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As a result of legal and regulatory pressures, Apple recently announced some upcoming changes to its App Store policies, such as letting developers email customers about payment options available outside of their iOS app and allowing "reader" apps like Spotify and Netflix to include an in-app link to their website for account signup.

app-store-vs-developers.jpg

Apple said the changes "will help make the App Store an even better business opportunity for developers," but Morgan Stanley analyst Katy Huberty believes there will be "minimal financial impact" to Apple. In a research note, she said the changes would result in just a 1-2% hit to Apple's earnings per share in the 2022 fiscal year in a worst case scenario.

For example, while "reader" apps will be able to provide a single link to their website to help users set up and manage their account, which could result in more customers subscribing to an app directly instead of through Apple's in-app purchase system, Huberty notes that Spotify and Netflix already disabled the ability for new users to subscribe to their services through Apple's in-app purchase system since 2016 and 2018 respectively, meaning Apple hasn't collected a commission on new subscriptions to either app for at least three years.

Huberty added that App Store revenue from the top 10 "reader" apps accounts for less than 8% of overall App Store revenue, suggesting the financial risk to Apple from these developers circumventing the in-app purchase system is "fairly small."

"We view the top 10 or so apps as those that are most likely to have the scale, brand, marketing budget, and customer loyalty to absorb the friction of circumventing the App Store payments platform," she wrote. "Assuming a worst case scenario in which Apple stopped collecting economics from all of the top 20 reader apps translates to downside risk of 4% of Services revenue, 1% of total company revenue, and about 2% of FY22 EPS forecast."

"In other words, we believe the recent App Store headlines are more attention grabbing than the ultimate financial impact to Apple's revenue or profitability," she concluded.

Huberty believes Apple has no intention to bring these changes to gaming apps either, despite having faced a lawsuit from Fortnite maker Epic Games, which accused Apple of having a monopoly over the sale of apps and in-app purchases through the App Store. A decision in that lawsuit is expected to be announced soon.

Article Link: Apple's Planned App Store Changes Will Barely Affect the Company's Bottom Line, Says Analyst
 
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dguisinger

macrumors 65816
Jul 25, 2002
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Of course it won't, most of these reader apps already required you to bring along your existing subscription. Now they are finally allowed to tell you how to sign up.

Good thing we are throwing away 30% on all our game content sales which apple has no hand in for privacy....after all children play games, and Apple gets a free pass on protecting children. Won't someone please think of the children? Now, shut up and give Apple all your money.... /s
 

Infinite Vortex

macrumors 6502a
Mar 6, 2015
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Apple said the changes "will help make the App Store an even better business opportunity for developers,"
That's all well and good to say that now but the number of times they've been in court to prevent it along with all of their long standing "justifications" to never have offered it without a court order makes Apple's statement ring a little bit hollow.
 
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Wildkraut

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Nov 8, 2015
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So Apple now admits that these links (which they didn’t allow till now) is a better business opportunity for developers?! Bwahaha… what a bunch of ass climbers, trying to twist it to sound like they are being gentle to developers and invented a new business model.

Soon they will have to admit that sideloading, alternative AppStores and open NFC r/w access is better for developers and customers, too.
 
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citysnaps

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Oct 10, 2011
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Apple will recover the 1% total company revenue hit in other areas (products, services, software). I suspect that's part of the reason for the recent price increase stories. Not surprised.
 
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lederermc

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Sep 30, 2014
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Seattle
How should Apple charge for access to the Xcode developer's tool and the Apple App Store if not thru a commission on sales? Or recognizing that, within the product's sale space, there is a monopoly so Congress should pass a law setting all online commission rates the same. This would include Google and XBox etc.
 
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dguisinger

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Jul 25, 2002
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How should Apple charge for access to the Xcode developer's tool and the Apple App Store if not thru a commission on sales? Or recognizing that, within the product's sale space, there is a monopoly so Congress should pass a law setting all online commission rates the same. This would include Google and XBox etc.

How could Apple charge for Xcode, a tool it needs internally to build its own operating system, that ships on its massively successful and profitable iPhone which would die off if there were no 3rd party apps-for-that. How could Tim Cook ever possibly afford to eat without double-dipping on recouping costs?
 

Wildkraut

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Nov 8, 2015
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How could Apple charge for Xcode, a tool it needs internally to build its own operating system, that ships on its massively successful and profitable iPhone which would die off if there were no 3rd party apps-for-that. How could Tim Cook ever possibly afford to eat without double-dipping on recouping costs?
With the upcoming laws which will be set by EU,US, etc. we probably won't badly need Xcode to code anything.
The SDK is enough, and alternative third-party IDEs will pop up.
 

dguisinger

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Jul 25, 2002
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With the upcoming laws which will be set by EU,US, etc. we probably won't badly need Xcode to code anything.
The SDK is enough, and alternative third-party IDEs will pop up.

I have to say, as someone who's used Visual Studio for 20 years.... the few times I've tried to use Xcode, .... I HATE XCode. The IDE just doesn't behave the way I expect an IDE to behave.
 

Wildkraut

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I have to say, as someone who's used Visual Studio for 20 years.... the few times I've tried to use Xcode, .... I HATE XCode. The IDE just doesn't behave the way I expect an IDE to behave.
Same here, I use it because there is no 100% way around it "yet".
It should be called Xpuzzler and not Xcode, good for noobs but bad for coders.
 

Seend1983

macrumors member
Aug 13, 2020
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Is that surprising? Why would a company do anything that would affect their bottom line? Even if the slimy hands of the Feds force them to undercut themselves, they would make it up somewhere else, maybe with a flat-fee charge on all developers or a tiered system where fat cats like Epic Game would pay a higher cost while indie devs would pay little or nothing. Regardless, they would make it up or maybe even end up more profitable.
 

MauiPa

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Apr 18, 2018
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the whole issue has always been a red herring. Any developer could have their apps downloaded from the App Store and use sign in credentials from a web based subscription - 0 fee to Apple. so all apple really did was say you can't advertise your subscription service on our App Store, which makes sense. You don't buy a phone at t-mobile and see AT&T adds
 

LeeW

macrumors 68040
Feb 5, 2017
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Over the hill and far away
I mean, if I see an app that I trust for $10 via Apple or pay externally $7 then yeah I would. Especially if it was a subscription. Not so sure this is 'nothing' to Apple in time.
 

MauiPa

macrumors 68040
Apr 18, 2018
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Same here, I use it because there is no 100% way around it "yet".
It should be called Xpuzzler and not Xcode, good for noobs but bad for coders.
I say the same thing thing about visual studio. The actually, not whiney fact is that one is based on a windows paradigm, and one on an apple paradigm, wanting one to behave as the other is just nonsense. So either stay with the one you like, or learn the other one, switching back and forth is frustrating.
 

MauiPa

macrumors 68040
Apr 18, 2018
3,007
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I mean, if I see an app that I trust for $10 via Apple or pay externally $7 then yeah I would. Especially if it was a subscription. Not so sure this is 'nothing' to Apple in time.
it's nothing because developers could always do this just see Spotify. Sign up for a subscription via Spotify's web site, use Spotify on iOS (their Mac app sucks). The whole thing is just whining for the sake of whining, so a store doesn't let you advertise a competing product, big deal, they all do that, doesn't mean you can't activate somewhere else
 

PC_tech

Suspended
Jan 17, 2019
933
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How should Apple charge for access to the Xcode developer's tool and the Apple App Store if not thru a commission on sales? Or recognizing that, within the product's sale space, there is a monopoly so Congress should pass a law setting all online commission rates the same. This would include Google and XBox etc.
Isn’t that what the 99 people pay them a year is for?
 

Cosmosent

macrumors 68020
Apr 20, 2016
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La Jolla, CA
She is part of the Band of Four (AAPL Cheerleaders), Munster, Ives, Huberty, & yes, even Cramer.

Always promoting AAPL !

Regardless, the App Store changes that Apple has already announced are meaningless to those who have a gripe against Apple, & as such, their War isn't over !

IMO, Apple really needs two App Stores, one that focuses on Game Apps, Little Kid Apps, & Apple Arcade, & one that focuses on everything else !

Apple's existing App Store is NO MORE THAN a Marketing Arm of the company itself !
 

arlomedia

macrumors member
May 5, 2021
66
77
The whole thing is just whining for the sake of whining...
It's actually good for usability (a.k.a. good for users) to make a registration workflow easy to find. I mean, I'm tech-savvy enough that if I download an app and it prompts me to log in, I go to the app's website and register. But I routinely see users that can't make that connection on their own and get frustrated. All parties would benefit from an App Store monetization approach that doesn't incentivize bad usability.
 
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