Just typical Apple greed. 30% is extortion and if they had done it 5% then nobody would have challenged it. Apple have billions sitting there so this isn’t about trying to make a company profitable, it’s just greed. I think I’m going to eventually go back to Linux and Android for my phone and computer as Apple are just taking the piss.
Greed? How much money does Apple make from the (mostly 15%, not 30%) fees? What are their margins? Someone testifying
for Epic said it was more than 70% but Apple said that wasn’t accurate; the judge in the trial said it was around that but we don't have the specific number. What margin is too much? Is 20%? 10%? 70%? Is that too much? Are developers making money? Are developers making too much or too little money?
Why is a 5% commission appropriate? That would almost certainly lose Apple money, considering Epic’s 12% doesn’t make them any money; it's expensive to run the App Store. How do I know 5% would lose them money? I don’t, but we can make some educated estimates.
Apple's services’ gross (not net) margins are about 70%. Let's just assume the App Store is at a 70% margin (there’s a claim it’s higher but we’ll go with what we
know about Apple’s services margins). With an assumed 70% margin and a 30% fee (most developers are not paying that much), Apple gross "break even" point is a 9% fee. That's gross margin though and would in reality lose Apple money. Apple’s overall net margin is about 60% of gross margins. If Apple needs a 9% fee to break even with gross margin on the App Store, Apple needs about a 13% fee to make money. That fits with Epic’s supposed loss at 12%.
Most developers pay 15% fees. Let's assume Apple still makes money on that and is grossing a 70% margin (which isn't likely because the higher fees bring in much more money from the big companies -- most developers pay the 15% fee but most money comes from the minority paying the higher fees). In any case, Apple’s gross "break even" point is a 4.5% commission. Again, that's not net, so a 4.5% commission would lose Apple money. Again Apple, while charging most developers a 15% fee, collects most of the money from the companies paying 30%, which means Apple margins likely come from the bigger developers who will subsidize the smaller ones paying lower fees.
In any case, what this means is 5% will lose Apple money. 10% might only be a break even point (again, Epic reportedly loses money with a 12% fee). This means that Apple charging 15% to most developers and 30% to others, allows Apple to make money. Apple would likely have App Store profitability if everyone paid 15%, but profits would take a considerable hit.
Can Apple only charge a fee if it loses them money? Can Apple only break even? Is Apple only allowed a small margin? What is an appropriate margin for Apple?
