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Apple to Allow Alternative Payment Systems in App Store in South Korea
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But… but… they created and control the printing machine that this postcard was printed with!?
The problem is that apples model is a subsidy based one. The in app payments pay for the hosting, verification, tools etc that all the free apps use. That’s the reason there are so many apps on the App Store. It’s easy for someone to just pay for a one of fee and go from zero to 10m downloads worldwide with no friction.
If you charged everyone what it actually costs to host their free app there wouldn’t be any more free apps if they don’t make money. Undermining the whole App Store business.
Even the judge in the epic lawsuit basically realised that the games business on the App Store subsided all the none game apps.
So, in my opinion, be careful what you wish for.. law of unintended consequences and all that…
It will or won‘t go down, depending on how much Apple is going to get away with charging for the transaction anyway. I wouldn’t be shocked if they were still aiming for 15% or 20% (at least for non-subscription in-app purchases - which would probably not result in much lower consumer prices).
No problem. Cause it‘s a subsidy based business model:
The availability of high-quality free native apps subsidises unit sales of iOS and iPadOS devices.
Apple provides (virtually) free developer tools and app distribution - and sells tons of iPhones units every year. At what is probably the highest margins in the smartphone industry. Cause, let‘s be real, how many would buy an iPhone phone, if there‘s a dearth of good apps (just ask Microsoft) or every popular app (your public transit app, online banking/trading, Instant Messengers) costs - while it‘s free on other platforms?
Well if the only element of the payment being removed from Apple‘s commission is the actual payment itself, how many percentage points does that save Apple? 1-3% points maybe?
So if the Apple commission does down by 3% then for devs using other payment providers, they would need to be able to get a payment provider AND additional administration burden for less than 3%. Is that realistic?
Things like Apple Connect, app reviews, payment processing, documentation, iOS update and development, Xcode are primarily tools for app developers and therefore they should be maintained by the yearly developer subscription fee.
If they didn’t have that developer subscription fee I could see your point tbf.
So you advocate for a much higher yearly developer fee? How many developers would that then put off developing for the platform?
This tells me one thing. No matter how smug Apple pretended they are, they still have to follow local laws.
Remember how smug Apple were when they claimed that their mass scanning system is foolproof form abuse? All one country needs is to make a law and Apple will have to follow it.
No wonder Apple stopped talking about it. Their virtue signaling didn't jive with reality of business.
Remember how smug Apple were when they claimed that their mass scanning system is foolproof form abuse? All one country needs is to make a law and Apple will have to follow it.
No wonder Apple stopped talking about it. Their virtue signaling didn't jive with reality of business.
Android already allows 3rd party stores and sideloading, so Google doesn't really need to do anything. Don't like Google's way, just sideload.
One of the best explanations of the issue I have read. Thank you
I have no evidence to present but it's obvious to me that a subscription to Dropbox, if the payment processing is done by Dropbox, has no added costs to Apple, meaning that 15-30% Apple takes is completely arbitrary.
Now, if the costs associated with auditing apps and their updates were to make up some of that, then that's fine, but there's 1 audit for 1 update, and that update may serve millions of users, so we look at bandwidth and storage instead, both of which are ridiculously cheap. I have a hard time imagining how the charges we're discussing now in any way shape or form can even approach 15-30% per customer, every month...
Yes, but it's in Apples best interest to enable developers to produce free apps, so that's a concession that they are making in all of this, and always has been.
I think the best solution is for there to be two tiers, the one we have today, and one where the costs are itemised. Apple should evaluate free apps and push them into itemised if they are abusing the free tier.
IAP are an entirely separate issue, if developers want to use Apples system they can obviously do that and everyone is happy, but Apple can not force them to if the developer is willing to build the infrastructure for another payment solution.
Here’s why it’s different. Because what are developers immediately going to do if this happens? Make all their apps free and put the purchase inside the application to get around Apple taking a cut.
Let’s apply that to your Walmart analogy. It doesn’t fit perfectly but for consistency.
Do you think they’d stock a free magazine if the customer could just buy it directly after taking a shell or cover from Walmart. No they wouldn’t. Why should/would they advertise it to their customer base if their is not return for them?
The cost to Apple is nowhere near 15-30%. Those figures include Apple’s costs and margin.
Dropbox is not a payment processor. If they aren’t paying Apple for payment processing they will need to pay another company for payment processing.
This sounds like an apple problem.
Apple will have two options.
1. Take out a higher fee, limiting the availability of apps.
2. Continue the status quo with hardware sales subsidize the software as it’s always been done, but with less profits on services
It’s not really an Apple problem as they don’t need to pick from either of these two options. Theyll pick option 3, which is to leave things broadly as they are and charge a slightly lower commission to those developers who choose to use an alternative payment processor.
Seems like you found a loop hole, mostly known as a tax loophole.. I mean profit exploitation of apples hard earned platform.
They can simply ask a fee to be payed.
App Store main purpose is not to make a profit, but to sell iPhones. Without the store the iPhone would have died like the windows phone
But I thought the issue was developers have a problem with Apple, not the other way around? Apple are very happy with the current developer agreement I’m sure!
Good luck enforcing a fee on developers not using the store payment system, controlling it without costing them more money in administrative costs. Apple will be forced to innovate once again.
Unless apple becomes the IRS, it’s not going to work
Apple have a problem now.
And that problem is they will likely not be allowed to take a smaller fee to equalize the lost revenue.
They won’t be able to collect it without losing more money than it’s worth.
We already know Apple will become the IRS (I presume you mean requiring audits so that they can charge the correct commission). That’s precisely how Apple will collect their fee if they aren’t the payment processor.
It’s been calculated that apples costs per app is likely less than 4% of every transaction. So everything above 4% is likely pure profits
The administrative burden will fall on the developer, not Apple. After all it would be the developer who chooses not to use Apples payment processor therefore the developer would bare the cost of that additional administration submitting accounts to Apple.
Indeed, and imagine how easy it is to fake such numbers as apple have zero ability to control them.
This might fly in the US but not in Korea or EU