Apple Says App Store Changes Go Too Far in New Epic Games Appeal Filing

[Abazigal]

Sorry can't continue. You start with one thing and just keep piling never acknowledging you were wrong. Now you're bring up maps?? The subject is so far gone. I tried to bring you back but you went further. iPhone brings in 200 billion a year. That covers all costs you brought up. Have a good day

Apple makes enough money to cover a lot of stuff. It doesn’t mean they are obligated to subsidise everything under the sun, nor does it mean that it is okay for these services to be run as loss-making entities.

That’s why this argument is going around in circles. You keep arguing that Apple could do this and that. My point has always been that they don’t have so, nor does it make financial sense to leave money on the table.

I mean, if we want to go there, Apple makes enough that they can offer Apple Music free of charge, give free iCloud storage etc, where does one draw the line?

At the end of the day, Apple is not charity. Some services like Siri, iMessage and Maps, Apple makes available for free because it’s not feasible to charge access for them and users expect them to come bundled as part of buying into the ecosystem. Others like operating the App Store, if there’s money to be made, I see no viable explanation for Apple to not go ahead and do so. They own the App Store. They created the modern App Store model and aggregated the best customers and solved the issue of piracy and made it easy and secure for transactions to take place.

The end result is that more people spend money on iOS compared to another platform such as android. Does Apple not deserve anything for the role they have played in creating an entirely new market where none existed before, and in growing the entire pie?

And frankly, an argument can be made that the iOS ecosystem is still under-monetised, and there is still more money that can be made by way of say more services, higher prices, higher margins. But that’s another discussion for another day.

 

[AppliedMicro]

Assume each review takes 15-30 minutes. Let's say 20 minutes.

(App) „Reviewers have daily quotas of between 50 and 100 apps, and the number of apps any individual reviewer gets through in an hour is tracked by software called Watchtower, according to screenshots seen by CNBC“

Inside Apple's team that greenlights iPhone apps for the App Store

An executive board led by Apple marketing SVP Phil Schiller meets every week to discuss controversial apps or other iPhone software programs that may infringe Apple's App Store guidelines.

www.cnbc.com

👉 I doubt that Apple‘s reviewers are working 16 to 32 hours each day.

 

[Bigbuddy1]

Apple makes enough money to cover a lot of stuff. It doesn’t mean they are obligated to subsidise everything under the sun, nor does it mean that it is okay for these services to be run as loss-making entities.

That’s why this argument is going around in circles. You keep arguing that Apple could do this and that. My point has always been that they don’t have so, nor does it make financial sense to leave money on the table.

I mean, if we want to go there, Apple makes enough that they can offer Apple Music free of charge, give free iCloud storage etc, where does one draw the line?

At the end of the day, Apple is not charity. Some services like Siri, iMessage and Maps, Apple makes available for free because it’s not feasible to charge access for them and users expect them to come bundled as part of buying into the ecosystem. Others like operating the App Store, if there’s money to be made, I see no viable explanation for Apple to not go ahead and do so. They own the App Store. They created the modern App Store model and aggregated the best customers and solved the issue of piracy and made it easy and secure for transactions to take place.

The end result is that more people spend money on iOS compared to another platform such as android. Does Apple not deserve anything for the role they have played in creating an entirely new market where none existed before, and in growing the entire pie?

And frankly, an argument can be made that the iOS ecosystem is still under-monetised, and there is still more money that can be made by way of say more services, higher prices, higher margins. But that’s another discussion for another day.

Yes however what you leave out
Is apple’s business model is based on profiteering due to how it is setup and how current society is

 

[Bigbuddy1]

Sorry I was pointing out to someone else who claimed Jobs created the AppStore and Cook is stuffing it up...

Jobs eventually cam around and the store became the huge success it is for devs and users.
I'm tired of people trying to break it.

This makes no sense
Because if the app is there either a payment link then how would that break the App Store as it would not affect the user
Only apple’s profiteering by how the business model is set up

 

[Bigbuddy1]

And why not defend a a multi trillion company. I don’t see many criticizing epic who it can be said is “worse” than Apple in the morality scale.

It seems at times an all out assault against Apple for no reason because they are Apple.

No this is incorrect it’s not an assault on apple
But on the business model and profiteering
That’s all

 

[Abazigal]

Yes however what you leave out
Is apple’s business model is based on profiteering due to how it is setup and how current society is

You make it sound like some earth-shattering revelation, but I have been pointing this out right from day 1. That's the beauty of the Apple ecosystem. While people were pointing out how Android smartphone market share dwarves iPhone market share many times over, I was highlighting how it was a nothing burger because of a number of factors.

1) iPhones are insanely profitable. It is no small secret that iOS devices garner the lion's share of profits in the smartphone market.

2) By virtue of the iPhone, Apple aggregates the customers with the most spending power. This means more money spent on apps, resulting on more app revenue for Apple as well. Apple Pay makes money, Google pays Apple 20 billion a year, I am pretty sure Apple's partnership with OpenAI is benefiting it financially as well.

3) Every aspect of the apple ecosystem is designed to make money. I see this as a feature, not a bug, because again, I do not feel it is in Apple's interests that any of their product categories be inherent loss makers. Their hardware is profitable. Their services add an extra layer of revenue, while also increasing the degree of stickiness in the ecosystem.

To sum it up, 

Apple's ecosystem is designed around people that easily spend money, and who are willing to pay for an integration solution that just works out of the box. It's a common trope around here that Apple gear is overpriced (which I disagree with) but given that, and their financials which are unlike any other comparable company, you can only conclude that Apple buyers spend money - a lot of it. 

I'm end-to-end Apple gear. A lot of the people around me are as well. I don't want to dick around with cobbling some system together, deal with any more accounts than I already have (200+ passwords in my 1Password - welcome to adulthood), or deal with security issues.

I've worked hard and I make decent money, and at this point in my life I want things to be easy more than I want them to be cheap. I am Apple's target market. Is Apple Music lower quality or more expensive? I literally don't care. I just want to be able to pull up a song on my watch and stream it to my airpods no matter where I am. That's it. I'll pay more for it. I don't have to install an app. I don't need to enter my l/p. I can airplay it to damn near everything. 

This is what Apple does. They rarely beat competitors on the bullet list, but when it comes to 'look at your phone and all your stuff is unlocked', they're unbeatable.

They play the system integration game better than anyone else, and if it costs a few bucks more, I'm happy to pay it. Apple knows this, and believe me when I say their ecosystem is still currently under-monetised (meaning there is still more money Apple can make from its user base), and we will probably see more of this in the coming years.

If you find the amount of money Apple makes to be obscene, you haven't seen everything yet. 😛

 

[Bigbuddy1]

You make it sound like some earth-shattering revelation, but I have been pointing this out right from day 1. That's the beauty of the Apple ecosystem. While people were pointing out how Android smartphone market share dwarves iPhone market share many times over, I was highlighting how it was a nothing burger because of a number of factors.

1) iPhones are insanely profitable. It is no small secret that iOS devices garner the lion's share of profits in the smartphone market.

2) By virtue of the iPhone, Apple aggregates the customers with the most spending power. This means more money spent on apps, resulting on more app revenue for Apple as well. Apple Pay makes money, Google pays Apple 20 billion a year, I am pretty sure Apple's partnership with OpenAI is benefiting it financially as well.

3) Every aspect of the apple ecosystem is designed to make money. I see this as a feature, not a bug, because again, I do not feel it is in Apple's interests that any of their product categories be inherent loss makers. Their hardware is profitable. Their services add an extra layer of revenue, while also increasing the degree of stickiness in the ecosystem.

To sum it up, 

Apple's ecosystem is designed around people that easily spend money, and who are willing to pay for an integration solution that just works out of the box. It's a common trope around here that Apple gear is overpriced (which I disagree with) but given that, and their financials which are unlike any other comparable company, you can only conclude that Apple buyers spend money - a lot of it. 

I'm end-to-end Apple gear. A lot of the people around me are as well. I don't want to dick around with cobbling some system together, deal with any more accounts than I already have (200+ passwords in my 1Password - welcome to adulthood), or deal with security issues.

I've worked hard and I make decent money, and at this point in my life I want things to be easy more than I want them to be cheap. I am Apple's target market. Is Apple Music lower quality or more expensive? I literally don't care. I just want to be able to pull up a song on my watch and stream it to my airpods no matter where I am. That's it. I'll pay more for it. I don't have to install an app. I don't need to enter my l/p. I can airplay it to damn near everything. 

This is what Apple does. They rarely beat competitors on the bullet list, but when it comes to 'look at your phone and all your stuff is unlocked', they're unbeatable.

They play the system integration game better than anyone else, and if it costs a few bucks more, I'm happy to pay it. Apple knows this, and believe me when I say their ecosystem is still currently under-monetised (meaning there is still more money Apple can make from its user base), and we will probably see more of this in the coming years.

If you find the amount of money Apple makes to be obscene, you haven't seen everything yet. 😛

Again I’ve read some of your posts on this topic and you compare it to games consoles like ps5 and switch that’s fine if you want to compare that and use that comparison that’s fine however since the PS5 came out compared with apple’s products like for example the iPhone 12?

Again you have essentially answered the point with your long statement about the ecosystem’ and how smartphones are used in today’s society in the west.

 

[bgillander]

I will absolutely be done with Macs if this ever happens.

And that is the correct solution. Not buying. Buying something that doesn’t work the way you want and complaining about it is not a good idea.

 

[bgillander]

I hope apple loses. 30% or even 15% for payment processing is criminal. In addition they don't even support our license type and so for years I had to go through this huge headache with apple almost every time we have a major app update.

If Apple was reasonable and said 5% or 10% nobody would have batted an eye. Their greed has put them in this position.

So Apple is greedy for wanting 15% or 30%, but 70% or 85% is not enough for you and you need 90% or 95%?

If you are totally against greed, you should stop offering your app, and then Apple will get nothing. That will teach Apple a lesson and you will then get 100%.

 

[Bigbuddy1]

Both are true. It is their IP. Courts don't care about user privacy as an arguement. Unless you didn't protect user privacy. Then they care. So for Apple, they are actively protecting user privacy to avoid going to court because they didn't do a good job of it. Their IP is being challenged in court by EPIC. EPIC doesn't want to pay Apple for using it. Apple has a different view on that. They disagree. Hence EPIC being kicked off the darn store. For Apple to allow EPIC and others to do what EPIC did would jeopardize Apple's users. Privacy and security being the major concern. Since EPIC willfully modified the app to allow it to do something that totally violates Apples rules. Just think about what else they COULD have done.

This is incorrect not once did epic say that apple wasn’t entitled to a cent they said about
8 to 9% based on the smartphone business model.
This privacy and security argument is nonsense as individuals purchase things on the internet from stores like the bolshoi theatre website and there is no issue

 

[bgillander]

Equally, no court and no legislature should be protecting intellectual property. Apple is welcome to do so by not making it available to anyone in the public (and I'm not talking source code; I'm talking not selling it or putting it on any platform). What needs to be eliminated is the concept of a software license. If you buy a product with software on it, you should own that product and that copy of the software, to do with as you please. Without compensating the company that made it. Pay once, use forever as you see fit. Anything purchased must be fully owned by the purchaser. Not "leased" to them

Although it would be lovely to be able to dictate how companies should be able to do things, you are welcome not to purchase anything with terms of service to which you do not agree. That is the correct course of action for any consumer, and if enough people actually agree with you, the market will eventually bend to your will.

But if courts don’t protect intellectual property, why would any company bother creating?

That said, feel free to create and to contribute your creations freely to the public domain, just for the good of all. It is a noble thing to do, but there is a reason the concept of the starving artist exists.

 

[Bigbuddy1]

So Apple is greedy for wanting 15% or 30%, but 70% or 85% is not enough for you and you need 90% or 95%?

If you are totally against greed, you should stop offering your app, and then Apple will get nothing. That will teach Apple a lesson and you will then get 100%.

Exactly your right what the mobile developer should do is this not accept apple’s terms and conditions and let them see how they make it on android and all the other multiple mobile OS’s out there so then they come crawling back to apple begging to be taken back
Your right and then apple can maintain their status quo business model

 

[wbeasley]

I’m not defending what Epic did in-app. I’m defending apps not being required to use IAP. I think Apple’s privacy and security arguments there are bunk since IAP only applies to digital goods (and not even all digital goods. I buy stuff in the browser all the time. Is my privacy and security being compromised because I’m not using Apple’s IAP where they get a cut?

give the almost weekly data hacks where customer data is stolen i think maybe you are at more risk buying outside the Apple environment.

i like paying with ApplePay because the stores dont even get my card number.

there have been more than a few times ive asked why a company is storing my card or personal details years longer than they need to get payment. even one of my banks asked for verification of my account - which i did when opening the account. but this time it went a lot further: lots of demographic questions. nothing too personal but the need to collect it wasnt about verifying me. it was about getting data for free. i will be closing that account soon. not happy at all.

 

[wbeasley]

I keep answering your question and then instead of acknowledging you were wrong you add more and change the question. Apple makes 30% for subscriptions and 15% the year after and 30% on paid Apps and 15% from less than $1 million paid apps. Apple also has a search business and of course iPhone itself. That's how Apple covers the costs and becomes a $3 trillion company. The California courts deemed what they did was unlawful to require developers to use their in app purchase system and not advertise a different payment system option. That is where we are at. You may disagree with the courts and that's ok. Doesn't change that what Apple did was against the law.

show us the law that states Apple has to allow alt IAP.
A Court interpreting something one way doesnt mean that holds in all regions the company does business unless it's a Federal law overriding State laws.

The 30% and 15% is a fact and doesnt form part of any answer.
A company can charge whatever they want for a product.
Customers will decide if they want to pay the ticket price.

Bottom line: Apple IP is not something a judge can give away for free.

And that's what will undo this ruling.

 

[Dirk Pieters]

What is the fee that developers have to pay for?

Do yourself a favor and take a look at Apple's annual report. Every year, the company makes an ever-increasing double-digit billion dollar profit. A little more each year. Pure profit.

Not here to claim that Apple is holier than thou, but I’ve had paid apps in the AppStore between 2012 and 2023 and I’d like to answer your first question.

You pay Apple for the platform to host your app, to have access to hundreds of millions of possible buyers and to deal with payments and refunds from customers worldwide. Although the AppStore isn’t perfect, that’s lot of boring admin taken care of.

30% sounds like a lot, but if you use the subscription model that percentage drops to 15 if a customer renews after a year.

As for the pure profit rant … a business exists to make a profit. Not sure where the profit = bad comes from. Apple isn’t forcing anyone to buy their products. People choose to and Apple profits from them.

 

[wbeasley]

This makes no sense
Because if the app is there either a payment link then how would that break the App Store as it would not affect the user
Only apple’s profiteering by how the business model is set up

why should any business work on your perception of what they charge?

customers decide every day what they buy and price is part of that calculation.

Apple is a for profit business. accept that. and customers will decide whether the price suits them.
Adding an alt payment system does break the current system.:
if you want a refund then Apple wont be handling it and poor customer service from an external party reflects on the Apple product to many people. I've seen plenty of product reviews on Amazon give a one star rating because a courier took too long to deliver - something not under the control of the company you bought the item from.

and what happens when your card starts getting used for other charges because there was a data hack?
Again, it reflects poorly on the Apple product.
MR will be full of "secure system not! Cook needs sacking" comments...

 

[Bigbuddy1]

why should any business work on your perception of what they charge?

customers decide every day what they buy and price is part of that calculation.

Apple is a for profit business. accept that. and customers will decide whether the price suits them.
Adding an alt payment system does break the current system.:
if you want a refund then Apple wont be handling it and poor customer service from an external party reflects on the Apple product to many people. I've seen plenty of product reviews on Amazon give a one star rating because a courier took too long to deliver - something not under the control of the company you bought the item from.

and what happens when your card starts getting used for other charges because there was a data hack?
Again, it reflects poorly on the Apple product.
MR will be full of "secure system not! Cooke needs sacking" comments...

It’s not my perception
It’s the reality of the current apple business model and smartphone market in the 2020’s
It’s not the early 2010’s anymore.

So just for clarification I assume you never make a purchase of any product outside the App Store and all use IAP so you are safe and secure because if you purchase things online outside apple’s App Store then you really don’t have an argument then.

 

[wbeasley]

It’s not my perception
It’s the reality of the current apple business model and smartphone market in the 2020’s
It’s not the early 2010’s anymore.

So just for clarification I assume you never make a purchase of any product outside the App Store and all use IAP so you are safe and secure because if you purchase things online outside apple’s App Store then you really don’t have an argument then.

ah that old chestnut... LOL

weve been through this MANY MANY MANY times...

to allow external payments requires modification to Apple code allowing access to external players.
all code changes carry risk, and another point hackers can exploit.

and the code is changed for ALL iOS users, not just those who choose to use external payments or appstores.
why should 90%+ who are happy using the system the way has existed for over a decade be forced to a potentially less secure OS because a few people suddenly dont like the terms they agreed to before?

you want an external appstore or outside payments? choose a device (Android) that meets those needs.

but every person complaining doesnt accept that OS meets their needs and wants to force Apple to change.
i've seen more than enough people have Android issues because they installed something they shouldnt "accidentally" through false trust...

 

[Bigbuddy1]

give the almost weekly data hacks where customer data is stolen i think maybe you are at more risk buying outside the Apple environment.

i like paying with ApplePay because the stores dont even get my card number.

there have been more than a few times ive asked why a company is storing my card or personal details years longer than they need to get payment. even one of my banks asked for verification of my account - which i did when opening the account. but this time it went a lot further: lots of demographic questions. nothing too personal but the need to collect it wasnt about verifying me. it was about getting data for free. i will be closing that account soon. not happy at all.

You do understand that in some countries if you open a bank account and then close it for legal reasons they have to keep your information for years and years

You do understand that if you make a purchase in the apple store they have the ability to get your information months & months down the line so I don’t understand your point

You understand there is no difference in purchasing through apple’s iOS payment and through a 3rd party payment link

 

[Dirk Pieters]

If you want to build an app and are uncomfortable with the AppStore’s percentage, then why not build a web app? A few advantages: you can target iOS, Android and every other device with a browser. You don’t have to rewrite your app when Apple decides to refactor whatever of their apis your app is using.

Disadvantages: you’ll spend a lot of time dealing with payments, refunds and invoices. You’ll probably need some knowledge about international tax laws as well. Not the most exciting thing to spend time on when you should be focusing on improving/growing your business. Your app won’t be in an AppStore which is used by hundreds of millions of potential customers each day.

Apple doesn’t force developers to use the AppStore. The AppStore comes with rules and commission percentages which are known before hand. You either agree and submit your app. Or you don’t.

Agreeing with the rules, submitting your app and then whine about the commission makes no sense whatsover. It is what it is.

You either agree. Or you don’t.

 

[SnowCrocodile]

Once a customer has bought your product from Target and taken it home, you are free to conduct additional transactions with him directly - without having to pay Target.

But Target isn't required to facilitate your advertising and getting in touch with the said customer, using Target as a platform, for free. And you're talking physical goods. People who buy from Target want something that they can touch and look at, in a close and familiar location. Should Target allow you to intercept the customers in Target stores and offer them a ride to your store where you could sell them the same product cheaper?

Essentially, judge is forcing Apple to allow other developers to use its AppStore as an advertising platform for their own stores, for the small cost of a single app listing.

E.g. let's say Apple compiles. Epic then could pay whatever the cost is for listing their app on the AppStore (which is trivial), set the subscription price in the AppStore to a million dollars per year, and tell the users to use the link to their own website to get the regular price. So they would be using AppStore's tremendous advertising potential, paying less than they would for 3 minutes of TV ads, and making sure that Apple doesn't get a penny more.

This is not going to fly.

 

[Bigbuddy1]

ah that old chestnut... LOL

weve been through this MANY MANY MANY times...

to allow external payments requires modification to Apple code allowing access to external players.
all code changes carry risk, and another point hackers can exploit.

and the code is changed for ALL iOS users, not just those who choose to use external payments or appstores.
why should 90%+ who are happy using the system the way has existed for over a decade be forced to a potentially less secure OS because a few people suddenly dont like the terms they agreed to before?

you want an external appstore or outside payments? choose a device (Android) that meets those needs.

but every person complaining doesnt accept that OS meets their needs and wants to force Apple to change.
i've seen more than enough people have Android issues because they installed something they shouldnt "accidentally" through false trust...

What old chestnut 🌰
So do you purchase things on the internet outside the iOS App Store it’s a simple question because if you do then your obviously not having that many issues then with security.

Again that’s not a valid point if you don’t like it go to android because it’s got bugger all to do with security by including a payment link it’s all about maintaining apple’s status quo unless you are admitting that apple don’t have the tools to do it.

 

[Nuno Lopes]

as a now indie developer, no thank you. I'd like the comfort of knowing that me deploying a 800MB app that suddenly went viral won't cost me an arm and a leg.

just because I get millions of downloads does not guarantee millions of dollars, but it can guarantee tens of thousands of dollars in distribution. and it would discourage me from submitting updates as that's probably another few thousand dollars down the drain when people download my update.

You are saying no and not even know the what could be hosting tier price?

Anyway why not a tier for you, premium at 30% or even more?

As for devs working on other areas … why should they “pay” for your comfort and others like you? I mean, devs that bet on a steady growing business were they take on hand their own marketing and lead generation rather the shooting for unicorns? Take for instance Facebook, Instagram, What’s App, TikTok … they get most of it all for free. But then hell goes loose if you are a math teacher providing remote lessons and content and do not pay a commission. Or if you develop say an innovative mail service … Why shouldn’t Netflix pay at least to host and distribute their App?

 

[surferfb]

You understand there is no difference in purchasing through apple’s iOS payment and through a 3rd party payment link

Of course there’s a difference. With Apple’s system, the purchase runs through their APIs, fraud detection, parental controls, refund handling, and account protections. With a 3rd party link, all of that disappears you’re dumped into a web flow that Apple doesn’t control or secure, that could have been compromised or have poor security, etc.

And when something goes wrong, the average user will blame Apple: ‘I clicked on it in an app, it should’ve been safe. Apple says iPhone apps are safe, but that app stole my credit card info/I got hacked.’”

 

[Rogifan]

I do see the logic of the decisions that went into App Store pricing.

In order to boost the vitality and vibrancy of the iOS App Store, you want to attract as many developers to release apps for iOS as possible. This is where a percentage cut based on how much money you earn makes sense. Make no money, and you don't have to pay Apple a cent (beyond the initial $99 annual fee). Make more money, and you pay more to Apple. It's similar to how taxation works. Earn below a certain wage bracket, you don't have to pay the government a cent in taxes. Conversely, the more you make, the more you pay in taxes.

The money that comes from your top-grossing apps goes back into maintaining the App Store for everybody. I believe Apple when they say that the vast majority of apps in the App Store are free and make Apple no money. Yes, maybe some of you feel it is unfair that companies like Epic are indirectly subsidising the makers of free apps, but the counterpoint is that it is another challenge altogether to differentiate an app like Facebook which makes money off ads, vs another free app which doesn't make any money at all. Apple has no insight into how much ad revenue a developer would make, and I don't think anybody here wants Apple to go there.

So far, we are only hearing complaints from your larger developers such as Epic and Spotify, who believe they have outgrown the App Store. We have not heard anything from the smaller developers who do find Apple's App Store terms reasonable.

I go back to other app stores with a similar business model like the Switch and PS5. If there is a way for game developers to get out of paying Nintendo and Sony their 30%, I am interested to know how it is done. I genuinely feel that in the very least, all games should pay Apple 30%, be it paid, or IAP. Similar to how it is charged on other game consoles.

Second, correct me if I'm wrong, but while the Spotify app is available on the PS5, there is no option to subscribe to the service within the app, only to log in (which means that you are expected to have created your account and paid for your subscription elsewhere). This seems to mirror the reader category on iOS, where Spotify and Netflix at least have the option to direct users to their website to create an account (and therefore avoid Apple their 30% cut). I similarly did not find a way to pay for Premium in the app on my Switch as well.

If I were running Apple, my line in the sand would be - continue charging games 30%, everything else 0% (eg: that Fantastical or Play or Infuse subscription made via iTunes, minus payment processing fees). I get to retain the bulk of my App Store revenue, while exempting most developers from the cut.

But that's just me.

So basically you’re saying games should subsidize everything else. What if we go back to what Steve Jobs said in 2008 when he said Apple intended to run the App Store at breakeven? Would Apple need to charge anyone 30% to do that?