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

[vantelimus]

One thing we do know is back in 2011 Phil Schiller argued that Apple should reduce the App Store fees once App Store revenues hit $1B.

I guess now you know at least one reason Steve Jobs didn't appoint Phil Schiller as his heir apparent.

 

[wbeasley]

Your point sounds like when an employee has a legitimate complaint about his work his boss says if you don’t like it here then there’s the door it’s a very odd response from individuals who just buy the products and don’t actually get paid by the company 🤔

If a parent allows their child access to their card details and said child rinses out their account then that is a failure of said parent and not the company for allowing their child access to it in the first place don’t blame companies for your failures.

it’s very strange that when someone has a legitimate point about apple then the exact same comment always comes out maybe you should purchase another brand it’s as if it’s a
🤔

it's a rather strange response that people buy devices they know exist with closed parameters and then fight tooth and nail to open the device up.

it's not a gen 1 product. it's been around in the same form for well over a decade.

your points sound more like the disgruntled employee who comes in every day and just complains.
i've worked in enough toxic workplaces where attitudes like that bring everyone down.

most decent bosses say "dont bring me problems, bring me solutions".
so the answer is to be clear about what the problem is, why it needs to change, what benefits and risks there are and what you would do differently.

then we can all discuss if that will work. or not.

As Spock said "the needs of the one do not outweigh the needs of them"

 

[neuropsychguy]

One thing we do know is back in 2011 Phil Schiller argued that Apple should reduce the App Store fees once App Store revenues hit $1B.
View attachment 2542414

Also, Schiller apparently initially opposed the 27% fee on purchases made outside an app.

Apple's Phil Schiller Initially Opposed 27% App Store Fee on External Purchases

Apple Fellow Phil Schiller testified in court on Monday that he initially opposed the 27% commission Apple now charges on purchases made outside the...

www.macrumors.com

And that shows that he admitted the idea was controversial within Apple. Even so, he was saying a reduction to 25% or maybe 20%. There are people here and on other sites who say that Apple should only charge 5-10%. These individuals probably would even be happy with that fee.

Do we think that Epic would be happy with Apple charging a 20% fee? I expect the lawsuits and arguments would be the same. Epic really wants to pay Apple nothing.

 

[Abazigal]

Your point sounds like when an employee has a legitimate complaint about his work his boss says if you don’t like it here then there’s the door it’s a very odd response from individuals who just buy the products and don’t actually get paid by the company

If a parent allows their child access to their card details and said child rinses out their account then that is a failure of said parent and not the company for allowing their child access to it in the first place don’t blame companies for your failures.

it’s very strange that when someone has a legitimate point about apple then the exact same comment always comes out maybe you should purchase another brand it’s as if it’s a

I view it this way - you either marry a person that you love, or learn to love the person that you do end up marrying.

You feel that iOS should be more open for your own reasons. I believe and maintain that being closed is one of the iPhone’s defining qualities, that there are legitimate benefits to users not being able to readily install any app they want outside of the App Store, and there is no way for the both of us to have our cake and eat it too.

And no, the whole “you don’t have to sideload if you don’t want to” argument does not suffice, for reasons I have stated in the past.

So it’s not that we don’t want the best for iOS (and Apple), but that what this entails precisely will look very different for both parties.

To bring this back to your original analogy, you have raised your feedback and your concerns to your boss. Your superior has heard you, and he is unable to give you what you want because it would require the company to make changes beyond what they are able to willing to do in order to accommodate you.

In this case, it’s either you accept that these will be the working conditions at your workplace moving forward, and you leave and hopefully your next place of employment will be kinder to you.

I don’t view this as being an unreasonable response at all.

 

[surferfb]

Your point sounds like when an employee has a legitimate complaint about his work his boss says if you don’t like it here then there’s the door it’s a very odd response from individuals who just buy the products and don’t actually get paid by the company 🤔

I don’t know what to say other than I wish I was employed by Apple, but unfortunately I am not. Tim Cook, if you’re reading, my DMs are open! 🤣

When I’m upset with a company I don’t continue to buy their products. Continuing to buy their products at best implies you can live with their decisions and at worst that you support their decisions. But you do you.

I think the free market voting is a much better solution than the government declaring certain business models are verboten when there are options that give you want.

If a parent allows their child access to their card details and said child rinses out their account then that is a failure of said parent and not the company for allowing their child access to it in the first place don’t blame companies for your failures.

Stuff happens. Kids steal cards out of wallets, parents fat finger the limit of $10.00 as $1000.00. The fact of the matter is most consumers assume: “I got it in the App Store, it’s safe and Apple has my back if something goes wrong.” It’s been that way since 2008. There’s no reason to blow that up because Epic and other large companies doesn’t want to pay for use of Apple’s intellectual property.

it’s very strange that when someone has a legitimate point about apple then the exact same comment always comes out maybe you should purchase another brand it’s as if it’s a
🤔

I disagree wholeheartedly your point is legitimate. I understand why you and others feel that way, but I personally don’t think “because I want an iPhone AND an open ecosystem” means you’re entitled it.

Why exactly is “if you don’t like it, don’t buy it” wrong? Especially when there is a great option that does what you want. If I want my to play Nintendo Switch games but like the look of the PS5 better than the Switch, should I buy an PlayStation and then complain to the government it won’t play switch games? Or should I just buy a Switch even though I prefer the design of the PS5?

You’re arguing that me saying “buy the switch” somehow implies I’m paid by Apple. Why?

 

[wbeasley]

I view it this way - you either marry a person that you love, or learn to love the person that you do end up marrying.

You feel that iOS should be more open for your own reasons. I believe and maintain that being closed is one of the iPhone’s defining qualities, that there are legitimate benefits to users not being able to readily install any app they want outside of the App Store, and there is no way for the both of us to have our cake and eat it too.

And no, the whole “you don’t have to sideload if you don’t want to” argument does not suffice, for reasons I have stated in the past.

So it’s not that we don’t want the best for iOS (and Apple), but that what this entails precisely will look very different for both parties.

To bring this back to your original analogy, you have raised your feedback and your concerns to your boss. Your superior has heard you, and he is unable to give you what you want because it would require the company to make changes beyond what they are able to willing to do in order to accommodate you.

In this case, it’s either you accept that these will be the working conditions at your workplace moving forward, and you leave and hopefully your next place of employment will be kinder to you.

I don’t view this as being an unreasonable response at all.

I'm liking your analogy of a marriage...

one person opening up a marriage wanting more thrills from outside also overrides the wishes of the other person if they dont want it.

"but you dont have to have a bit on the side if you dont want" is pretty much the same as "well dont use the alt app store".

the changes affect all parties.

 

[surferfb]

Why would it reflect badly on Apple? Quite the contrary.
It'd just serves to underline Apple own's argument:

"See, we told you so. Third-party sales can't be trusted.
Proof why our Apple App Store is more secure and customer-friendly."

Average users aren’t going to know the difference. It’s been “When it comes to in-app purchases, if you download from the App Store, Apple is the responsible party” for almost 20 years now. I see no need to blow that up so Epic and Spotify can freeload, particularly when Android exists as an alternative.

And remember, the reason Epic wants to do this is there is significant value in using Apple’s IP. Value they don’t want to pay for. I bet they don’t like paying their server bills either, but that doesn’t mean they don’t have to. Pay for what you use!

 

[zahuh]

It’d be better to read Apple and Epic’s briefs (which I have), because then you have a better understanding of the legal questions at hand, but I understand not everyone has that sort of time or interest, particularly when what you find may call your prior assumptions into question. But if you’re not going to read the briefs and instead are going to use AI to research highly technical legal issues, don’t be surprised if it leads you astray.

The facts:

• Despite ruling Apple violated no federal antitrust law, Judge Rogers ruled the anti-steering language violated California state antitrust law and ordered Apple to allow link outs as a result of that violation.
• After the federal case was over, a California court ruled the anti-steering language didn’t violate the law, the California Appeals court confirmed it didn’t, and the CA State Supreme Court declined further appeal.
• Had all that happened before Judge Rogers ruled, she would have been bound to follow CA state precedent, because it’s a state law, and a state court’s interpretation of their laws overrides a federal court’s interpretation of state law. (In other words, It’s not a “federal/state law conflict” as your first quote states.)
• But because CA ruled after the federal case was over, her ruling based on her incorrect interpretation of CA law stands.

Had you read Apple’s brief, you’d see it’s a major point in Apple’s appeal of her order. Apple also is arguing that even if she was right, her order of “no commissions on link outs” is unconstitutional, which is what this thread is arguing about in the first place.

Whether Apple violate or didn’t violate Judge Rogers’ order (the second quote you included) has no bearing on whether or not her interpretation of CA state law was correct/incorrect regarding California law in the first place. Had she ruled correctly, there would have been no order for Apple to (allegedly) violate.


That is amazingly rich coming from someone who has made numerous mistakes on basic facts throughout this thread, keeps throwing up strawman arguments, cartoonishly misstating the beliefs of those who disagree with you, repeats logical fallacies followed by “checkmate, you lose”, and generally seems incapable of understanding that the case is not black and white, people can have different opinions than you without arguing in bad faith, or honestly engaging with points that undermine your argument.

But if you’re tired of engaging with me, I encourage you to either stop or use the “ignore” button so you don’t see what I have to say.


Again, another strawman argument. But you’re correct that we’re not going to change each other’s minds, so I’ll take my own advice stop engaging here. Have a good one!

I'll trust multiple AI's 10000x over a guy that will not admit he's mistaken on a forum. And I will sleep better at night knowing the judge decided the creators should make 30% for their efforts. Have a good one.

 

[germanbeer007]

I never said hardware sales would or should cover the entire cost of the App Store.

I'm giving you perspective on how much it covers. it's less than 0.1% of the estimated annual cost of running the App Store.

I’m asking why some developers should cover the entire cost of the App Store.

All developers adhering to the rules it should collectively cover the cost. If you're an app developer that makes a free app with no IAP, it doesn't make sense to charge that developer $$$ other than te $99/year. That developer potentially brings in new customers with his work.

And as I said in a previous post, back in 2008 Steve Jobs said Apple’s intention was to run the App Store at break even. Clearly that isn’t the case. The App Store is a huge revenue/profit generator for Apple. Which is why they’re fighting so hard to keep devs from offering anything outside of IAP.

1. Not sure what's the point. Steve Jobs isn't here anymore and since Steve Jobs, the rules of the App Store only relaxed since inception.
2. That's before they had that much investment into the App Store. Since Android has passed marketshare, Apple has to entice developers substantially. So they developed a ton of free services to attract developers (free Apple Maps usage, free CloudKit servers, etc...)

Whatever one’s opinions on this I think we can all agree if Apple had reduced its fees like Schiller suggested back in 2011 they’d be in a much better place now.

No? One example: We used to have 7-14 day window for our app to get reviewed. Because of the investment into App Store, Apple brought it down to just 24 hours. App Store review is security theater so users feel safer to download apps from the store which is one of the reasons why Apple App Store brings in more money despite having less marketshare.

Then like I said, investments into custom maps, CloudKit, on demand resources services, china deployment, etc...

 

[ZeroInspo]

I think it is very simple with anyone with more than two brain cells that Apple should be able to charge whatever they want on the App Store. The real discussion, and here’s where Apple still has a chance to get ahead, is whether it is right and fair that Apple does not allow apps that do not use their distribution infrastructure to be installed. I think insisting on keeping the App Store is going to end up hurting them more in the long run.

 

[Rogifan]

I am saying that money is money. If the App Store is profitable, let it be profitable, the same way Steam is. The same way the Nintendo switch store. The same way the PS5 game store is.

If a game developer publishes a title for the Nintendo switch and you have no issues with them giving Nintendo 30%, I honestly don’t see why it’s suddenly an issue when Apple takes a similar cut.

I’m not a gamer and don’t own any of those devices so it’s not something I think about. 🤷‍♀️

 

[Rogifan]

And that shows that he admitted the idea was controversial within Apple. Even so, he was saying a reduction to 25% or maybe 20%. There are people here and on other sites who say that Apple should only charge 5-10%. These individuals probably would even be happy with that fee.

Do we think that Epic would be happy with Apple charging a 20% fee? I expect the lawsuits and arguments would be the same. Epic really wants to pay Apple nothing.

My point is Schiller knew, back as far as 2011, that Apple would need to adjust it at some point. Obviously he lost out; or the revenue and profits became so huge even Schiller couldn’t resist them.

 

[frownface]

To be fair if i was running apple and saw the numbers, i'd start asking "reckon we could push for 40%?"

 

[PlayUltimate]

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.

The retail model is more like a consignment store. You put your stuff up for sale and the store gets a cut of what you sell it for. Sell nothing; pay nothing. This has been a great model for students and hobbyists. They get to learn and play and maybe get lucky and create something the market wants. But they pay nothing until then. And Apple handles all of the details: hosting, downloads, transactions. And, the developer keep 70-85% of what you sell. From a business perspective, that’s a pretty good deal.

 

[FriednTested]

I bought something on amazon.com on my Mac, APPLE SHOULD GET 30%!!! I bought something on Ebay app, APPLE SHOULD GET 30%!!! It's done on Apple's device and they should get a piece of every transaction!!! Oh wait, doesn't make ANY SENSE and they've made BILLIONS. I wish someone would sue them and give us developers our money back WE EARNED by a user going to our website/app and buying something.

If you buy a Mac from Walmart. Walmart takes a cut. If you buy a Mac from Amazon. Amazon gets a cut. Why should they? Why shouldn’t Apple make all the money? They made the products. Why should Walmart amd Amazon double dip.

And Amazon took a huge cut from the manufacturer when you bought that item on Amazon. Didn’t really think that example through did you?

 

[bgillander]

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

By that logic you should be fine with Apple not allowing 3rd party payment links.

 

[Abazigal]

I’m not a gamer and don’t own any of those devices so it’s not something I think about.

I don’t think about it insofar that it’s not something that affects my bottom line at the end of the day, but the parallel does amuse me.

Say a developer releases slay the spire for the switch. Nintendo gets 30% of all sales. Nobody says anything.

Developer releases it on Steam. People purchase it for their PC, Valve keeps 30%. Nobody bats an eyelid. If anything, the expectation seems to be that a game should be made available on steam for the convenience. Is there even a way of downloading it externally?

Developer releases it on iOS. Apple wants to keep 30%, suddenly that’s a crime against humanity?

And Sony, Steam and Nintendo are amongst your biggest gaming platforms in terms of gaming revenue (Epic even admitted as much). If people really cared about profits, shouldn’t they be picking a fight with the ones who are getting the bulk of the revenue here?

Somehow, Apple is the only one being singled out and I just cannot fathom the double standard here.

 

[wbeasley]

I think it is very simple with anyone with more than two brain cells that Apple should be able to charge whatever they want on the App Store. The real discussion, and here’s where Apple still has a chance to get ahead, is whether it is right and fair that Apple does not allow apps that do not use their distribution infrastructure to be installed. I think insisting on keeping the App Store is going to end up hurting them more in the long run.

its already the long run. we are at peak phone. nothing too new or exciting happens these days.

and the store has how many apps? made how much for Apple and for devs?

seems more like a success story already IN THE LONG RUN...

 

[wbeasley]

By that logic you should be fine with Apple not allowing 3rd party payment links.

exactly.

i have all my cards in ApplePay. I link one to my Apple ID and it's easy as to use.

why would i as a consumer WANT or NEED to go to an outside payment method?
what benefit does it give me at all?
A warning screen i have to click through, and harder refunds... nah. not seeing an upside for me.

 

[bgillander]

If you're genuinely asking, here's the article when Netflix removed the in-app purchase system from their app.
Does this make a better customer experience that I have to leave the app? No. Wouldn't it be easier if I could just us Apple Pay for 2% or less commission and pay through the app? Yes. But that's not allowed. DUMB that it's not allowed. It's NETFLIX'S APP! They should be able to do what they want. Just like amazon does just like everyone does on a website. No COMPANY should own how your app does payments and 1000000% no company should get 30% of your digital products money! They did NOTHING to get it!!

Netflix No Longer Allowing Subscribers to Pay Through Apple's App Store

Netflix subscribers who still pay their monthly fees through the App Store in-app purchase system will soon need to add a new payment method to keep...

www.macrumors.com

If you want to buy through the App AND use Apple Pay, Apple actually did quite the opposite of NOTHING for you to be able to do that. They built the phone, the os, the app infrastructure, and Apple Pay.

If you can’t make the effort to order your Netflix from the web, you definitely owe Apple some cash for your laziness of needing a better customer experience, since Apple spent years and a lot of cash building that customer experience.

 

[bgillander]

OK so you’re saying the cost of running the App Store is (or should be) 100% funded by developers? No percentage of hardware sales go to running the App Store? Did Steve Jobs ever say that?

Where is the law that states apps developers are obligated to cover the cost of Apple’s App Store? If there was no App Store and no 3rd party apps how much do you think Apple could charge for an iPhone?

Why should hardware sales fund the App Store?

Just because Costco sells hotdogs at a low price to bring in customers, it doesn’t mean every restaurant inside a store shouldn’t be able to charge for the food served without it being subsidized by profits from diaper sales.

 

[bgillander]

I'll trust multiple AI's 10000x over a guy that will not admit he's mistaken on a forum. And I will sleep better at night knowing the judge decided the creators should make 30% for their efforts. Have a good one.

The judge decided creators should only make 30% for their efforts? Geez, that’s at least 40% less than Apple gave them.

 

[AppliedMicro]

Average users aren’t going to know the difference. It’s been “When it comes to in-app purchases, if you download from the App Store, Apple is the responsible party” for almost 20 years now.

Average users have used Uber or a transit app to purchase a ride. And ordered a meal.
I’ve never heard of users disputing their Uber rides or food deliveries with Apple - have you?

Slapping a “this transaction will not be processed and receive no support from Apple” is otherwise enough to reemphasise the point.

I bet they don’t like paying their server bills either, but that doesn’t mean they don’t have to. Pay for what you use!

Quite the irony, given how many/most other apps are paying nothing except a yearly flat fee.

But that’s pretty much what they want: Pay for what they use.
It’s just that Apple does not charge them fairly for what they use.

They aren’t “using” anything when unlocking a virtual helmet or in-game weapon, once the app has been delivered to the customer’s device. Except, in some instances, Apple’s IAP - which they do not want to use.

And the court agreed that Apple, a company with monopoly power, can’t force them to use it or prevent them from linking out to alternative purchase options.

 

[Maven1975]

Next time, Don’t blatantly lie and then get caught.

Free advice there Tim.

 

[bollman]

Raising the developer fee would fail on two levels:
1) It would deter smaller developers by imposing a higher proportional cost on them and raising the barriers to entry, this reducing competition between developers and apps, damaging consumer choice and application quality
2) It ignores the fact that costs of hosting and running a store scale dependent on demand and traffic - it costs Apple more to provide an app to thousands or millions of customers, and it’s fair that the most downloaded and used apps provide scalable higher reimbursement for the costs they impose

While 1) may be true, 2) is by no means true.

I would assume that a huge portion of the app store most downloaded apps are free as in banking apps, companion apps and so on. Of the 100 apps I have on my phone, none are bought apps and less than 10 are apps with (at least to me obvious) in-app purchases.
Some of these free apps probably have downloads in the millions. My banking app alone has 443000 reviews.
This makes me believe that Apple has to recuperate the costs of providing for free apps that are downloaded millions of times, and they do that by punishing paid apps. This means huge banks that provide apps to their millions of paying customers only need to pay the small developer fee, while developers trying to make a living from paid apps have to give Apple a huge portion of their income.