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

[csilverman]

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.

 

[UKitsme]

yes, all this shows is that Netflix took a decision not to use in app purchases to save 30% and obtain a better churn rate, they didn't kick up a fuss and issue proceedings, why can't Epic do same, if you don't like it then don't use it no one is forcing you to?

 

[nwcs]

A lot of people here would be shocked, SHOCKED, to find out what actually happens at the exec level of any small to giant company. Nothing at all surprising in this disclosure. Quite yawn inducing, really. It’s easy to throw out terms like greed and overreach and such but if you were hired to be an executive at any company you’d be singing a different tune. Quite a world of difference between the real world and the fairy tale world where everyone lives in their private utopia and everyone gets along like Care Bears or something.

 

[Glideslope]

This is a good example of Apple almost going too far.

There is always that line not to cross. I don't see it crossed here. Apple, Microsoft, Google, FaceBook, Epic, Steam, Ford, GM, AA, United, Delta, Nabisco etc...... all have these types of discussions. It's simply more orgasmic to pile on Apple in 2021.

You want to live in a Capitalist Economy? This is it.

 

[BvizioN]

Ok, so you have an app in the AppStore, which people can download but can not sign up for!! Forcing users to join from some backdoor, removing the choice for consumers who perhaps want all subscriptions in one place. But hey.... at least Netflix knows it is a hassle so that's OK.

 

[MarckyG]

Well, I bet there are a lot of greedy business people working at Apple.
So things are discussed, I bet a lot of things that would shock us here. But just like Timmyboy said "We do not retaliate or bully people. It’s strongly against our company culture.” and so they did neither bully nor retaliate against Netflix. Sounds okay to me so far... regarding there are always some shady or baffling things happening under the surface of such a gigantic company.

 

[Glideslope]

A lot of people here would be shocked, SHOCKED, to find out what actually happens at the exec level of any small to giant company. Nothing at all surprising in this disclosure. Quite yawn inducing, really. It’s easy to throw out terms like greed and overreach and such but if you were hired to be an executive at any company you’d be singing a different tune. Quite a world of difference between the real world and the fairy tale world where everyone lives in their private utopia and everyone gets along like Care Bears or something.

The majority of members on these forums have never run/owned a business. Pretty obvious actually.

 

[Jakuta]

Ok, so you have an app in the AppStore, which people can download but can not sign up for!! Forcing users to join from some backdoor, removing the choice for consumers who perhaps want all subscriptions in one place. But hey.... at least Netflix knows it is a hassle so that's OK.

Do you really consider Netflix's web site "some backdoor" or were you just trying to be snarky?

 

[GeoStructural]

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

Exactly. Your comment will cause some hyperventilation here because MR is full of blind fans, but I cannot even imagine paying 30% of my income to someone, especially for something I don't even need.

And they’ve been found guilty of illegally colluding with book publishers to raise prices of ebooks in the past. Something that lots of people on this forum supported. Bafflingly.

Yes, and they also broke the license agreement with Qualcomm unilaterally because they considered it unfair, Apple did to Qualcomm exactly what Epic did to them and now they are complaining.

 

[DotCom2]

A U.S. company, in a Capitalistic society, trying to make as much money as possible. Who'da thought?

 

[macintoshmac]

I dont see anything here. A business manager asked a question about what the company should do. Thats not "apple" doing anything here.

Then they discussed working with Netflix to improve the experience etc.. Again what is the deal here? Apple works with companies that add significant benefit to their products.. is that news?

Finally, Netflix seem to have decided that the churn rate for sign ups via the app were even more of a problem than the 30% cut ( which would drop to a lot lower after 1yr right?).

What am I missing here?

What you are missing is that Apple tries to play God and use its position in the market (propelled both by great products and services as well as through devoted Apple fanatics that think Apple can do no wrong) to punish a developer on their platform for seeking its own interests. Literally, the words were 'punitive measures'. That is what you are missing.

Then, their own will to bend the rules to keep Netflix on with IAP, trying to offer them benefits clearly not provided to all developers paying the same $99 fee. That is also what you are missing.

 

[jmgregory1]

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.

It’s a complicated position for Apple to be in - their billion+ device base can drive significant revenue for a developer or brand like Netflix or Epic - and it’s a proven market of consumers actually spending money. Allowing apps to be ”free” on the App Store, then have them charge consumers IAP’s because they can skirt paying Apple would be like a brand getting Walmart to stock their product in all 4500 stores where the product is free, only to have consumers have to pay directly to the brand once they take the product home. Walmart would never go for that, nor should any store be ok with a scenario like that.

 

[soa]

Apple spent the last 15 years building an ecosystem across all of their devices and now other companies want to use it for free. lol. why am I paying rent again? shouldn't everything other people worked for be free for everyone else?

 

[BvizioN]

Do you really consider Netflix's web site "some backdoor" or were you just trying to be snarky?

Probably not, but what happen to choice? I do not want to join on their site if I am using the app. But honestly, its Ok because with so much to go around (Prime, Disney, YouTube, Apple TV, etc) and with Netflix catalog getting pretty poor by day, that is not going to be a big deal.

 

[jetrois]

I dont see anything here. A business manager asked a question about what the company should do. Thats not "apple" doing anything here.

Then they discussed working with Netflix to improve the experience etc.. Again what is the deal here? Apple works with companies that add significant benefit to their products.. is that news?

Finally, Netflix seem to have decided that the churn rate for sign ups via the app were even more of a problem than the 30% cut ( which would drop to a lot lower after 1yr right?).

What am I missing here?

Exactly what are you missing. Its pretty easy to go OTR anytime. just because we don't have a record of it dosnt mean it doesn't exist.

I love apple but most of you guys sitting here talking about how apple built the platform. Yes and third party devs are what made that happen without the developers the app store would have flopped. apple mostly makes money on hardware the software to me can be kinda muddled who owns what does apple own the software or are they selling it I mean really think it through. who owns an iPhone.

 

[I7guy]

Based on some of the comments, discussion is now grounds for Apple losing?

 

[m11rphy]

I just want Netflix to be in the unified TV app

Agreed, I wish apple would ban Netflix from iOS until they integrate with Apple TV it would be far better for us consumers

 

[genovelle]

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

They are a business and to have people use their platform to access customers they marketed to get and support for free is dumb.

 

[I7guy]

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

Maybe that is so, but I say vote with your dollars, if one doesn't like the way the company is operating or doesn't like their products. In the meantime, most companies charge what the market will bear.

 

[BvizioN]

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.

Of course they can and they have. Their store, their rules. As a developer, you are free to not use their platform if you don't like their rules. Who gives you the right to run a free business in someones store?

 

[m11rphy]

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.

Should LG be able to put a sign up in Best Buy saying buy this TV from our website instead?

 

[rjohnstone]

Apple spent the last 15 years building an ecosystem across all of their devices and now other companies want to use it for free. lol. why am I paying rent again? shouldn't everything other people worked for be free for everyone else?

No dev uses the App Store for free. You have to pay to be listed... annually.

Apple App Store would be nothing without these third party devs. It's a mutually beneficial arrangement.
Apple devices brought people in... an abundance of quality third party apps keep them there.

 

[Sensa2004]

Even though they didn’t do it, this speaks to Apple’s greed and overreach in how they view their control of the App Store. Why would hosting the app on the App Store entitle them to 30% of subscriptions Netflix makes through the app? Absurd. I hope they get crushed in this case.

It doesn't speak to that at all. Apple was "boosting" netflix by providing "free" cross promotional advertising for their service. When it came apparent that Netflix was going to stop allowing in-app sign-ups, thus cutting Apple revenues from their product to ZERO, it was a legitimate response for Apple to consider no longer providing "free boosting" or advertising of Netflix which would be worth a substantial sum if Netflix actually had to pay for this free advertising. The choice of the word "punitive" wasn't great to describe what was otherwise a legitimate question / response to a significant loss of revenue.

The practise, of co-branding, is common. Every time you see your local furniture store promoting a particular Brand in an Ad they are doing so because that Brand will compensate them for an agreed upon portion of the cost of the Ad. If the store stopped selling their product the Brand would take "punitive" measures by no longer co-sponsoring their advertising.

And the record shows that Apple's actual response was to try to do everything to keep Netflix happy by addressing all of their concerns. Hardly punitive. Netflix still opted out. And Netflix still stayed in the App store just proving that as long as they follow the guidelines...no promoting of alternative subscription methods within the App store....they and anyone else can still benefit from and be a part of the App store. I'm fairly sure that Apple also took the next logical step of no longer providing millions of dollars of free promotion but that's not being greedy or "punitive" that just makes 100% sense from a business relationship that is no longer generating direct revenue to your firm. Every business in the world would ultimately cease free promotions faced with this same scenario.

Really nothing to see hear but the fact that Apple tried to get them to stay in the in-app subscription model by accommodating their concerns and when that wasn't enough allowed them to stay in the store anyway.

Not evil, not greedy.

 

[Jakuta]

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

LOL, they are simply charging what the market will bear. Apple has a fiduciary responsibility to their shareholders to maximize their profits.

 

[benshive]

Of course they can and they have. Their store, their rules.

Whether or not they can is something that the courts can decide. Antitrust laws exist. They're very clearly not enforced or interpreted the same as they used to because a tech company like, say, Microsoft, would've never gotten away with something like this in the 90s. But yea, a company is not allowed to do absolutely anything it wants.