Neither a monopoly nor a duopoly are illegal. Using market dominance to prevent others from entering the industry is illegal but being the only one (or one of two) is not.
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Spotify on Apple's Response to App Store Dispute: 'Every Monopolist Will Suggest They Have Done Nothing Wrong'
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Neither a monopoly nor a duopoly are illegal. Using market dominance to prevent others from entering the industry is illegal but being the only one (or one of two) is not.
Many of Apple's business units are subsidized by other parts of the business.
Ask yourself: do you think Apple Music, supposing it's not run at a loss, could afford a 30% fee on first year subscribers and still be competitive with Spotify?
Update, after googling around: Apple Music's gross margin is estimated at 15%. That's not enough to cover a 30% first year subscriber fee. And of course there are additional costs in actually running Apple Music (not just paying out royalties).
It's totally unfair to Spotify.
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I can't imagine how you would feel if you ever purchased:
- Jewelry
- Bottled water or soft-drinks
- Medications
- A mattresses
I guess I should have explicitly added, the implied "in this case".
Governments don't even do much when predatory Pharma companies jack prices on meds that people need to stay alive by 1000% or more.
https://www.washingtonpost.com/news...ent-drug-price-hike-is-altruistic-not-greedy/
Given that it seems that interfering with app store pricing is an absurd action by governments.
I put myself in the shoes of some of these pro Apple supporters, and I’ve decided that Apple owns the store so it’s their rules. They can kick any company out because it’s the same as “at will employment”. I also don’t care if Apple subsidizes their cross business units because that doesn’t fit my ideas of what I know of Apple
I dont know what to call it, but only being able to deliver apps through the App Store on the iPhone is a bit unfair. It is the only distribution model Apple will allow, and Apple is in full control of its profit share and approval process.
I can understand there is a price to be paid to have your App offered, reviewed and showcased in the Apple controlled store, thats fair. But Spotify, and number of other Apps would flourish while being distributed directly from the developer.
I would personally drop the Mac platform if they did this to their desktop OS.
I can understand there is a price to be paid to have your App offered, reviewed and showcased in the Apple controlled store, thats fair. But Spotify, and number of other Apps would flourish while being distributed directly from the developer.
I would personally drop the Mac platform if they did this to their desktop OS.
Imagine you have a service that offers streaming content. You charge users $10/month. You pay your content suppliers an average of $5/month per user. You profit $5/month per user.
Now Apple comes along and decides to enter the same market. They create a streaming service, for the same $10/month. But Apple, being a much larger corporation, can afford to make less on this particular endeavor. So they make a generous deal of $7/month per user to the content suppliers. Content suppliers love it, they're making more money, and Apple gets a lot of exclusivity.
What's now happened is content suppliers are enjoying their $7/month, and want everyone else to start paying it as well. Content providers start telling you that they want $7/month, or they're pulling off your service.
Your service looks at its budget and says "well, if I had to start paying $7/month, I'd still make $3/month per user. It's a cut, but it's not that bad, I think we can try to make those ends meet."
But then the same company that is now your competitor tacks on a fee of 30%. There goes your $3 profit. You now have zero profit, and you go out of business. Or, you raise your price to $13/month to compensate for the difference, but your users just see "Apple is cheaper, let's go there" and leave.
Apple on the other hand happily continues their service, making $3/month per subscription.
This to me is the core issue here. What Apple is doing - entering a market then using their market power to try to "encourage" others to exit that market - is exactly the sort of practice that Microsoft got in trouble for. Microsoft used their market power (they WEREN'T a monopoly - Mac and Unix/Linux existed at the time!) to try to push their browser. Although I still think this situation is a bit worse - Microsoft never forced you to use their browser, they only required it to be preinstalled. The entire idea was "people might be discouraged from using the competition because the UX of using the built in option was better." That's precisely what's happening here - the UX of using Apple Music, along with its potentially lower cost (should Spotify raise prices to compensate for the Apple tax), is quite obviously going to "discourage" people from using the competition.
Now Apple comes along and decides to enter the same market. They create a streaming service, for the same $10/month. But Apple, being a much larger corporation, can afford to make less on this particular endeavor. So they make a generous deal of $7/month per user to the content suppliers. Content suppliers love it, they're making more money, and Apple gets a lot of exclusivity.
What's now happened is content suppliers are enjoying their $7/month, and want everyone else to start paying it as well. Content providers start telling you that they want $7/month, or they're pulling off your service.
Your service looks at its budget and says "well, if I had to start paying $7/month, I'd still make $3/month per user. It's a cut, but it's not that bad, I think we can try to make those ends meet."
But then the same company that is now your competitor tacks on a fee of 30%. There goes your $3 profit. You now have zero profit, and you go out of business. Or, you raise your price to $13/month to compensate for the difference, but your users just see "Apple is cheaper, let's go there" and leave.
Apple on the other hand happily continues their service, making $3/month per subscription.
This to me is the core issue here. What Apple is doing - entering a market then using their market power to try to "encourage" others to exit that market - is exactly the sort of practice that Microsoft got in trouble for. Microsoft used their market power (they WEREN'T a monopoly - Mac and Unix/Linux existed at the time!) to try to push their browser. Although I still think this situation is a bit worse - Microsoft never forced you to use their browser, they only required it to be preinstalled. The entire idea was "people might be discouraged from using the competition because the UX of using the built in option was better." That's precisely what's happening here - the UX of using Apple Music, along with its potentially lower cost (should Spotify raise prices to compensate for the Apple tax), is quite obviously going to "discourage" people from using the competition.
i dislike statements such as the one made by Spotify.
Not saying that Apple is innocent or guilty of that ccusation. Just saying that if a party is innocent of an accusation, they will say the same thing too.
“Hey, I didn’t do that!”
“Oh yeah? Only a guilty person would say they didn’t do that!”
Not saying that Apple is innocent or guilty of that ccusation. Just saying that if a party is innocent of an accusation, they will say the same thing too.
“Hey, I didn’t do that!”
“Oh yeah? Only a guilty person would say they didn’t do that!”
These manufacturers created the platform their "App" will be running on... whats the difference? Apple is allowing Apple Music on these third party devices because it knows it can make more money that way. If Apple thinks that is worth 30% why shouldn't they pay these companies?
Nice revisionist history. But that isn't what happened.
Apple didn't decide at some later point to tack on 30%, that fee existed before as long as the App store existed, and Spotify doesn't actually pay that fee, because the don't have the option to upgrade to premium in their App. So spotify gets the benefits of the Appstore and pays nothing.
They would just like to also add the convenience of IAP, and pay nothing for that too.
The hundreds of thousands of developers who don't pay anything to have Apple host their free App are laughing out loud at you. The developers who share in the $120 BILLION DOLLARS that the App Store has brought them are laughing out loud at you. On their behalf, thank you for the brief respite of humor you have brought them.
One of these things is not like the other.
Android, nintendo switch, Xbox, playstation. All these platforms allow the devs to choose the distribution provider, choose the stores they sell their game/app in. None of them are monopolies.
As a iOS dev, you can only pick one iOS app store to sell in, the one run by apple.
The problem with this post isn’t that it’s just off-topic, but it’s a straw-man. Nobody is saying that there aren’t situations where governments shouldn’t intervene in the markets.
The gov doesn't have to set the price or percentage. They can force apple to allow alternative iOS app stores. The market can determine the price.
Please show me this alternate Switch/XBox/PS store where Nintendo/MS/Sony don't get their cut.
I recall it being more complex than how it was reported (not that you claimed to be giving the definitive explanation) but the issue arose because Microsoft started getting aggressive with forcing IE as the de facto standard. They aggressively went after partners hinting that their preferred pricing was dependent upon them supporting IE. Their partnership with Apple included making IE available on the Mac to prevent other standards from gaining a foothold on that OS. (Their reluctance to update it showed it was more a of a power move bound by contracts than a desire to offer quality Macintosh software.)
When Microsoft made IE impossible to uninstall, claiming it had to be part of the OS in the future, opponents pointed to the standalone version of IE for the Mac as evidence that it had to be integrated. Now, history is blurry, and poor support of IE for Mac could have been a way to show that it had to be integrated into the OS or it could have served its purpose and Microsoft no longer saw value in updating it. In any case, IE killed Netscape as a business before market forces took over.
I think Microsoft was unsure of the potential revenue the internet offered, likely due to the value of AOL at the time, and tried to protect the right to profit from IE ultimately baking the cost into Windows. Instead, I think they should have made the IE source free in order to ensure IE protocols were the industry standard. This would allow them to write off development and also charge partners an annual 'certified IE' to receive pre-release of new builds to ensure their platforms supported it before the update went live. Open sourcing the IE platform would have allowed competitors to IE, but all of them would always be one release behind Microsoft.
Can you clarify your point? Nintendo (an likely Microsoft and Sony as well) restricts the number of games on their platform that can be sold per year by a developer. They can also refuse to approve a game if they don't think it is good enough for release (although this is rarely done). It doesn't matter if you have the option to choose the store it will be sold at if they can decide your game isn't approved to be released for their platform.
Free. Free. Free.
Every iOS dev pays apple a yearly fee even if the app is free. Stop with your fake info.
Without the App Store, Spotify wouldn't be where they are today.
I used to own many Symbian and Windows Mobile devices. It was difficult to get good software because there was no consistent distribution channels. This is why traditional smart device ecosystems like Blackberry, Palm, Symbian, Windows Mobile are all dead.
Spotify could not have survived in that landscape.
Apple designed the hardware, the software, and control the use of the software to ensure a consistent customer experience. They created the SDK, market, distribution, payment system all to accommodate their developers. I don't always agree with the 30%, but Apple is far from monopolistic.
I used to own many Symbian and Windows Mobile devices. It was difficult to get good software because there was no consistent distribution channels. This is why traditional smart device ecosystems like Blackberry, Palm, Symbian, Windows Mobile are all dead.
Spotify could not have survived in that landscape.
Apple designed the hardware, the software, and control the use of the software to ensure a consistent customer experience. They created the SDK, market, distribution, payment system all to accommodate their developers. I don't always agree with the 30%, but Apple is far from monopolistic.
Functionally you are correct, however they pay a fee for the development tools. Technically they don't pay to submit an app but rather they pay for the resources to make one. Apple just doesn't allow apps to be submitted that were not compiled using their software.
$99/year is effectively free to businesses at this scale. There are no fees for the millions of downloads that Apple is hosting for them and it certainly costs Apple much more than $99/year for the service that Apple is providing, so they are costing Apple much more than they pay.