The economics of the current system favors small developers. Letting big apps exclude apple from getting a cut and exclusively pushing customers from the app onto web payments will wreck the system for small developers. I'm a small developer.
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EU Plans to Let Spotify Direct Users to Other Payment Options on iPhone
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The economics of the current system favors small developers. Letting big apps exclude apple from getting a cut and exclusively pushing customers from the app onto web payments will wreck the system for small developers. I'm a small developer.
Going to a place where your argument crumbles into pieces? hahahahaha hell yes.
Anyways, moving on.
I don't know?
You stated that developer fees barely covers Apple's bandwidth cost.
So just increase the developer membership fee - or charge per download. Problem solved.
No need to freeload by charging 30% commission on a music streaming service Apple doesn't provide.
Oh, I do approve of free markets. Such as... free markets for mobile apps, for instance.
Let's read up on free markets, shall we?
"For classical economists such as Adam Smith, the term free market refers to a market free from all forms of economic privilege, monopolies and artificial scarcities. They say this implies that economic rents, which they describe as profits generated from a lack of perfect competition, must be reduced or eliminated as much as possible through free competition"
👉 A market free of economic privilege and monopolies? I can get totally behind that!
We just have to free the distribution of apps and services from Apple's iron shackles, to bring about a free market for mobile apps.
They are basically forced to develop for Google Play and Apple's App Store.
Not having an app makes on these two stores makes their business unviable.
Very few people would want a music streaming services that doesn't have an app, background streaming etc.
Absolutely.
But not one without its downsides - namely the market concentration and the unique economic power and rents Apple is able to earn, and the potential for abuse and anticompetitive practices it allows Apple.
Absolutely.
So much has it flourished that it (with Android and Google Play Services) has becoming virtually unassailable duopoly in the market for mobile apps.
No private investment could and will be apple topple that (due to the network effects). Not Nokia, not Blackberry, not Amazon, not Microsoft. Just as Microsoft and its Windows operating system have withstood competition for decades.
So it's about time government makes appropriate laws to tip the scale back in favour of third-party developers and consumers.
👉 Only government intervention and regulation can bring about freer markets for mobile apps and digital services on mobile devices.
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read the part before that: "but either way, yes. professional services cost a referral fee which is a percentage of the service cost."App Store now. Sounds like you’re the 1 changing the goal posts
do you admit you were wrong now? I await for your response.
Yes. The current foundation of the App Store is economically viable with current fees and rates. Apple makes up on the bandwidth costs and other costs from other means instead of through developer fees.
Forcing Apple to let Spotify or any other big app bypass the fees and redirecting all users from within the app to outside the app for payments this late in the game ruins the foundation and can potentially destroy the App Store.
I think you just understood my point?
Nonsense.
Hosting and bandwidth is cheap, the App Store existed when even expensive (!) apps were $5, and Apple is making enough money from hardware sales. Their hardware sales are relying on third-party apps being available for the platform - so it's appropriate and fair if they cover operating costs of the App Store.
Apple is free to set competitive fees and rates for their App Store that make Spotify and Netflix want to use Apple's in-app purchase system.
Calculate it. Spotify has 500 million users. Assume 100 million users is on iOS. App is 150 MB. Spotify pushes 4 updates a month.
That's 60 Petabytes every month from just Spotify. Based on standard S3 pricing, that's $3 million per month. Spotify no longer has inapp purchases so Apple loses $3 million/month from one app.
The App Store actually display a current size of 179 MB for Spotify.
But you're calculating it wrong. Very wrong.
Here's an example of a 47MB app: https://apps.apple.com/app/ia-writer/id775737172
Yet when I update that through the App Store, it needs to download a update package of merely 593KB to update the last to the latest version:
Thanks to the clever use of app update packages (that you may want to read up on), the update size is reduced to - in this case - a small fraction of less than 1.5% of the full download.
This was the first and random example showing up in my App Store updates, and admittedly, this must have been a small code update without updates to other app resources (images). But Organic Maps is also displaying 623KB update on a 115MB full download app - so not an extreme outlier.
EDIT:
60 Petabytes is approximately 60 million Gigabytes.
Your $3 million per month figures assumes a cost of $0.05 per Gigabyte.
Some quick googling convinces me that it actually must be less than one cent per GB, at Apple's size.
Given your assumptions about number of users and app downloads and mine about size, that'd make for less than $10k a month (on small updates).
👉🏻 That’s a bit less than Tim Cook’s 2022 hourly executive compensation (almost $100 million for the year. Or more than 10k per living hour - basically assuming the guy doesn’t sleep but works 24h a day).
Again, that’s just assuming small code updates - but anyway, it’s a fraction of your estimate.
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Ok, but even if you are wirelessly streaming it to speakers, you are still using it through the app. Spotify isn't a physical product or tangible service like a hamburger purchased through the McDonalds app, a ride purchased through the Uber app, or a computer purchased through the Best Buy app.
What do you think the fairest solution would be in this situation for Apple, app developers and users? Apple should lower 15%/30% commissions and/or Apple should charge "free" apps a set monthly fee and/or Apple should allow apps to use or at least promote alternative payment methods? Something else?
And that is precisely why google lost their case with Epic because Google is actually doing anti-competitve BS behind the scenes and not applying the same standard to everyone in their stores.
Spotify Doesn't Pay Google Play Store Fees
Google admits in court that Spotify got a sweetheart deal of 0% fees.uk.pcmag.com
Do research so you don’t waste your time. Apple aren’t paying you to be their cheerleader so less defending the indefensible is wise. This verdict is a consumer benefit as allows competitors not to be stifled.
thank you for making my point.
their current rate is completely fair. 15-30 percent. It's not as if apple is asking for equal or more.
Apple alone did create the success for the app store. It literally launched without an App store and changed what we know as smartphones today (including Android phones). Without it, we'd likely still be using Blackberrys and Windows mobile.
Android certainly would have came along but it likely wouldnt be the Android it is today without iPhone reinventing what we now know as the smartphone.
Now you would be fair to say that the App store(And the developers) helped build upon and continue the legacy apple created but remember: iPhone launched BEFORE the app store and given the growing popularity of the iPhone which came before the app store, the developers benefited from iPhone.
It is a mutually beneficial thing yes but to act as if it is 50/50 is ridiculous. A lot of these popular apps we used today would not exist without the iPhone in their early days.
Why the distinction? Why should Apple be entitled to a commission on a video streaming subscription purchased through an app - and isn’t when I purchase or rent a physical DVD through an app? Why are physical products or services allowed to be advertised, offered and sold in apps? And why not digital downloads, too? It’s not as if governments would treat or tax them differently - they’re usually subject to the same tax rates and similar regulations.
First if all, a per-download fee doesn’t strike me as unfair - especially if it’s applied equally to all apps.
Given how
- smartphones costs hundreds of dollars
- few relevant operating systems and App Stores exist
- high the hurdles to switch are (people can’t afford to and won’t switch on spontaneously overnight)
- how important they’ve become to organise and manage our daily lives
There should be no single gatekeeper to dictate what apps are allowed to be installed and run on such a phone and what business models they’re allowed to. Allowing sideloading should be mandated by governments (and slowly it is, with the EU being a forerunner in that).
The threat of, espcially prominent apps like Spotify or Netflix going that route and offer their apps for sideloading will limit Apple’s ability to unilaterally set and increase fees. The more normalised and accepted sideloading becomes (as it is on a Windows or Mac PC) for consumers, the stronger the effect.
Also, anti-steering provisions such as prohibiting app developers from marketing and advertising to end users should be prohibited by law.
Both may lead to Apple charging commissions that are determined by market supply and demand instead of being unilaterally set. They won’t be at 30% for the first year.
It’s would be fair if it’s a market price determined by supply and demand - with viable alternatives and competitors being available.
To suggest it’s fair someone charge 30% commission on a music or video streaming subscription when that someone didn’t produce, or license that content, not store or provide its transmission over the internet - I find that ridiculous.
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there are alternatives
Spotify
Pandora
Apple Music
Youtube Music
Amazon Music
Musi
napster
iHeart
Tidal
All of which are cross platform. All of which can be used instead of Apple Music.
Spotify has no alternative to the Apple App Store to distribute their app for iOS devices.
Well now it seems they will. But to argue 15-30 percent is too much is ridiculous.
I think this really wont do much in the long run to hurt Apple or help them because if IOS users are to be thought of....most of them will continue to go the apple route.
I know i would. I dont want to go to separate stores and websites just to sign up when i can do it all from the App store.
That being said, I already uninstalled Spotify anyway for this childish behavior. So i am least a new Apple music user.
Alternative payment methods are utterly pointless as long as Apple are (as they’ve shown they want) charging 25%+ commissions.
If you’d make me name „fair“ number for Apple‘s commission rate, I‘d say it may actually be 10-15% or close to that (if you look at alternative full-service options like FastSpring, Paddle or Gumroad that also do VAT and act as merchant of record, charging somewhat between 5 and 13%. And also factoring in a premium for Apple as the platform operator, their marketing of third-party apps and their app review process).
The biggest developers will however be able to do their payment and VAT processing for considerably less
30% commission is not a competitive (or „fair“) rate at all.
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Sure I don't mind getting technical. I'm an iOS developer so I'm well versed in this, was only dumbing it down to prevent posts from getting 10 pages long:
Disingenuous example. My Tesla update was 197MB. Full app is listed as 477 MB. Tesla also ships weekly updates.
Also you're missing:
1. On demand resources download - content that downloads after the app is installed. These resources also get updated separately apart from app updates.
2. Apple Watch updates - small app, but that also gets updated 4 times a month
3. iPad updates - 4 times a month
4. Apple TV updates - 4 times a month
5. Push notifications are sent by Apple servers (1KB-4KB each notification x number of Apple devices). Example: Sending 1 push notification @ 4KB to 100 million devices = 500GB. That's conservative. Multiply many devices per user, many push notifications per week, etc... This also includes macOS apps since push notifications are also sent by Apple's servers.
6. iPhone/Watch/iPad device restores - redownloads all apps from scratch each time a user replaces the device.
AWS Calculator for 60PB showed $3million outbound from Ohio. Type it in here: https://calculator.aws/#/addService/S3
Apple used a mix of Azure/Google Cloud/and AWS, so use those numbers. Why are you using providers where there is no evidence to show Apple is using those providers?
Apple ditches Microsoft Azure, confirms that it uses Google Cloud for iCloud
In a document updated last month, Apple confirmed that it uses Google Cloud Platform to host user data for iCloud. Interestingly, the file no longer makes a mention of Microsoft Azure.
www.neowin.net
Apple spends more than $30 million on Amazon's cloud every month, making it one of the biggest AWS customers
Apple is a big spender on Amazon's cloud — and that isn't going to change anytime soon.
Could they have negotiated a deal? Sure. Could they run their own caching servers for big apps to save on bandwidth costs? Sure. But I'm going based on what is known.
So when I say 60PB, that's extremely conservative when you factor the above, primarily the fact that plenty of users have many Apple devices. But say it's 30PB/mo, is that argument really changing anything? Suddenly comparing against Tim Cook's compensation is meaningless. Spotify is still getting millions of dollars of value and not paying Apple anything other than the developer program @ $99/year.
And that's just *bandwidth* cost. Didn't even get into server costs, TestFlight costs, CDN costs, app thinning costs, app review costs, etc...
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You didn’t prove anything except proved yourself wrong. You tried to make it sound as if Google got a free pass but it didn’t, Google knew having a music service and trying to make them pay the fees is uncompetitive and they’d lose - so they gave Spotify 0% fee alternative while Apple stupidly didn’t.
Now if it is deemed Google provides competitive games like Epic with a cost/advertising advantage - same will occur. They don’t.
You are bringing a completely different issue which is, should they allow different payments to avoid paying the % fee for all apps entirely (not due to having competing app specifically). In that regards I think both Apple and Google are greedy.
But let’s not pretend these are the same cases.
I never once said Google got a free pass (LMAO you would never see me defend google in the least). That's not my fault you misinterpreted or read what you want.
You accused them of doing shady stuff with Spotify - when in fact they did what Apple should be doing aka let them not have to pay that fee. And I didn’t say you defended Google once…
Nothing misinterpreted - you tried to defend Apple using Google, incorrectly, because you failed to understand the facts of both cases.
No actually I didnt.
Google made a shady deal with Spotify that it did not offer to other developers giving Spotify an advantage and google making money from it BY BEING ANTICOMPETITIVE, so why should Apple do the same thing? It's literally what cost google their case.