Thank you for the comprehensive reply.
Warning: Long Post ahead!!
For the record, I very much
do know what ambush marketing is as that knowledge is an integral part of my "day job" now. Please note that in my original post I did not say that what Spotify is doing
is ambush marketing, simply that it felt a lot like it. You mention that placing a link to your own website on your own app isn't ambush marketing, and if it was purely a link to their website then I would agree. But it is a link to a website in order to get the user to sign up to avoid the app owner (Spotify) having to pay Apple's commission charges.
Imagine going in to Walmart and seeing a brand new Sony TV being sold for $1299...only have have a "demo reel" playing on the screen which says "Go to
www.sony.com and you will only pay $999 for this exact same TV". Do you not feel that is disingenuous? Having the TV on display in Walmart but trying to get people to buy it elsewhere? How does that not fulfil the criteria I gave for being
similar to ambush marketing in that Sony (in this case) is benefitting by using the huge customer base of Walmart to try to get people to actually purchase the item in question
from a different store? It is using one brand's prominence to try to gain sales - direct sales - without paying the original store in question anything for doing it?
But, again, to be clear, I am not saying this
is ambush marketing, I am just saying that the process that they are saying they should be able to adopt has many of the same traits as ambush marketing.
Good to clarify. Primarily I think it is not close to ambush marketing as it does require an active purchase (or at least download) of the app before this "marketing" is even done. Thus the consumer already have the intent of using the app.
I think that many others have pointed out that apps like Uber are not recurrent payments. I could download the Uber app and then use it once in two years. Sure, Apple could insist that all payments are routed through iTunes billing for that too. But it's not a direct comparison. A Spotify subscription is a known quantity, billed on a certain date, with no interaction required from the user beyond the initial agreement.
Now let's consider Uber. Somebody could call an Uber any time of day or night. They could be in a hurry, they could be unwell, that could be totally drunk. Requiring the user to confirm their identity through iTunes billing may be simple (TouchID or FaceID) if they have recently purchase something, or it could require them to re-enter passwords which the may have forgotten, all of which adds up to potential for the user to not actually be able to pay for their ride there and then. In that situation, it is understandable that the simplest, most immediate forms of billing are required to cover all eventualities.
Apple Pay is certainly an option as you mentioned but then Apple would be making money from that transaction too. Is that also immoral and anti-competitive? Just asking...
To be honest, though, I don't think the issue is the payment method used (you mentioned other apps allowing Apple Pay and Credit Cards), I think the issue is the fact that Apple is actually charging commission at all...whether it was billed through iTunes or whether it was paid monthly/quarterly as a commission payment from Spotify to Apple. People seem to be getting their panties in a bunch simply because Apple dares to make money from a competitor selling a similar product on their store!
I am not saying that Apple should take a 30% cut from Uber too. I am saying that payment methods should not be monopolised and actively limited by a platform owner such as Apple. And while you can argue there is an option for circumventing it, by posting a link as Spotify or going with Android if you want to circumvent it as a consumer.
And yes, I do not think that Apple should have 30% of anyone's yearly payments for Spotify as their contribution is very marginal. Nor should they have a cut anywhere near for 30% for basic transaction handling.
Yes of course the App Store is good for Apple...but let's get real...for every $0.30/$0.15 that Apple makes from the App Store, the Developers make $0.70/$0.85...so it's doing the Developers more "favours" than it is Apple. But, as you say, the main beneficiaries are the consumers...the mighty consumers...
Two points here. Firstly, competition does not always benefit the consumer. The easiest way to compete is on price and more often than not a "race to the bottom" on price simply means that consumers end up with a bunch of cheap rubbish that has little to no quality control and simply appeals to those looking for a bargain. The other kind of competition, that based on quality and product offering, often goes the other way and actually increases prices. Look at the innovation of Samsung's folding phone for example. They are competing on features, offering something that Apple doesn't, and the price is almost unfathomable. So yes, competition can benefit the consumer, but doesn't always and to say that it does as a blanket fact is disingenuous.
Apps sell the iPhone and developers get no benefit from that. I use 7 apps from Apple (clock, mail, messages, phone, calendar, photos and camera) everything else is not developed by Apple. It is of course true that Apple enabled the existence of these apps, but at the same time these apps made the iPhone successful. And as far as it goes for apps, I find it easier to justify to take a hefty cut, as they will be 100% only consumable in the Apple ecosystem.
Secondly, Apple is not making Spotify "less viable" unless the general public today is too lazy to click on an email link and sign up to a service that way rather than simply clicking a button in an app. Of course, Apple Music does have the option to do that so yes, in that sense, if Spotify were not allowed to have an in-app purchase option then it could be seen that Apple Music has an advantage - albeit an incredibly small one. However, Spotify does have the option to do that, it simply has to pay for it. So Apple is not making it less viable at all, it is simply saying that if Spotify wants that convenience it has to pay for it.
Apple is making Spotify less competitive by taking the cut, its just simple math as all other costs are basically equal. And I think Spotify's "
ambush marketing" and also the antitrust complaint is a very acceptable move in the situation they are in.
Plus, why should a company that invents a technology (the App Store in this case) not be allowed to have an advantage over using it itself when compared to a third-party that it is allowing to use that technology? If I invent a technology and I have the ability to produce it at scale and I then license that tech to a competitor who can't (for whatever reason) produce it as cheaply as me, should I be prevented from offering my product at a lower price simply because I have the advantage of being able to produce it more cost-effectively? That argument is a little thin and essentially removes the ability for any company, anywhere to have any kind of competitive advantage. Very few people would bother setting up businesses if they weren't allowed to try to find advantages over their competitors.
I disagree, Apple is not providing a service, they are running a business. Something like a hospital could be considered to be providing a service but even though only if it was state funded and run. A private business exists to make money (non-profits excluded of course). In fact, the directors of a business have a legal obligation to run the business in a way that most benefits the shareholders...not the consumers.
So yes, you want people to look at this issue from the perspective of the consumer who is somehow suffering some "hurt" in this, and you are completely entitled to do that. But others among us, perhaps those who run businesses themselves, are equally entitled to view this from a more pragmatic standpoint and consider how they would feel if there business were being subject to the same circumstances. That is what I base my viewpoint on.
I am an Apple consumer (not a Spotify one though it should be said) and I can completely understand the "consumer" viewpoint. However, I like to look a little deeper than what simple provides me with an immediate perceived benefit and consider the bigger picture not only of the company perspective but also of the long term consumer perspective.
I am not talking about the legal playing field nor the capitalist reality but how we as consumers should look at the situation. In this putting anything else than the consumer in focus is clueless fanboyism or ignorance.
From the corporation's point of view I agree that neither Spotify nor Apple is doing this for the benefit of the consumers, but rather the shareholders. I would counter your argument by saying that Apple's practices and Spotify's complaints are just how this corporate game is played, thus I find the
ambush marketing label for Spotify's tactic very harsh when Apple's monopolistic aspirations are justified by the fact that they are a business and not some charity.
In this case however the consumer should take Spotify's side, simply because of some long-term benefit from it and some short-term moral consequence of the money maybe going to the artists.
I don't actually live in the US so I have no feelings either way. What I can say with absolute certainty is that you are not the first person to feel that something is too expensive. Neither is the US cellular industry the first to come under fire for being too expensive. My take on it is that you have something you want...it is offered at a certain price...you can either afford it and you get it...or you can't and you don't. If you can't afford it then you can complain about it and say that the whole industry is somehow corrupt and unfair...or you can just get on with life without it.
I was suspecting that. I am not affected by it either, but can still think a system is ****** for that. I am for free market, but have come to the conclusion that in order to keep it free in the long run, sometimes one have to take (anti free market) actions in order to protect it.
The problem with this is that if the EU forces Apple to lower it's commission rates then it will have to lower them across the board. This will mean that they will be "punished" financially even on apps where they don't directly compete in the space. Unless, of course, they have a two-tier system where some apps attract a 30% commission and some a 10% (or whatever arbitrary number the EU decides is acceptable) commission. Then that would create a whole raft of cases where those being charged 30% would start running to the EU screaming "Unfair!".
Apple already enforces different rates. See transportation, food, payment services, even allowing other payment methods, or news, where they have an even higher rate. They are at the same time screaming "unfair" themselves as in the Qualcomm case.
I suspect what will happen is that Spotify will be allowed to place a "sign up here" or "upgrade to premium here" link in their own app.
Finally Apple's 30% for actual in-app purchase (not recurring subscription payments) is pretty competitive, there are not many payment provides who are ready to do those for less, so I don't think Apple or Google in Google Play Store have to worry too much about that.
<rant>For me, I don't relate to the Entitlement Generation and I will certainly never be convinced that having a cellular service is some kind of human right. Perhaps I am in a minority here but I have my reasons, mainly based around the fact that, in spite of all of the promise that the Internet gave at the beginning, I believe that the Internet (and Social Media in particular) has done more harm than good and this "always on" generation has become too reliant on technology. </rantover>
However, I will end by saying that while I understand your viewpoint, and while I will openly say that you put it very elegantly, I disagree with almost every point that you made!
Oh, the whole entitlement generation is an interesting issue for an other day. I guess you are a few years older than I am, and while I share some of your opinions, being a part of that generation I have an understanding for the worries about the potential hardship that is inflicted upon us by the previous generations.
Thank you for a good post. I liked discussing this with you.
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So if it's ultimately about what is best for the consumer, then an App store that has made the vast majority of Apps free and the rest 99cents is not good for the consumer???? LOL. You win the award for the most ironic post of the week.
If all the Apps where free or at least 30% cheaper, it would be better for the consumer, right?
If you really think Apple should have 30% of every single payment for what they provide for Spotify, then please let me know how you will be sending me $20 for every one of your posts I thumb up. Lol.
