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

[Abazigal]

If Apple’s having such a hard time breaking even with their current pricing structure, they should change their pricing structure. They’re not a charity, and all it is is an excuse for them to act like free app developers are ingrates any time they ask for a fairer deal.

Most developers would be happy to pay at cost for the services offered to them or slightly above. (I can assure you that 30% is not “slightly above.”) Other than that, paid/IAP app developers shouldn’t have to subsidize free, ad-supported apps — if Apple views those as such a burden, start charging the developers.

There are plenty of developers who develop free apps, and have their developer fee waived altogether, such as those from nonprofits, schools, and governmental organisations. The very nature of their work means that their apps are never going to generate any revenue in their own right.

I believe that Apple wants to lower, not raise, the bar for people to become iOS developers. Raising fees would serve the opposite effect by slowing the growth of new developers (even if this might actually increase overall revenue), and it’s apparent that Apple has a vested interest in courting these people and getting them to develop for the iOS platform as they tend to have less baggage or connection to older platforms.

This entire discussion goes to show that there is no one right solution to this issue. Of course someone like DHH would want to keep as much of his subscription revenue for himself as possible, given the scale at which he operates. So no matter what option is chosen, there will be winners and losers.

I have no right answer right now, though the easiest solution right now would be to allow developers to inform users that they can go to their webpage to sign up for said service. I really see no harm in it.

 

[jonblatho]

Do customers HAVE to pay more or can they pay more for convenience?

If the developer says they have to pay more to pay through Apple, because Apple won’t allow alternative payment methods, the user does, in fact, have to pay more.

Without Apple’s restrictions, there’s no reason a developer couldn’t run a transaction through Stripe or some other payment processor using Apple Pay and get very close to the same user experience as IAP.

 

[mrochester]

If the developer says they have to pay more to pay through Apple, because Apple won’t allow alternative payment methods, the user does, in fact, have to pay more.

Without Apple’s restrictions, there’s no reason a developer couldn’t run a transaction through Stripe or some other payment processor using Apple Pay and get very close to the same user experience as IAP.

Surely the user would be choosing to pay more? Can’t the user just go directly to the services website and buy the service there for less? E.g., YouTube premium is £11.99 directly with youtube and £15.99 in the App Store. As a user im free to choose whether I want to pay the extra for the service apple is offering me or not.

The user has a choice; pay more for the convenience and security of Apple handling the payment or pay less but it’s more inconvenient and potentially less secure.

 

[acidblood]

this is a ****** argument. If developers wanted to make web apps for the iPhone they've been allowed to do that since day one. Go and see the WWDC 2007 keynote. What's been discussed here is developers selling their apps via an infrastructure that Apple has invested hundreds of millions, if not billions, of dollars into to allow consumers an easy and secure way to find and download apps. Not a single of one of these developers who are whining have taken the time to create an infrastructure of this scale. It isn't any different than when a retailer opens a store in a mall. No one gets a free ride.

Who asked Apple to create that infrastructure? App developers existed and thrived everywhere before 2008 when Apple created the concept of an app store.

If most everyone sufficiently educated on the issue had to choose between app store + direct downloads or app store only, they'd certainly choose the former.

I'll go further and state that if I could choose to have the app store close down tomorrow (assuming direct downloads are available), I'd gladly choose that. The value I place in the app store is zero, zilch, zip, nada. But you know what, I'll let you guys who see value in app stores keep it. Just so long as I have the option for direct downloads without a 43% markup.

It's funny to see users (who may be developers, but are users as well) asking to have their choices remain restricted, and being forced to pay a markup on their apps.

Going beyond, as it happens on every market where artificial costs are imposed, people find a way around it. Clearly lots of developers prefer to create "free" apps supported by advertising (which Apple doesn't get a cut of). They must have done the math and saw they couldn't sell it at a decent price if they took out the ads.

I'd wager, in the future, there'll be less and less app charges in the app store. Developers will increasingly find ways to get apps downloaded for free into user's devices and sell subscriptions/upgrades bypassing the app store.

 

[Larabee119]

Which makes Apple’s policy hostile to consumers by making them pay more, in cases where the developer decides that they need to charge more for IAP to offset the 30% cut.

And some services, especially those seeking to compete with other services which already have an established customer base, don’t even realistically have that option.

People have the choice to switch to android. They have the choice to purchase other app that cost less.
what would you do if you were Apple. Make eveything cheaper and go bankrupt?

 

[jonblatho]

Surely the user would be choosing to pay more? Can’t the user just go directly to the services website and buy the service there for less?

If they don’t know that they can because Apple won’t allow the developer to say so, let alone link to it, that makes it an uninformed choice. If IAP’s so great, let users pay more for it when standing against another option offered directly in the app.

 

[acidblood]

So are people going to complain about all App Stores now?

I'm not. If I want to buy Counter Strike or whatever straight from the developer for a Mac or PC, I can. With the iPhone I can't do that.

Regarding game consoles, that is a fight for someone else to pick, I don't own one. But I'm a little more sympathetic to the game console companies, seeing as they don't have a huge markup on their hardware like Apple does. It's been said, and I'm sure it's true when you factor in all other costs beyond the parts cost (R&D, support, sales, etc.), that game consoles are sold at a loss. Just take the latest Playstation or Xbox and try to find a Mac with similar computing power, which doesn't cost 5 or 10 times as much.

As for retail, nobody is forcing you to buy your stuff from a given store. If you bought a given product from a retail store, called up the manufacturer and asked to sell it directly to you (and assuming they agreed), you and the manufacturer are free to do so. If I call up Hey and ask for a copy of their app to install on my iPhone, will Apple allow you to do that?

 

[mrochester]

If they don’t know that they can because Apple won’t allow the developer to say so, let alone link to it, that makes it an uninformed choice. If IAP’s so great, let users pay more for it when standing against another option offered directly in the app.

ignorance isn’t really a valid defence IMO. It’s not apples job to advertise where someone can get an app or service cheaper.

I can see one resolution being apple displaying a disclaimer that says ’you may be able to get this product/service cheaper elsewhere if you shop around’. Just what the world needs, another disclaimer for stupid people

 

[acidblood]

People have the choice to switch to android. They have the choice to purchase other app that cost less.
what would you do if you were Apple. Make eveything cheaper and go bankrupt?

Let people install apps directly on their phone without going through the app store?

They do that on the Mac and they haven't gone bankrupt from it yet.

 

[I7guy]

If the developer says they have to pay more to pay through Apple, because Apple won’t allow alternative payment methods, the user does, in fact, have to pay more.

Without Apple’s restrictions, there’s no reason a developer couldn’t run a transaction through Stripe or some other payment processor using Apple Pay and get very close to the same user experience as IAP.

Do you think a developer would charge less for services if they got a break on the fees? I don't think so, and developers would do the same as MR posters say Apple would do. Keep the price the same and pocket the difference.

For some users, it may be worth it to pay more, to have their billing in one place.

Do you have any examples that show a trend that devs do this?

 

[Rogifan]

So Fastmail is adding IAP in their next release because Apple asked them to. I guess Hey decided screw it we’re going to make this public and see where it goes.

https://twitter.com/x/status/1273800222989324288

 

[jonblatho]

People have the choice to switch to android. They have the choice to purchase other app that cost less.
what would you do if you were Apple. Make eveything cheaper and go bankrupt?

I’d stop forcing paid/IAP-supported app developers to subsidize work that isn’t theirs, lower the paid app/IAP cut to 15% for all transactions, and begin charging free app developers to offset costs associated with their app.

Really, if free apps are such a burden for Apple to bear, they can fix that themselves before government steps in and does it for them. I can assure you that they’ll prefer the former.

 

[mrochester]

Let people install apps directly on their phone without going through the app store?

They do that on the Mac and they haven't gone bankrupt from it yet.

I don’t think it’s about Going bankrupt more security. As soon as you allow stuff to be installed outside of the App Store you have opened additional vectors for compromising security. We don’t want or need another android in that regard.

 

[acidblood]

ignorance isn’t really a valid defence IMO. It’s not apples job to advertise where someone can get an app or service cheaper.

Nobody is asking Apple to advertise it for them.

They want Apple to take off the muzzle that prevents them from saying it on their own apps.

Like the previous poster said: if the app store was such a good deal (because of security, privacy, credit card fraud or whatever), to the point users wouldn't care paying 43% more, they wouldn't have to restrict companies from advertising that possibility on their apps. They put that restriction in place precisely because they know the app store is a ripoff.

 

[gleepskip]

Microsoft, Netflix and Spotify apps would appear in the Apple App Store and google play store. iOS apps would appear in the Apple App Store and android apps would appear in the google play store.

Microsoft, Netflix, and Spotify are paying Apple a 30% cut of their subscription revenue?

 

[boss.king]

Surely the user would be choosing to pay more? Can’t the user just go directly to the services website and buy the service there for less? E.g., YouTube premium is £11.99 directly with youtube and £15.99 in the App Store. As a user im free to choose whether I want to pay the extra for the service apple is offering me or not.

They can, but only if they know that the other place exists. The App Store prohibits developers from acknowledging that their business exists outside of the app or even hinting that the internet exists.

The generous take on that is that Apple believes its users are smart enough to shop around before making any app purchase.

The less generous take is that they're intentionally trying to trick people into paying the higher price to ensure that they get their cut.

 

[jonblatho]

Do you think a developer would charge less for services if they got a break on the fees? I don't think so, and developers would do the same as MR posters say Apple would do. Keep the price the same and pocket the difference.

For some users, it may be worth it to pay more, to have their billing in one place.

Do you have any examples that show a trend that devs do this?

Did you miss the whole discussion where Netflix and Spotify used to charge more for IAP subscriptions compared to what they offered on their website? When they chose to stop offering IAP, they didn’t jack up the prices on their website to compensate.

I don’t currently have an app on the App Store, but I used to. It was a paid app. Had it not been for Apple’s 30% cut, I probably could have justified charging $0.99 instead of $1.99, but so it goes.

 

[acidblood]

The problem with people like you is you think the iPhone is and should be a Mac. It's been sandboxed since day one. Don't like it? Jailbreak it or buy an Android.

So add a switch somewhere I can use to disable that sandbox. That would be putting the interests of the user first. Apple merely pays lip service to that concept; their actions undoubtedly show they're putting their 30% cut first instead.

But don't worry, I'm doing my part and switching to Android for my next phone. Just don't complain the day your precious Apple folds precisely because these tactics drove users away.

 

[smulji]

It's funny to see users (who may be developers, but are users as well) asking to have their choices remain restricted, and being forced to pay a markup on their apps.

I'm not being forced to pay 43% markeup. For apps like Spotify, Netflix, Office 365 I can actually sign up on their website for 43% less and still use the app on my iPhone or iPad. Of course, if a user doesn't want to, they subscribe directly via IAP. If you did your homework you would know that.
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So add a switch somewhere I can use to disable that sandbox. That would be putting the interests of the user first. Apple merely pays lip service to that concept; their actions undoubtedly show they're putting their 30% cut first instead.

But don't worry, I'm doing my part and switching to Android for my next phone. Just don't complain the day your precious Apple folds precisely because these tactics drove users away.

If they fold, then they fold. In the meantime, I'll happily enjoy the experience that they provide.

 

[I7guy]

Did you miss the whole discussion where Netflix and Spotify used to charge more for IAP subscriptions compared to what they offered on their website? When they chose to stop offering IAP, they didn’t jack up the prices on their website to compensate.

Two is not a trend, which is different than saying some publishers didn't do it. Netflix was displaying the same greed that MR posters accuse Apple of having. Netflix could have easily left some money on the table as MR posters say Apple should do.
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....
But don't worry, I'm doing my part and switching to Android for my next phone. Just don't complain the day your precious Apple folds precisely because these tactics drove users away.

You really believe what you wrote above will happen?

 

[mrochester]

They can, but only if they know that the other place exists. The App Store prohibits developers from acknowledging that their business exists outside of the app or even hinting that the internet exists.

The generous take on that is that Apple believes its users are smart enough to shop around before making any app purchase.

The less generous take is that they're intentionally trying to trick people into paying the higher price to ensure that they get their cut.

So we should let the market decide how people want to pay for these things. Apple can simply give a disclaimer to reminder the user to shop around first.

 

[jonblatho]

Two is not a trend, which is different than saying some publishers didn't do it. Netflix was displaying the same greed that MR posters accuse Apple of having. Netflix could have easily left some money on the table as MR posters say Apple should do.

Wait, so they were greedy by discontinuing options that made their users pay more?
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So we should let the market decide how people want to pay for these things. Apple can simply give a disclaimer to reminder the user to shop around first.

Or, how about let the developer make their own billing system available in the app, or at least link to their website for payment.

Again, if IAP is so great and users love it so much, it should have no problem standing on its own against competition.

 

[acidblood]

Yes the appeal of the iPhone is that it doesn’t behave like a Mac!

Speak for yourself. The iPhone appeals to me (or used to) DESPITE that, not because of that.

If you look at the history of new iPad features, it's quite clear iPad user want a more Mac-like experience. The market spoke and Apple had to adapt. Remember Steve Jobs claiming styluses were crap? Yet here is the Apple Pencil (and it's a stylus, only in Apple's reality distortion field it's not). Same goes for multitasking, split screens, a file manager, access to external storage, and so on.

Regarding the iPhone, most users don't do that because they don't know better (and developers are afraid to speak up about the status quo and receive retaliation from Apple). But it's not a long-lasting arrangement.

Look at Microsoft's former business model and its current business model. The longer Apple takes to adapt, the more likely it's going to be too late when they finally decide to adapt (and they will).

 

[mrochester]

So add a switch somewhere I can use to disable that sandbox. That would be putting the interests of the user first. Apple merely pays lip service to that concept; their actions undoubtedly show they're putting their 30% cut first instead.

But don't worry, I'm doing my part and switching to Android for my next phone. Just don't complain the day your precious Apple folds precisely because these tactics drove users away.

No, the solution is to leave iOS the way it is instead of forcing it to be like android. By forcing iOS to be like android you are taking away people’s choice to not buy that sort of product.
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Speak for yourself. The iPhone appeals to me (or used to) DESPITE that, not because of that.

If you look at the history of new iPad features, it's quite clear iPad user want a more Mac-like experience. The market spoke and Apple had to adapt. Remember Steve Jobs claiming styluses were crap? Yet here is the Apple Pencil (and it's a stylus, only in Apple's reality distortion field it's not). Same goes for multitasking, split screens, a file manager, access to external storage, and so on.

Regarding the iPhone, most users don't do that because they don't know better (and developers are afraid to speak up about the status quo and receive retaliation from Apple). But it's not a long-lasting arrangement.

Look at Microsoft's former business model and its current business model. The longer Apple takes to adapt, the more likely it's going to be too late when they finally decide to adapt (and they will).

Apple should make a product that appeals to the masses, not the few. Compromising the product to satisfy the few is definitely not the way to go.

 

[Lone Deranger]

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.

Who can say what kind of backroom deals have been forged between these two juggernauts over the years.