in a few specific cases and circumstances.
But literally nothing I have seen from the EU gives me confidence that is the case. They just play Calvinball and change the rules. Verstager says 5 years ago she wants Facebook to offer a paid version with no tracking? Well in 2024 that's not good enough. The EU doesn't write the DMA to say Apple can't charge for its IP - well we get to decide what the "spirit of the law" means, too bad.
They should just write a law that says Gatekeepers can't charge for their IP - but they won't, because even they understand how obscene that is (and if a miracle happens and somehow an EU company becomes a gatekeeper, they don't want to hurt themselves). This way they have plausible deniability and can say it's just because the big bad American gatekeepers trying to "comply maliciously".
I‘m not seeing any indication. Reading their press release, it seems quite clear that their issue is with Apple's anticompetitive steering towards Apple's own store. Not the fees itself.
"Apple has so far kept the option to subscribe to the previous conditions, which do not allow alternative distribution channels at all."
And:
"Apple's Core Technology Fee, under which developers of third-party app stores and third-party apps must pay a €0.50 fee per installed app. The Commission will investigate whether Apple has demonstrated that the fee structure that it has imposed, as part of the new business terms, and in particular the Core Technology Fee, effectively complies with the DMA."
Again, no indication that the CTF per se would violate the DMA. But if it (overwhelmingly) prevents business users from making use of the rights provided by the DMA, it can - and likely will - be found noncompliant.
And IMO that's exactly what it was (maliciously) designed for, along with their keeping "legacy" business terms: To discourage business users from making use of the provisions introduced by the DMA.
Yeah, that‘s exactly what they should do:
Demand and mandate fair and equal - or equitable - terms of access.
And that includes getting rid of the unjustified differentiation between digital goods/services and others.
Cause with all the talk about "using IP", costs of "developing and maintaining the system", Spotify are not benefitting from it any more than Uber (quite the contrary!).
No - mandating uniform pricing is not forcing someone to give away its IP for free.
If Apple want to keep it low, that's their their choice of "giving it away for (almost) free".
And there's a good reason why they'd want make that choice - cause it benefits them: Low entry barriers to app development and publishing for iOS are among the main reasons why iOS has become so popular. Why Apple has an iPhone business at all today, IMO. And why they've cornered the market to operate in a de facto duopoly with Google.
Giving away their IP for (almost) free to companies like Uber, Doordash and Booking.com and my local train operating company and charging them nothing on in-app transactions - while "taxing" sellers of digital goods/services through the roof while competing with them. That is the unfair thing and unjustified differentiation that government should prohibit - at least for gatekeepers with the market power of Apple and Google.
If I was the lawmaker or regulator, that's what I would mandate in no uncertain certains:
- If third-party developers (or Apple themselves) are allowed offer in-app purchasing, ordering or subscribing, they'd have to allow the the same payment methods, whatever they're selling.
- ...and Apple charge the same commissions on such sales.
And if I can order a paperback book, music CD or movie DVD with my credit card, so can I purchase an eBook or audio book from the Amazon Kindle apps - using the same conditions and payment methods. It's a market for digital goods and services - and there's very good reason for government to prohibit Apple from anticompetitively discriminating against "digital" businesses.
👉 For clarity's sake: I have (from a "political" perspective) no objection to Apple taking a 30% commission on my Spotify in-app transaction - as long as it's the same for ordering a pizza or buying the train ticket of the same value (and using the same payment method).
But benefitting from low entry barriers for developers, from "free" apps with "free" in-app transactions, so much to become one of only two relevant mobile operating systems in the world - and then leveraging that power to selectively "tax" the businesses that have no reasonable alternative to provide their service/product - that needs to be abolished.
Giving away your stuff to become a monopolist (or duopolist) - and then using that market power to selectively "tax" your competitors in other markets (music streaming) or the ones that depend on that platform - that's having your cake and eating it, too. And that needs to stop.
Apple has an integrated platform which provides app makers with messaging (for customer acquisition), a sales channel, payment processing, and digital-product fulfillment. It reaches affluent potential customers who have a proven propensity to pay top dollar.
Messaging and targeting are multibillion dollar industries, as are different sales channels and fulfillment. The vast majority of properties on the internet are built specifically for these purposes. Apple has no shortage of competition for building a valuable digital-customer base.
Why, after spending 10s to 100s of billions of dollars to create the modern smartphone and building the most valuable customer base, do you think Apple shouldn’t be able to monetize their assets the way thousands of other companies do?
Apple isn’t a monopoly because no matter how you slice it, it only reaches 30% of the EU market. It sure isn’t a public infrastructure, because the phone is merely an access terminal to the infrastructure. It isn’t for the sake of innovation because the major complaint we hear on this forum is that Apple’s App Store has stifled competition by disallowing 20+ year-old download technology and 20+ year-old emulator technology (which is designed to mimic 40-year-old technology), both of which are aides to violate copyright laws.
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You know, I thought some were saying it, but now I think I simply misunderstood what the actual ask was
Of course, yes, but only if you comply with the laws of the country in question, in this case the DMA Act.
If Apply can't or won't comply and still want be in EU market, it might have to pay aa stiff fine. Maybe, Apple just loves to pay fines, as it is just shareholders' money. 😏
They are (have been) been a monopoly on iOS.
They are a duopoly with Google in mobile operating systems.
They are estimated to account for more than half (a majority) of mobile app spend, yet…
It certainly isn’t a small luxury supplier like Ferrari in cars.
It does. Nobody (used to) compete on sales of digital products/services for the millions of iOS users.
And no one but Google does on mobile operating systems.
Apple provides is an intermediary between many thousands of businesses across all kinds of industries and millions of business users. It lacks competition, their commission pricing isn’t set competitively.
And having become the richest company in the world over just a few years, with products that consumers spend as much time with and interact as much with as they do, indicates that they aren‘t some random company and this isn‘t some random business like thousands of others. Smartphones have profoundly changed the way we communicate and organise our lives and interact with businesses - and Apple serves as a gatekeeper between those businesses and consumers.
Age doesn‘t matter. If someone stifles competition for 100+ year vehicle propulsion fuel (gasoline) that‘s important.
It stretches credulity to say “[Apple] are […] a monopoly on iOS”. iOS is a component of the iPhone. It is not a product that is sold to other manufacturers. It is not a commodity. It is not a service. It is not a product category. It is a part of the iPhone product, a proprietary technology. No one can go out and buy iOS for their Samsung or Xiaomi phones. It simply isn’t a product or a service or a market to which one can apply the term “monopoly”.
And, since iOS is a proprietary product component not for sale or license to OEMs, it is inappropriate to consider it part of a market duopoly.
There is a reason why more than half the mobile apps sold in the EU are sold for iPhone. It has to do what I have been talking about Apple’s user base. Apple attracts more a more affluent user, ones who by their very purchase of an iPhone has a demonstrated propensity to pay for premium products. This limits Apple’s reach to minority, but respectable, 30% of the EU smartphone market. This even though only ⅔ the number of apps available on iPhone as on Android.
Apple competes with Google, Huawei, Samsung, Nokia, and others. Clearly those others are doing something right since they have garnered a super majority of the sales. The Apple App Store commissions compete against the commissions charged by the app stores on those other platforms. If you don’t like the way Apple’s App Store structures commissions, buy a phone which gives you more options. I recommend one of the higher-end Samsung Galaxy phones. They are every bit as good as, and on some measures better than, the iPhone. They run Android, which has multiple App Stores with different commission structures. Plus, Android apps can use many different payment processors (e.g., Google, PayPal, Stripe, Square, Amazon, and at least as many others). To top it off, Android has over one million more apps than are available on the iPhone. Honestly, I don’t see why you have an iPhone when the competition is clearly superior on the features you prize most.
Apple being the richest company is irrelevant. But, since you mention it, the reason Apple has become so profitable is their integrated set of products which offer additional security due to their walled garden. They don’t even have ⅓ the sales of others in the EU, yet customers with money prefer them. In other words, they have become “rich” because customers value the things the EU wants to destroy.
Rather than make up new laws to penalize the innovators, why not let consumers vote with their pocket books? You see, that’s what has been happening. A supermajority of EU consumers have rejected Apple and prefer the EU-politician-preferred feature set of Android. Let Apple live or die according to the value proposition they offer to customers.
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