Apple Discussed 'Punitive Measures' Against Netflix for Dropping In-App Purchases

[quarkysg]

That cuts both ways. Where would Apple be without the vibrant app developer community?

Besides, people forget that the original iPhone didn't have an app store when it came out. Jobs envisioned that everyone would use web applications at the time, which wouldn't allow Apple to play these games.

My memory is a little cloudy, but before the App Store, was there a vibrant developer community for the mobile/PDA app market? There should be one correct, since there's already a lot of mobile devices capable of installing apps before 2008?

I remember carrying a Palm IIIc back in the days, but I don't seem to find a lot of apps I can install for it. Ended up using it as an organiser and an offline news reader while travelling on the train to work. Those were the days ... but I digress.

 

[DeepIn2U]

And here you go.. Apple has no right to ask this, I think Epic Games deserve to win! to stop some of the shady stuff apple is doing.

What exactly are you referring to as Apple being shady?

- they engaged Netflix, tried to work with them.

Netflix:

Netflix was concerned about voluntary churn levels on iOS because it was higher than those who signed up via the web. In a nutshell, iOS users who subscribed to Netflix through in-app purchases were cancelling their Netflix accounts at a greater rate, an issue that Apple worked to solve for Netflix

^ because iOS users saw better alternatives as competition rose: Hulu, etc In the USA.
Funny because last quarter Netflix is once again either seeing churn or a ceiling in their subscriptions: thank you Disney+ (that’s competition and a really GOOD one at that.)

Other Netflix concerns included free trial abuse (which Apple addressed), un-grandfathering (raising prices on users locked in to a select price), and offering promotions (wasn't possible to offer discounts on iOS). Apple internally discussed ways to fix these problems for Netflix to encourage the company to stick with in-app purchases.

Apple address free trial abuse - that’s HELPING Netflix nothing shady there.
BUT Netflix wanted to un-grandfather users that locked into a select price that THEY NETFLIX offered?! THAT is shady business to me! cellular providers try this crap ALL the time - it’s NOT fair competitive action and it’ll cause major churn of users. Users have a specific need for specific service - they have the price they agreed upon. cell providers try screwing around with switch settings in their towers or network and then pushing users with BS about changes that ‘no longer allow their grandfathered pricing’ for features or changes they never asked for.

Like when did Netflix EVER offer promotional pricing on iOS? I’ve never seen it in 4yrs on iOS here in Canada, is this USA focused only? WHY couldn’t Netflix offer promotional pricing - exactly? What stopped them? Surely not Apple as I’ve seen various developers and services offered through iOS App Store doing exactly this for almost 10yrs. I smell BS on Netflix’s part.

Apple proposed continued coordinated featuring across iOS and Apple TV, ads promoting Netflix, App Store email campaigns, featuring performance data, an "Apple TV bundle" and select video partner program benefits such as the option to up-sell non-IAP customers and billing flexibility to un-grandfather and cancel subscription charges.

Apple here literally bending over backwards and a full 2-handed reacharound to help Netflix!!

Sorry but your view is completely unfounded of Apple being shady here.

 

[quarkysg]

What Jobs envisioned is irrelevant, didn't come to pass by his own hand.

I'm very sure the App Store is on the cards. It's likely just not ready when the iPhone was launch. I remember Apple has to move OS X engineers to work on iOS to meet the Oct launch deadline. It's quite unlikely they have any bandwidth left to even start on the SDK.

Jobs saying the alternative are web-apps is just deflection on his part.

 

[DanTSX]

Apple is the greediest company in the world. They take extracting money out of others to ridiculous levels in every product they sell.

And we love them for it, ok.

 

[DeepIn2U]

"We do not retaliate or bully people. It’s strongly against our company culture.” - Tim Cook.
So that was a lie under oath.

What in this article backs up your opinion here? Absolutely nothing.

 

[DeepIn2U]

C'mon Apple, you can't have your cake and eat it too. You can't tell developers that they need to make sure any in-app purchases go through Apple so that Apple gets a cut and then try to force them to make all of the purchases on their platform go through the app.

Then lets see developers create their App Store with the funding to handle refunds, dispute claims a proper system of oversight that’s independent.

I still haven’t seen ANYTHING close or even what you hint at as being better.
PS4, XBox, Steam, etc etc etc. All play the same game. Developers swallowing all the entire cost of: Advertisement, SDK Purchases, hosting of their apps on the web (bandwidth, download thresholds or unlimited downloads/uploads, issues with updates that are not working, disputes of broken updates/apps, etc). There is a LOT more yet to be discussed on Apple’s (and other platform) fees here in this case not yet mentioned.

 

[DeepIn2U]

That business of not allowing companies to tell users where they can sign up for services is absolute crap. If allowing clear communication in app design costs Apple money, then so be it; good design must come before greed, and greed is what this is.

I'm not an Apple hater—I've been a customer for thirty years—nor am I a defender of Epic, but Apple strong-arming vendors into using its payment system puts them in a very distasteful light. Especially when it results in decisions that affect users (and especially given how much they like to style themselves as principled defenders of user interests).

And let me be clear, I'm not interested in empty platitudes about how Apple can do what it wants on its platforms. Repeating the obvious contributes nothing; please don't do that here. I'm not saying Apple can't do this. I'm saying they shouldn't.

I honestly don’t think it’s “crap”

Sure companies could tell users wher to sign up - but as we’ve seen with cellular providers, cable companies, etc … pricing is regional based, seasonal based, metric based, or like all the above ‘at the whim’ of their marketing/sales departments.

What you get for say Netflix monthly charge where you live, vs where I live should be currency equivalent - unfortunately it’s not. Your deals are not offered to me where I live. Population could affect this - but it should also be considered the same demographic (population) should also affect cost of distribution/bandwidth of streams of their hosting platform costs as well.

Apple is trying a balancing act that benefits their customers but keeps the $$$ flowing into companies coffers.

Why Does this have to be some major court case vs first coming together as a consortium (Epic and others) to work with Apple, discuss their needs gripes etc first … go at it for 6mths work on this get it done. No this is greed … if anything on both sides.

 

[wigby]

Just because they didn’t do it doesn’t mean it shouldn’t be opened up for discussion. Regardless of your view, it’s messed up that they were even considering punishing them. That’s going too far.

If we’re going to open discussions on what tech companies are just contemplating doing, I think Facebook, Amazon and Google are much more dangerous than Apple and should be addressed first.

 

[DeepIn2U]

The reason Netflix saw a higher churn rate on iOS vs web is that Apple makes it easier to track and manage subscriptions on their platform. On web, it is easier to snatch someone's credit card and charge it for a year without them remembering they have a subscription.

In this scenario, in-app purchases/subscriptions are a benefit to the consumer.

BINGO!

 

[quarkysg]

The point was that people will always find ways to be dumb, at some point you have to stop babying them.

As they say, prevention is always better than cure. So Apple designed iOS to be different from macOS from the scare the world got from the W2K virus debacle.

If anyone wants to live differently, there's always the Android option.

 

[DeepIn2U]

I've always said Apple shouldn't get a 30% cut of Netflix or Spotify subscriptions. They literally have nothing to do with people using the service, the content is all hosted and streamed from Netflix. This is an area where having Apple Pay as an option would make sense, where Apple gets a small processing fee, but that's it.

Really?

hmm. Apple creates 3 awesome platforms with years of support to both developers/companies and the end users:
OS support (TVOS, iOS, iPadOS),
SDK always updated and if your code is good or great your app will work,
Distribution and Bandwidth - developer/company uploads 1 time (NO COST), and reaches over a billion devices and users!
Marketing - 1 simple writeup and Apple helps you continually advertise, relate to your competition towards end users, vastly superior search for your wares. Again at NO COST to you or the end user really. VERY important if your logo or your app is similar to others.

 

[boss.king]

If anyone wants to live differently, there's always the Android option.

Or regulation.

 

[quarkysg]

Or regulation.

Only if Apple is found to break laws. I don't see this happening.

 

[UBS28]

Apple is the greediest company in the world. They take extracting money out of others to ridiculous levels in every product they sell.

Absolutetly. Microsoft sells their consoles at a loss, that is why they charge 30% commission on the games, that is their source of income.

However Apple, has huge margins on every device they sell, yet they want the same 30% commission that Microsoft charges?

 

[UBS28]

Really?

hmm. Apple creates 3 awesome platforms with years of support to both developers/companies and the end users:
OS support (TVOS, iOS, iPadOS),
SDK always updated and if your code is good or great your app will work,
Distribution and Bandwidth - developer/company uploads 1 time (NO COST), and reaches over a billion devices and users!
Marketing - 1 simple writeup and Apple helps you continually advertise, relate to your competition towards end users, vastly superior search for your wares. Again at NO COST to you or the end user really. VERY important if your logo or your app is similar to others.

Please, Netflix is not build in Xcode at all. The iOS app, is just a “viewer” so to say to display what is being run on Netflix their own servers. The actual code is being run on the side of Netflix, including the servers.

You must be out of your mind that Apple requires 30% commission for “marketing”, when Netflix is not famous because of Apple. Apple literally has nothing to do with it.

My Samsung smart TV also has apps like Netflix and it even comes pre-installed. That is more marketing than what Apple has ever done for Netflix, and Samsung does not get a 30% commission.

 

[deevey]

Did they need authorization? I didn't get the sense that Netflix did anything wrong here, nor did Apple, and the word "punitive" is getting a lot of attention but just doesn't fit the action described...

I would have assumed that you are either in or out. An A/B test would require the downloaded app to have undisclosed dual functionality. Perhaps I was wrong, but that was my take on it.

In any case, they did it, and decided that IAP's were not making enough difference to warrant the percentage.

 

[deevey]

My Samsung smart TV also has apps like Netflix and it even comes pre-installed. That is more marketing than what Apple has ever done for Netflix, and Samsung does not get a 30% commission.

If Netflix was installed on an iOS device by default, I guarantee there would be immediate law suits from other streaming companies against Apple for playing favorites.

The play store has had a loophole which allowed apps like Netflix to charge without paying commission, the loophole is closing in September. So you'll either be subscribing directly through the Netflix website, or side loading via Samsung (maybe). Apple just got their house in order first.

Google plans to shut the loophole that lets Netflix, Spotify, and Tinder avoid paying its 30% app tax

Google also said in a blog post it will make it easier for users to install alternative app stores to its own.

www.businessinsider.in

Advertising and marketing comes in many forms from regular adverts, product placement to lead generation. IAP's are most similar to the latter.

An impulse purchase in-app that requires a single gesture for many developers is far more lucrative than their customers going out-of-app to subscribe elsewhere and lose interest at checkout.

 

[Krizoitz]

You wouldn't be forced to use it, so you could stick your head in the sand and pretend it doesn't exist and nothing would happen. It's a change that would impact your life in literally no way.

On the topic of what a company should or shouldn't be FORCED to do, that's up to the law. I'm flattered that you seem to think I'm the one making this decision, but I promise you it's a much larger movement.

As for my options, you seem to have missed one:
5. Continue buying Apple devices because I like them, and wait for the inevitable regulation.

Yes I would be forced to use it because it would change the nature of iOS, and likely apps I can currently use now would be pulled and put in alternate App stores. Meanwhile my only alternative would be the same experience (Android) or no experience (no phone) so again you want to reduce people’s choice rather that buy a phone that already does what you want.
And I am under no impression you have the power to cause things to change but you still want it to be done. Supporting a terrible idea is worthy of criticism and you definitely do support a terrible idea.

 

[Krizoitz]

Not true. Government have broken up large companies before. Look up Pac Bell. They were AT&T and they broke them up because they got too powerful. If the government deem Apple to be too large for the US, they can simply break them up. That is why all the big tech are self watching themselves right now because the government have a study going on at the moment. They are seeing if these huge tech companies need to be broken up so they'll be more competition and to help better serve the consumers.

You think Apple wanted to drop their 30% rate? Nah.. they know if they push too hard the government will come down w/ a hammer. Look at MLB and their steroid program. You think they wanted to implement that? The govt got tired and stepped in.

They were a monopoly, Apple isn’t even close.
And no, the government can’t just on a whim decide a company is “too big”. That’s not what anti-trust legislation says, there are criteria involved. Could they create a NEW law that gives them that power? Maybe, though the Constitution still applies and it would definitely take time to get any such law passed.
MLB is also a bad example as the govt already had grounds to look in to MLB because:
A. They are a monopoly (Apple still isn’t)
B. There were special laws in place already regarding MLB

 

[AndiG]

Really interesting to read some of those comments. Some people seem to be truely in love with Apple, ignoring the facts that Apple is just a company - it is not your new god - and as a company lead by humans it is also prone to errors.

In respect to this, Apple needs to be regulated since it can not regulate itself. We the people make the rules. Neither Apple nor Google do.

 

[Krizoitz]

Absolutetly. Microsoft sells their consoles at a loss, that is why they charge 30% commission on the games, that is their source of income.

However Apple, has huge margins on every device they sell, yet they want the same 30% commission that Microsoft charges?

So Apple should be punished because the game companies are terrible at making and selling their consoles? That makes zero sense.
Microsoft charges 30% because they’ve decided that’s how much they think they can and still get enough developed.
Apple also charges 30% for the same reason. The profit or loss on the respective device is irrelevant, companies who make Apps/Games don’t care, they only care if they can make money or not selling on the platform. Either they can and they do, or they can’t and they don’t. It’s a choice. None of them have the right to sell on Xbox or the AppStore nor should they.

 

[Krizoitz]

Please, Netflix is not build in Xcode at all. The iOS app, is just a “viewer” so to say to display what is being run on Netflix their own servers. The actual code is being run on the side of Netflix, including the servers.

You must be out of your mind that Apple requires 30% commission for “marketing”, when Netflix is not famous because of Apple. Apple literally has nothing to do with it.

My Samsung smart TV also has apps like Netflix and it even comes pre-installed. That is more marketing than what Apple has ever done for Netflix, and Samsung does not get a 30% commission.

Again either Netflix feels like IAP and the 30% cut is worth it or they don’t. It doesn’t matter one bit how much or little code is in their app, this isn’t a merit based argument it’s “this is the fee if you want to participate”. Either it’s worth it to you or not. If not, fine, you can still put an App in the store for free, but it has to meet certain guidelines. If THAT isn’t ok then you don’t get your app in the AppStore. It’s a choice every developer makes, not one of them is forced to make an app OR ELSE. 100% voluntary.

 

[Krizoitz]

Really interesting to read some of those comments. Some people seem to be truely in love with Apple, ignoring the facts that Apple is just a company - it is not your new god - and as a company lead by humans it is also prone to errors.

In repect to this, Apple needs to be regulated since it can not regulate itself. We the people make the rules. Neither Apple nor Google do.

You have to make a case for WHY the govt needs to regulate them and either what laws they are currently breaking or what new laws need to be passed first. The govt can’t simply wave its hands and “regulate” because they feel like it.

 

[jinnyman]

If Apple wasn't offering their streaming service, I'd be on Apple side, but since they also offer Apple TV, I'm on Netflix side. It's unfair for Apple TV to offer at practically discounted price compared to netflix. What if Apple does another new business that would hurt already established business through apple platform?

 

[quarkysg]

In repect to this, Apple needs to be regulated since it can not regulate itself. We the people make the rules. Neither Apple nor Google do.

I'm quite interested to know what rules you are making tho. I'm only aware of customers voting with their money to buy products/services any company makes/provides. I'm not aware that normal folks can also dictate what a company can/should and cannot/shouldn't do. Do tell so that everyone can start exercising their rights.