Again, how is that different from grocery stores starting to selling their own lower cost brands against established national brands (charging a markup in the process)?
Got a tip for us?
Let us know
Become a MacRumors Supporter for $50/year with no ads, ability to filter front page stories, and private forums.
FTC Looking Into App Store Rules Regarding Subscription Services
- Thread starter MacRumors
- Start date
- Sort by reaction score
Again, how is that different from grocery stores starting to selling their own lower cost brands against established national brands (charging a markup in the process)?
Why doesn't Spotify/Tidal/etc just shut up and eat the cost? As a user, I'd never go to a company's website when I can use the convenience of in app purchases. It's as stupid as some websites/merchants passing the credit card fees to the consumer. It's not my problem. You have a product, you should sell it at the same price everywhere and to everyone, regardless of payment method.
I'd hazard a guess it's because there are many different grocery stores competing with each other. Whereas in smartphones it's pretty much just Apple and Android.
It's not the markup that's the problem. It's the arbitrary restrictions in their TOS that can be used to potentially hamper competition that's the issue here.
I can understand Apple taking their 30% cut off an app sold. They're running a store. I don't expect anyone to be doing anything for charity. But explain to me why they deserve a 30% cut of a company's revenue for any product used on an iOS platform?
$3 on $10 retail cost is the extent of profit being made.. they can't operate as a business under the notion "it's cool..we'll just make no profit."
Malls do the same thing when they charge kiosk operators % of sales rather than flat rental rates, or in addition to rental rates.
Yes, but consider my analogy from earlier in the thread. There is only one shopping mall in your entire city, and everything is sold there. No one else is even allowed to open up a store in the city without making it part of the shopping mall and paying the same duties on everything. Your only other choice is to buy from a street vendor (like the web - cheaper but a lot less convenient), or go live in a different city altogether (Android).
Yeah, but the malls are also providing them space for sales and advertising on their own grounds. It's a surrogate rental fee.
But does Apple help Netflix with their vast and massive internet infrastructure? Do they help them negotiate licenses to host movies and TV shows on demand on their own servers? No. Netflix does all that themselves, and it costs them a lot of money. All Apple does is give them store space, a place to put their box on their virtual shelves. Apple deserves a small cut, sure. Like I said earlier, a 30% cut off sub fees for a couple of months isn't too unfair. But not 30% FOREVER!
like the grocery store analogy, this one is also completely different.. you're to consider malls are providing real estate / brick&mortar / infrastructure..
the people collecting most of those types of dollars in digital world are the isp/telecommunication companies.. appstore etc are the kiosks.. you pay $50/month-- likely more-- in order to buy that app for a buck or whatever.
i get it that you're trying to make a point with the comparisons to traditional consumer markets but you have to realize when saying "how is it different than..." that you're using examples which have huge differences between them.. amongst a few similarities.
It has never been Apple's responsibility or duty to ensure a fair playing ground for its competitors. That's precisely the whole point of controlling your own ecosystem and Apple would be a fool not to take advantage of this strength.
Yeah, it sucks for companies like Spotify, but from a legal and business perspective, I can't see what Apple is doing wrong.
Yeah, it sucks for companies like Spotify, but from a legal and business perspective, I can't see what Apple is doing wrong.
Because it's typically the higher priced brand name companies that are making the no name and store brand also and getting both markets. The stores do not make or own the companies that make the products so it's not the same thing, they are still selling products made by other companies. There used to be lists of the companies that made these products and a lot are the same ones. It's not the same thing, an apples to oranges comparison..
None of the prices are the same anyway, someone has to have to have the low prices. Stores do not make their own stuff , as I stated above, and they have the same deals with whoever makes the stuff just under generic name. They are able to offer this stuff cheaper because there are no advertising costs, etc. attached to the stuff sold that way. I get great value peanut butter here in mexico because it is by peter pan, the peter pan recall affected great value and other store brands. So in most cases all it is, is the big guys playing both ends. Con agra and sarah lee does a lot of walmart's great value stuff.
http://lifehacker.com/stop-wasting-money-buy-the-identical-cheaper-versions-1481925774
Costco’s Kirkland Signature Products
- Shampoo is said to be made by Pureology
- Super Premium ice cream is made by Humboldt Creamery
- Tuna fish is made by Bumble Bee
- Diapers are likely made by Huggies
- Liquor: Jim Beam makes the bourbon, Grey Goose makes the vodka, and the Scotch is a Macallan 18
According to Fortune:
- Pita chips are from Stacy’s (a division of Frito-Lay)
- Yogurt from Stoneyfield Farm
- Indian food made by Tasty Bite
The Huffington Post did a side-by-side taste test of many of Trader Joe’s brands and found these to be identical:
- Cream of tomato soup: Pacific ($2.49 at Trader Joe’s vs. $4.69 regularly for Pacific)
- Organic shells and white cheddar: Annie’s Homegrown ($1.49 vs. $3.29)
- Pretzel chips: Snack Factory ($2.19 vs. $3.69)
- Vegetarian Chili: Amy’s ($2.29 vs. $4.19)
Costco and Trader Joe’s aren’t the only places to shop and save. Many high-end brands have “sister” companies which share the same manufacturing process and materials, but simply are priced lower:
- Saks Fifth Avenue’s Platinum clothing line is said to be produced in the same factory as Armani clothing
- Victoria’s Secret pantyhose is manufactured by Hanes and made in the same factories as DKNY stockings
- Old Navy, Gap, and Banana Republic often use the same materials (e.g., for jeans), but just different cuts
- Makeup is one place you can definitely save, since many of the major cosmetics companies are owned by the same parent company. L’Oreal, for example, owns Lancome, Maybelline, and Garnier; Estee Lauder owns not just Mac, Clinique, and Bobbi Brown but also cheaper brands sold at Kohl’s (Flirt1 and American Beauty). Find dupes at the Makeup Dupe List.
- We learned that Girl Scout cookies are made by a Keebler subsidiary and the Keebler versions taste quite similar
Last edited:
has anyone mention that google takes 30% cut as well? Don't see spotify complaining about Google Play.
https://support.google.com/googleplay/android-developer/answer/112622?hl=en
https://support.google.com/googleplay/android-developer/answer/112622?hl=en
Actually, it is. Apple can't use their own store, their own platform, to hobble their competition there in order to make their own service look that much better in comparison.
It's what got MS in trouble all those years ago, and it could do the same for Apple (albeit to a much smaller extent, since they're not a monopoly). The moment they allow a 3rd party to function within their ecosystem, they're expected to play by certain rules. Unfair business practices are unfair business practices after all.
That's the transaction fee. No one's complaining about that. Plus, Google doesn't prevent subscription services from providing a URL to sign up to their services from within their own apps like Apple does.
That's not to say that Google are perfect angels or anything. But in this situation at least, they're the lesser evil.
Define "hobble".
Apple has long used custom APIs in their own stock apps which they don't allow 3rd party apps to access. Their stock apps are integrated with iOS on a system level not available to other apps. Just look at Siri integration with Apple Music vs lack of a similar feature for Spotify. Or quick reply on Apple Watch compared to what the Pebble Watch can access. Nobody has exactly complained about that.
It has always been the unspoken rule of developing for iOS that your app will always be a second-class citizen.
And technically, could it not be argued that Apple is also paying 30% fees on its own apps and services, just that Apple is effectively paying money to itself?
I still don't think Apple is doing anything wrong. Yes, we can argue until the cows come home as to whether 30% is justified or not, but that is really besides the point here.
In this case, it'd be forcing their 3rd parties to jack up their prices in order to compensate for Apple's perpetual 30% cut of all sub fees running through iOS apps.
Not really. It's the crux of the issue. I think Apple deserves a cut, but not a permeant, ever ongoing one.
It costs Spotify just as much to maintain their service as it does Apple. But Apple can undercut Spotify on price because they're not working under the same restrictions as those they've applied to their competition on their own platform. It's an unfair advantage.
Exactly, ms got nailed for it over ie and the same people were probably cheering.........that is if they were even born by that time.
This thread is going in a loop. To anyone reading, here is a summary of the past 300 comments:
1. Apple is right - Spotify should go somewhere else. Apple provides them with the App Store and they should be grateful for the advertising. The 30% is justified because Apple needs to pay for their servers and review process. Google, Amazon, Steam and Microsoft all charge the same amount!
2. Apple is wrong - Apple should not continue to charge 30% on a service that they don't run. They should take their initial fee to cover costs (and maybe the 30% percentage for a month or so) and be done with it (or lower the fee to a more reasonable amount). The 30% is anti-competitive because it means that Spotify and Apple are on an unfair playing field.
1. Apple is right - Spotify should go somewhere else. Apple provides them with the App Store and they should be grateful for the advertising. The 30% is justified because Apple needs to pay for their servers and review process. Google, Amazon, Steam and Microsoft all charge the same amount!
2. Apple is wrong - Apple should not continue to charge 30% on a service that they don't run. They should take their initial fee to cover costs (and maybe the 30% percentage for a month or so) and be done with it (or lower the fee to a more reasonable amount). The 30% is anti-competitive because it means that Spotify and Apple are on an unfair playing field.
Yeah, MS pretty much defined the model of what's good and what's not when it comes to treating your developers fairly. Apple can use their services App Store terms to embrace, extend, and extinguish the competition just like MS did. Don't assume Apple won't do it because they're Apple, and are somehow "better" than MS. Recent history has proven they can play just as dirty.
When you get right down to it, all big businesses will do anything and everything for their bottom line.
I agree that it's an unfair advantage, just not an illegal one.
Doesn't Google Play Store levy the same 30% cut too? Google has its own music streaming service as well. How come Spotify isn't suing Google as well?
Because the iOS platform is the more lucrative one and that's where Spotify has the most to lose. It's just another day in the cutthroat world of business.
Like I said above, they're not quite as restrictive as Apple is. They take their 30% off app prices, same as Apple, but they don't forbid Spotify, Netflix, and the like from providing a link to their own webpage in app to sign up for a sub. It's a small distinction that might make for a huge difference.
And no, on the surface it's not illegal, so long as it's not being used to harm the competition. That's what the FTC is here to decide. Right now they're not bringing about any charges. They're just listening to everyone involved complain about each other, and they may or may not move on from there.
That's pretty much the truth of it.