Spotify Accuses Apple of Using App Store Approval Process as a 'Weapon to Harm Competitors'
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Spotify Accuses Apple of Using App Store Approval Process as a 'Weapon to Harm Competitors'
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Tell you what.. how about I put a sign in your yard because millions of folks drive by your house daily, which advertises my business just next door, and refuse to pay you a cent. Bet you would take a dim view of that. Apple should be compensated for the use of their server, bandwidth and other items. Apple also allows developers to be paid for their software, WITHOUT having to buy a credit card machine, or setting up expensive back end transaction software.. That means if I create an app for 99 cents that a 100,000 people download, I get a check for 70% and don't have to do any of the work besides create the app. Seems pretty fair to me..
If Spotify wants to not pay Apple, keep it simple.. have a web site only that anyone with a Safari browser can go to, sign in and listen to their hearts content.
I have a product to sell, so can I use your house as my store but not pay you anything for it?
I think Apple's rules regarding non-promotion of competing payment mechanisms are completely fair. Presence of the app in the App Store is a major advertising for Spotify's business - and they should pay for that with 30% cut of revenue.
Apple doesn't restrict them in terms of functionality, and they even relaxed rules for Spotify - previously the rule was that the subscription price in App Store and outside App Store must be identical (so either 9.99 or 12.99 in both places), but now Apple allows companies to charge more via Apple Store so that companies won't lose revenue.
What Spotify wants is to distribute app for free (using Apple's infrastructure and publicity from the presence in App Store), and then get 100% of revenue - so a total loss for Apple.
P.S. I do think that 30% cut is too high though - I cannot imagine Apple's actual total expense being more than 10%. This has to come down.
Apple doesn't restrict them in terms of functionality, and they even relaxed rules for Spotify - previously the rule was that the subscription price in App Store and outside App Store must be identical (so either 9.99 or 12.99 in both places), but now Apple allows companies to charge more via Apple Store so that companies won't lose revenue.
What Spotify wants is to distribute app for free (using Apple's infrastructure and publicity from the presence in App Store), and then get 100% of revenue - so a total loss for Apple.
P.S. I do think that 30% cut is too high though - I cannot imagine Apple's actual total expense being more than 10%. This has to come down.
What about the option where the store owner makes better widgets that people prefer? Why didn't the store owner patent his widgets before the landlord got into the same business? Why can't the store owner vaguely mention that widgets are for sale in the back alley like another really successful store owner does in this same strip mall?
We aren't talking about the hosting of the apps here or the approval process. We are talking about the price of subscriptions via the apple store versus outside directly on Spotify's website. Every Spotify user can subscribe outside of the app store. Spotify in this case was simply expressing dissatisfaction about having to charge 12.99 per month if letting users to subscribe through the app store to still make the same amount as non app store subs.
In my opinion this kind of stuff really just hurts the consumer because it reduces clarity on the most economical way to get the same service. It is actually pretty astounding the number of people that don't care about that.
Yeah what's the deal here. Samsung should be selling Apple iPhones in all the Samsung stores, as should Microsoft and all other phone manufacturers. And while we at it why isn't the Chevy dealership selling Ford cars. And Mercedes should be selling BMW as well. Very anti competitive.
I don't know that what Apple doing is illegal- at all. The 30% cut is not illegal, nor is having some rules in place to prevent developers from trying to circumvent the commission.
What makes this situation unique for Spotify compared to other app developers is that Apple has a competing product. But that's not Apple's 'fault' either.
In the long run, if the developer community decides that Apple's app store is too restrictive or predatory somehow, they will be motivated to emphasize the Android store instead. So outside of a monopoly (which can be investigated and regulated), there is a process in the marketplace in which hopefully competition will drive everyone towards offering the best product or service for consumers.
And what if they guy that built your house wanted 30% of everything? How would you feel then?
What do you think a reasonable profit margin for Apple to make on the App Store would be?
The estimates that I've seen put the profit margin of the iTunes Store in the single digits.
It already is. Keep your customer for a year? Drops to 15%.
And there are 200 different pricing options that Spotify can use. Is that not enough for them to get the terms they want?
Excellent argument, since that you've presented both sides of the talk.
My point are these:
- Apple has its rules in place since day 1, Spotify has agreed to this for a very long time with its past/current version. If it no longer agrees, all it has to do is leave.
- Apple is not twisting anybody's arm, forcing them to use Apple Store. Spotify can build their own platform or use Android, which I suspect it will end up sueing Google for the same reason. And we will be back here discussing the same argument, part 2.
- Spotify is a free app, only its subscription makes money. So if Apple can't get any share of the subscriptions, it's basically building a free platform for its competitors to take money from its own customers. This platform cost Apple millions of dollars and years to build. It costs millions of dollars to continue supporing it. So no, Apple should not and will never allow iOS apps to make money on the side without being able to get a cut.
Spotify: Please supply to the "Court of Public Opinion" the break out of all profits directly attributed to the Apple ecosystem. Please include all subscriptions which were initiated from an Apple iPhone, iPad or Mac. Please include all shared ad revenue.
Then we can all make a more judicious ruling on your complaint.
Then we can all make a more judicious ruling on your complaint.
Well the key thing here is Spotify chose to play in Apple's house. In a way this is like Google not wanting to be controlled by Microsoft so they developed their own OS, Browser, and what have you so that they can control their own destiny. As been said here earlier, if Spotify doesn't like it, take their ball and go play exclusively with Android especially if you don't want Apple getting a penny off you. I would also look into redesigning the iOS app so that their are no in-app purchases and try to do a better job advertising your website for subscription sign-ups. This would allow you to just sign into any app on any device to use your subscription.
Psssst. You can't compare a physical marketplace where space is finite vs an online marketplace.
I don't disagree with you. But I do feel there is a legitimate reason to have rules on promoting off-app subscriptions, otherwise everyone would try to circumvent Apple's cut. "Subscribe in-app for $10, or go to our web site and get it for only $8!"
This is like selling an item on eBay or Amazon and not wanting to pay the selling fees. Grow up Spotify!
If you think App Store is unfair, I bet you dont know anything about retailers.
A typical strip piriton pill costs only $0.50 cost price but you need to pay at least $5 from the pharmacy or $10 from the doctor.
A typical new Adidas shoe costs $20 to make but you pay $120 - $160 at retailers.
Why don't you condemn physical retailers and ask them to stop doing it? You don't because retailers are paying rent, wages, interest, marketing and other costs.
Apple needs to pay its curators, software engineers, servers and data centres to maintain that app stores.
And Spotify has a choice, they can choose to leave the App Store. If you don't wish your product to be sold at Walmart, find Target, Costco or other retailers. Spotify has a choice and they should stop whining. Start their own app store, cut their price to 6.99 or offer their app for free. Spotify has a choice.
HAHAHA, the same crap they tried with Kindle. How did that work out? Microsoft should start charging Apple 30% for everything bought on iTunes on a Windows OS computer 
Solid points and Apple seems to be trying to address this with their post-one-year reduction from 30% to 15% fee, but I agree that even that could be argued as excessive considering Apple doesn't have any costs (direct or indirect) associated to the actual content delivery.
Perhaps a more equitable (for both sides) solution would be to allow in-app purchase of monthly subscriptions, but Apple only takes their cut (be it 30%, 15% or whatever) for that first month to cover the cost of hosting the App in the Store and delivering it to the customer's iOS device. And the service could not offer a lower introductory price in order to "stiff" Apple. So Spotify would have to charge the same $9.99 for the first month as they do for the second and onwards months. You could also make a requirement that the service is not allowed to change their subscription price for in-app purchases for a period of a year. So if Spotify wanted to charge 99 cents, they would have to do so for the entire first year of a customer's service.
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Here is the real issue. Spotify is choosing it's timing pretty wisely. Elizabeth Warren is rumored to be on the short list for Hillary's VP. She is challenging Apple, Google and Amazon on different fronts, but for the same "monopolistic" reason, even though that isn't the case with any of these companies. Spotify thinks it can gain support because of what Warren is doing. Good luck.
How exactly?! Spotify has 30 million subscribers vs Apple's 10 million and besides that the AppStore is not the only platform to sell apps or offer the service...
How is that relevant at all? Spotify is the one with the product, selling it in Apple's house. Not the other way around.
Are you suggesting Spotify built iOS?
That's not the same as calling for the approval process to be eliminated. So I'm not sure why you quoted the previous poster and then used red to prove - what?
Man I like my apple products as much as the next guy, but damn you fanboys are just ridiculous. To me, my phone is just a really small computer. So, let's say Apple starts telling you, that you can only buy software for your mac from their app store. Would you be cool with that? It seem to me that Apple is going way beyond what M$ got hit for with the anti-competitive lawsuit. I'm betting that will happen to Apple very soon.
Yes, I know the argument that the software is vetted .. blah-blah-blah. The same risks are there on a computer as a phone as a tablet. Just give me and the others who know the risks and how to avoid them the option to load software from wherever we want to. It's my device. I paid for it. I should be able to do with it as I please.
Yes, I know the argument that the software is vetted .. blah-blah-blah. The same risks are there on a computer as a phone as a tablet. Just give me and the others who know the risks and how to avoid them the option to load software from wherever we want to. It's my device. I paid for it. I should be able to do with it as I please.