I don't see how the info in your link would change their effective tax rate. IIRC, they pay 35% or so on Americas income and 10-15% on overseas income for an effective tax rate of 25% on their overall income.
Got a tip for us?
Let us know
Become a MacRumors Supporter for $50/year with no ads, ability to filter front page stories, and private forums.
Spotify Accuses Apple of Using App Store Approval Process as a 'Weapon to Harm Competitors'
- Thread starter MacRumors
- Start date
- Sort by reaction score
I'm not complaining about that. I'm complaining about the only way to get apps is through the app store. Devs either comply with apple or ignore iOS. On every other os devs can ignore its respective store and go direct to consumer with the app on their website.
Imagine if Microsoft tried to get a cut of every sale of every windows application and there was only one avenue for purchasing that could not be circumvented. Nobody holds power and influence over their ecosystem like apple, unprecedented..
I think it's been argued that they are paying closer to 2% as per that article. Doesn't really matter as the conversation is irrelevant to the topic - I think we can drop it. LOL.
Excluding any prior issues that Spotify and Apple have had, this is my view point on this article.
Spotify updated their app to not include the ability to buy subscriptions via the iPhone and Apple blocked that update because they of this (so Spotify stated). I have a problem with Apple blocking the app if that is all that was done. There are plenty of apps that don’t allow IAP, but you pay for the service in other means: HBOGO, SiriusXM, Amazon Video, CBS, Watch ABC, Watch TBS, Audible and the list goes on and on. Now, with that said, I do not know if these apps are paying Apple anything as these apps are free to download from the app store.
As for the advertisement in the app about signing up at their website, I will agree with Apple on this, somewhat (I hate the whole advertisement in any app, but that’s business). However, Spotify only needs to change its verbiage a little, to something like Audible uses “Purchases cannot be made through the app.” This is no longer advertisement, it’s just a statement of fact.
As for re-directing to Safari, I know that DirecTV app does this and I am sure others do as well, so, why does Apple block Spotify or any other app from doing this?
I don’t have a problem with Apple charging a 30% fee for apps/services bought via Apple, especially if Apple doesn’t also sell competing app/service. However, Once Apple start offering an app/service that competes with the businesses that are paying the 30% fee, this becomes an unfair practice, in my opinion. I know, people say, everyone pays the 30% fee and if Apple pays a 30% fee…exactly who is Apple paying that 30% fee to, yea, that’s right, themselves.
Spotify updated their app to not include the ability to buy subscriptions via the iPhone and Apple blocked that update because they of this (so Spotify stated). I have a problem with Apple blocking the app if that is all that was done. There are plenty of apps that don’t allow IAP, but you pay for the service in other means: HBOGO, SiriusXM, Amazon Video, CBS, Watch ABC, Watch TBS, Audible and the list goes on and on. Now, with that said, I do not know if these apps are paying Apple anything as these apps are free to download from the app store.
As for the advertisement in the app about signing up at their website, I will agree with Apple on this, somewhat (I hate the whole advertisement in any app, but that’s business). However, Spotify only needs to change its verbiage a little, to something like Audible uses “Purchases cannot be made through the app.” This is no longer advertisement, it’s just a statement of fact.
As for re-directing to Safari, I know that DirecTV app does this and I am sure others do as well, so, why does Apple block Spotify or any other app from doing this?
I don’t have a problem with Apple charging a 30% fee for apps/services bought via Apple, especially if Apple doesn’t also sell competing app/service. However, Once Apple start offering an app/service that competes with the businesses that are paying the 30% fee, this becomes an unfair practice, in my opinion. I know, people say, everyone pays the 30% fee and if Apple pays a 30% fee…exactly who is Apple paying that 30% fee to, yea, that’s right, themselves.
Huh? That doesn't make any sense. It's right on their financial statements. Unless you are implying that Apple makes 10x what they claim to make?!?
"And one of the company’s most notable tactics for lowering what it owes in taxes is using three subsidiaries it headquartered in Ireland, which has a corporate tax rate of 12 percent and where Apple has been accused of inking a sweetheart deal where it only has to pay a 2 percent rate,"
I didn't say it was fact. Just that it's been argued. But seriously - let's both drop this part of the conversation - it has zero baring on the actual topic
Spotify and Apple are embroiled in a major dispute, which Spotify is today taking to the court of public opinion. Spotify submitted a new version of its app to the App Store, following a decision to eliminate the option to purchase a subscription through Apple, and Apple has rejected the update.
In response, Spotify wrote a letter to Apple's legal team on June 26, portions of which have been shared by Recode. Spotify's letter, which it shared yesterday with Congressional staff in Washington, D.C., accuses Apple of causing "grave harm" to Spotify by rejecting the app update.
The details on the rejection are somewhat murky, but Spotify claims Apple denied the app update and demanded Spotify use Apple's billing system if it "wants to use the app to acquire new customers and sell subscriptions." Spotify was using its iOS app to highlight a promotion offering new Spotify customers three months of service for $0.99, something Apple didn't like.
Apple reportedly forced Spotify to stop advertising the promotion in the iOS app or face the removal of the app from the App Store. Spotify stopped the advertisements, but also decided to stop offering App Store subscription options, a move that's led to the current disagreement between the two companies.At issue is the 30 percent cut that Apple takes from App Store subscriptions, which has caused Spotify to charge $12.99 for subscriptions purchased through the App Store, a $3 premium over subscriptions purchased on the web and $3 more than the price of Apple Music. Apple does not force apps to use its billing system, but it also does not allow apps to offer other purchase options. As stated in the App Store guidelines:
Apple in the past had a battle with Amazon and other book sellers over its App Store rules, which resulted in Amazon, Barnes and Noble, and Kobo removing an in-app book store purchase options from their apps. Apple has never relented on the issue, even years later.
Apple recently announced plans to tweak its subscription policies to take a smaller 15 percent cut from subscribers who stay subscribed to a service for more than one year, but Spotify says those changes don't "get to the core of the problem."
Though Apple has rejected Spotify's update, options to purchase Spotify subscriptions in the Spotify app for iOS devices have been gone since the end of May, removed via a backend update. At the current time, it is not possible to purchase a subscription through the Spotify app, and the Spotify app is not able to direct customers to purchase a subscription on the web.
Article Link: Spotify Accuses Apple of Using App Store Approval Process as a 'Weapon to Harm Competitors'
Hey Spotify, its an App STORE just like Costco or Walmart get to choose what products they sell Apple can set up rules any damn way they choose for products in their store for their device. Go build your own phone and app store and quit your crying.
If i had ever considered signing up for Spotify this greedy temp tantrum has sealed my decision to never even look at their product. bye bye spotify
Yeah but the same people that hold this opinion are the ones that are mad that google changes their search results to benefit themselves. The problem with the current situation is that there's a near monopoly on mobile app distribution, and users are over committed to operating systems after buying all of their tools in one and them not being transferrable to another.
[doublepost=1467380570][/doublepost]
Should walmart get a cut of all of the sales made on an iphone if the iphone was bought at walmart? That's also analogous.
Of course it does, Spotify want to stop paying Apple - simple as that. Free markets means free to trade, you don't tell people what they can and can't buy and sell, Spotify want to be able to sell their product as they see fit without paying Apple, and ideally they would like Apple to not sell music. Apple is hardly causing anarchy, they don't agree that Spotify should have it all for free and Apple have to pay to support their competitor. That sort of manipulation exists in China, it shouldn't exist in a fair economy.
I'm guessing Spotify won't last too long, it hasn't worked out how to be profitable, it would be a shame if they collapsed as I think hey provide a good service, but they dont have a right to make Apple Pay for their sustainability.
[doublepost=1467381243][/doublepost]
I've read it, that's part of the article. They don't want to pay Apple (part 1) so they are trying to find a way to get out of paying via an app update (part 2). Spotify want their app hosted and marketed by Apple for free. If it was a free app then fair enough, but it's not, why should they get it for free when all other developers who sell an in app purchase or charge for their apps have to pay?
I see it as really simple - if you don't like it don't put your app on. Why do people feel they have some kind of a right to get everything for free? Yes it's annoying when you can't have your cake and eat it, but if Apple didn't exist and / or have the App Store Spotify wouldn't have the problem, instead of working with them and seeing they benefit from Apple they want to take everything for nothing. Spotify does nothing for Apple, it's not as if Apple gets business from Spotify, in fact they lose business to them, and then Spotify expect the support for free.
I completely understand the argument, I don't find it complicated, I just believe it's wrong. You are entitled to think it's right, I'm not remotely interested in changing your mind as it really doesn't matter to me, just telling it as I see it.
I guess I've just never understood people feeling they have a right to anything at someone else's expense.
well spotify HAS to have their app hosted by apple, they have no choice if they want to service ios customers
no other OS forces use of the store like this
no other OS forces use of the store like this
I am not talking about that. Apple prohibits iPhone and iPad owners from purchasing/downloading/installing any IOS software application that is not approved and sold through the Apple app store. And I know all about jail breaking IOS but I don't want to get into that discussion.
I too wonder why they are being chased. The bigger they get the more people are determined to see them fall. Again, too many people wanting something for free, they don't want to make their own money, they want to take it from someone who already has it.
I spent years running a charity helping thousands of people, I never took an income or expenses, I'm fortunate that I didn't need to, but I got sick of so many people trying to take, take and take some more, they didn't want to help themselves, they wanted everything for free and everything done for them. I usually found those who had the least we're most grateful and less greedy, others were just keen to get what they could for the minimum amount of effort. In the end I decided to let others just get on with it.
Those defending Spotfy seem to think it's ok to expect Apple to support other organisations because they can afford it. There are an infinite amount of examples we could use to compare this to, I've not heard anyone give an equal example that could justify Spotifys belief that they shouldn't have to pay for Apple hosting their app. I'd like to hear some.
does apples lowering it to 15% change this conversation? why aren't they complaining about google? don't they have the same policy?
I think when there are many (dozens, hundreds, thousands) of competitors, it is legal. In my example, the store owner could just move the store to another mall. When it comes to mobile application stores, there are only 2 stores that are pretty much identical and they do not really compete, and they do not negotiate terms at all. It's a duopoly of the mobile application distribution marketplace. Apple is using their share of this duopoly to bully competitors in other markets. Apple is using their position in the mobile application distribution market to get an unfair advantage in the music streaming market (among others). This is illegal.
Lot's of people dismiss the old Microsoft antitrust example, but I think those folks don't really understand what Microsoft did wrong. It was not wrong for Microsoft to effectively have a monopoly on the desktop operating system market (Windows). That is fine, bravo for them for getting a monopoly. It was wrong for Microsoft to use their monopoly in the desktop operating system market to gain an advantage in other markets (the internet browser market in that instance).
It's fine to have a monopoly or a duopoly and milk that market all you want. It becomes unfair when you use a monopoly or a duopoly in one market to take over another market.
Yes, I agree that is about not wanting to pay Apple for a service. However, what about all the other subscription based apps that exist (HBOGO, SiriusXM, etc) that you pay outside of apple, the app is free. How much or little do they pay apple? If they are paying 0, then I think it's only right that Spotify's should pay 0 also.
That's just FUD. (Almost Trumpian "Some people are saying...")
Even if it's true, it's already accounted for in their effective tax rate. Whatever their tax rate is in various countries (35% in the US or 2% in Ireland, etc.), they are still as a whole effectively paying 25% of their income in taxes. The numbers are literally black and white. Unless you are claiming that they are falsifying their financial statements.
[doublepost=1467382616][/doublepost]
Those other subscription based apps have the same rules as Spotify. It you sign up through the app, Apple gets a cut. If you sign up outside the app, Apple does not get a cut.
OK, I understand what you're saying and you're analogy with Microsoft seems sound, I'm mostly in agreement with you. I can see how it's unreasonable to force Spotify to pay such large recurring charges when they have no real alternative but to sell in the App Store. I think the next question is would the 15%, second year, rate that's coming soon for subscriptions make enough of a difference. My guess is it wouldn't, as it a.) doesn't apply till the second year and b.) still seems mathematically too high for Spotify to be able to compete effectively given how thin the margins are in this business. Given that, what charges would be reasonable?
The problem with this is that the reason many of those customers are coming to your dealership in the first place is BECAUSE they only want to buy gas from your gas station. They've went to other dealerships that were more open and their car broke down after a year because they got some crappy bio fuel.
Yes, Apple could have other app stores as well as downloads from the web. Apple has chosen (correctly in my opinion) to have a platform that doesn't allow those things. The reasons are numerous. OS stability, security, brand image, ease of use and user friendliness, etc.
If, as a customer, multiple avenues of downloading apps is important to you then perhaps you should get an Android device. Personally I don't think I would ever use 3rd party app stores or web downloads. I wish that back when I was a kid using Windows PCs that an App Store would have been around. Probably would have prevented me from messing up so many machines. Even today if I owned an Android device I would probably stick to the Google Play store. To each his own, but I'm just saying that if you're looking for the freedom to download from other places then iOS probably isn't the platform for you.
No real alternative? Android, web, Mac, Windows Linux, proprietary solutions. They have a number of alternatives.
ALL developers have to pay Apple to list their apps in the app store. Even free apps cost money to list.
Spotify is not getting something for free.
They simply removed the in-app subscription option and Apple got their undies in a twist over it since they will no longer get a cut from new subscribers.
This is pure anticompetitive behavior on Apple's part.
Nope. Apple got their undies in a twist because Spotify was advertising an outside payment option in the app. Something that has clearly been against the store rules since at least 2011. Plenty of apps including Amazon have removed the in-app subscription option without any issue from Apple.
If they don't have a link - I think Apple's objection isn't quite valid. Like I wrote earlier in this thread. Spotify could (as a work around) have an ad supported app and then buy ads that promote subscriptions outside the store WITH a link and there's nothing Apple could do. Naturally this would be a cost for Spotify to do - and a crappy work around.
Ignoring iOS is not a sound business decision. There is no alternative to the app store. That is the problem. It is the only ecosystem with one channel to distribute apps