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Apple to Collect 27% Commission on Third-Party App Payment Systems in the Netherlands
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Pull out of any country which has laws that Apple doesn't like then.
lol, you've got to laugh when a company is ordered to do something and they find a way to ignore obey the letter of the law while carrying on doing what they were doing before. Reminds me a bit of the hijinks Microsoft got up to with IE6.
Some here give examples here about credit card rates, consider that this is not in the U.S. , rates are lower in the Netherlands, credit card transactions are also way lower than debit card transactions, pretty positive rates for debit card transactions are even lower than cc rates.
And even if they are not, misunderstandings and mistakes will happen, and developers will have to do the work to resolve those. More hassle for everyone.
I highly doubt that the Netherland authorities will give Apple the right to audit a company in the Netherlands. This is going to get really funny 😂😂😂😂😂😂
And - oh my god! What if the payment happens using a website? What if the dating service has a website and a user can use both - website and App. Apples old mantra "Think different" changed to "We don't think at all" ..
Als Nelson would say - Haha
Refrain from making uneducated comments and do your research before you make silly comments about (Dutch) politicians.
Start your research here. (ACM)
The regulators don't understand Tech, they have no idea what they want.
But the need to be seen to be doing something about the "Big Tech is too powerful" problem.
Whether what they come up with is good or bad is secondary.
They hope that after the dust settles there will be a situation that they can point to and say "See? We fixed it."
I'm curious, what makes you think that? (audit rights is actually quite a common term in outsource arrangements)
There are no politicians involved in this. (Or not yet maybe) This is entirely public servants trying to do their job.
It is very simple. The Netherlands want to force Apple to give up some control, but what Apple really wants to do is tighten its grip on iOS. So if you want to have an App on Apples AppStore, you are forced to give Apple audit rights? Come on! Seriously?
Big companies like Epic (especially Epic) BMW and lots of other companies will be delighted when another company and maybe a competitor, takes a look at their numbers ....
The fight will go one .... Yeah ....
Nah Apple is smart and will set up things so the developers so the law didn't work as planned and makes the developer's and consumer's life more of a hassle. When they complain Apple will go 'Yes we know this method is a load of BS out of a donkey's rear end but (cite law) requires us to do it this way.'
I've worked for the government (Forest Service and BLM) and I know how completely FUBARed ways the laws can be written/interpreted.
Case in point. The Forest Service had to survey areas near Camptonville, CA to make sure there wasn't logging in archeological sites. Problem was the law was written when all loggers had were hand axes and two person saws.
The heavy machinery modern logging equipment causes any buried lithics to eventually rise to the surface. So the logging company would go in log up to 90% of an area, we'd come in and find lithics all over the place meaning they couldn't continue to log there.
We knew it was silly to the point of stupid (joke was we worked for the Forest Circus rather than Forest Service) and so did our bosses Tom and Barry (yes the joke for them was it was time for the Tom and Barry Show) but it was the way the Law was written.
Another governmental agency I worked for, the Bureau of Land Management, had the opposite problem. They had detailed rules on livestock and mining (their nickname was Bureau of Livestock and Mining) but anything outside of that - like water rights, oil or gas drilling - were not regulated for the longest time. Even today the law with regard to those things, compared with the livestock and mining ones, are a total joke in terms of details and regulation.
Apple has enough money to make build their own military. They should become the Dutch East India Company of the 21st century. Just wage war against them. That is what the people want.
Who in their right mind would open themselves up to use what is basically an unchecked 3rd party payment system other than the system provided by the most admired and trusted company on this Earth? To save a few cents?
Well, I don't see a calculation from your side either.
Let's start with hosting: here is an article about Apple paying Amazon $ 1.5B over 5 years and it also states that Apple spends $ 10B on it's own data centers in 5 years and they also have other contracts with cloud providers.
So there is at least our first $ 2.25B a year. Let's say that about 50% is just for the App Store, that's still more than $ 1B. But now we only include 2 numbers here and easily subtract 50% for other services while the App Store is by far the most popular service worldwide. The actual costs are way, way higher as not all costs are taken into account.
Then we have App Review. Apple employs about 500 people for the manual review. That's about 500 * $ 100,000 a year just for personnel cost. All the engineering required for the App Store will be another at least 1000 * $ 150,000 (yes, engineers in the bay area are that expansive), and likely way more.
Then I haven't taken into account all the finance and legal processing, support and other costs. We're certainly talking billions here. Maybe $ 8B is a bit much, but if Apple takes a gross margin of 40% on the App Store like on other products it might come pretty close.
But the credit card companies themselves are multinational corporations in their own right and unless there are very special laws likely apply the same rules for higher rates in as wide a region as they can.
Apple’s proposal has zero % chance of being accepted by authorities. Time to exponentially increase those fines to really get Tim’s attention.
Just a thought; they did the math and they'll make a profit.
I don't think Apple takes all this as a personal insult like some commenters here do. For them, it's just business.
Note that Apple never claimed that it costs them 30% or anywhere near that to run the app store. They always argued that they run a business that brings values to their developers, and want to get paid = earn money on it. So 3% is the cost for charging money. Another few percent is the cost of hosting etc (analysts estimate 1.3 billion a year according to my google skills, services revenue 20 billion a quarter), and the actual profit is 25%. If a profit of 25% is going to be deemed illegal, a LOT of companies are going to be in trouble...
In other words, just as a lot of us have been saying all along, opening up other payment options will only make things more complicated with zero gain for the consumer. It will only complicate how consumers purchase things, and how Apple makes the money that they are going to make anyway. Noone wins.
Oh, and let's see how many of the developers who say that they don't want alternative methods to save money, but to be in more direct contact with their customers, are actually willing to put their money where their mouth is. They will end up figuring out that it will cost them money, and everyone except scammers and a handful of zealots will stay in the app store.
In other words, just as a lot of us have been saying all along, opening up other payment options will only make things more complicated with zero gain for the consumer. It will only complicate how consumers purchase things, and how Apple makes the money that they are going to make anyway. Noone wins.
Oh, and let's see how many of the developers who say that they don't want alternative methods to save money, but to be in more direct contact with their customers, are actually willing to put their money where their mouth is. They will end up figuring out that it will cost them money, and everyone except scammers and a handful of zealots will stay in the app store.
That's my estimate.
You got better numbers?
Last year 60 billion was paid to developers, Apple's take is about 28% ( 15% form most developers, 30% from the developer that make most of the money). So, the 60 billion is 72% of the total which is about 83 billion. So Apple's take is about 23 billion. Gross margin for services was about 65% last year so, 35% of 23 billion comes to about 8 billion.
The App Store is huge. I serves about a billion customers with curated content in 40+ languages around the world.
Sen. John Cornyn (R., Tex.), who voted “no” Thursday, suggested the fees were fair compensation for the platform the companies provide.
“I hope we’re not, by focusing on these specific cases, suggesting that somehow there is something wrong with creating a new product that has value to consumers and making a profit and creating jobs,” Mr. Cornyn said……vote Cornyn in for his basic common sense!
“I hope we’re not, by focusing on these specific cases, suggesting that somehow there is something wrong with creating a new product that has value to consumers and making a profit and creating jobs,” Mr. Cornyn said……vote Cornyn in for his basic common sense!
They don't get a percent of third party payments, they charge a fee for a specific use of their app: In-app purchasing. They are a private company, they can make up license rules as they like (until a court deems that they are misusing a monopoly that I don't believe that they have). There are plenty of ways to collect license fees based on revenue, it is being done all the time in various industries. It just complicates things since you need to audit etc.