Facebook Claims Apple is Damaging Small Businesses by Collecting Fees From Paid Facebook Events

[BeefCake 15]

Get'em Mr.Cook, fight them on all fronts!!

 

[locovaca]

Oh, jealousy is such a sad thing... wish Apple would create a social network. You know, just for your contacts, secure, minimalist and not selling your personal information.

Maybe someday.

I got a great name for such a theoretical service: Ping!

 

[Rogifan]

The latter.

So Apple thinks it deserves commissions but doesn’t have to pay them. Curious what the defense of that would be.

 

[jclardy]

Funny to me how all these multi-billion dollar businesses are coming out of the woodwork to demand lower fees. I don't necessarily side with Apple on this issue but it's hard to feel sorry for these giants.

If any of them were in Apples position to have a smash hit phone ecosystem they would undoubtedly do the same. Heck Epic Games takes a cut from the games on their game store as an example.

The problem isn't Apple taking a share, it is just the fact that the 30% of things sold in-app makes no sense anymore.

Facebook makes millions from iOS users, but they pay $300/year for an enterprise account. Apple gets none of it.

Meanwhile, small devs pay 30% cut from their paid app revenue, while also getting grifted by apple via search ads. You literally have to pay apple for ads on your own app name to ensure your app is the first result when a user types in your app specifically.

Some kind of tiered system would likely be the best option - remove the apple cut from the first 10/50/100k revenue, then go up from there, but also have provisioning from download numbers for free apps that are monetized in some way.

The problem is right now an indie game that sells 2000 copies at $5 each makes Apple $3000. Facebook/Uber/Netflix/Lyft all pay less than that for millions of users. Those companies are raking in profits from them, but instead we have the small players supporting the entire app economy.

The App Store is an incredible achievement, but it is not a level playing field as Apple continues to spout.

 

[kuwxman]

Anyone that supports Apple is just suckling their teet at this point. A 30% commission on in-app purchases is robbery.

 

[jonblatho]

So Apple thinks it deserves commissions but doesn’t have to pay them. Curious what the defense of that would be.

Well, it’s not against Google’s rules for the Play Store. The only Play Store apps that must use Google’s IAP system are games; other than that, it’s left up to the developer whether they want to use it in combination with their own option or at all. This is, of course, pretty different from Apple’s own stance, currently.

 

[Zoboomafoo]

Spotify, Netflix, Epic, Microsoft, Facebook (WhatsApp/Instagram/Messenger) should have all did the same what Epic did yesterday and get their apps pulled.

With that much leverage Apple would be forced to act quickly.

I am a huge Apple fan, but they got very bad points for blocking innovation like xCloud because I am a gamer.

They should just allow sideloading of stuff they don't want to approve. Everybody happy. They can even keep their 30 percent then without issue.

does this mean the second coming of version tracker to manage everyone’s application updates?

 

[Quu]

That's why I feel the policy should be changed, but not in favor of these big businesses. Who does this really hurt? The independent developers with small teams (sometimes one person!) who then have to leave 30% of their profits on the table. Facebook is complaining about a 30% charge for something that, in the end, they could eat. They could eat the entire surcharge and their bottom line wouldn't change much at all. Facebook does not have my sympathy here at all. Maybe Apple should charge up to 30% based on the size of your development team.

A sliding scale start from 0% to like 20% based on the revenue the app generates would make sense in my eyes as-well. The 0% would be for free apps obviously.

 

[fmillion]

The latter.

If that's true, then Apple is violating Google's Play Store policies. They have the same rule about requiring purchasable digital goods to be done through Google's payment platform.

Hey Apple, why not play by the same rules you enforce?

EDIT: I may be wrong, looks like their requirement only applies to games. Apple's is a lot more broad.

 

[Rogifan]

Well, it’s not against Google’s rules for the Play Store. The only Play Store apps that must use Google’s IAP system are games; other than that, it’s left up to the developer whether they want to use it in combination with their own option or at all. This is, of course, pretty different from Apple’s own stance, currently.

So basically Google offers something Apple should offer. If Apple had the same rule as Google (i.e. excluding game apps) they still would rake in $$$ from the App Store.

If that's true, then Apple is violating Google's Play Store policies. They have the same rule about requiring purchasable digital goods to be done through Google's payment platform.

Hey Apple, why not play by the same rules you enforce?

Doesn’t Google offer alternate payment methods in-app (at least for non-game apps)?

 

[dguisinger]

Easy way to resolve this is lower your in-app transaction rates to something similar to PayPal, Stripe, Square, and every other payment processor. Start charging App developers for distribution bandwidth (Bandwidth is dirt cheap, so this would hurt no body), that way "free" apps still pay for their presence. Apple is providing nothing of value to these companies once the customer already has an app. Developer fees and money earned from actually selling the hardware/operating system should cover the costs of SDKs and tools, just like they do on the Mac, on Windows, etc.

 

[icanhazmac]

People who fail to see the issue with all of this really need to put down the Apple Kool-aid. Sure, App Store purchases make sense to have a commission fee, but does it make sense for Apple to take 30% of every single transaction within the ecosystem, even inside of each app?

People fail to see that without a commission on the IAPs developers would list the app as free then charge you a per turn, per use or per time to play which would cut Apple out completely. How would you fix that?

 

[BeefCake 15]

Anyone that supports Apple is just suckling their teet at this point. A 30% commission on in-app purchases is robbery.

Sure, negotiate the 30% but these companies don't wanna pay any of it....how is a company that builds and maintains the OS, hardware and other supporting services for the companies to be able to sell their Apps not entitled to a percentage for the work?

 

[Bonte]

People who fail to see the issue with all of this really need to put down the Apple Kool-aid. Sure, App Store purchases make sense to have a commission fee, but does it make sense for Apple to take 30% of every single transaction within the ecosystem, even inside of each app?

No.

Then Playstation, Nintendo, TV-boxes and Samsung's connected fridge should open up to forced apps with fee-free in-app purchases. Not everything needs to be a PC.

 

[dguisinger]

People fail to see that without a commission on the IAPs developers would list the app as free then charge you a per turn or per time to play which would cut Apple out completely.

Oh poor apple, benefitting from having Apps on their platform, making their platform more appealing to customers, having billions in the bank and not being able to make 30% on stuff they aren't actually producing.

Cry me a river.

 

[MvdM]

Except Epic does has their own store, and I'm sure they'd be happy to implement whatever infrastructure would be needed to make it into a viable mobile store for iOS. Call me back when Apple allows a third party app store, then we can talk about allowing innovation.

Running your own store is not innovation at all. It is also risky if the store does not seem to be that safe. What if Coca-Cola started a small store inside Walmart, selling their products for lower prices than Walmart does, and openly complaining about the prices Walmart asks. Walmart would not allow that either.

 

[Rogifan]

People who fail to see the issue with all of this really need to put down the Apple Kool-aid. Sure, App Store purchases make sense to have a commission fee, but does it make sense for Apple to take 30% of every single transaction within the ecosystem, even inside of each app?

No.

Don’t forget Apple’s big push of developers towards subscriptions. The app below was told future updates will be rejected because one time charges aren’t allowed. Apparently Apple is treating this day pass as a rental purchase and only certain content can be offered as a rental purchase. Man they need to blow up the App Store rules and re-write them from scratch.

https://twitter.com/x/status/1294357856951529473

 

[dguisinger]

Running your own store is not innovation at all. It is also risky if the store does not seem to be that safe. What if Coca-Cola started a small store inside Walmart, selling their products for lower prices than Walmart does, and openly complaining about the prices Walmart asks. Walmart would not allow that either.

Coke doesn't need to run a store INSIDE of Walmart. They need to be able to have their own store.
How hard is it for people to understand the PLATFORM (iOS/iPad OS) is not the STORE (AppStore), and that the restriction of only having the AppStore and only using App Store payments is what is the issue. You shouldn't even need a store.

Thank god they are fighting back now, I would go ballistic if Apple thought they could get away with bringing this eventually to the Mac

 

[TrevorR90]

Dang, is the fee really 30%? What justifies 30%?

 

[DaveSanDiego]

Its amazing to me how many people post in support of Apple and against Facebook on this subject, without having actually read the article. Facebook isn't complaining about fees the FB itself has to pay, but rather the fact they (FB) are being forced to forward 30% of the fees that businesses using Facebook charge for classes, services etc... I think 30% is too high regardless, and at worst, FB might be obligated to forward 30% of any fee they charge, but not 30% of the fees THEIR customers charge.

And while companies like FB and Epic are not cash strapped, there are small developers (myself included) that cannot justify attempting to enter the iOS market place. for two reasons. One this environment has totally killed any competitaion, where customers expect to get an app for free or at worst 99c.... and even without the 30% "app tax"... think how long the average developer would have to wait and the number of units that would have to be sold just to cover the cost of the pizza and beer consumed during devlopement....

There are apps out there now that are consider "over-priced" at $1.99, yet those same ones sold for $40-$70 just 10 yrs ago. iOS has destroyed the competivie 3rd party software market.

 

[nickgovier]

.

 

[mdriftmeyer]

Funny how I mentioned basically this in a comment on the post about Epic Games. Now things are going to get really interesting. Not only does Facebook have a ton of market power (they existed well before the App Store did, and I'd argue that any mobile platform today owes some of its success to Facebook's presence on that platform), but they and others like ClassPass have an interesting argument with respect to COVID.

If Apple's rules are "things in person don't require payment via Apple, but things online do", then the fact that things being moved to online is largely due to COVID will put them in an interesting position - regardless of how you feel about Facebook, it's pretty easy to argue that Apple is hurting businesses in their time of need by charging a cut for paid online events that would otherwise not be online, but have been forced to move online due to COVID.

The one thing I see as a positive here is that all of these companies are, at the very least, trying to draw a lot more public attention to the issue. Epic did this pretty brutally, by allowing Fortnite to be completely pulled off the store. Facebook is doing it more subtly, including language that I'm pretty sure Apple is going to try to force them to remove. But both of these moves have the potential to draw a lot more public attention to the issue. If customers are fully aware that 30% of their online purchases are going to Apple (and are OK with the potential increase in cost and/or the reduction in profit for their target business) then the argument that customers want this is valid. But the truly shady part of the whole thing is Apple forcing developers not to even include language in the app indicating that you can purchase elsewhere. This keeps the customer in the dark unless they are the type to follow tech news. I could be wrong but I also seem to recall Apple not allowing you to charge more for iOS users because of their cut, which even further lets them hide what they're doing from the typical consumer. The free market works best when customers are fully aware of what's going on, and these moves will help make customers more aware so they can make truly informed decisions.

Facebook's primary population driver has been iOS. Both Facebook and MySpace were pre-IPO, money losing propositions and then the iPhone and iOS AppStore arrived to change it all.

 

[dguisinger]

Its amazing to me how many people post in support of Apple and against Facebook on this subject, without having actually read the article. Facebook isn't complaining about fees the FB itself has to pay, but rather the fact they (FB) are being forced to forward 30% of the fees that businesses using Facebook charge for classes, services etc... I think 30% is too high regardless, and at worst, FB might be obligated to forward 30% of any fee they charge, but not 30% of the fees THEIR customers charge.

And while companies like FB and Epic are not cash strapped, there are small developers (myself included) that cannot justify attempting to enter the iOS market place. for two reasons. One this environment has totally killed any competitaion, where customers expect to get an app for free or at worst 99c.... and even without the 30% "app tax"... think how long the average developer would have to wait and the number of units that would have to be sold just to cover the cost of the pizza and beer consumed during devlopement....

There are apps out there now that are consider "over-priced" at $1.99, yet those same ones sold for $40-$70 just 10 yrs ago. iOS has destroyed the competivie 3rd party software market.

Thats not at all what they said
Facebook is charging $0 fees to their customers on this service
Want me to repeat that?
$0 fees, NO FEES, need me to spell it out?
N O F E E S

This isn't even for "content", its for local businesses holding online events to replace in-store events during COVID-19. Sounds like tangible goods and something that would be outside of the 30% fee normally, but hey, Apple never stops being Apple.

 

[TiggrToo]

Irony is we can’t sell our products during a Facebook event because Facebook want a cut from it.

Pot, meet Kettle.

 

[Dezryth]

I understand there's a lot of Facebook hatred here. Separate that from the issue at hand here.

A local business creates a paid event to teach attendees how to cook a particular dish or to discuss some particular topic or to host a party or ~whatever~

In what world is Apple taking 30% of the small businesses revenue for attendees justified? This isn't an in-app purchase to remove ads or to unlock additional levels for a game. This is Facebook offering businesses a way to reach their audience on the Facebook platform and giving them a way to sell tickets to a paid event the business will be hosting. Facebook is not collecting any fees and passing 100% of the sales price to the business after Apple gets it's (in this situation) ridiculous 30% cut. This is truly just hurting small businesses and Apple being tone-deaf, and if you're not seeing that it's because you're blinded by some hatred of Facebook for other reasons.