If you really believe that Apple will be allowed to continue collecting 30% commission on everything in the App Store then I have a bridge to sell you. They’re being sued or investigated for monopolistic practices in pretty much every major market.
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Apple to Collect 27% Commission on Third-Party App Payment Systems in the Netherlands
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Android user.
Ok seriously, there is a reason "penny wise pound foolish" is effectively a truism. People will try to save a small amount up front even though odds are it will cost them further down the line. And when it goes bad boy does it really go bad as demonstrated by this PC building nightmare.
Report: iTunes costs Apple $1.3 billion a year to run
In an analysis, market research firm Asymco estimates that it costs Apple $1.3 billion a year to maintain iTunes and the App Store.
www.cnet.com
EDIT: Haha, I didn't notice the date... If it was 1.3 billion 10 years ago, 8 billion today doesn't seem that far off given the intensely increased focus on services.
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Well in that case Microsoft should charge 30% commission on every transaction done using Windows right?
How can you really tell a business how much it can earn from sales of services or products. Is costco regulated or sued? Is Ferrari regulated or sued?
Almost as if that was the point of every business.
Yes, through IAP made from games or other services through it's app store. It may not go over so well, since it is THE dominant platform.
If Costco and Walmart were the only 2 retailers in existence and both charged the same percentage for selling stuff through their stores then they most definitely would be regulated. Look up the term “duopoly” to learn more.
It costs money to run the App Store, and the majority of apps in the App Store are free and therefore earn Apple no money at all. They are in essence costing Apple money because the $99 a year doesn’t come close to covering the costs of supporting them.
As such, the bulk of their revenue comes from the 30% cut of paid apps (mainly freemium games). Remove that by allowing third party payments, and Apple will need to find a way of still getting money from developers to offset the costs of operating the App Store somehow.
And if Apple can’t get 30% via iTunes billing, then they will just change the name, but either way, it looks like Apple is dead set on claiming what they believe to be rightfully theirs.
And as I suggested in a way earlier thread, Apple could simply have developers sign a revised agreement stating that they owe Apple a percentage of sales regardless, and verify this amount via external audits (which would be way more work for all parties involved).
It’s pretty in line with how I expected Apple to handle the situation.
How does Unreal Engine and Unity do it?
Let's see how you got your number then.
If just iTunes (remember that?) cost 1.3 billion to run 10 years ago, "Not even 1B" seems a bit low.
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IF they are ruled a monopoly, perhaps not. To my knowledge no judge has made this ruling so far. "Being sued or investigated" does not make one a criminal.
I see it like this: If a court is going to argue that 30% is unreasonable, then they or the lawmakers will have to set a number on what is, in fact, a reasonable commision on selling software through an app store or similar. This will not only affect Apple, it will affect every other app store as well. Once you have done that, the next step is to consider whether this decision should only affect software, or whether politicians should set a maximum profit on everything we buy.
A few years ago, I sold some hardware through a "50% rebate club", where the customers purchased the product directly from me, the rebate club only did commision. Zero handling, zero stock, zero post-sales responsibilities. Just handing over customers to me. Do you know what the commision fee was? 30%. I guess I should sue them for helping me make money ?
Why would Apple be prevented from making agreeing to audit rights a condition for licensing its IP? That's a fairly standard condition on the licensing of IP. How else would licensors check that licensees are paying what they agreed to?
I'll point out (again) that the Netherlands is a signatory to international agreements in which various nations have agreed to respect the IP rights of entities from other nations.
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If 50% rebate club (Apple) and 50% rebate group (Google) were the only 2 avenues for selling hardware then they would definitely be sued.
You're making assumptions that may not be relevant. If this was about "duopoly" the ACM would have gone after the app store in it's entirety not dating apps.
Luckily for Apple, iOS apps are not the only way that developers can sell digital goods. They can sell them in android apps, windows programs and on a website. There are multiple ways for developers to sell their goods and services that do not involve Apple.
By Apple's reckoning their take is 3%. 30% of 10%.
Most of the apps are free and make money not going through Apple. Meal services, Uber, companion apps to some gadget, that sort of stuff. That accounts for 90% of the money. The money made from digital goods that can be consumed on device is 10% of "App Economy". They tax that with 30%.
Can I sue my web host Dreamhost so they are forced to lower their commissions charged to me? I mean they have the best product out there but screw it let the govt force them to lower it!!…..this will go on everywhere
Oh boy, still 27%, this will not land well with anti-monopolists and legislators
Dating apps are almost all owned by one mega company. They should pay an even bigger commission and be hit with a mega tax to pay for the social harms that happen to the majority of their users.
Apple is entitled to monopolistic profit when it comes to the use of its IP. That's how IP rights work, by design.
Potential anti-trust problems really only come in when IP owners try to tie that which they have a legal right to monopolize (i.e., the use of their IP) to other things they don't have a legal right to monopolize. The more such things are untethered, the more IP owners are free to charge whatever they want for the rights to use their IP. For instance, developers not being required to use Apple for payment processing makes it easier for Apple to legally justify charging whatever it wants for the licensing of its IP.
Where Apple might have a problem would be if it, e.g., charged 40% to license its IP if a developer wasn't also using Apple's payment processing but only 30% if they were. That might be seen as an illegal tying meant to help Apple monopolize payment processing.
Are you suggesting that Dutch authorities will force a private company to offer services for free? That would be a very odd precedent.
Ok, now you MUST be trolling. The smartphone is by far the most widely used computing device for the masses to the point where it’s becoming increasingly difficult to get by without one in any developed (and many developing) countries. Try pitching a tech startup without an iOS app and you’ll get laughed out of the room.
"Could". Not "Should". For various reasons it would proably not be a wise business move. But also, they are much closer to a monopoly on PC operating systems than Apple is to a monopoly on phones.
Anyway, even if Apple is ruled a monopoly, someone needs to decide for them how much then is "reasonable" to charge. It is certainly not zero. Is it 25%, 15%, 5%? If you look at what is charged from similar companies that are neither in a monopoly or duopoly, how are you going to argue that 30% (with caveats!) is unreasonable? Would a lawmaker not have to compare it to how much is charged by Google, Microsoft (Xbox), Amazon, Nintendo etc and use those as a precedent? If so, how are you going to argue that the "reasonable" number is not 30%?
Keep in mind that before Apple entered the ebook scene, and got fined for price fixing in the process, Amazon's cut was HIGHER than 30%. If Apple had not lowballed Amazon by ONLY charging 30%, Amazon's commision would be higher. Just one more example that 30% is not actually unreasonable compared to the rest of the market. Some are lower, some are higher, some (including Apple) have varying rates depending on different stuff.
Exactly, it’s fine for Apple to charge whatever commission it wants for the sale of digital goods via iOS apps.
What Apple can’t do is charge a commission on the sale of digital goods regardless of where they are sold just because a developer has an iOS app. E.g., Apple can’t charge Netflix a commission for Netflix subscriptions sold via the Netflix website but they can charge Netflix a commission for subscriptions sold in the iOS app.
Likewise, Candy Crush can sell you ‘bags of candy’ on their website and not pay commission to Apple, but if they sell you ‘bags of candy’ in the iOS app, Apple can charge them commission.
Huh? What I said is factually correct. Just because iOS is really popular doesn’t mean it’s the only place these purchases can be made. The law is based on facts and is not a popularity contest.
These idiot lawmakers when Apple finally granted the third party payments they were clamoring for while still taking a cut of proceeds for, well you know, providing the hardware and software and store and promotion and infrastructure and userbase:
