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As you said below, there isn't a perfect analogy for this, so we're all trying to work with what's best given the circumstances.

Apple making money off of sales through the app store is perfectly kosher. If it came down to it, I'd rather they charge something like 99 cents for service apps like Netflix, Hulu, and Spotify, and take 100% of the profits from that sale because they all make their money through the sub fees anyway.

But think of what would happen if everyone started following Apple's direction on this, that because someone is running a service on their platform, they're entitled to a cut of the profits. It'd end up with only 1st party apps being worth a damn in comparison, because they wouldn't have to worry about any extra overheads, and can set aside more to improving their service while still turning a heavier profit, or the 3rd party apps would have to raise their prices to compensate, and then wouldn't be able to compete with 1st parties on price. The end result would be entrenched 1st party services being able to bully and control the market, leaving the only competition among vertical platform owners.

What Apple's doing is more than a bit anticompetitive. But since there are workarounds, and Apple doesn't absolutely force the issue, it's not really worth doing anything more than arching an eyebrow over.

It's a good example, because Steam does give away things for free, and they handle far, far more bandwidth than Apple does. It negates the argument that these apps are mooching off Apple's good graces, taking their expensive bandwidth by hosting the app without giving anything in return.

For one thing, the amount of money Apple spends on bandwidth to host these apps probably costs them mere dollars. It's certainly not eating into their profit margin enough to justify taking a 30% cut off all sub fees on iOS. Think about all the demos and free apps people download that don't provide Apple with anything. If it were truly so costly, Apple wouldn't offer them.

It's the argument that Netflix, Spotify, etc. are stealing from Apple that I take issue with. To clarify, I'm not saying Apple doesn't deserve to turn a profit off the App Store. They do. They provide an excellent service themselves. But there is such a thing as taking too much.
I agree with the gist of what you're saying, but I don't think I'm perceiving it as causing as many problems as you do. That being said, I agree that requiring all subscription apps to cost money isn't a bad idea. Instead of pulling a cut from every subscription payment, they simply mandate that any app that offers a subscription service is required to be some actual price, maybe a variable price based on the cost of the subscription. That would be a very friendly alternative from Apple.

That said, I've been doing some research, and I can't actually find verification that Valve doesn't take a cut from every subscription payment made through Steam. So maybe they aren't such a great example after all. Though that was just a short search, the information doesn't seem to be readily available.
 
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all i have to say is WOW.

had no idea MR commenters were nearly unanimous in an unabashed hatred of E Warren... i feel like i just walked into a frat house, or church 'water cooler' or biker gang or something...
 
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Fact is they can't compete against Apple on iOS, nobody can unless their product is free. Apple can offer thier product 30% cheaper before they even come close to being on the same level. The Apple defence force is basicly cheering for being ripped off by Apple themselves. Unless you're a shareholder, you should be supporting this.

...No. I use Netflix and I don't pay a 30% higher price, because I subscribed through Netflix.com directly. Same would be true if I used Spotify.
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May just be me, but when your product has a significant portion of the market place, and it's manufacture releases a competing product to other existing services on its platform, and then undercuts those competing products on price AND demands a 30% take of every single sale made through their competitors products, it could be seen as anti competitive...
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Netflix is a poor example to use, you subscribe to a package and that's it for payment, you can't buy films from them.
You can from Amazon and that's why on their iOS app you cannot buy anything from them, and Apple made them change the app when they made it go outside the Apple Eco system for purchases.

Netflix was the only comparison I could find. I could buy music from iTunes, or stream from Spotify. Apple launched Apple Music to compete with Spotify.

I could buy TV shows / movies on iTunes, or stream from Netflix. Apple hasn't launched a Netflix competitor just to snuff out the competition, like Elizabeth Warren suggested they liked to do.

I could send a message through iMessage and video conference through FaceTime, or I can use WhatsApp. Apple hasn't tried to block WhatsApp from the App Store - in iOS 10 they allow third-parties like WhatsApp deeper integration.

In the three examples I give, only once can you make the case for Apple trying to "snuff out the competition". And quite frankly, all it has to do is outlive Spotify, which seems to be losing more and more money the more customers it has.
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Um, well. Any business runs anticompetitive. You have to do what it takes, of course staying legal.

The whiners need to just uncouple from iOS and seek their luck on their own.
(Hint: Can't do it!)

Yeah. Every time I browse Google on Safari I see an ad for Chrome. Is that anti competitive? Google is using a pre-existing business so more people will download their browser.

Is Apple pushing millions into advertising the Apple Watch on TV anti competitive because startups and smaller competitors can't do the same with their wearables?
 
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Yeah, all her sponsored legislatures practically scream Marxism.

Listen, here's a bunch of links to The Communist Manifesto. It's about 40 pages or so. Read it, so you'll never again make the mistake of saying any of our politicians, democrat, republican, or independents (except for those 5 guys who actually are in the US communist party) are communists.
Sorry but the DEM party is no longer a party that JFK would belong to- and yes sir she is a Big government progressive marxist - but all big government progressives call themselves progressive because communism is a BAD word. And on top of that --http://www.againstcronycapitalism.org/2016/06/communist-party-usa-chairman-endorses-hillary-clinton-instead-of-bernie/ -
 
30% of EVERY sale is anti competitive, and you only mentioned iPhones? You seem to have forgotten the same rules apply to EVERY iOS device and platform, and considering Apple has the monopoly share of the tablet market, I think we can argue it's anti competitive.

Apple demands you accept it's terms, if you release an app that tries to direct you to another site outside the Apple eco system, even if you paid for the app, Apple will not validate it or remove it from the app store, that's not fair on the consumer or it's competitors.

Microsoft was very very very nearly split apart by the European Court for anti competitive behaviours for simply including Internet Explorer by default with Windows. It was certainly punished hard for it, so what Apple is doing can be seen these days in the same light.

I'm afraid it is a bit short sighted to defend Apple's behaviour in this case I feel, as I said I know of Sky and Amazon apps where on Android I can buy products, on iOS I can't.

Other free apps like games have the business model of targeted advertising and data mining to make money, Spotify has advertising so far as I know but it also has the subscription base.

A few things.

On a tablet, there is no distinguishable market other than screen size. (A company makes a lot of SUVs, therefore they have all the car market). It's just not reality to say "monopoly share" of the "tablet market". Besides, you can't have a monopoly share if your share is less than a majority, right? Worldwide, iPads are not anywhere close to the majority of tablets sold. Just the most profitable.

Every company that offers a platform "demands" you accept its terms. Consider the opposite bizarro world - the customer gets to demand what price and terms the host uses. That is absurd on its face. This type of competitive regulation only applies in a "true" monopoly, in terms of where there is no competition. Deregulated power companies come to mind, but even in that situation, the game is simply that the utility sells power at auction in bulk, and the companies get to charge a premium, but also collect bills, deal with surges and imbalances, etc. Your description of the App Store comes nowhere close to meeting those levels of market monopoly.

Microsoft wasn't split apart, was it. The issue there was that software browser companies were attempting to stay relevant. It turns out they were fighting the wrong fight. It turns out that the fight needed to happen with standards. That said, there are thousands of examples where large companies are the ones who write, or at least influence heavily the industry standards they use. This is hardly unique; not even in technology.

So for you to say that Apple is "doing the same thing today" is so far off, I'll only point out the main difference. That difference is that instead of shutting people out of the ecosystem, Apple actively engages anyone to submit apps on their platform, and offers them a 70% return for those that wish to charge for their app. Microsoft was actively saying that Windows was their product, and shouldn't be forced to add competition to their integrated product. A case could be made both ways, but it's obvious they weren't making an open call to other companies to add to their ecosystem. They are just flatly opposite issues.

To quote you, "as I said I know of Sky and Amazon apps where on Android I can buy products, on iOS I can't." In each case, is it a choice? Would the apps violate ToS for Apple? Unless you can say systematically that Apple is being *anticompetitive*, your case has no merit. You can have an emotional, visceral hate of the 70/30 split, but that on its own does not make it either anticompetitive or illegal. It is clearly a fair pricing scheme. If that upsets your sensibilities, that's a bummer for you or anyone else who wants to complain about it. However, complaining is as far as this legally goes. There's no case of monopolistic manipulation or anticompetitive behavior, end of story.
 
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I find it amazing that so many people think it is somehow inappropriate for a United States Senator to make a speech criticizing certain business practices. And that the majority of those people think the best response is an ad hominem counterattack.
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Actually, it is quite a bit different from retailers getting a cut of products sold in their stores. The analogy would be apt if these retailers had control over how you furnished your house, and you could only use furniture in your home that you obtained from their stores. Of course, quite a number of people would then "housebreak" their homes; but if your house then burned down, your insurance wouldn't cover you.

What? Apple has provided the platform and hundreds of millions of potential customers. For brands who want in on that opportunity, they need to pay to play. It's pretty simple, really.
 
But you can't expect Apple to let them profit from their platform for free.

Yeah just like when you buy a Sony TV "you can't expect" them to allow others like NBC, Universal, etc to "profit from their platform for free"... oh wait that's exactly what we expect - because it benefits us as consumers and the marketplace itself (thus laws against monopolies).

I swear the people in this thread have no common sense to look after their own interests. Most are simply acting as the courtesans of Apple. (Edit: no coincidence these people usually carry the Apple brand as their avatar)
 
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A monopoly should not be possible, easy or not .

In the US, no company can compete with Apple, Amazon, Google, Microsoft, or even Facebook in their field .
As a large part of the world tolerates US business standards, this is a global issue .

The big cats in the internet related business just buy up possible competitors, or render them powerless with the weight of their market presence . A free and balanced market is the worst thing that could happen to them .

There havn't been any underdogs in this business for many years, and Apple is one of the companies who try very hard to keep it that way .

Big corporations are inherently anti-competition, pro-monopoly and anti-consumer .
That's why regulations are so important - governments might look suspicious at times, but it's big business that's always out there to get you, by definition .

No company can compete with the tech companies you mentioned in their respective fields because no one is as good as they are. Those companies earned their number one spot in their fields.

Apple didn't start out as a big cat. It came out with versions of products that constituted disruptive innovation. MP3 players were on track to take over the CD players. Apple came out with the iPod and helped finish the job. Google, Facebook and Amazon didn't start out as big companies. They grew to the position they are in today.

Making an acquisition just to snuff out the competition is the stupidest reason to make the deal. Point to a single deal by the aforementioned big tech companies that involved "buying out the competition." And I'm sure the shareholders of those poor companies that get bought out are crying all the way to the bank.

I have a request for Elizabeth Warren. Bring a court judgement in writing which says that Apple is trying to snuff out competition with respect to Spotify. Then, she has a case.
 
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Unless you can say systematically that Apple is being *anticompetitive*, your case has no merit. You can have an emotional, visceral hate of the 70/30 split, but that on its own does not make it either anticompetitive or illegal. It is clearly a fair pricing scheme. If that upsets your sensibilities, that's a bummer for you or anyone else who wants to complain about it. However, complaining is as far as this legally goes. There's no case of monopolistic manipulation or anticompetitive behavior, end of story.
Yes, very much this - not liking Apple's terms does not make them, in any way, the slightest bit illegal. And with Apple not being the majority of the market, any talk of monopoly is... fanciful. Of course Spotify would like completely free access to Apple's customers, but those customers did all choose Apple, after all, and the nature of Apple's closed ecosystem is not a secret

Nothing is keeping Spotify from heavily advertising, on their dime, all over the Internet and TV and print media, to implore people to pay them through the Spotify website. What they can't do, under the App Store Terms of Service, which they agreed to, is blatantly advertise in their app "don't pay us here, because Apple will get some of that money - let's go around the corner and do a deal". Of course Spotify would like to get 100% of the money that flows through the App Store in relation to their app/service. But that's not the way business works. Apple is not inclined to do work for other companies for free.
 
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Yes, very much this - not liking Apple's terms does not make them, in any way, the slightest bit illegal. And with Apple not being the majority of the market, any talk of monopoly is... fanciful. Of course Spotify would like completely free access to Apple's customers, but those customers did all choose Apple, after all, and the nature of Apple's closed ecosystem is not a secret

Nothing is keeping Spotify from heavily advertising, on their dime, all over the Internet and TV and print media, to implore people to pay them through the Spotify website. What they can't do, under the App Store Terms of Service, which they agreed to, is blatantly advertise in their app "don't pay us here, because Apple will get some of that money - let's go around the corner and do a deal". Of course Spotify would like to get 100% of the money that flows through the App Store in relation to their app/service. But that's not the way business works. Apple is not inclined to do work for other companies for free.

Would love to see this fully investigated and into court. This is technically a new venue. If nothing else, a defined set of rules would be helpful.
There is a difference between "making money" and "unfair pricing". As we define it today, for this , you can argue both sides of the coin and come to no definite conclusion.
 
A few things.

On a tablet, there is no distinguishable market other than screen size. (A company makes a lot of SUVs, therefore they have all the car market). It's just not reality to say "monopoly share" of the "tablet market". Besides, you can't have a monopoly share if your share is less than a majority, right? Worldwide, iPads are not anywhere close to the majority of tablets sold. Just the most profitable.

Every company that offers a platform "demands" you accept its terms. Consider the opposite bizarro world - the customer gets to demand what price and terms the host uses. That is absurd on its face. This type of competitive regulation only applies in a "true" monopoly, in terms of where there is no competition. Deregulated power companies come to mind, but even in that situation, the game is simply that the utility sells power at auction in bulk, and the companies get to charge a premium, but also collect bills, deal with surges and imbalances, etc. Your description of the App Store comes nowhere close to meeting those levels of market monopoly.

Microsoft wasn't split apart, was it. The issue there was that software browser companies were attempting to stay relevant. It turns out they were fighting the wrong fight. It turns out that the fight needed to happen with standards. That said, there are thousands of examples where large companies are the ones who write, or at least influence heavily the industry standards they use. This is hardly unique; not even in technology.

So for you to say that Apple is "doing the same thing today" is so far off, I'll only point out the main difference. That difference is that instead of shutting people out of the ecosystem, Apple actively engages anyone to submit apps on their platform, and offers them a 70% return for those that wish to charge for their app. Microsoft was actively saying that Windows was their product, and shouldn't be forced to add competition to their integrated product. A case could be made both ways, but it's obvious they weren't making an open call to other companies to add to their ecosystem. They are just flatly opposite issues.

To quote you, "as I said I know of Sky and Amazon apps where on Android I can buy products, on iOS I can't." In each case, is it a choice? Would the apps violate ToS for Apple? Unless you can say systematically that Apple is being *anticompetitive*, your case has no merit. You can have an emotional, visceral hate of the 70/30 split, but that on its own does not make it either anticompetitive or illegal. It is clearly a fair pricing scheme. If that upsets your sensibilities, that's a bummer for you or anyone else who wants to complain about it. However, complaining is as far as this legally goes. There's no case of monopolistic manipulation or anticompetitive behavior, end of story.

I'm afraid all I've read here is an apology for Apples behaviour, perhaps not surprising on this site, and someone who missed my points and clearly doesn't understand anti competitive behaviour and you also misinterpreted parts or my comments, for instance I never made the comment that Apple is doing 'exactly the same thing as Microsoft', I was using them as an example of a giant corporation being penalised for anti competitive behaviour.
 
Yeah. Every time I browse Google on Safari I see an ad for Chrome. Is that anti competitive? Google is using a pre-existing business so more people will download their browser.

Is Apple pushing millions into advertising the Apple Watch on TV anti competitive because startups and smaller competitors can't do the same with their wearables?

Any outsider trying to decide how a company should run its business must be joking. Even when that business is not fair to others (Who decides what is fair) or morally and ethically reprehensible. (Who decides about moral and ethics)

In a democracy a free enterprise can legally do whatever it wants.

To sum it up SPOTIFY is also free to do what it wants.

That includes whining. Wah!
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I'm afraid all I've read here is an apology for Apples behaviour, perhaps not surprising on this site, and someone who missed my points and clearly doesn't understand anti competitive behaviour and you also misinterpreted parts or my comments, for instance I never made the comment that Apple is doing 'exactly the same thing as Microsoft', I was using them as an example of a giant corporation being penalised for anti competitive behaviour.

I don't see where Apple is doing anything but running its business within its rules.
Since it is their business they have the right to set the rules, if you want to play with them.
Nobody is forced to be with them.
Why do people even expect that Apple should share or nurture competition?
 
Sure there is. All Spotify has to do is invest billions of dollars into developing and promoting their own operating system, hardware, and App Store. Then they'll be on an equal playing field.
I think we both know that is nearly impossible. Microsoft has done exactly that and they got what? 5% market share? 3% market share? Windows Phone is essentially irrelevant. Thats equivalent to saying "all you have to do is win the lottery. Its that simple!"

No, it is not that simple. The bottom line is that Spotify will never be on an equal playing field on iOS. Not somer other mythical platform that has never been created, but iOS.
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4. Put on you big big undies and Negotiate for better terms like Netflix did.
So, Netflix does not pay the 30%? I am not aware of Netflix getting preferential treatment, but I guess its possible. Netflix wanted to buy its own internet highway so it wouldn't surprise me. The problem with certain companies getting preferential treatment over others is that Apple then gets to hand pick which apps do well on their platform. And I am sure Apple will not just give it to any old company... You have to have a lot of money and clout. Which means some small startup is at a disadvantage because it is unable to negotiate those deals.

Oh, and Netflix trying to buy that internet highway got the government involved and a couple of net neutrality bills started to circulate. So, Apple is definitely treading in some gray area with theses policies...
 
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Yeah just like when you buy a Sony TV "you can't expect" them to allow others like NBC, Universal, etc to "profit from their platform for free"... oh wait that's exactly what we expect - because it benefits us as consumers and the marketplace itself (thus laws against monopolies).

I swear the people in this thread have no common sense to look after their own interests. Most are simply acting as the courtesans of Apple. (Edit: no coincidence these people usually carry the Apple brand as their avatar)

If you are talking about selling a hardware solution that follows open-air requirements, sure. Apple clearly does not sell just phone hardware. Your analogy is just flatly non-applicable. It isn't apologetic. Your argument is just a dumpster fire.

Let's talk about another product since you brought it up. TV. If you need an analogy, it is the channel offering a platform. Your argument is that programs should be aired commercial free because the channel that put up the antenna is unfair. Oh wait, you say, there are more channels! Yes, just like there are other app stores. That analogy isn't perfect, but it's miles ahead of your tv retort.
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This kind of thing makes me consider going back to android...
And *this* is precisely why any of you saying the word monopoly are 100% wrong.
 
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Anyone who uses their "race" to get an advantage at a job is a disgusting, immoral racist who deserves the mocking. Using skin color and "race" to advantage or disadvantage anyone makes about as much sense as using hair color.

True, and even worse that that, she isn't even the race that she claimed to be in order to get those advantages. It's hard to think of a less credible creature than Liawatha.
 
False equivalency. What you're saying is that Apple should be allowed to profit off a service they're not providing.

Apple gives you the app. Spotify provides the service. If Apple wants to make money off the app, they're free to do so. They're hosting it, they're advertising it, they're acting a store front for it. But what is Apple doing to make Spotify's service better?

As I said, it's like Walmart taking a cut of AT&T's monthly fees because someone bought a smartphone from their store. Just because a store acted as a gateway to a service doesn't entitle them to a 30% cut of another company's monthly income, not unless they're supporting it in some way.


Apple is providing a service. They are providing and maintaining the app store as well as every iOS device on the planet. The work around is easy enough, subscribe on your laptop and then download the service.
 
Um, well Elizabeth Warren does have a point. Apple runs parts of its business in a completely anticompetitive manner. Those aspects need to be investigated and if supported by evidence, then prosecuted appropriately. Apple isn't above the law.
Side note, personal attacks on Elizabeth Warren aren't arguments.

Then I guess Amazon and Ebay should be investigated for anticompetitive practices- after all they charge selling fee % for every single item sold in their marketplaces.
 
A monopoly should not be possible, easy or not .

Who has a monopoly in this situation?

In the US, no company can compete with Apple, Amazon, Google, Microsoft, or even Facebook in their field .
As a large part of the world tolerates US business standards, this is a global issue .

No offense, but that's exactly what I'd expect to hear from a European. ANY company can compete with the big players but they need to be fast, innovative and smart. You could have made the same argument about Apple in the late 90s that they didn't stand a chance against the Wintel stranglehold on the market (and in fact, many were making that argument.) So what did Apple do? They got smart, fast and innovative in areas nobody had thought about innovating in the PC market (starting with some out-of-left-field aesthetics—thank you, Jony Ive.) Then they branched out into areas no other companies were taking seriously. They flipped the playing field. Spotify could do that too.

The big cats in the internet related business just buy up possible competitors, or render them powerless with the weight of their market presence . A free and balanced market is the worst thing that could happen to them .

There havn't been any underdogs in this business for many years, and Apple is one of the companies who try very hard to keep it that way .

Big corporations are inherently anti-competition, pro-monopoly and anti-consumer .
That's why regulations are so important - governments might look suspicious at times, but it's big business that's always out there to get you, by definition .

None of what you just said stops Spotify from killing these guys by innovating, being fast and smart. Spotify is a Swedish company. Again, no offense to Europeans, but they don't seem to understand how to compete. I doubt they're going to rise to that challenge and instead sit around whining about it hoping someone's government is going to slap down Apple because... I don't know... Apple is evil or something?
 
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Let's talk about another product since you brought it up. TV. If you need an analogy, it is the channel offering a platform. Your argument is that programs should be aired commercial free because the channel that put up the antenna is unfair. Oh wait, you say, there are more channels! Yes, just like there are other app stores. That analogy isn't perfect, but it's miles ahead of your tv retort.
This analogy your using is also completely wrong. You have two scenarios with a program being aired by a channel. Either the channel created the program itself through its own funding or some other company created the program and the channel is paying to host it on their network. Advertising (through commercials) is one way the channel funds these programs. The latter is most fitting for the Apple/Spotify debate as Apple does not own Spotify.

So by your analogy, Apple would be paying Spotify to host their app. The exact opposite is happening. Spotify is paying Apple. And, by applying your analogy to the apple/spotify scenario, Spotify would be using its hard earned capital to create a service people want (just like a company creating a TV show) and Apple would have to pay Spotify in order for Spotify to grace apple with its presence. It would then be Apple's responsibility to pass that charge onto its customers (via upping iPhone/iPad price???).

While the scenario I described is plausible, that model is not how apple does business, so I think your analogy is also moot. One would not expect the program to be aired commercial free, because they understand that the company has to pay for that programming. Since Apple only houses the Spotify App and not Spotify's service, why would it make sense to give Apple $3 every month? Is that $3 for the functionality of downloading the app whenever I need to after the initial download?
 
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This analogy your using is also completely wrong. You have two scenarios with a program being aired by a channel. Either the channel created the program itself through its own funding or some other company created the program and the channel is paying to host it on their network. Advertising (through commercials) is one way the channel funds these programs. The latter is most fitting for the Apple/Spotify debate as Apple does not own Spotify.

So by your analogy, Apple would be paying Spotify to host their app. The exact opposite is happening. Spotify is paying Apple. And, by applying your analogy to the apple/spotify scenario, Spotify would be using its hard earned capital to create a service people want (just like a company creating a TV show) and Apple would have to pay Spotify in order for Spotify to grace apple with its presence. It would then be Apple's responsibility to pass that charge onto its customers (via upping iPhone/iPad price???).

While the scenario I described is plausible, that model is not how apple does business, so I think your analogy is also moot. One would not expect the program to be aired commercial free, because they understand that the company has to pay for that programming. Since Apple only houses the Spotify App and not Spotify's service, why would it make sense to give Apple $3 every month? Is that $3 for the functionality of downloading the app whenever I need to after the initial download?

It is amazing the "same as" scenarios and analogies that folks do come up with. ;)
Nice explanation.
 
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