Senator Elizabeth Warren Accuses Apple of Trying to 'Snuff Out Competition,' Spotify Agrees

[CarlJ]

Lets try to look at this in terms of economics and not add in politics and any bias for a second. With Apple's current policy, Spotify is at a disadvantage. ...

Now, hopefully that point is a no-brainer and everyone can agree on it, so there should be no point to keep arguing over it. So, where the disagreement comes is whether Apple has the right to create this disadvantage or not.

You are presenting it in terms of economics, from the standpoint of this current question, but ignoring the economics of why the App Store charges 30% across the board in the first place. I do agree that Spotify is at a disadvantage.

(To step back a little, if I had a swing set in my back yard and my kids got to play on it and yours didn't, your kids would be at a disadvantage - but does that necessarily lead to a requirement to "level the playing field"? It would certainly be nice of me to let your kids play on my swing set - should I be somehow obligated or required to do so? Should the government get involved? Not every disadvantage equates to a situation that must be changed. This is in no way an exact analogy - I'm trying to get at the idea of: is it a requirement that all advantages, regardless of how they came about, be removed, so that nobody is at a disadvantage?)

Saying "whether Apple has the right to create this disadvantage" not only questions whether Apple should be compelled to share, but is kind of implying intent on Apple's part to create a disadvantage, rather than it simply being one of many eventual cascading consequences of actions that Apple took for other reasons. Another bad analogy: If we're both circling the block looking to park our cars, and we both spot a space, and I park in the spot (not racing to edge you out, I'm just closer this time), was my intent to deprive you of that space? Or was my intent to get to my appointment on time? (I might not have even been aware that you had also seen the parking space.)

 

[jnpy!$4g3cwk]

Not every disadvantage equates to a situation that must be changed. This is in no way an exact analogy - I'm trying to get at the idea of: is it a requirement that all advantages, regardless of how they came about, be removed, so that nobody is at a disadvantage?

You make good points. There were several generations of smart phones before the iPhone, and, most of the individual components were already in use by somebody. And yet, nobody was satisfied. The iPhone combined the elements in a unique way that both techies and the general public found useful and sufficiently affordable. (The same thing had already happened with the OS X GUI - Unix GUI's had been around since the early/mid-80's, and yet nobody (well, there is NeXT etc.) got it quite right where a programmer and her grandfather both agreed that the GUI was usable and effective). As a result, Apple has an advantage. But, not a (horizontal) monopoly -- you can go buy any number of cheaper Android phones any time you want.

The Apple situation is a vertical monopoly -- something that Steve (Jobs) always preferred -- not only more profitable, but also, easier to provide a clean, predictable experience for the customer. (Think Windows device drivers as what Steve wanted to avoid.) Apple highly controls its software environment and what apps can and can't do. In recent years, worrying about vertical monopolies has gone out of fashion. If a user can purchase into a different ecosystem, why should we worry about Apple's taking advantage of its advantages? I think there may be a case to be made here, but, I agree with you that it has to be thought through very, very carefully.

 

[lchlch]

I think to some degree this discussion is going around in circles.

Lets try to look at this in terms of economics and not add in politics and any bias for a second. With Apple's current policy, Spotify is at a disadvantage. If you sign up for Apple Music on iOS, it will always be $9.99 a month. If you sign up for Spotify on iOS, it will either be $9.99 or $12.99 depending on where you sign up. Yes, Spotify could just keep it simple at $9.99, but Spotify still has that 30% charge that Apple Music doesn't. That 30% charge automatically puts Spotify at a disadvantage on iOS.

Now, hopefully that point is a no-brainer and everyone can agree on it, so there should be no point to keep arguing over it. So, where the disagreement comes is whether Apple has the right to create this disadvantage or not.

On one hand, Apple has a very successful business model where it was to make products plain stupid to use. Streamlining the payment system for all apps in the app store is one way Apple can uphold this business model. If every App had you pay for things differently, it could be seen as confusing to some. This confusion would make it harder to use, which goes against Apple's business model. Now, streamlining the payments does come at a cost to Apple. So, theoretically Apple could pass this cost off to the app developers.

On the other hand, this practice in certain circumstances (i.e.. streaming services like Spotify) promotes anti-competitiveness. This practice makes it harder for streaming services to compete with Apple Music.

I personally think the only solution to this issue is some sort of compromise (that is if you agree with both sides as I do). One of those compromises is allowing Apple to charge the 30%, but also allow Apps to advertise cheaper prices elsewhere. I think this still would not make Spotify on an even playing field, but it would improve the competitiveness of Spotify. And on the other side, Apple is still able to charge its 30%.

I am sure there are other compromises that can work as well and I would love to hear them! This is just the one I thought up.

So from an economic point of view Apple has to process the payment for free in order not to have an advantage?

Because no matter what amount they charge they'll still be at an advantage.

P.S Margins on software product and services are way higher than what people on here think. Spotify is losing money not because of the 30% cut but because of its free tier. It's business model is inherently flawed.

P.S.S to all the android fans, do you know that Google takes 30% from subscriptions as well? They also prevent developers from advertising the fact that there are cheaper alternatives. So it's anti competitive as well?
https://developer.android.com/google/play/billing/billing_subscriptions.html#payment

 

[xSinghx]

You and others here keep arguing over which analogy best explains the current App Store subscription pricing, when all of the analogies are flawed...

And why is that? Just another declaration without substance.

Apple made all methods of paying for apps and app content cost the same because if they did otherwise...[blah blah blah, poor Apple, sob story, need their 30%]

Well, only looking at the problem through Apple's eyes is a simplistic and ultimately useless way to understand the issue of monopoly with them shutting out competition (possibly illegally) to their own benefit.

 

[MadeTheSwitch]

So the other choice would be better? This election is lose lose.



View attachment 638345

Obviously a large number of Americans disagree with you since these two people are the respective party's presumptive nominee. Which makes you the outlier, not everyone else.

 

[xSinghx]

Obviously a large number of Americans disagree with you since these two people are the respective party's presumptive nominee. Which makes you the outlier, not everyone else.

Well you could say he's correct as most polls show that people are not so much supporting those candidates as they are simply against the other. They are two of the most (if not thee most) despised candidates in recent political memory. Remember only about 30% of the public voted in the primaries assuming that's about 15% for each side it's really the voters that are the outliers.

 

[MadeTheSwitch]

Well you could say he's correct as most polls show that people are not so much supporting those candidates as they are simply against the other. They are two of the most (if not thee most) despised candidates in recent political memory. Remember only about 30% of the public voted in the primaries assuming that's about 15% for each side it's really the voters that are the outliers.

Then all those unhappy people should have gotten off their butts and either:

A. Voted for more acceptable candidates

Or

B. Run for office themselves if literally none of the candidates appeal to them.

There are choices out there. Everyone just seems to want to be lazy and then complain about things later.
[doublepost=1467522021][/doublepost]

His message is strong but the delivery isn't. Plus he has no visibility. Wouldn't it be nice if he could at least get on the debate stage? We had 10 on at one point in the Republican debates and 3 in the Democratic ones.

Why is he being excluded?

Because his polling is not high enough yet. The threshold for the general election is 15%. If he gets his numbers up (and I hope he does) then he will make it onto the stage. There's still time, but he needs to somehow get his message out more. I know advertising is expensive, but somehow he needs to do it.

Some background info on the 15% rule:

Why did CPD Select 15 Percent as the Polling Threshold for Inclusion in the Debates? The CPD first adopted the 15 percent level of support criterion in 2000. Its initial adoption, and its adoption in subsequent cycles, was preceded by careful study and reflects a number of considerations. It was the CPD’s judgment that the 15 percent threshold best balanced the goal of being sufficiently inclusive to invite those candidates considered to be among the leading candidates, without being so inclusive that invitations would be extended to candidates with only very modest levels of public support, thereby jeopardizing the voter education purposes of the debates. Notably, the League of Women Voters struck the balance in the same way. Fifteen percent was the figure used in the League of Women Voters’ 1980 selection criteria, which resulted in the inclusion of independent candidate John Anderson in one of the League’s debates.

http://www.debates.org/index.php?page=overview

 

[xSinghx]

Then all those unhappy people should have gotten off their butts and either:

A. Voted for more acceptable candidates

Or

B. Run for office themselves if literally none of the candidates appeal to them.

There are choices out there. Everyone just seems to want to be lazy and then complain about things later.

Regardless - that's a separate topic from what you took issue with as far as the other poster being out of the norm - he's not. As for the issue of apathy it's simplistic to attack the people when the system is purposely designed to exclude them - you're putting the cart before the horse.

 

[MadeTheSwitch]

Regardless - that's a separate topic from what you took issue with as far as the other poster being out of the norm - he's not. As for the issue of apathy it's simplistic to attack the people when the system is purposely designed to exclude them - you're putting the cart before the horse.

Nonsense. If the numbers are there, change can happen. But people have to come out and vote and make that happen. It doesn't just happen by itself. People have to get off their lazy butts and make it happen. Complaining about things and then staying home solves and changes absolutely nothing.

 

[xSinghx]

Nonsense...Complaining about things and then staying home solves and changes absolutely nothing.

Again - not the issue.

If people are simply to blame for not voting then you don't need something like the voting rights act. Systemic disenfranchisement is real both in/outside the voting booth - to discount that is both simplistic and "nonsense."

 

[MadeTheSwitch]

Again - not the issue.

If people are simply to blame for not voting then you don't need something like the voting rights act. Systemic disenfranchisement is real both in/outside the voting booth - to discount that is both simplistic and "nonsense."

Oh please. There is no such thing as "systemic" disenfranchisement. Do some groups...say older people without birth certificates and current ID have a tougher time with new voter ID laws? Sure. But it's not insurmountable and again, not systemic.

Where there is a will, there is a way. It's just that too many people don't have the will.

 

[dk001]

FWIW, the experience Apple offers has never been about being the cheapest, it's been about ease of use and convenience. Looking for a good deal (as long as things important to you are not sacrificed along the way) is being a good consumer.

Latest numbers are, Apple has 13 million registered developers. You want Apple to negotiate, individually, with each of them? There are over two million apps in the App Store. You really want Apple to have two million separate negotiations? I think you may have overestimated the size and capabilities of the team that runs their App Store.

And as far as the mobile music industry goes, when Apple entered the picture, the music industry was busy shouting at everyone not to download music "for free" (e.g. Napster and the era of looting music), while steadfastly refusing to offer music in any form other than CDs, because that would be giving in to "the enemy" (aka their potential customers). Steve Jobs did a remarkable thing: he convinced the music industry not to drive over a cliff, and to try letting him sell their music online instead. He stared at a bunch of music industry execs, held out his hand, and growled, "come with me if you want to live!" And surprisingly they took that chance, and they're still here because of it. And people buy music downloads now, instead of just grabbing it and running off with it because the opportunity presents itself (that does sound like looting, doesn't it?). AND Apple got terms that were reasonable for customers (instead of what the industry was trying for), so, for instance, you can listen on any device that can handle the format, rather than music being tied to an individual device (the industry wanted very much to sell you separate copies for each device), and you can (mostly) buy individual songs, instead of being forced to buy an album to get the one song you like, and everything sold for the same price, instead of prices being crazily all over the board (yes, now there's a few prices - at one point that was traded to the music companies in exchange for getting them to drop the DRM requirements) - everything Apple coerced out of the industry made buying music online more popular with customers than it otherwise would have been. Profitable for Apple? Absolutely. But also profitable for the music industry, and infinitely better than their original plan of driving off a cliff while screaming at "those darn kids". So I don't think the music industry has much to complain about with respect to Apple.
...

Try a different assumptive track. It's not about cheapest. It's about control.
Your "example"of two million revenue streams .... where did you pull that out of? The current path Apple takes is "surrender or die" vs. "let's negotiate. The number; one, one thousand, one million, etc..., is incidental. That is scope. Legally that has no impact on right / wrong.

One thing to always keep in mind when you say "Music Industry"; the Music Industry will always put themselves first and do what is best for themselves. You say Apple prevented them from driving over a cliff? Not hardly. Apple's solution was one they felt was advantageous. It was negotiated. It was a win - win for the Music Industry and Apple. A cleverly disguised loss for consumers.

Now back to my original post. You seem to have gone off on a distraction. Using iOS, I have learned I cannot find the most cost effective solution within Apple Apps. As a result I always go to the web; right or wrong. Just for iOS. For all the rest I can stay within the app ecosystem. It is a learned behavior based on experience. As a result I spend more in the App Store for app acquisition. I spend more within an app in other OS's. It's not who get's the money. It is about how much I spend. I have an approx 30gb music library (bought electronically, not ripped - ripped is about another 40GB) and of that less than 1% was via an Apple path. Instead of "simple click - simple buy", I have learned. Apple? Stop, look elsewhere, compare, then procure. And I am not talking about just music.

For clarity: I use neither Spotify nor Apple Music for my music streaming needs.

 

[CarlJ]

Your "example"of two million revenue streams .... where did you pull that out of?

I didn't say "revenue streams", I said "apps". It's in the text you quoted. Reading really is an important skill. It was in direct response to you saying, "What Apple should have is a negotiable percentage and negotiable service agreement." I was suggesting that negotiating individually with the developers of two million apps was impractical.

As to where I pulled that out of, it's been widely reported; but **************************, here's the first three hits:

• http://www.theverge.com/2016/6/13/11922926/apple-apps-2-million-wwdc-2016
• https://techvibes.com/2016/06/17/wi...store-apple-has-paid-50-billion-to-developers
• https://news.fastcompany.com/the-ios-app-store-passes-two-million-apps-4010209

One thing to always keep in mind when you say "Music Industry"; the Music Industry will always put themselves first and do what is best for themselves. You say Apple prevented them from driving over a cliff? Not hardly. Apple's solution was one they felt was advantageous. It was negotiated. It was a win - win for the Music Industry and Apple.

Apple spent a lot of time talking them into the idea of selling music as digital downloads; at the time music piracy was a big thing, and they were fearful of non-physical music, and wished it would just go away. Companies behave irrationally sometimes, because they are run by people. It is a win-win for the Music Industry and Apple, but the Music Industry refused to believe that for quite a while. How is it a loss to consumers, exactly? We don't have to buy an entire album to get the one or two songs we like, don't have to rip the CDs ourselves, and can play the music on any capable device. Things are never perfect, but I think consumers came out of this okay.

 

[dk001]

I didn't say "revenue streams", I said "apps". It's in the text you quoted. Reading really is an important skill. It was in direct response to you saying, "What Apple should have is a negotiable percentage and negotiable service agreement." I was suggesting that negotiating individually with the developers of two million apps was impractical.

As to where I pulled that out of, it's been widely reported; but **************************, here's the first three hits:

• http://www.theverge.com/2016/6/13/11922926/apple-apps-2-million-wwdc-2016
• https://techvibes.com/2016/06/17/wi...store-apple-has-paid-50-billion-to-developers
• https://news.fastcompany.com/the-ios-app-store-passes-two-million-apps-4010209

Apple spent a lot of time talking them into the idea of selling music as digital downloads; at the time music piracy was a big thing, and they were fearful of non-physical music, and wished it would just go away. Companies behave irrationally sometimes, because they are run by people. It is a win-win for the Music Industry and Apple, but the Music Industry refused to believe that for quite a while. How is it a loss to consumers, exactly? We don't have to buy an entire album to get the one or two songs we like, don't have to rip the CDs ourselves, and can play the music on any capable device. Things are never perfect, but I think consumers came out of this okay.

You do realize that of the 2mil apps, almost all are onetime buy, with updates and bug fixes. Quite a bit different than subscription. Negotiations for a one time buy are simple. It is the growth of the subscription and similar stream models that would be a bit more complex. That is a very small amount. Not impractical by any means. Businesses do this every daily on a global scale.

As for selling as digital downloads, I was doing (buying) that prior to the iTunes craze. It was unfortunate and a loss to the consumer that no other venue could implement a working model. Once the model was set, overcoming iTunes was difficult at best. The sale of "singles" has existed for a long time. Doing it in digital format was something the current Music Industry did not want to get back into. The song based released vs. the album release was already in the work. Apple managed to help convince the industry it was the right thing. It would have likely come about anyway driven by consumer / radio / music videos / clubs / etc... If you look at the consumptive drivers, only the consumer aspect plays within Apple's realm. Apple was able to prove it worked financially also.

If you would like to have a discussion, please refrain from the grade school comments. Your "apps" comment was parlayed in the form where, linked to the thread topic, can be interpreted as "stream", not single sale.

 

[Thunderhawks]

You may not see it but a member of government does. Anti Competition rules exist, and they are there to stop giants like Apple doing whatever they want and feel like, but it seems you have no problem with them doing exactly that? Are you a share holder?
You also seem a bit clueless about business? Apple isn't doing anyone a favour? They are purely doing things for profit ONLY, like make their product extremely popular then offer a platform to others based on that product in the hope that also becomes extremely popular so they can rake the money in with 30% cuts from everything. And this also argues against your 'nobody forces them to use Apple' argument, because if others want to be successful then they DO have to use the most popular platforms, and that means the provider of that popular platform CANNOT just go and undercut everyone and destroy the competition.

But this is Apple's usual MO, it just lurves to destroy the competition, hence why it went to court with Samsung, they couldn't care less if they copied them, they just wanted to remove a main competitors products of the store shelves, because that is worth a LOT more to them at the end of the day.

Not a share holder, but as for business clueless, I own one.

There are no anti competition rules, but there are ce

So, I guess you think Standard Oil should never have been broken up? same with AT&T? If you believe companies can do whatever they want regardless of how horrible it is, then you also should believe monopolies should be legal. If you do indeed believe monopolies should be outlawed, then your statement is moot. You then believe there is needs to be a balance between government oversight and regulations and the free market. Where that balance is is where the debating begins.

I have NEVER met anyone who believes a complete 100% free market is the ideal solution, but I guess there is always a first for everything. So forgive me if I am a little skeptical of your claims.

Since when is Apple a monopoly?

Obviously they are not, so your point makes no sense.
Apple competes like everybody else with the PC world, Android, smartphones, mp3 players, streaming, cloud services etc..

Is it anti competitive for them to not license the macOS, while their computers can run Windows and macOS?
Don't see anybody whining about the app store versions for macOS.

Now, they happen to have a money making iOS platform for which they are entitled to set the rules and negotiate pricing. They also keep it a closed environment in order not to destroy the consumer experience.
(I'll leave it at that. Not everything is perfect there)

Spotify's whining is all about money (as in wanting more) and as some others posted they aren't even on the same page internally with different statements.

Again, Spotify or any developer are FREE to not provide iOS apps and avoid whatever Apple wants to charge.
It is not a new practice that companies charge for store space.

Goes on in the supermarket world, where it is even more brutal. Your product doesn't sell X amount of $$$ in a certain time period they throw you out.

Sorry, I just can't see how it is Apple's job to nurture competition for companies who have not yet figured out how to make a profit.

 

[redhawk87]

Since when is Apple a monopoly?

Obviously they are not, so your point makes no sense.
Apple competes like everybody else with the PC world, Android, smartphones, mp3 players, streaming, cloud services etc..

If yo urea my previous posts, I do not think Apple is a monopoly. If I remember correctly, the point was aimed at a statement saying the government should not tell companies how to operate. The government breaking up monopolies like Standard Oil is just that: Government telling companies how to operate. If you feel Governments CAN NOT UNDER ANY CIRCUMSTANCES tell private companies what to do, then you believe that The US government should never break up a monopoly. A government organization breaking up a privately held monopoly would be considered government intervention. I do not know the exact economics term, but its called something like pure capitalism or something. If you believe there are certain circumstances where Government should get involved (like breaking up monopolies), then we can agree there need to be a balance between the free market and government intervention. Where that line is is where most people rightfully argue.
[doublepost=1467668384][/doublepost]

So from an economic point of view Apple has to process the payment for free in order not to have an advantage?

Because no matter what amount they charge they'll still be at an advantage.

P.S Margins on software product and services are way higher than what people on here think. Spotify is losing money not because of the 30% cut but because of its free tier. It's business model is inherently flawed.

P.S.S to all the android fans, do you know that Google takes 30% from subscriptions as well? They also prevent developers from advertising the fact that there are cheaper alternatives. So it's anti competitive as well?
https://developer.android.com/google/play/billing/billing_subscriptions.html#payment

No, Apple does not have to process it for free. I am sure Spotify would be happy to process it on their own as long as they can still charge the $9.99 price point. As I have said before, I sympathize with Apple in that they should not just give a service away for free. I never said Spotify should make Apple process all of its payments for free.

 

[lchlch]

If yo urea my previous posts, I do not think Apple is a monopoly. If I remember correctly, the point was aimed at a statement saying the government should not tell companies how to operate. The government breaking up monopolies like Standard Oil is just that: Government telling companies how to operate. If you feel Governments CAN NOT UNDER ANY CIRCUMSTANCES tell private companies what to do, then you believe that The US government should never break up a monopoly. A government organization breaking up a privately held monopoly would be considered government intervention. I do not know the exact economics term, but its called something like pure capitalism or something. If you believe there are certain circumstances where Government should get involved (like breaking up monopolies), then we can agree there need to be a balance between the free market and government intervention. Where that line is is where most people rightfully argue.
[doublepost=1467668384][/doublepost]
No, Apple does not have to process it for free. I am sure Spotify would be happy to process it on their own as long as they can still charge the $9.99 price point. As I have said before, I sympathize with Apple in that they should not just give a service away for free. I never said Spotify should make Apple process all of its payments for free.

Which means that they have to distribute, advertise and push updates for $99/year?

Just for context if an update takes 70mb, and there are 10 million users the amount of data served is 700 terabytes. I'm guessing the cost is way more than the $99/year.

 

[Thunderhawks]

If yo urea my previous posts, I do not think Apple is a monopoly. If I remember correctly, the point was aimed at a statement saying the government should not tell companies how to operate. The government breaking up monopolies like Standard Oil is just that: Government telling companies how to operate. If you feel Governments CAN NOT UNDER ANY CIRCUMSTANCES tell private companies what to do, then you believe that The US government should never break up a monopoly. A government organization breaking up a privately held monopoly would be considered government intervention. I do not know the exact economics term, but its called something like pure capitalism or something. If you believe there are certain circumstances where Government should get involved (like breaking up monopolies), then we can agree there need to be a balance between the free market and government intervention. Where that line is is where most people rightfully argue.

Obviously the government would step in depending on a market situation. As long as that is done fairly, rather than listening to competitor lobbying, I don't have a problem with it.
Whether the Standard Oil break up was a positive thing is questionable. The consumers enjoyed lower prices and by the time they broke it up the competitors had also organized, instead of whining. (BTW: copying what Rockefeller etc. had done years earlier)

When a company displays foresight and runs it's business well, implements new ways of doing things it should be entitled to benefit from that situation.
So, yes, I have a problem with competitors whining. If somebody can't make money in a certain field they have to get out of it or find a way to make their business profitable.

Thank you for making me read up on Standard Oil, quite interesting.
Brilliant businessmen for their time.
Left alone they'd probably own the Middle Eastern countries by now

 

[redhawk87]

Which means that they have to distribute, advertise and push updates for $99/year?

Just for context if an update takes 70mb, and there are 10 million users the amount of data served is 700 terabytes. I'm guessing the cost is way more than the $99/year.

First, where is $99 coming from? There are 12 months in a year. That would mean Spotify is getting $120 a year per customer.

Second, Spotify does not get $120/year from 10 million customers. They get $120 from ONE paying customer. So $120 * 10 million = $1.2 billion. I think they can host 700 terabytes for $1.2 billion.

Thirdly, I am only talking about payments, not distribution. Spotify does not own an app store on iOS. No one except Apple is allowed to have an app store on iOS. Therefore, Spotify cannot administer its own updates. So, bickering over whether Spotify can fund an update infrastructure with its current model is irrelevant.

Spotify already accepts payments through its own website, so the infrastructure to accept payments already exists at Spotify. They are completely capable of handling 10 million payments a month.

 

[lchlch]

First, where is $99 coming from? There are 12 months in a year. That would mean Spotify is getting $120 a year per customer.

Second, Spotify does not get $120/year from 10 million customers. They get $120 from ONE paying customer. So $120 * 10 million = $1.2 billion. I think they can host 700 terabytes for $1.2 billion.

Thirdly, I am only talking about payments, not distribution. Spotify does not own an app store on iOS. No one except Apple is allowed to have an app store on iOS. Therefore, Spotify cannot administer its own updates. So, bickering over whether Spotify can fund an update infrastructure with its current model is irrelevant.

Spotify already accepts payments through its own website, so the infrastructure to accept payments already exists at Spotify. They are completely capable of handling 10 million payments a month.

The $99 refers to the fee dev pays to Apple.

Secondly, thats just an issue with the quantum. Setting that aside, I'm just showing that there is real cost involved in distributing the app and updates. And thus one would have to recoup the cost somehow. In our case the 30%. Btw it's 700 terabytes for 1 update. There could be many updates in a year.

Thirdly, I never mentioned anything about spotify's ability to fund their own update infrastructure or payment collection. So not going to comment.

 

[redhawk87]

The $99 refers to the fee dev pays to Apple.

Secondly, thats just an issue with the quantum. Setting that aside, I'm just showing that there is real cost involved in distributing the app and updates. And thus one would have to recoup the cost somehow. In our case the 30%. Btw it's 700 terabytes for 1 update. There could be many updates in a year.

Thirdly, I never mentioned anything about spotify's ability to fund their own update infrastructure or payment collection. So not going to comment.

ah, the dev fee, not the 30% fee.. My bad. So, my counter was completely off topic. I thought you were saying the money Spotify was getting from their users was not enough to pay for the updates.

I understand the $99 a year does not cover all those costs. I am also fully aware of all the costs Apple incurs by hosting an app and administering updates and I bet most people on here who think Apple's policy is anti-competitive are also fully aware of this. That is not exactly what needs to be debated here. What you are trying to argue is whether Apple has the right to charge app developers for its service. What needs to be argued is whether this practice is anti-competitive or not. Now, Apple carrying the burden of housing the apps and updating them and everything else is definitely one point to be made for it not being Anti-competitive, but it is just one point to be had. And that point is a valid one!

 

[CarlJ]

As long as that is done fairly, rather than listening to competitor lobbying, I don't have a problem with it.
...
So, yes, I have a problem with competitors whining. If somebody can't make money in a certain field they have to get out of it or find a way to make their business profitable.

Sadly, when was the last time the government did anything affecting business without giving huge consideration to business lobbying? Many times, lobbyists for corporations end up writing the legislation they get the congressfolk to put forth for "regulating" that business sector. (Okay, sure, this doesn't always happen, but it happens distressingly often.)

But agreed, it's not the government's job to ensure that your business plan is profitable.

 

[redhawk87]

Obviously the government would step in depending on a market situation. As long as that is done fairly, rather than listening to competitor lobbying, I don't have a problem with it.
Whether the Standard Oil break up was a positive thing is questionable. The consumers enjoyed lower prices and by the time they broke it up the competitors had also organized, instead of whining. (BTW: copying what Rockefeller etc. had done years earlier)

When a company displays foresight and runs it's business well, implements new ways of doing things it should be entitled to benefit from that situation.
So, yes, I have a problem with competitors whining. If somebody can't make money in a certain field they have to get out of it or find a way to make their business profitable.

Thank you for making me read up on Standard Oil, quite interesting.
Brilliant businessmen for their time.
Left alone they'd probably own the Middle Eastern countries by now

your welcome I always love a good read.

Yes, competitors should not be able to whine just for the sake of whining. If someone truly has a better product, then they should be able to benefit from it. I completely agree with you.

Spotify was not the first streaming service, but it was the first to popularize it. Spotify has been growing at an amazing clip and has been seen as one of Europe's biggest start-up success stories.

So, to your point, should Spotify be able to capitalize on this success? Currently, Apple is potentially stunting Spotify's growth, making it harder for Spotify to capitalize on its own success. Now, dont tell me that you think Apple Music is superior or 'a new way of doing things' because it essentially is a Spotify copycat. Apple is capitalizing on the success of Spotify by copying their idea and then making it more difficult for them to grow.

Now, it can be argued that since Spotify looses money every year, it does not 'run its business well'. But, the idea of growing really fast while loosing money is a pretty common business model in this field.

 

[CarlJ]

Currently, Apple is potentially stunting Spotify's growth, making it harder for Spotify to capitalize on its own success. Now, don't tell me that you think Apple Music is superior or 'a new way of doing things' because it essentially is a Spotify copycat. Apple is capitalizing on the success of Spotify by copying their idea and then making it more difficult for them to grow.

You paint it as if Apple saw Spotify being successful and set out: a) to develop a service specifically to compete with Spotify, and b) to put up roadblocks to hinder Spotify. I'd say that Apple Music is a pretty natural outgrowth of Beats Music, which Apple purchased as part of Beats (for a wide variety of reasons), which in turn, had its roots in MOG, which goes back quite a few years. And I don't see any changes that Apple has made to the App Store rules to stunt Spotify's growth - the monetization rules are what they've always been, and are designed to ensure that Apple gets paid (quite handsomely, to be sure) for running the store (thus, 30% no matter how the money is collected, because otherwise developers would always flock to the lower priced option even if it wasn't good for customers - calculator subscriptions anyone? - and no redirecting users to some outside place to pay the developer directly). For the record, I think a 30% cut for subscriptions is pretty high, but I can see why they do it that way (again, if the paths through the system aren't equal, the cheap one will win out).

Reading your first sentence above, one would conclude that Apple has made recent changes in the pricing structure in order to thwart Spotify's potential for success. I don't see that supported by the evidence (unless perhaps Apple has developed a time machine and used it to go back and change their pricing rules in the past). Instead, I see Spotify deciding that Apple's rules, which they agreed to (just like every other developer), are not sufficiently advantageous to Spotify's business model, so they're throwing a tantrum to try to get them changed.

 

[lowendlinux]

Ok, you dont like the Microsoft example. Try Palm. They had an amazing OS (WebOS) and crappy hardware and absolutely no money for advertising. They no longer exist. Look at Amazon's Fire Phone. A disaster. As you mentioned, Blackberry, another disaster. Nokia... disaster. Samsung's Tizen line of phones? I think the better question is whats Tizen? Mozilla, Garmin, Ubuntu, etc. all have tried to make phones and have horribly failed. Now you cannot tell me they all failed simply because "they all made similar phones". To be the kind of different in the Smartphone industry that makes you an instant success either takes luck (like winning the lottery) or an insane genius (like Steve Jobs). As I have mentioned, any old company technically has the potential to make a hugely successful phone on their own, but it is highly unlikely that they will succeed in doing so. So, you cannot base your argument on something that is highly unlikely.

Samsung still has it's Tizen line of phones and Ubuntu touch has been successful enough that they have two makers and now a tablet. Neither are Apple nor Android size wise but they're not dead either. Jolla is also hanging in there though tenuously