Phil Schiller: Apple Will Not Change Decision on 'Hey' Email App, No App Store Rule Updates Imminent

[I7guy]

One can actually consume e-mail without creating it. For example, I wake up every morning and read each one of my e-mails. In Netflix, one can easily add and delete things from their queue. Furthermore, the ability to read or create an e-mail is designed and implemented by the developer here and the content is managed by Hey's backend servers.

Can you upload new content to Netflix for others to consume it? Saying one can add or delete from a queue seems disingenuous to the discussion at hand. Email by it's very nature is not read-only. I'll quote from another post:

"Apple told me that its actual mistake was approving the app in the first place, when it didn't conform to its guidelines. Apple allows these kinds of client apps -- where you can't sign up, only sign in -- for business services but not consumer products. That's why Basecamp, which companies typically pay for, is allowed on the ‌App Store‌ when Hey, which users pay for, isn't. Anyone who purchased Hey from elsewhere could access it on iOS as usual, the company said, but the app must have a way for users to sign up and pay through Apple's infrastructure. That's how Apple supports and pays for its work on the platform."

 

[cualexander]

This has been covered a dozen times. Google lets developers distribute apps outside of the Play Store and use their own payment processing if they so choose.
For someone making snarky comments about research, maybe you should have done some yourself.

But still it’s 30% is the main point and 15% thereafter. The same as Apple’s. How many standard non-technical users really take advantage of alternative distribution though? My guess is very few as an overall percentage. Most people would rather keep the security of having apps vetted, and Apple provides a more secure environment, in that regard. If you value openness over security, then go to Google then. The whole controversy seems a bit much.

 

[Lone Deranger]

I'm with Apple on this. It's their store, they can set the rules.

The developers should offer in-app and web purchases and let the customer decide where they want to pay.

I do find it a bit silly though that one is forbidden to even mention alternate payment methods in the app.

 

[acidblood]

Then they should also investigate any brick and mortar store for extorting a margin from the manufacturers of the goods they sell.

Do brick and mortar stores prevent you from selling your goods through any other channel?

A better analogy is the mob. You never asked for their "protection", but if you don't pay for it, you can't run your business.

 

[Rogifan]

I'm with Apple on this. It's their store, they can set the rules.

The developers should offer in-app and web purchases and let the customer decide where they want to pay.

I do find it a bit silly though that one is forbidden to even mention alternate payment methods in the app.

From screen shots I’ve seen on social media it appears Apple Music on Android doesn’t allow customers to use Google’s IAP. You have to provide credit card information to Apple. Of course Google allows this in-app so you don’t have to do this outside the app but still Apple isn’t giving any cut of subscriptions to Google.

 

[acidblood]

*sigh

This is what I'm afraid of, Apple reaffirming their position. Now, many more apps and developers are probably scrutinized and potentially facing the same barrier, just because one attention seeking developer did a tweeter rant. In the end of the day, DHH probably won't be affected that much in real life and would still be living large. However, there are probably other developers that don't have as much resources as him.

I, on the other hand, find it absolutely excellent. I hope this starts a movement with other app developers speaking up. Some already did, like Rogue Amoeba and Panic.

I couldn't put it better than the following Star Wars quote: "The more you tighten your grip, Tarkin, the more star systems will slip through your fingers."

 

[Rogifan]

It also feels to me that developers are never going to be satisfied with paying any amount to Apple that is basically greater than 0%.

$100 per year per developer doesn’t even begin to cover the cost of running the App Store and every developer has shown that given the option, they would rather not pay Apple a single cent if they could help it.

Say Apple releases their App Store profit numbers in court and it shows that they need at least 25% from developers to break even (hypothetically). Would this make developers feel better about paying Apple their 30% cut, or is it still “every man for himself”?

How much of the $1000 iPhone goes towards running the cost of the App Store?
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Apple cannot allow Hey to get away with this, no matter how inconsistent or illogical the rationale. Otherwise, the flood gates will open and other companies will start doing the same thing.

Apple can set all the rules they want, but consumers, oversight organizations, and governments will have the final say.

I'm pretty tired of Apple lording over the App Store like a tyrant. It's theirs, they built it, but they're a ****ty landlord.

Well Hey is arguing they are following the rules and other apps do what they do without requiring IAP.

 

[acidblood]

for those that argue Netflix and Amazon got a free pass, and Dropbox being a "Reader" app is ridiculous, I thought Apple has already outlined what constitutes a "Reader" app clearly in their guideline?

Dropbox allows access to cloud storage - ✅
Netflix and Amazon allow access to video and books - ✅
Hey - ❌



Am I missing something?
Or are people having issues with their definition of a "Reader" app? I can probably understand that issue a bit more if that is the case...

Email is cloud storage. Although, of course, this still misses that greater point. Like in Soviet Russia, some apps are more equal than others (i.e. those Apple couldn't like without -- try telling Netflix people will have to subscribe through the app, watch them pull their iOS app, and wait for all the sheep crowd up at Apple Park with pitchforks in their hands.)

 

[I7guy]

How much of the $1000 iPhone goes towards running the cost of the App Store?

Why does this matter?

Well Hey is arguing they are following the rules and other apps do what they do without requiring IAP.

Apple argues otherwise.

 

[lah]

Do brick and mortar stores prevent you from selling your goods through any other channel?

A better analogy is the mob. You never asked for their "protection", but if you don't pay for it, you can't run your business

I disagree with the mob comparison. The App Store is not the only game in town. They can choose not to write an iOS app. They can choose to only publish an Android app or just have a web experience for the user. But they know having an app in Apple's App Store is lucrative for them and also a superior experience for the user (this superior experience is what Apple has supposedly built up). So if they want to publish an app they need to abide by each platform's rules and plan to pay 30% of iOS generated revenues to Apple. Now where it gets murky, and where I agree with Basecamp and DHH, is Apple's inconsistent or lack of clarity on who gets to be classified as a reader app. This needs to be addressed by Apple and institute clear guidelines so there is no confusion to their developer partners.

 

[Abazigal]

How much of the $1000 iPhone goes towards running the cost of the App Store?

Which begs the question - how much should Apple be expected to subsidise their services with hardware profits?

 

[boss.king]

But still it’s 30% is the main point and 15% thereafter. The same as Apple’s. How many standard non-technical users really take advantage of alternative distribution though? My guess is very few as an overall percentage.

And that's fine. For most devs that is easier than building their own payment system. But more established businesses already have their own payment system, and they don't have 30% to spare, and for them, Android offers a viable alternative. But in the App Store, that's a luxury that only a few developers get.

Most people would rather keep the security of having apps vetted, and Apple provides a more secure environment, in that regard. If you value openness over security, then go to Google then. The whole controversy seems a bit much.

No one's saying you can't have security and vetted apps. Having an alternative payment option isn't going to somehow fill the App Store with malware, nor does it force users to download and subscribe to apps that use that payment option if they don't feel comfortable with it. This idea that "if you don't like it you can go elsewhere" is exactly the same sentiment that Microsoft had in the 90s, and its the reason Apple is now coming under scrutiny for anti-competitive practices.

I've said it before, but it's worth repeating. If Apple is going to get on their high-horse about protecting the user experience, then they should actually do it. Filter out the apps that try to trick users into extortionate subscriptions, clarify and equally enforce rules so that developers can more easily follow them, spend some time and money making the App Store less of a dumpster fire for app discoverability. Locking out options doesn't help me as a user, but it sure does help Apple and its shareholders.

 

[cualexander]

Email is cloud storage. Although, of course, this still misses that greater point. Like in Soviet Russia, some apps are more equal than others (i.e. those Apple couldn't like without -- try telling Netflix people will have to subscribe through the app, watch them pull their iOS app, and wait for all the sheep crowd up at Apple Park with pitchforks in their hands.)

Every major business provides different level of service to valued customers. That’s standard practice. Look up tiered customer support agreements, and you’ll see that a small mom and pop customer does not get the same level of service as a Walmart or Disney. And there’s nothing wrong with that because bigger commercial customers pay more for the privilege of high service level.

 

[acidblood]

It's the other way round: app developers are the greedy ones by giving you a sub standard user experience in order to avoid paying a fair share to the store that they use to get in touch with you.

30% markup by the supply chain and store is little, very little. Yet there are those who feel they deserve 100% and will circumvent so much that they'd rather create unusable or hard to use apps in order bypass paying a fair share to the hand that feeds them.

They never asked for the app store. iPhone users never asked to be restricted from downloading apps directly (and given how many people used to jailbreak iPhones back when that was a thing, they actively rejected this restriction).

On Android you can "sideload" apps and pay $0 to Google. Please point out how Google is doing just fine with Android developers don't having to pay their fair share, while Apple isn't. And recall that Google makes very little money from hardware, whereas Apple makes most of its money from it. It is said the parts cost of an iPhone 11 Pro Max 512 GB is less than $500 whereas it retails for triple that. Where do you think 2/3 of the price is going? Among other things, to fund iOS development, because what use is a bunch of metal, glass and silicon without the software to run on it?

 

[gleepskip]

Every major business provides different level of service to valued customers. That’s standard practice. Look up tiered customer support agreements, and you’ll see that a small mom and pop customer does not get the same level of service as a Walmart or Disney. And there’s nothing wrong with that.

It is anti-competitive to provide a lower barrier of entry to one entity and not another.

 

[acidblood]

Before there was digital distribution of software, consumers had to buy boxed software from retailers. Those retailers charged developers 50% to allow them to distribute their packaged software in their stores. So for Apple to take 30% cut in the first year and 15% thereafter for subscription-based services isn't bad at all especially since Apple spent the time and money to build the infrastructure for it.

In the meantime, there was this little development we call The Internet. Because of it, selling physical software boxes is pretty much a niche market now. It's working out fine just about everywhere (PCs, Macs, Android, etc.), with no middlemen taking their cut (or at least the option exists for that -- if people additionally want the choice of a middlemen for some reason, I say let them have it), the major exception being the iPhone where Apple introduced artificial restrictions so users are unable to install software on the hardware they own (and paid handsomely for).

Just because retailers used to charge 50%, doesn't mean that cost has to be artificially added back when technology is available that means it is no longer needed.
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I think the big thing here is the Gmail app functions as an app instantly. The Hey app doesn’t function without buying the service. I see many ways Hey can get around this. They just want to pick a fight, and they’re doing it on behalf of all developers. I do think as a developer we are all at Apple’s mercy. If you don’t like that, get in a different line of business. That’s part of the deal for developing. Apple outlays all the cash and deals with server bandwidth to payments and free advertising to developers who can develop worthy apps. Basecamp Hey is just getting free publicity here and trying to make Apple look bad. I get both sides, but if this was a legitimately decent reasoning and the app functioned without having to go to the Hey site, I would side with them. But in this case I just think Apple is correct.

That's not "part of the deal for developing". It never has been, for virtually all computing platforms out there. Apple created that by going out of their way to introduce artificial restrictions, so that you can't install any app you please on the hardware you own and handsomely paid for.

 

[XNorth]

Phil Schiller sounds like an arrogant ass in that quote.

 

[acidblood]

iPhone could simply get a web app instead of a native app on mobile whereas Android will benefit from a native version of the Hey app.

Who would ever use an email app that can't notify you when new email arrives? What if you're in an area with no coverage but want to compose an email or draft a reply to send later?

 

[I7guy]

In the meantime, there was this little development we call The Internet. Because of it, selling physical software boxes is pretty much a niche market now. It's working out fine just about everywhere (PCs, Macs, Android, etc.), with no middlemen taking their cut (or at least the option exists for that -- if people additionally want the choice of a middlemen for some reason, I say let them have it), the major exception being the iPhone where Apple introduced artificial restrictions so users are unable to install software on the hardware they own (and paid handsomely for).

Just because retailers used to charge 50%, doesn't mean that cost has to be artificially added back when technology is available that means it is no longer needed.

If the technical barriers Apple has established for it's hardware is too great for some consumers, there are alternatives.

But you bought the iphone, presumably turned it on, agreed to the eula and tos and now you want apple to change the way it manages it's devices? Not a convincing case.
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They never asked for the app store. iPhone users never asked to be restricted from downloading apps directly (and given how many people used to jailbreak iPhones back when that was a thing, they actively rejected this restriction).

On Android you can "sideload" apps and pay $0 to Google. Please point out how Google is doing just fine with Android developers don't having to pay their fair share, while Apple isn't. And recall that Google makes very little money from hardware, whereas Apple makes most of its money from it. It is said the parts cost of an iPhone 11 Pro Max 512 GB is less than $500 whereas it retails for triple that. Where do you think 2/3 of the price is going? Among other things, to fund iOS development, because what use is a bunch of metal, glass and silicon without the software to run on it?

Do you have a accredited source for your accounting of the price of an iphone? Or is it your opinion?

 

[acidblood]

30% is the standard commission charged by any platform holder. I’m confused why it’s a problem with Apple when all other companies charge the same percentage.

Because on the Mac, I can download apps without going through the Mac app store. On Windows, I can download apps without going through the Windows Store. On Android, I can download apps without going through the Play Store.

If I pay an obscene amount of money for an iPhone, I should have a say on how I can install apps on the hardware that I own and paid for.
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If the technical barriers Apple has established for it's hardware is too great for some consumers, there are alternatives.

But you bought the iphone, presumably turned it on, agreed to the eula and tos and now you want apple to change the way it manages it's devices? Not a convincing case.
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Do you have a accredited source for your accounting of the price of an iphone? Or is it your opinion?

As for the first point, I fully intend to rectify that mistake by moving to Android for my next phone.

As for the second, absolutely no one outside of Apple knows exactly the parts cost of an iPhone, but there are specialized companies who make their livelihood out of providing good estimates. Here is one.
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It also feels to me that developers are never going to be satisfied with paying any amount to Apple that is basically greater than 0%.

$100 per year per developer doesn’t even begin to cover the cost of running the App Store and every developer has shown that given the option, they would rather not pay Apple a single cent if they could help it.

Say Apple releases their App Store profit numbers in court and it shows that they need at least 25% from developers to break even (hypothetically). Would this make developers feel better about paying Apple their 30% cut, or is it still “every man for himself”?

How much does Apple get from a Mac developer that chooses to self-publish?

 

[cualexander]

It is anti-competitive to provide a lower barrier of entry to one entity and not another.

If I have entity A and entity B, and they both give 10 million dollars to my company. Then yes, they should be treated the same. But if entity B gives 50 million, I’m going to cut them a better deal on the product, licensing, whatever. Bulk discounts, volume purchases, Contract discounts, these are not anti-competitive.

And that's fine. For most devs that is easier than building their own payment system. But more established businesses already have their own payment system, and they don't have 30% to spare, and for them, Android offers a viable alternative. But in the App Store, that's a luxury that only a few developers get.


No one's saying you can't have security and vetted apps. Having an alternative payment option isn't going to somehow fill the App Store with malware, nor does it force users to download and subscribe to apps that use that payment option if they don't feel comfortable with it. This idea that "if you don't like it you can go elsewhere" is exactly the same sentiment that Microsoft had in the 90s, and its the reason Apple is now coming under scrutiny for anti-competitive practices.

I've said it before, but it's worth repeating. If Apple is going to get on their high-horse about protecting the user experience, then they should actually do it. Filter out the apps that try to trick users into extortionate subscriptions, clarify and equally enforce rules so that developers can more easily follow them, spend some time and money making the App Store less of a dumpster fire for app discoverability. Locking out options doesn't help me as a user, but it sure does help Apple and its shareholders.

What would prevent someone from putting a link in their app that just went to a site that just collected credit card numbers? You could put a legitimate link during the review process and then change it after the fact. Even logins are risky which is why Apple made the appleid auth system, which is great. They are making things more secure. ApplePay is great, it makes things more secure too.

Having links to external payment sites in a app is a security risk because they can always be manipulated or compromised by outside actors at any point in time. Keeping all payments directly to Apple prevents this from happening.

I love how easy it is to cancel an iTunes Store subscription. Other subscriptions make you call and talk to people who try to convince you not to cancel. iTunes Store subscriptions I can cancel all in one swoop. It’s a great experience. I’d pay for everything that way if I could.

 

[acidblood]

What Hey is trying to do is leverage Apple's platform, that they have invested literal billions in, for nothing. The points Phil is making are very reasonable and would be an easy out for Hey. Either offer a free version of the app, with the ability to upgrade to a pro-tier on their website. Or sell the app for a higher price on the Appstore, which would be convenient for some people and would let people buy the app without spreading their payment information around. This whole thing is a marketing campaign by Hey and they are definitely not getting any love from me.

Hey doesn't want to leverage Apple's platform. Hey surely would love for users to direct-download their app from their website. Except they can't do it, can they?

And as an iPhone user, every time something like this happens, I lose. Here is an app I could have on my phone (maybe it's useful to me, maybe it's not) but Apple won't let me have it.

 

[boss.king]

If I have entity A and entity B, and they both give 10 million dollars to my company. Then yes, they should be treated the same. But if entity B gives 50 million, I’m going to cut them a better deal on the product, licensing, whatever. Bulk discounts, volume purchases, Contract discounts, these are not anti-competitive.

And you don't see how company B then has an anti-competetive advantage over company A and makes it so company A will likely never catch up?

What would prevent someone from putting a link in their app that just went to a site that just collected credit card numbers? You could put a legitimate link during the review process and then change it after the fact. Even logins are risky which is why Apple made the appleid auth system, which is great. They are making things more secure. ApplePay is great, it makes things more secure too.

That would depend. If Apple is willing to work with developers and allow them to distribute through the App Store just using alternative payment options then the app review process should catch that. If not, then nothing, but Apple could offer a warning to users that install from outside the app store leaves them more exposed to risk and put a number of roadblocks in the way, just like they've been doing on the Mac for years. Again, no one is forcing users to use any of these apps, it's a risk you would choose expose yourself to.

Having links to external payment sites in a app is a security risk because they can always be manipulated or compromised by outside actors at any point in time. Keeping all payments directly to Apple prevents this from happening.

People have been paying for things online for a long time. This isn't some unknowable future, it's all around you. How often do you wander onto shady sites and just start filling in your credit card details right now?

I love how easy it is to cancel an iTunes Store subscription. Other subscriptions make you call and talk to people who try to convince you not to cancel. iTunes Store subscriptions I can cancel all in one swoop. It’s a great experience. I’d pay for everything that way if I could.

Okay? You sort of missed the entire point of what I was saying there but I'm glad you like the unsubscribe method. It doesn't do anything to address the actual problem I raised or the many others that demonstrate that the motivating factor here is profit, not caring about the user experience.

 

[acidblood]

Clearly the AppStore brings value to developers so for people to expect Apple to charge next to nothing for it, doesn’t make sense and is pie in the sky. I listened to the Vergecast interview with DHH and he does make some good points so let’s hope this will lead to some changes to make it a bit more developer friendly. Some of the restrictions are a bit onerous and need to be changed, but the AppStore runs on trust so at the same time I get why they’re strict.

Expect can take a 99.99% cut from the app store for all I care. So long as I have an option to download apps directly from the developer. Like I can on my Mac, on Windows, or on Android.
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I think this is the right direction. If your app is free and there is no revenue stream for your app, Apple should host it for free. If your app is cash-positive (through ads or external sales) and you choose to opt out of Apple's payment system, there should be a reasonable hosting/distribution fee.

A flat 30% rate makes no sense when the overhead incurred by Apple is the same cost for every application, excepting bandwidth for huge applications.

While what you propose is better than the status quo, I have an even better suggestion: let everyone install apps on their devices, as you can with your other computing platforms. If someone sees value in the app store and finds the 30% cut reasonable, no one is stopping them from using it. The issue is, if they don't, there is no alternative.
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Google has a 30% cut too. Why aren’t people decrying them as evil too?

What’s that? No one researched anything?Google Service Fees

Because you can "sideload" apps on Android?
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I disagree with the mob comparison. The App Store is not the only game in town. They can choose not to write an iOS app. They can choose to only publish an Android app or just have a web experience for the user. But they know having an app in Apple's App Store is lucrative for them and also a superior experience for the user (this superior experience is what Apple has supposedly built up). So if they want to publish an app they need to abide by each platform's rules and plan to pay 30% of iOS generated revenues to Apple. Now where it gets murky, and where I agree with Basecamp and DHH, is Apple's inconsistent or lack of clarity on who gets to be classified as a reader app. This needs to be addressed by Apple and institute clear guidelines so there is no confusion to their developer partners.

Assume you're right (I disagree, but let's do that for the sake of the argument). You're only looking at the developer's side.

As a user who already paid handsomely for the phone, I don't see why I should be paying an extra 43% on all apps, and sometimes even have no access to an app I could really use because they can't justify development costs with Apple taking a 30% cut.

I've seen people claim here "just raise the price". I've never taken Economics 101 but I hear they cover the issue of the supply/demand curve. If you sell X units at price Y, you're simply not going to sell X units at price Y + 43%. Maybe you'll sell so few you'll have to close up shop.

 

[macfacts]

If you like workarounds, iOS is the platform for you. Always needing tricks to work normally