Postmates founder here. I am subscriber to Internal Tech Emails and I couldn't help but smile reading these emails this morning. It was in 2017, around April 12th when we launched Postmates Unlimited - the subscription program that inspired all this. Now, we all know Postmates didn't win the space but some product decisions outlast a company and this was one one of them. I still remember the meeting when we decided to launch the subscription. No one had ever done it, the board thought it was nuts. It became the industry standard. ¯\_(ツ)_/¯
Regardless of outcome, it must feel pretty good to know you and your company ended up being a keystone in corporate tech history. Very few people get to say they were at the meeting when these subscription models became the future. Historians 30 years down the road would love you if you wrote a book about your perspective on it.
>Very few people get to say they were at the meeting when these subscription models became the future.
Yeah, it's like being at the meeting where planned obsolelense was first invented, or when a telco devised the "jump through hoops to to cancel your service" concept...
WAT? Adobe launched "Creative Cloud" (which at the time was basically desktop-software-as-a-service) on July 17, 2013; if I recall correctly they had been trialing that for about 1year in Australia before deciding it's a good idea and doing the global launch. Not sure if Adobe was first, but they definitely preceded you by half a decade!
Forgive my confusion, but wasn't Amazon Prime started a good 10 years before that? It seems like that'd the precedent. I'm guessing I'm missing some major detail.
May be I am too naive but even if you want to limit to apps/companies providing similar kind of services, I don't think this to be something Uber/Lyft wouldn't have tried to do eventually anyway? May be others just had bigger fish to fry?
I was at your presentation to Super Mondays at the end of the Difference Engine accelerator, when you demo'd Curatedby, many years ago. It's fantastic to see what you and the team you've built have achieved since then. :)
Depending on how bullish you are on the market it's either DoorDash or no one. Because DD is the frontrunner by a pretty solid margin but time will tell if the business ends up being sustainable med-term.
They had the first food delivery subscription service among the food delivery services, such as Uber Eats, DoorDash etc, is what I believe they mean to say, not that they literally invented subscriptions.
Aside, the sibling comments are quite uncharitable, I don't see why anyone would reasonably believe that the founder invented subscriptions. If one thinks for even a second, they know this isn't true, so why not think for another second about what they really mean? I don't see the need to complain and hem and haw about how the "world's gone crazy."
It's pretty clear from the original thread and the reply that the implication is that Postmates was the first to offer subscriptions through iOS without going through IAP, therefore bypassing Apple's 30% cut, not that they "invented subscriptions."
I feel like these marketplaces could maybe justify 30% on the purchase of an app up front, where there are clear benefits to the exposure and platform offered by them. But ongoing revenue is really attributable to the app itself and feels to me much harder to justify.
At this point I’d be happy if Apple just let me install apps outside their ecosystem, then they could at least defend themselves by saying if the developers aren’t happy with the terms of the App Store they can offer alternative methods.
It's more than that: it's the fact that all of the payment info is there. Every step, field entry, hurdle you put infront of a consumer is usually associated a significant increase in "cart abandonment". By apple allowing you to just apple pay straight in and avoid CC, and billing address etc, they are decreasing the hurdles and increasing the conversion.
Is it worth 30%? In 2013? Maybe In 2021? Definitely not. It should be closer to 5%.
That being said I do like using Apple subscriptions because they make it REALLY easy to cancel them, all in one place, something that can't be said for a lot of other services.
Yeah, one MAJOR issue I have with the folks complaining about apple. Many of them have HORRIBLE cancellation policies.
I had to fight NY Times like crazy (it was sign up online, call to cancel kind of thing).
Match is also in the "alliance" fighting apple with Facebook. They also have scummy practices (either tracking you or again duping you).
The other thing I like with Apple, the trial periods are REALLY clear. When you sign up with comcast it's like $29/month (and then in tiny tiny print 10 pages later you find out that after 6 months it's $69/month or whatever).
So until these folks clean things up where they ALREADY have full control (on the web) I'm willing to cut apple a ton of slack.
Apple will remind you to cancel a subscription when you delete a related app. It reminds you if a subscription will renew and you can cancel then. I willing spend money through the app store I'd not spend ANYWHERE else. For folks willing to spend money but who don't want to f'ed around with constantly apple is the place to be. And it is super easy these days. Double tap or touch and done.
Apple Pay isn't the only payment processor that's convenient like this. But of course, Apple has created a market where their processor is the only one allowed.
If it's anything like Google Subscriptions, there's the danger of disputing charges leading to your Apple account being banned, so it's probably in the users' interests to avoid it.
But of course, when you've just come off of a plane at 2 AM and want to get a ride to your hotel so you can get a few hours of sleep before checkout time, this is probably not something users will think about.
> It's more than that: it's the fact that all of the payment info is there.
Haven't Lyft and Uber already collected that payment information to charge per ride today? Is there even any friction savings here? What justifies the 30% cut when these companies seem to have done just fine not using the Apple Payment infrastructure?
Apple Pay is different from App Store fees. Apple Pay is a payment process where the store doesn’t get your credit card number. Apple Store fees are a matter of business agreements between software companies and Apple.
Using PayPal won’t help an app company escape its agreements with Apple.
Apple should be forced to allow other payment processors store a platform wide login like you can with a Google account. So none of the payments run through Apples infrastructure, but there is no extra friction over their provider.
Even with the 30% up front - if it is such a great deal, why don't they allow alternatives?
It's clear as day they know the minute they allowed alternatives, a giant fraction of the App Store would depart because they can get a better deal either elsewhere.
> It's clear as day they know the minute they allowed alternatives, a giant fraction of the App Store would depart because they can get a better deal either elsewhere.
As an user of an iPhone I don't want this. I bought an iPhone because I deal with enough technology in my day to day job and I want a phone that's straightforward to use and doesn't need any attention. So no I don't want to install three app stores on my iPhone and have to deal with 20 different payment providers.
In the end it's important to make the distinction between consumer interests and the interest of businesses that want to sell their product on the iOS platform. I get that this sucks for developers because iOS is from what I've heard much more profitable than Android. In my opinion consumers interests should be weighed higher here and Apple's policies for the App store are mostly pro consumer, at least compared with the situation on different platforms.
Consumers that want a more open platform can always choose Android or Linux phones.
There is a mutual benefit. More apps means that Apple benefits from a stronger platform (and can sell more copies of iDevices/iOS). That's why Microsoft never charged 30% for the privilege of selling an app on MSWindows, back in the old days.
A platform is largely "made" by external developers who contribute to the platform. It is unfair to start charging them (or anyone who comes later) for being on the platform.
Of course, Apple execs, who have no pride in making things but only in extracting money out of things, will have a different opinion on this.
> A platform is largely "made" by external developers who contribute to the platform. It is unfair to start charging them (or anyone who comes later) for being on the platform.
> Of course, Apple execs, who have no pride in making things but only in extracting money out of things, will have a different opinion on this.
I think they've always known, that's why they created an artificial ecosystem where this equation is backwards. No developer can harm Apple, but Apple can harm the biggest of developers on a whim.
> I feel like these marketplaces could maybe justify 30% on the purchase of an app up front, where there are clear benefits to the exposure and platform offered by them. But ongoing revenue is really attributable to the app itself and feels to me much harder to justify.
It’s not 30% of ongoing revenue though. You only have to pay 30% in one situation: you are already earning millions of dollars in the App Store AND it’s the first year of the subscription.
If you earn less than a million dollars, you qualify for the small business program and the rate is 15%:
maybe stop supporting apple's exploitive practices then and not buy their products. At this point, they're second tier on phones and laptops and dead last in desktop PC. I guess they're still first in watch and earbuds but that isn't saying much.
If you're talking about hardware capabilities you are so wrong. They are only in the market position that they are in because their stuff is expensive, and people think they need to buy new stuff so often that Apples stuff becomes prohibitively expensive for them.
Their tech is solid. M1 completely obliterates the competition for laptops, and is getting there for desktop. Their desktop positioning is mostly self-made to be honest, they haven't really focused on it.
Phones are so overpowered these days that the only thing that really matters is battery life, and Apples chips accomplish so much more than the competition with a lot less battery.
> At this point I’d be happy if Apple just let me install apps outside their ecosystem, then they could at least defend themselves by saying if the developers aren’t happy with the terms of the App Store they can offer alternative methods.
And, of course, you can also use a different smart phone ecosystem. Android makes it comparatively easier to sideload apps and mess with stuff.
The overwhelming majority of apps can be turned into websites instead, unshackled by store regulations. Devs should vote with their feet if app store costs outweigh the benefits
But a lot of app classes can't. Browsers being the obvious one, but generally anything that requires optimised code, heavy computation, multi-threadedness, or access to certain sensors. Anything that fits any of those requirements has to be a real app and must then adhere to Apples rules.
I suspect if the UI offered customers to pay now using Apple's thing, or have a button to get 30% off by going to some more convoluted flow, a lot of people would choose the rebate.
> Apple wants their cut. This is the only way for them to get any cut at all. It’s either this rule or $0 revenue.
Why do they deserve a cut?
Uber and Lyft, deliver a material service, Apple have not contributed to that in any way beyond existing as a general purpose computer manufacturer.
Take an alternative, food delivery service, you pay a monthly subscription for a set selection of fruit and veg delivered every week. The cost is made up of food cost and delivery cost... You could sign up through a website, or you could sign up through an app on Apple's app store, in the later case the only option would be to increase the price by 30%, because there is no where near 30% profit left over.
Not convinced? Ok lets go to an extreme, what about a mortgage monthly repayment app, that's essentially a subscription to your home right? Do you think Apple deserve to have almost 30% of the value of your house for the privilege of letting you use an app to pay? Does their App store really deliver that much value?
Before, it was sort of justifiable when people were trying their get rich quick schemes with flappy bird clones... because the argument from the other side was a weak "but that's my get rich quick scheme", Apple's platform and what they shove in front of users faces made a real difference to the almost pure profit of those Apps, the apps simply would not be popular without Apple... but as soon as we start talking about apps that deliver material services and other significant value it makes no sense to argue that Apple deserve even 1 penny. Apple have gone completely fucking mental with their own greed, they think they deserve a slice of the entire world.
> It is Apple's Devices, Apple's Software, Apple's Platform, Apple's user and Apple's Customer, everything belongs to Apple. But Apple is very generous and give "70%" of those revenue to developers and business partners.
> These companies and developers are greedy. They want even more than 70%! Uber and Lyft should be kicked out of the App Store.
> Laws and Regulations wants to fine Apple for Anti-Trust and Anti Competitive practice, Apple should pull out those market, that is the EU common market, Australia, Japan, South Korea, Russia, India!
I wish I made these sentiment up, except you will find many Apple apologist supporting Apple writing exactly that.
But none of these matters to the general public. Apple is Three Trillion Market Cap company, they are very successful, selling iPhone and Mac in record numbers. Tim Cook will continue to tell you Apple is making the world a better place. To enrich people's lives. And privacy is a fundamental human right. [ Subject to Terms and Condition ]. With a big smile on the face.
On another note it is interesting this isn't the first time Phil Schiller has been fighting the battle for users and developers. But now he is "promoted" ( cough ) to Apple Fellow. And Eddy Cue......
Apple is a small country disguised as a company. This is nothing else but essentially a tax, collecting economic rent from their digital fiefdom. Of course unlike actual nation states, Apple's not really in the business of providing many public services in return.
Seems like we're kind of at the point where actual nation states should take that as a sign of peer competition and do something about it because I honestly have no idea why we're tolerating this.
As an attempt to steelman their point, Apple has more employees than about 30 countries and has more CASH on hand than the GDP of over a 100 countries (220~ total worldwide).
As far as regulations go, I think those points could be an argument that more regulation could be warranted.
that's like saying "standard oil just sells hydrocarbon". Computing underpins virtually every aspect of the economy, almost all communication, the national infrastructure, increasingly the military, and the public debate.
The tech industry (of which Apple is the largest representative) is, and increasingly becoming even more, the second largest center of power within any modern nation. As evidenced by the fact that they can and have removed elected representatives (most of which I'm not a fan of to make that clear) from public debate.
Except that just means they'll get less subscribers. The margins on these things are razor thin. If people don't think they're getting a deal they won't sign up.
To my knowledge you are allowed to do so, but aren't allowed to tell people that it's cheaper somewhere else. I don't know how this works in practice though
I disagree. I think Apple should get nothing from them. The rent seeking has to stop. Anything with a service fee should be outside their grasp. The product isn’t the app, it’s the service.
Recently there was discussion[0] about Apple devices dominance amongst teenagers ~85% mobile devices in US. Apple is heading towards market domination in a couple of years - in US first but in some European countries trend seems to be catching as well.
With company's total control over locked down hardware, software, software delivery and browser (and other, fresh endeavors like identity management aka AppleId, payments etc) it will be very interesting time and quite a show to observe.
Maybe they should... "We charge $50/month extra for the iphone charging service. If we detect an iPhone in your house, the charge will be automatically applied to your bill".
Not saying I agree with what I'm about to respond with, but nonetheless:
If not using IAP is worse for users, wouldn't users then immediately gravitate to apps that do use IAP? Meaning not using IAP would be a competitive disadvantage and tada, capitalism magic--especially given iOS users are the most valuable segment in the world (typically wealthier and much more willing to spend $1.99 on an app than their Android counterparts)
The counter-argument is it is better for users in ways they are oblivious to (i.e. security), but even that should eventually make its way to the user. If eventually all but IAP cards are compromised or abused, users will eventually change their behavior, especially iOS users (typically more educated).
* all iOS user characterizations are based on 3rd party research and not my own opinions
I think a lot of the takes on this are coming at it from the wrong angle - "Why does Apple deserve a third of app revenue?"
What if we flip it to: "Why do app developers deserve access to Apple's customers?"
30% is the price to access Apple's customers.
If you're a developer and don't like this, then don't build an iOS app. Build Android-only, or build a web app.
If you're a customer and don't like this, then don't buy an iPhone. Vote with your feet. Buy an Android. Or a Pinephone/Fairphone/Librem which are as close to a general purpose computer-as-a-phone outside of the Apple-Google duopoly that there is at the current time.
I understand that the value of the Apple ecosystem is not just what Apple bring to the table. It's the ecosphere of apps available. So there's definitely a symbiosis here. But Apple is like China here. No matter how ethically questionable, there will always be those for whom the market that Apple represents is too tempting to ignore. Even with a 30% cost of doing business. Meaning there will always be app developers building apps for iOS.
> What if we flip it to: "Why do app developers deserve access to Apple's customers?"
As I posted in another comment, part of the reason Apple has so many customers is that their platform has so many apps. If all developers left the App Store overnight, would anyone go out and buy an iPhone the next day?
Apple benefits greatly from their app ecosystem, even ignoring the 30% App Store cut. They should be careful not to kill the goose that lays the golden eggs.
I absolutely agree, however the point I made is that the temptation of the market share means there will always be app developers willing to step in to replace any that withdraw from the market.
If I'm an app developer, from a purely financial perspective, why would I forego a market of Apple's size, even with a 30% tariff? Sure, I may lobby for change, or even go to court to try to reduce that tariff. But while I'm doing that, I sure won't be leaving money on the table. And there's little chance I'll abandon that market in the interim, in order to maintain an ethical position.
I don't understand this argument. Would it apply anywhere else? Could some company sell houses where they demand 30% of the price of every appliance you buy? You're the housing company's customer so they're bringing you their customers apparently.
Could some car company demand 30% of all gas, tires, oil, and electricity? You're the car company's customer. Could a refrigerator company demand 30% of all groceries you put in it?
There have been laws that disallow you to limit customer choice. For one example, a company can't force you to buy 1st party parts for repairs
You're position seems to be if they can prevent people from doing something with their device they don't like and people still buy it then that's ok. So if a sofa manufacture found a way to prevent people of color from sitting on it and people bought it that would be perfectly fine by your position I guess. I could certain make a fridge that complained if you put something in it that had no RFID tag and that those tags must correspond to items they've licensed.
In any case, my position is, no company should have that kind of power, period. A house company shouldn't be able to decide who my guests are who what items I put in it. A fridge company shouldn't be able to decide what items I keep cold. A cabinet company shouldn't be able to to decide what I store in my cabinets. And a computer company should not be able to decide what I can run on my computer (smartphones are computers).
Apple has to pay to keep your app hosted in the store. They have to pay to check your app for safety. They have to pay developers to maintain the store. Your fridge doesn't have that. Your fridge manufacturer made something to host your food. It costs them zero dollars to perform the hosting. In fact, you have to pay another company (the electric company) that hosting cost. If a fridge manufacturer decided to become the electrical company, then it would make more sense.
Apple has to pay costs to maintain the app store, the operating system for the app store, and the hosting costs in-between.
That totally happens by the way. When we built our house, we had to use bathroom supplier X and the builder took a cut (might very well be 30%). Same for the kitchen.
The builder brings in the customers, and the bathroom and kitchen suppliers seem to be happy to share a ~30% commission for it.
(note: this is in Belgium, but I assume similar setups are commonplace in other places)
This is way too charitable to the largest company in the world, one which enjoys a duopoly over the smartphone market in the United States. If you are Lyft and you don’t have an iOS app, then you probably go out of business.
Lyft would only go out of business (without an iOS app) because there are Lyft competitors who won't cede the Apple customer segment. If all those players stayed Android-only, not only would they survive, but they'd be turning Android into a more compelling alternative. But this would require two things - for them to collude to stay off iOS, and for no new competitors to write an iOS app.
If having access to the Apple customer segment is the difference between success or failure - even despite the 30% tariff - then why is it strange that access to that segment has a price? This is a market.
I realize that the only reason they don’t have an iOS app is because Apple didn’t let them, but OnlyFans is doing very well as a web based service. It’s certainly not iOS-or-nothing.
> If you're a customer and don't like this, then don't buy an iPhone. Vote with your feet. Buy an Android.
That's a good option. At the same time I can also work together with other citizens of my country to force Apple to allow alternative app stores. Our reason would be that we think society stands to benefit from this. Whether or not Apple "deserves" [1] a third of app revenue doesn't matter.
Allowing alternative app stores would then be the price Apple has to pay to access our market. They might not like this, but they're free to ignore this market. Other companies will be happy to comply.
[1]: I'm not sure that it's meaningful to say a trillion-dollar company does or does not deserve something.
I actually love this answer, but I will point out that any arguments relating to "deserving" - especially in relation to companies' profits - becomes a very different discussion. We live in a capitalist system and "deserves" = "can achieve within the law". I offer no assessment as to whether this is a good system or not, but its the one we have.
It's absolutely reasonable for a government to impose its own market rules - but even there, the government follows its own logic for what to impose. Either to benefit consumers, protect local industries or industry segments (e.g. smaller companies), or increase tax revenue. What's the logic behind such a restriction? Unless applied to all app stores, this would be unfair to Apple.
For both customers and app-developers, we make an assessment of value and decide which phone to buy or which phone to target with apps. For app developers this involves a contractual obligation they freely sign on to. Making an assessment of value that is based on not meeting the obligations you agreed to is an act of bad faith. You don't "deserve" to play on my turf if you're not following my rules. Go play in someone else's yard. I can see how it makes sense for a government to assess whether everyone's yards needs to be follow a basic set of rules. That currently exists in the sense that no contract or agreement can upend the laws of the land. Is new law required here? Perhaps, but then it won't be Apple specific. Depending on how its worded it may apply more broadly than to just app stores. In which case there's a whole raft of rent-seekers who may not want such laws.
Fundamentally, it boils down to this (in my view):
Are smartphone ecosystems private property upon which third parties are allowed to conduct commerce subject to the property owners rules?
OR
Are smartphone ecosystems a public commons upon which third parties are free to conduct commerce as they wish?
> If you're a customer and don't like this, then don't buy an iPhone. Vote with your feet
Alright, so then if microsoft wanted to ban alternative web browsers, or engage in anti-competitive practices that are currently illegal, and they lost the court case for, your answer is "Yes, that should be allowed for microsoft to do"?
Most of society would agree that laws that outlaw anti-competitive behavior are a good thing.
And if you opinion is the naive "just vote with your feet, lol" position, then you need to bite the bullet and just straight up say that you think that anti-trust law is bad. Just say that you support the standard oil monopoly, or the microsoft monopoly and be honest about it.
Microsoft's share of the desktop market at the time was very close to unity. You couldn't vote with your feet because there was nowhere to go. Even now, MS have about 75% of the PC OS market.
Apple's share of the smartphone market is around 15% globally, and 55% within the US. Under no definition can Apple be said to be in the same position that Microsoft was. You can indeed vote with your feet and many do (in both directions).
Anti-trust law is designed to do two things. Prevent companies from becoming monopolies in a market, and break up companies that are monopolies. By the numbers, Apple is not a monopoly, and there are plenty of healthy alternatives to Apple. Anti-trust law is just fine and dandy and I support it. It just does not apply here.
Good luck! Safari is crippled. The examples are too numerous to list but even the UX around existing features that would bring Web apps closer to on-par with App Store apps is terrible. For example my friend was sad that Wordle wasn't an app because they wanted it on their home screen. No problem I said! I know you can add shortcuts on iOS. But they couldn't find the option. They even game me the phone and I couldn't find it in the 30s I looked! I'm sure it is there somewhere but it is clear that the UX is damanaged to keep the moat between native and web artificially high.
Huh, maybe there's an opportunity to make an app that appifies appfiable sites. Like a captive browser. That app could be free. But Apple would find a way to say it's not OK with their rules and boot it from the store.
> 30% is the price to access Apple's customers.
Perhaps, but you'll notice many people don't agree, and those people participate in politics, and some of them will say "company store!!" and demand statutory or judicial intervention, and who knows, they might get it. Lucky for Apple 99.9% of their customers aren't those people.
I assume you are implying "access to all app providers on the phone of their choice". What about those app developers that have chosen not to target a market? For example there are plenty of app developers that are iOS-only, and some that are Android-only. Do you then force them to target both systems? (since the customers deserve it). Would you enforce this on PC developers too? I'd love to have native Microsoft Office apps on my linux laptop. But I'm not holding my breath.
Readit News
Yeah, it's like being at the meeting where planned obsolelense was first invented, or when a telco devised the "jump through hoops to to cancel your service" concept...
WAT? Adobe launched "Creative Cloud" (which at the time was basically desktop-software-as-a-service) on July 17, 2013; if I recall correctly they had been trialing that for about 1year in Australia before deciding it's a good idea and doing the global launch. Not sure if Adobe was first, but they definitely preceded you by half a decade!
restec-p
https://www.youtube.com/watch?v=YWLMnX8F45M
Aside, the sibling comments are quite uncharitable, I don't see why anyone would reasonably believe that the founder invented subscriptions. If one thinks for even a second, they know this isn't true, so why not think for another second about what they really mean? I don't see the need to complain and hem and haw about how the "world's gone crazy."
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I am happy to hear from people with something apropos to add.
Being out of touch with the everyman isn't overly weird for a founder of a company.
Your account is brand new, so this comment is doubly weird.
At this point I’d be happy if Apple just let me install apps outside their ecosystem, then they could at least defend themselves by saying if the developers aren’t happy with the terms of the App Store they can offer alternative methods.
Is it worth 30%? In 2013? Maybe In 2021? Definitely not. It should be closer to 5%.
That being said I do like using Apple subscriptions because they make it REALLY easy to cancel them, all in one place, something that can't be said for a lot of other services.
I had to fight NY Times like crazy (it was sign up online, call to cancel kind of thing).
Match is also in the "alliance" fighting apple with Facebook. They also have scummy practices (either tracking you or again duping you).
The other thing I like with Apple, the trial periods are REALLY clear. When you sign up with comcast it's like $29/month (and then in tiny tiny print 10 pages later you find out that after 6 months it's $69/month or whatever).
So until these folks clean things up where they ALREADY have full control (on the web) I'm willing to cut apple a ton of slack.
Apple will remind you to cancel a subscription when you delete a related app. It reminds you if a subscription will renew and you can cancel then. I willing spend money through the app store I'd not spend ANYWHERE else. For folks willing to spend money but who don't want to f'ed around with constantly apple is the place to be. And it is super easy these days. Double tap or touch and done.
But of course, when you've just come off of a plane at 2 AM and want to get a ride to your hotel so you can get a few hours of sleep before checkout time, this is probably not something users will think about.
Haven't Lyft and Uber already collected that payment information to charge per ride today? Is there even any friction savings here? What justifies the 30% cut when these companies seem to have done just fine not using the Apple Payment infrastructure?
Using PayPal won’t help an app company escape its agreements with Apple.
Yeah, that's annoying, but for new vendors I just use Paypal.
It's clear as day they know the minute they allowed alternatives, a giant fraction of the App Store would depart because they can get a better deal either elsewhere.
As an user of an iPhone I don't want this. I bought an iPhone because I deal with enough technology in my day to day job and I want a phone that's straightforward to use and doesn't need any attention. So no I don't want to install three app stores on my iPhone and have to deal with 20 different payment providers.
In the end it's important to make the distinction between consumer interests and the interest of businesses that want to sell their product on the iOS platform. I get that this sucks for developers because iOS is from what I've heard much more profitable than Android. In my opinion consumers interests should be weighed higher here and Apple's policies for the App store are mostly pro consumer, at least compared with the situation on different platforms.
Consumers that want a more open platform can always choose Android or Linux phones.
A platform is largely "made" by external developers who contribute to the platform. It is unfair to start charging them (or anyone who comes later) for being on the platform.
Of course, Apple execs, who have no pride in making things but only in extracting money out of things, will have a different opinion on this.
> Of course, Apple execs, who have no pride in making things but only in extracting money out of things, will have a different opinion on this.
I think they've always known, that's why they created an artificial ecosystem where this equation is backwards. No developer can harm Apple, but Apple can harm the biggest of developers on a whim.
It’s not 30% of ongoing revenue though. You only have to pay 30% in one situation: you are already earning millions of dollars in the App Store AND it’s the first year of the subscription.
If you earn less than a million dollars, you qualify for the small business program and the rate is 15%:
https://www.apple.com/newsroom/2020/11/apple-announces-app-s...
If your subscriber has been subscribed for a year or more, the rate is 15%:
https://developer.apple.com/app-store/subscriptions/#revenue...
Their tech is solid. M1 completely obliterates the competition for laptops, and is getting there for desktop. Their desktop positioning is mostly self-made to be honest, they haven't really focused on it.
Phones are so overpowered these days that the only thing that really matters is battery life, and Apples chips accomplish so much more than the competition with a lot less battery.
And, of course, you can also use a different smart phone ecosystem. Android makes it comparatively easier to sideload apps and mess with stuff.
Android allows it, usage of alt stores is marginal.
Developers want less
Customer don’t care, and want what Apple is selling.
Developers feel it’s not fair because they think they are losing money but customers seem happy to pay for Apple’s premium service.
I suspect if the UI offered customers to pay now using Apple's thing, or have a button to get 30% off by going to some more convoluted flow, a lot of people would choose the rebate.
If I want it cheaper in exchange for having to deal with onerous cancellation methods, I can just go direct to the developer’s website and buy it.
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Like… within months.
Why do people not get this?
Apple wants their cut. This is the only way for them to get any cut at all. It’s either this rule or $0 revenue.
Why do they deserve a cut?
Uber and Lyft, deliver a material service, Apple have not contributed to that in any way beyond existing as a general purpose computer manufacturer.
Take an alternative, food delivery service, you pay a monthly subscription for a set selection of fruit and veg delivered every week. The cost is made up of food cost and delivery cost... You could sign up through a website, or you could sign up through an app on Apple's app store, in the later case the only option would be to increase the price by 30%, because there is no where near 30% profit left over.
Not convinced? Ok lets go to an extreme, what about a mortgage monthly repayment app, that's essentially a subscription to your home right? Do you think Apple deserve to have almost 30% of the value of your house for the privilege of letting you use an app to pay? Does their App store really deliver that much value?
Before, it was sort of justifiable when people were trying their get rich quick schemes with flappy bird clones... because the argument from the other side was a weak "but that's my get rich quick scheme", Apple's platform and what they shove in front of users faces made a real difference to the almost pure profit of those Apps, the apps simply would not be popular without Apple... but as soon as we start talking about apps that deliver material services and other significant value it makes no sense to argue that Apple deserve even 1 penny. Apple have gone completely fucking mental with their own greed, they think they deserve a slice of the entire world.
> These companies and developers are greedy. They want even more than 70%! Uber and Lyft should be kicked out of the App Store.
> Laws and Regulations wants to fine Apple for Anti-Trust and Anti Competitive practice, Apple should pull out those market, that is the EU common market, Australia, Japan, South Korea, Russia, India!
I wish I made these sentiment up, except you will find many Apple apologist supporting Apple writing exactly that.
But none of these matters to the general public. Apple is Three Trillion Market Cap company, they are very successful, selling iPhone and Mac in record numbers. Tim Cook will continue to tell you Apple is making the world a better place. To enrich people's lives. And privacy is a fundamental human right. [ Subject to Terms and Condition ]. With a big smile on the face.
On another note it is interesting this isn't the first time Phil Schiller has been fighting the battle for users and developers. But now he is "promoted" ( cough ) to Apple Fellow. And Eddy Cue......
Seems like we're kind of at the point where actual nation states should take that as a sign of peer competition and do something about it because I honestly have no idea why we're tolerating this.
As far as regulations go, I think those points could be an argument that more regulation could be warranted.
The tech industry (of which Apple is the largest representative) is, and increasingly becoming even more, the second largest center of power within any modern nation. As evidenced by the fact that they can and have removed elected representatives (most of which I'm not a fan of to make that clear) from public debate.
Dead Comment
For something that costs $10 on Android, charge $13 for iPhone.
This is a win-win solution. The app companies get more money and Apple gets positioning as a premium brand.
Apple will not let you do that at first place. It's against their guidelines and apps that do that and get caught get the boot.
It'd be $10 on android and $14.29 on iPhone to break even.
There should be the iPhone price and the Android price. Just charge iPhone users more.
Dead Comment
With company's total control over locked down hardware, software, software delivery and browser (and other, fresh endeavors like identity management aka AppleId, payments etc) it will be very interesting time and quite a show to observe.
[0]https://news.ycombinator.com/item?id=29851317
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Um...yeah, that's pretty damning.
Of course it is a good indication that it is overpriced.
If not using IAP is worse for users, wouldn't users then immediately gravitate to apps that do use IAP? Meaning not using IAP would be a competitive disadvantage and tada, capitalism magic--especially given iOS users are the most valuable segment in the world (typically wealthier and much more willing to spend $1.99 on an app than their Android counterparts)
The counter-argument is it is better for users in ways they are oblivious to (i.e. security), but even that should eventually make its way to the user. If eventually all but IAP cards are compromised or abused, users will eventually change their behavior, especially iOS users (typically more educated).
* all iOS user characterizations are based on 3rd party research and not my own opinions
What if we flip it to: "Why do app developers deserve access to Apple's customers?"
30% is the price to access Apple's customers.
If you're a developer and don't like this, then don't build an iOS app. Build Android-only, or build a web app.
If you're a customer and don't like this, then don't buy an iPhone. Vote with your feet. Buy an Android. Or a Pinephone/Fairphone/Librem which are as close to a general purpose computer-as-a-phone outside of the Apple-Google duopoly that there is at the current time.
I understand that the value of the Apple ecosystem is not just what Apple bring to the table. It's the ecosphere of apps available. So there's definitely a symbiosis here. But Apple is like China here. No matter how ethically questionable, there will always be those for whom the market that Apple represents is too tempting to ignore. Even with a 30% cost of doing business. Meaning there will always be app developers building apps for iOS.
As I posted in another comment, part of the reason Apple has so many customers is that their platform has so many apps. If all developers left the App Store overnight, would anyone go out and buy an iPhone the next day?
Apple benefits greatly from their app ecosystem, even ignoring the 30% App Store cut. They should be careful not to kill the goose that lays the golden eggs.
If I'm an app developer, from a purely financial perspective, why would I forego a market of Apple's size, even with a 30% tariff? Sure, I may lobby for change, or even go to court to try to reduce that tariff. But while I'm doing that, I sure won't be leaving money on the table. And there's little chance I'll abandon that market in the interim, in order to maintain an ethical position.
There have been laws that disallow you to limit customer choice. For one example, a company can't force you to buy 1st party parts for repairs
https://www.ftc.gov/news-events/blogs/business-blog/2018/04/...
You're position seems to be if they can prevent people from doing something with their device they don't like and people still buy it then that's ok. So if a sofa manufacture found a way to prevent people of color from sitting on it and people bought it that would be perfectly fine by your position I guess. I could certain make a fridge that complained if you put something in it that had no RFID tag and that those tags must correspond to items they've licensed.
In any case, my position is, no company should have that kind of power, period. A house company shouldn't be able to decide who my guests are who what items I put in it. A fridge company shouldn't be able to decide what items I keep cold. A cabinet company shouldn't be able to to decide what I store in my cabinets. And a computer company should not be able to decide what I can run on my computer (smartphones are computers).
Apple has to pay to keep your app hosted in the store. They have to pay to check your app for safety. They have to pay developers to maintain the store. Your fridge doesn't have that. Your fridge manufacturer made something to host your food. It costs them zero dollars to perform the hosting. In fact, you have to pay another company (the electric company) that hosting cost. If a fridge manufacturer decided to become the electrical company, then it would make more sense.
Apple has to pay costs to maintain the app store, the operating system for the app store, and the hosting costs in-between.
The builder brings in the customers, and the bathroom and kitchen suppliers seem to be happy to share a ~30% commission for it.
(note: this is in Belgium, but I assume similar setups are commonplace in other places)
If having access to the Apple customer segment is the difference between success or failure - even despite the 30% tariff - then why is it strange that access to that segment has a price? This is a market.
They weren't when they started the App Store, should they change their policies reflecting their current market worth?
>30% is the price to access Apple's customers.
That goes both ways. Would Apple's products be as popular as they are without 3rd party apps? The apps are what is bringing in those users.
That's a good option. At the same time I can also work together with other citizens of my country to force Apple to allow alternative app stores. Our reason would be that we think society stands to benefit from this. Whether or not Apple "deserves" [1] a third of app revenue doesn't matter.
Allowing alternative app stores would then be the price Apple has to pay to access our market. They might not like this, but they're free to ignore this market. Other companies will be happy to comply.
[1]: I'm not sure that it's meaningful to say a trillion-dollar company does or does not deserve something.
It's absolutely reasonable for a government to impose its own market rules - but even there, the government follows its own logic for what to impose. Either to benefit consumers, protect local industries or industry segments (e.g. smaller companies), or increase tax revenue. What's the logic behind such a restriction? Unless applied to all app stores, this would be unfair to Apple.
For both customers and app-developers, we make an assessment of value and decide which phone to buy or which phone to target with apps. For app developers this involves a contractual obligation they freely sign on to. Making an assessment of value that is based on not meeting the obligations you agreed to is an act of bad faith. You don't "deserve" to play on my turf if you're not following my rules. Go play in someone else's yard. I can see how it makes sense for a government to assess whether everyone's yards needs to be follow a basic set of rules. That currently exists in the sense that no contract or agreement can upend the laws of the land. Is new law required here? Perhaps, but then it won't be Apple specific. Depending on how its worded it may apply more broadly than to just app stores. In which case there's a whole raft of rent-seekers who may not want such laws.
Fundamentally, it boils down to this (in my view):
Are smartphone ecosystems private property upon which third parties are allowed to conduct commerce subject to the property owners rules?
OR
Are smartphone ecosystems a public commons upon which third parties are free to conduct commerce as they wish?
Alright, so then if microsoft wanted to ban alternative web browsers, or engage in anti-competitive practices that are currently illegal, and they lost the court case for, your answer is "Yes, that should be allowed for microsoft to do"?
Most of society would agree that laws that outlaw anti-competitive behavior are a good thing.
And if you opinion is the naive "just vote with your feet, lol" position, then you need to bite the bullet and just straight up say that you think that anti-trust law is bad. Just say that you support the standard oil monopoly, or the microsoft monopoly and be honest about it.
Apple's share of the smartphone market is around 15% globally, and 55% within the US. Under no definition can Apple be said to be in the same position that Microsoft was. You can indeed vote with your feet and many do (in both directions).
Anti-trust law is designed to do two things. Prevent companies from becoming monopolies in a market, and break up companies that are monopolies. By the numbers, Apple is not a monopoly, and there are plenty of healthy alternatives to Apple. Anti-trust law is just fine and dandy and I support it. It just does not apply here.
Good luck! Safari is crippled. The examples are too numerous to list but even the UX around existing features that would bring Web apps closer to on-par with App Store apps is terrible. For example my friend was sad that Wordle wasn't an app because they wanted it on their home screen. No problem I said! I know you can add shortcuts on iOS. But they couldn't find the option. They even game me the phone and I couldn't find it in the 30s I looked! I'm sure it is there somewhere but it is clear that the UX is damanaged to keep the moat between native and web artificially high.
Huh, maybe there's an opportunity to make an app that appifies appfiable sites. Like a captive browser. That app could be free. But Apple would find a way to say it's not OK with their rules and boot it from the store.
> 30% is the price to access Apple's customers.
Perhaps, but you'll notice many people don't agree, and those people participate in politics, and some of them will say "company store!!" and demand statutory or judicial intervention, and who knows, they might get it. Lucky for Apple 99.9% of their customers aren't those people.
Because it’s better for customers if they do, than if they don’t.