And there we have it. Jobs won't ever have a chance to be clearer, but it sure sounds like Jobs never intended for the App Store (or "Services") to be how Apple made money. Apple makes money by selling hardware which comes with great software included. They operate a store and an API that is supposed to make it easy for developers to make apps and for customers to receive apps, and they don't want it to be a money losing operation so obviously some small fees need to be collected, but at the end of the day, everything about the store should be in service of selling hardware.
and the leap to....
And when the store gets in the way, alternative options should exist.
Believe it or not, Apple's average gross profit margin is ~35%. Apple makes more _profit_ as a percentage from hardware stores than the gross revenue from the App Store. The App store brings their profit margin _down_.
Subtract subsidizing creation of API, hosting of the store, dealing with customer service, payment, fraud and conflict resolution, and all the downloaded data from CDNs. It isn't that much.
The problem is that Apple doesn't nickel and dime in billing like you see with AWS. Some people pay dramatically less than others. Until recently, Facebook had been on a decade+ tear of paying $99/yr for hundreds of terabytes of downloads and so on.
Does Apple get benefit from developers in terms of increasing the perceived value of their device ecosystem? Yes! In fact, that was the reason that Apple lets people publish software for their devices. Try to publish a brand new fart app, and watch how quickly Apple tells you your app provides no new, distinct value.
Apple never limited us to only putting music and videos from iTunes on the iPod - we could get them from anywhere
Strangely enough, I only ever was able to put music from iTunes on my iPod. There was no third party software that was supported/supportable for doing synchronization.
If you meant the iTunes Music Store, yes there were alternatives. Also, the iTMS had an Apple margin for customer service, payment, fraud, hosting, etc. of.. 30%
There were a lot of parties upset that only the iTMS could ship DRM'ed music that would work on iPods. They wanted to have a slice of the pie of that ecosystem.
and Apple couldn't care less whether we pirated them or not. Their argument was that we could find the stuff on the iTunes store easier than via piracy, and so naturally it'd make sense for us to use it, but they didn't actually care. Jobs went as far as arguing against DRM and making everything about iTunes DRM free, so that everything would "just work".
Exactly! How did Apple protect their strong market position on being the only store that had the DRM protections the music industry was requiring and that works with the iPod/iTunes? By pushing the music industry to drop DRM, so that music purchased from any store would work on any device.
But this wound up also being a smart defensive move for the iTMS, because the music industry was trying to bolster up competing stores (like Amazon) by negotiating special pricing deals. The music industry couldn't stop their paranoia long enough to notice they were creating a future iTMS monopoly entirely through their own contractual stipulations.
You still have DRM for non "owned" music (free song/album downloads back in the day, iTunes Music which is a subscription) but generally nobody brings it up anymore.
That was totally against the idea of them caring about making money via the store - only one person needed to buy it from iTunes, DRM free, and then they could distribute it however they wanted enabling piracy.
Word to the wise - the songs still had watermarking. By default, your AppleID was stamped into every song you downloaded. Let a m4a file you bought trickle unedited up to a file sharing service and see what happens.
The reality is that people who download from pirates and the actual pirates are entirely different demographics of people. Once people could just get the songs easily through purchase or subscription, why would they go to a piracy site? And once nobody wanted the music from your site, why pirate it?
Apple gave developers an easy way to make money via iAds. Developers were free to use it, or not, and overwhelmingly they didn't.
In-App Purchases is the first time where Apple got super different about it - suddenly it wasn't about giving developers and users more and better choices. Suddenly Apple wanted to force everyone into giving them money.
Actually In-App Purchases were entirely additive. Before in-app purchases, there was no option within an app to buy virtual goods and services, or upgrade a 'free' app to a 'paid' app. Developers were forbidden to take payment in-app. Developers were the ones who were screaming for more options.
Yeah, maybe the App Store was different, too, but I think that was intended to be short term, while Apple worked on their security model - if Jobs hadn't died, we would have seen Apple bring Gate Keeper from the Mac over to iOS 8 years ago.
There is no security model that accounts for malware tricking and abusing users. Look at the newest App Tracking Transparency - through the App Store, apple has rules about misleading text, promises about payment or other reward for enabling tracking, any sort of feature removal for the user denying tracking, and any third party hacks for tracking devices/users without the user opting in to tracking based on telemetry or fingerprinting.
_None_ of that is enforceable with light touch technical measures. Apple believes the App Store exists to give them the leverage to act as a user advocate on their own platform, to ensure that there is a positive app experience.
I look forward to hearing about the steps that the hypothetical future Facebook app store takes to prevent abuses by Facebook.