Apple’s App Store profits on commissions from digital sales
Revenue $32 B
Operating Costs $7 B [1]
Estimated Profit $25 B
Operating Margin ~78%
[1] R&D, security, hosting, human review, and including building and maintaining developer tools Xcode, APIs, and SDKs.
Apple could take just 7% cut and still make 20% profits.
Fun Fact: During the Epic trial, it was revealed that Apple's profit margins on the App Store were so high that even Apple's own executives were sometimes surprised by the internal financial reports.
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edit: There is no ideological argument for voluntary action here. The entire goal is to force regulators to step in. The debate over 'good vs. bad companies' is just online noise and rhetorical trik, no one on either side of the political spectrum wants these systems to be fixed voluntarily with corporate altruism.
The operating cost is the maximum Apple can come up with when their accountants attribute everything they possibly can to digital sales for the sake of legal argument. R&D shouldn't really be included, and Apple uses those same tools and APIs themselves. I think the actual profit margin is closer to 90%, and Apple could maintain a 20% margin with just a 3–4% fee.
I'd say that in the case of Patreon, any fee for Apple is unjustified. Apple can justify their fee on app purchases/subscriptions in the app store, but Patreon is not an app subscription, the money goes mostly from the patrons to the people they support. Ok, Patreon takes a cut to cover their operating costs, and also make a profit (not sure how profitable they are currently), but I really can't see how Apple, who don't have anything to do with this process except for listing the Patreon app on the app store, can justify taking a cut.
Certainly not defending Apple's behavior in this instance, but isn't the success of the larger product ecosystem a direct driver of their App Store profitability? To strictly evaluate the App Store finances in isolation seems to be the sort of accusation you've levied against Apple in the opposite direction..
I like Apple less and less these days for various reasons, but I haven't purchased an app on the App Store in more than a decade. It's strictly a vehicle for local utilities when, for whatever reason, a browser will not suffice. Nearly all purchasing is done on the 'open' web.
What really makes it uncomfortable is that Apple isn't just a neutral marketplace. They control the OS, the distribution channel, and the payment rails, so creators and platforms like Patreon can't realistically opt out
Don't forget they also directly compete with Patreon with podcast subscriptions. You can support a podcast through Apple podcasts or Patreon, but only one of those has a 30% chunk taken out.
That's pretty much the conclusion the EU came to and why they introduced the notion of gatekeepers in the DMA.
It doesn't matter if you are not technically in a dominant position if your special role in a large ecosystem basically allows you to act like one in your own purview.
You could say this kind of move invites more scrutiny but the regulators are already there watching every Apple's move with a microscope and their patience with Apple attempts at thwarting compliance is apparently wearing thin at least in the EU if you look at preliminary findings.
The problem is the monopoly over distribution channels. Regulation needs to force devices to allow A) downloading and using packages & executables from the internet, and B) any app to download and install other apps.
Regulating the fees for one central app store is no solution.
> no one on either side of the political spectrum wants these systems to be fixed voluntarily with corporate altruism
Right on. But that's exactly the wiggle room where voters could pull some of those cards like "climate change mitigation (of consequences)", "climate change preparation", "upcoming waves of climate change refugees", "AI dividing the population", "Universal Basic Income", all of which are things companies like Apple won't do anything for (or against) while their goods are still mostly for proper earners and not for people who buy stuff at a discount (I'm exaggerating).
Since corporate altruism is definitely not on the menu, government institutions and NGOs will have to pick up way more than they are currently prepared for.
We are in a strange phase of calm before the storm, despite all those wars and conflicts--or in spite of them, I don't know. Shits' gonna hit the fan sooner or later and it's up to the voters to demand adequate preparation.
Big Corps caused significantly more damage than they had to cause for all those profits, whether as a side effect or not, and they did that long enough.
Job cuts, whether due to AI or not, will remain a thing while no "new" giants will rise for quite a while ... and corporations will sing the song "it's what the people want" only as long as voters will stay quiet.
Sure, bribes, corruption and blablabla, but it doesn't change how votes work and none of it changes how the devoted clerks in the administration do their jobs and write laws (if they have to have to) ...
> Apple could take just 7% cut and still make 20% profits.
We can say this to any company, "$X could reduce price by $Y and still make $Z profits", but it doesn't really make any sense. Making profits is what makes a company a company instead of a non-profit organization.
It does make sense to highlight, because this kind of statistic is a very strong indicator that the market is not competitive. This is not a normal kind of profit margin and basically everyone except for Apple would benefit from them lowering the margins.
In normal markets there are competitors who force each other to keep reasonable profit margins and to improve their product as opposed to milking other people's hard work at the expense of the consumer.
When parts of a market become dominated by one or few companies operating in a limited choice environment, consumers can't just opt to not use both Apple and Play store. You need to choose one in practice.
At this point the regulators should investigate what the barriers are to new entrants and if it's too costly and nobody has managed to cut in the last few years, establishing some rules is probably a good thing. This happens as industries mature and become critical, it happened in transportation (most bus, train companies), energy, water supply, trash, etc, depending on the country and market conditions.
Makes me think of the concept of involution in Chinese business and how they understand all of this very differently, and how difficult it is to compete because of that.
Agreed, but this is about to be a special case if it's not already. We're contending with compulsory digital IDs and cashless economies that must be used on authorized devices, and Apple is one of the two makers. While it's certainly not necessary to use Patreon, not having it or something like it is an actual barrier to individual trade. I don't think I can get behind a schema that means Apple can take whatever portion it wants from a transaction initiated on a device that it creates and that is otherwise fairly necessary for day-to-day life in the developed world.
it sounds like it does make sense because if they are making $Z profits then they are still making profits and are not non-profit.
there could also be cases where cutting back to $Z profits might be preferable in case not doing so were to prompt legislation causing someone to be forcibly cut to $Z-1 or even $0 profits from a particular profit source.
Which it has been my observation that when someone is saying "X could reduce price by $Y and still make $Z profits" it often coincides with saying therefore company X should be legislated on this particular profit source.
Until it turns into cancer because of unrestrained growth.
Like it or not capitalism is a part of an ecosystem. We’ve been “educated” to believe that unrestrained growth in profits is what makes capitalism work, and yet day after day there are fresh examples of how our experience as consumers has gotten worse under capitalism because of the idea that profits should forever be growing.
Let's be honest if this was a European company it would be capped by law at 5-10%. Problem is who has an incentive to do the right thing here? Not apple and certainly not the US government (most of this revenue comes from outside the US).Nobody can defend it, yet nobody wishes to stop it.
The US government should absolutely do that, but they won't because they defends the interests of big companies rather than the interests of small companies or US citizens.
That's not how business works. The App Store in current form would not exist without all the collective investment that went into all of Apple's hardware, for instance.
> That's not how business works. The App Store in current form would not exist without all the collective investment that went into all of Apple's hardware, for instance.
While technically true, this argument doesn't provide any merit to the discussion. The App Store backed purchase for the Patreon subscription would not exist at all without the creator's work and investment in creating their form of content.
In the absence of the App Store, the creator would still have access to their patrons via mobile web and payment via the methods already provided by Patreon. The app is merely a convenience - it's a hard sell that this convenience is worth 30% of the creator's revenue through the platform.
also now one of the worst ide in mobile/desktop development and an embarrassment for a company of apple's size and profits
them taking more and rents from their store-related operations is hard to justify from software product-quality perspective; its like a slap in the face
I’m surprised they were surprised because operating costs should be pretty much nil. What do they do, pay a few thousand app reviewers, a few hundred software engineers? Pretty sure if they had to, they could operate App Store for a few tens of millions of dollars per year.
All of this could be solved easily if developers were allowed to pass on the apple tax to consumers and advertise discounts for not using the App Store. No one wants to pay more for nothing.
I really think I might be done with Apple. The only thing keeping me using them is how much I hate Android. The _millisecond_ a competitor arrives, I'm dropping my iPhone like a bad habit.
Off topic, but is there anything specific that you hate about Android? I find it acceptable. I'm trying to cut down my phone usage so maybe I'm more tolerant.
GrapheneOS on a Pixel is that competitor. Open source, more secure than Apple, compatible with nearly all Android apps. It's all the positive aspects of Android without the downsides (Google).
I keep hoping and wishing for a daily drivable linux phone that's compatible with all the us networks to come along. I'll keep hoping and wishing. Someday I hope we will get there!
The problem is that Apple owns the platform and half of the mobile ecosystem. You can't just launch a competitive marketplace which could compete alongside Apple's app store, nor can you launch an alternative operating system. You have to launch a whole new smartphone stack complete with operating system, app distribution and app ecosystem.
They could lower the rates even more and still afford the government bribes and solid gold tchotchkes, but the whole point of the bribes is to not do that.
There is no ideological argument for voluntary action here. The entire goal is to force regulators to step in. The debate over 'good vs. bad companies' is just online noise and rhetorical trik, no one on either side of the political spectrum wants these systems to be fixed voluntarily with corporate altruism.
This is all money that is reducing expenditure elsewhere. I get it: capitalism and economics. Yet I still think humanity could do better and I think capitalism itself suffers. Economics theory is broken if it thinks this is good for society in general.
I think what confuses me is that Apple is taking so much profit that it reduces their profits.
It's a classic direct-indirect management problem. Think about Android for a second. It costs nothing to put an app on their app store. People can make apps for themselves and then just publish because either "why not" or it's an easy way to distribute to friends and family. So basically it is making app creation easy. Meanwhile Apple charges you $100/yr to even put something up on the store, makes it hard to sideload, and consequently people charge for apps, which Apple rejoices as they get a 30% cut (already double dipping: profiting from devs, profiting from the devs' customers).
BUT WE'RE TALKING ABOUT SMARTPHONES
A smartphone is useless without apps! People frustrated they can't find the apps they want on iPhone? They switch to Android. People on Android want to get away from Google but they can't do half the shit they want to on iPhones (and the other half costs $0.99/mo)? They bite their tongue or rage quit to Graphene.
The only reason this "fuck over the user" strategy works is because there's an effective monopoly.
All of this is incredibly idiotic as the point of a smartphone is that it is a computer that also makes phone calls. We have made a grave mistake in thinking they are anything but general purpose computers. All our conversations around them seem really silly or down right idiotic when you recognize they are general purpose computers. And surprise surprise, the result is that seeing how profitable and abusive the smartphone market can be leads to a pretty obvious result: turn your laptops and desktops into smartphone like devices. Where everything must be done through the app stores, where they lock you out of basic functionalities, where they turn the general purpose computer into a locked down for-their-purposes computer.
The thing that made the smartphone and the computer so great was the ability to write programs. The ability to do with it as you want. It's because you can't build a product for everyone. But the computer? It's an environment. You can make an environment that anyone can turn into the thing they want and they need. THAT is the magic of computers. So why are we trying to kill that magic?
It doesn't matter that 90% of people don't use it that way, and all those arguments are idiotic. Like with everything else, it is a small minority of people that move things forward. A small percentage of players account for the majority of microtransactions in videogames. A small percentage of fans buy the majority of merchandise from their favorite musicians. And in just the same way, it is a small number of computer users (i.e. "powerusers") that drive most of the innovation, find most of the bugs, and do most of the things. I mean come on, how long did it take Apple and Google to put a fucking flashlight into the OS? It was the most popular apps on both their stores for a long time before it got built in. Do you really think they're going to be able to do all the things?
Advocating for regulators to step in is already a value judgement. Why is "high profitability" a cause for regulatory scrutiny? The optimal behaviour in any ecosystem (corporate or natural) is to defend as much territory as is within your power, not to keep only to what covers your "needs". Why have you deemed this behaviour, which is emergent anywhere competition between organisms exists, as in need of regulation?
Apple is succeeding largely on merit, within the bounds of civilized, peaceful competition. Shouldn't we all just be grateful for the contributions they have made to our civilization?
What we need much, much less of in this world is government force, especially during these trying times of government force and outreach (something I expected my more left side of the isle colleagues to have finally realized by now).
COIVD really was a test of how much governmental draconianism we would take, and we failed spectacularly, and not only that, but are demanding more government.
So no, we don't need more regulation, especially given this country's history of regulatory capture. We need new solutions.
We don't need "more" government, we need the government to do its job. We need the regulators who have been legally appointed to oversee these areas to actually respond to these behaviors. Regulatory capture is the issue, but the solution isn't less government. It's getting corporate money and lobbying out of the government (Citizens United is to blame for most of our woes), increase the enforcement of anti-corruption laws, and get antitrust back on the table.
I want big corporations to be scared. I want them to fear for their own survival, and to tread lightly lest the sword of damocles fall upon them.
But what about my banking app! I think it’s only fair Apple take 30% on every transaction I make. After all they put in a huge amount of work validating and making sure my banking app is safe and functional.
Edit: Maybe I am greedy now, but it would be nice if large transactions like say buying a house only would cost me a 15% transaction fee to Apple.
Developers are a tricky market for this because they could realistically move to different platforms if stuff like this started to happen. Or at least work on remote machines.
If gaming on Macs ever became popular though this would be a real risk.
I'm not sure Claude Code is making enough for Apple to take notice & drastically alter their CLI like that? CC has 100-150k users across all platforms, paying $200-1200/yr each. Even if every developer is on the top tier Max plan, and on MacOS, that's $180mn in revenue at Anthropic. So even in the most optimistic scenario, that's only ~$50mn revenue for Apple at a 30% take.
That pales in comparison to the hardware & subscription revenues Apple brings in by being a dev-friendly OS.
> Wouldn’t be surprised if macOS starts locking down CLI tools towards an App Store model too.
The day that happens is the day Apple sees a mass exodus of developers to Linux, I don't think they'd be that stupid. They enjoy enough goodwill right now as the platform of choice (vs. Windows for those that don't want to run desktop Linux), I can't imagine they'd casually just throw that away.
If Claude Code was in the Mac App Store, they would have signed an agreement to do so (offer an in-app purchase option and Apple gets a 30% cut of subscriptions for the first year, 15% after that).
They would also be sandboxed such that the app wouldn't have access to the level of system integration it needs.
You joke, but legally they could. If game engines can charge a licence fee as a % of revenue from games developed on those engines, then legally there's not much to stop apple doing the same. Of course consumers and enterprises wouldn't tolerate it, but the barrier is commercial rather than legal.
I've long believes that the requirement to use in-app purchasing was to make such revenue sharing easier to audit - if you can only use Apple's payment system to do certain things (or else your app isn't approved), then Apple doesn't have to worry about things like audits.
Since various countries have regulated the ability to do third party payments from apps, Apple has since added API to launch said payments, to help generate statistics on use so that they can then demand third party auditing that the commissions are still being properly paid.
In the US there was a court decision that they couldn't meter or charge commission, which may very well be walked back and will lead to lots of fun future articles.
It made sense in the early days, phone operators were charging up to 90% for the infrastucture to send an SMS, and get a download link to a J2ME/Windows CE/Pocket PC/Symbian/Palm/Blackberry download link to install the app.
So everyone raced to the iOS app store, it was only 30%, what a great deal!
The problem is that two decades later it is no longer that great deal in mobile duopoly world.
It's kind of interesting that while the structure is largely the same, the underlying behaviour/intent has morphed from a disruptor-model into being toxic rent-seeking behaviour.
Isn't it strictly worse that they're already thinking they're entitled to 30% of your salary because your clients use Apple hardware? You can change what you use, you can't change what they use.
All the regulators in the world have their sights set on them and they know it. The light is half on already and the music is slowing. This party is soon to be over. It's a last ditch attempt at milking all they can.
Stuff like this is ironic but I do think it's escape hatches like this that will make these tech companies, if they ever go down, go down kicking and screaming. Any platform holder that ever finds themselves in a bad place financially will 100% pull all the levers like this.
30% of profit from stock sales initiated on Apple hardware should automatically go to Apple. Because why not. It's a digital sale, there is no physical goods changing hands. Sounds perfectly reasonable to me. /s
The wealthiest company in the world really needs that last little bit from those Patreon creators who have it way too easy in their lives. It's not as if the people that take that meager bit of cash are going to invest it in Apple stock so they're going to have to pay up.
2035: Apple takes 30% of my Patreon, Google matched it through their "Competitive Parity Agreement," and the EU fined them both €2 billion which they paid in 45 minutes of revenue then raised fees to 32% to cover legal costs.
The real innovation was convincing us this was inevitable.
Sometimes I think the 30% was supposed to be 3% originally, and no one noticed the decimal was in the wrong place when they shipped it, and then people paid it anyway, so they kept it.
30% is just so unreasonable that it would be totally understandable if someone would believe this.
In 2008, the app store was launching, and physical software was still sold at Targets, Walmarts and other large retailers. A 30% margin was roughly what retailers would make off of physical software sales. By setting the App Store to be the same, Apple was signaling to retailers that they were not trying to undercut their margin, and keep a healthy relationship with them.
No one was buying boxed software in 2008. The second we had broadband, call it 2002-ish, everyone was downloading everything. For many of us that began in the 90s before we had broadband. Overnight downloads over 56K phone modems was already overtaking boxed purchases. More people downloaded Netscape in 1995 than bought it boxed.
It was 2008; "big box" software was largely seen as obsolete to the vast majority of developers. Marketing was done online, and the benefit of investing in retail had stopped outweighing the consequences. Online updates quickly became the norm, and service features supplanted point-of-sale business model (much like Apple's double-dip into microtransaction profits).
Apple chose 30% because they knew they weren't a retailer. You can hunt for a cheaper Diablo II copy online or at Wal-Mart, but not on iPhone.
Steam, the Kindle Store and iTunes all had similar sales cuts since before the app store launched in 2008.
It’s egregious now but at the time it wasn’t crazy because software developers often made way less than that when going through traditional publishing routes. Plus everyone was just happy to be making money off the new platform.
You can be the patron of a creator and Apple in the same time! Jokes aside, this is awful...I like/use Apple products but this unacceptable, I hope everyone dodges this and pays through the website
In all seriousness, finance people see everything through the lens of margins and money primarily. Since any company's function is to deliver value to its shareholders, if allowed, bean counters will scorch the earth for it.
Ultimately, this is at odds on how Jobs approached things, i.e., money was not the end all be all.
Apple's 30% tax was introduced under Steve Jobs and there were no small business exemptions back then. Jobs died in 2011. It's time to stop extrapolating what Jobs would be doing 15 years later in 2026 if he were still around. Could be the same, could be better, could be worse.
Tim Cook is usually good at politics, which doesn't seem to be the case here. Nobody other some CNBC guests really gets too upset when they take 30% from tinder, music or mobile gaming companies. And those types of apps run by unpopular large companies make up the majority of App Store revenue.
However, newspapers and content creators are popular in a way that carries political weight. It'd be wise for Apple exempt these categories and write off the few hundred million in forgone revenue as a political expense.
For example allowing the NYT or Joe Rogan to have nice paid apps with no fees would be a much more effective use of money than the same amount in political donations.
I'm running a small service, sub 150 users, no online signup kind of business, B2B. Small EU country. 95% of users ask 'do you have an mobile app?' in first 5 minutes of onboarding. Telling them how to install a PWA (and what it is and so forth) is an uphill battle. Unfortunately App Stores rule the non technical crowd.
This is not an accident. This is exactly why Apple (and Google also) have made the PWA experience bad for years. They must force users to believe their app store is the only source of programs.
To many users, an app seems to be perceived as the blessed way to access the web. While on a mobile, they are mostly a way to organize symlinks or bookmarks. Except, off course a web browser does its best to protect the user while most apps don't.
Meanwhile I continue doing the Lords work by telling kids that apps are not the internet. Hopefully, that 95% percentage will eventually decrease.
There may be a time where we have to push back, though, and this may be it. "There is no app" may sound terrifying now, but once we've educated users, it will only get less scary, until we might actually claim back some ownership of our own stuff from the likes of Apple.
This may just be more of a design and communications challenge for you, than your users. I have seen several design templates that use various forms of visuals to assist the user through the “add to Home Screen” process, which is just three steps; Share—-> More —-> Add to Home Screen. It Is arguably even a faster process than going through the App Store, even if users may be more familiar with it.
You could accompany it with some copy explaining how it keeps the service efficient and affordable, i.e., possible stating if you were to offer an app you would have to increase the price by 75% to pay Apple their fee and for the extra costs.
I suspect other arguments for PWAs would not really matter, like that you have no need to track them or use other abilities an app affords, etc. Most people only care about very few things engineers actually care, let alone know about.
I’ve always been an advocate of PWAs whenever it makes sense and will even design and architect to that objective. But even when I would deal with clients, I think the real “up hill battle” is that apps allow for higher fees and charges because they’re more work and come with greater expenses for for-profit apps, so there has been very little incentive to spread general user awareness about the “add to Home Screen”/PWA.
It’s a bit of a paradox, but I guess that seems to be an under-appreciated driver in something like “advanced consumer capitalist economies”, where the “rational actor” simply does not exist anymore.
What kind of users are these? Power-users or normal users (Android etc.) or dum..Apple users?
Because in my circle, power-users and beyond. Everybody is angry with apps needed for everything, you want buy bread in store, "do you have our app?" It's a meme here.
And in our local subreddit, 600k users. Sentiment is the same.
We also tried to bypass stores apps with generating new accounts and distributing QR/cards for free to everyone.
It was kinda popular.
And problems are more real with each day, eg.: scammers have their work way easier, since dumb users can take a huge loan directly from banking app in their phone.
BTW, you don't need the app store for that. You can use Firebase App Distribution which doesn't require you to go through the review process.
Basically you just ask their email address and add it to a list in Firebase. Upload your ipa to firebase and the user will receive an email with a link to download
Clients and customers will not stand for this. I don’t agree but I’ve seen it enough times now it doesn’t surprise me. They want an app, doesn’t matter if you have an identical web-based version that does the exact same thing, they want an app.
I write cross platform apps using Vue/Quasar (previous Angular/Ionic, and before that Titanium), I have put up a web-based version of their app (as a fallback and as an early MVP) and it’s like pulling teeth to get anyone to even play with it. Then you put an app up on TestFlight and suddenly they are using it.
And that’s just trying to get the to use the web while I’m still setting up crap for a “native” app. The idea of not having an app is a non-starter.
Again, I don’t agree with them, I’m just telling you what it’s like out there if you are developing software for other people. An app brings “prestige”, they want be able to say “we have an app”. And no, saving a webpage to the home screen is not a viable alternative (trust me, I’ve tried). Clients and customers reject that and there are extra limitations with that approach (or there were last time I tried, around using the camera feed, things that work fine in mobile Safari).
OK, but you sound like you consult for businesses. Who may not be rational. That doesn't necessarily mean end users are demanding an app. They could be, but your anecdote here doesn't support that conclusion. Patreon's clients are end users.
Apps are usually built so people can't skip ads. Its the only reason to have an app. Other than esoteric reasons like "we also have an app because x,y,z also have apps".
I don't think that applies to Patreon which, as far as I know, doesn't have any ads in the first place?
The app might make it easier for them to enforce DRM-like behaviors to prevent people from pirating creators content, but I strongly suspect people aren't doing that on iOS regardless.
Yep, it's the driving force why I rarely install apps. If the mobile site doesn't work well, it's a good filter that I shouldn't use it. (Doom scrolling trap).
For those that are not aware, on Android you can install Firefox and Ublock-Origin. Life saver!
Hard agree. I hate it when a website force me to get an app now. I feel like websites have matched apps in terms of feel-good on mobile that I don’t really use apps anymore
I use the Patreon app. It's great. I get to see stuff from my favorite creatives weeks (sometimes months) early, and ad-free. Since many of them are youtubers and I don't pay google to show me less ads, this is a huge value prop. And, the Patreon app can cast videos to my TV, so it's really a complete experience.
Patreon isn't something you need to be checking all the time, though, unless you patronise a LOT of people. It can pretty much be a "setup and forget" kinda deal.
I think they could get pretty far with a PWA, but there are legitimate arguments to go native. For use cases like podcasts, where users can download them ahead of time, it seems like Safari limits storage to 1GB [0]. Plus playing background audio might not be as good an experience.
I use the app for its native podcast integration. The RSS URL also works but I have yet to find a decent RSS client that will synchronise progress across devices well.
Funnily enough I stopped using the Patreon app for podcasts with the big rewrite a while back where it became almost unusable and switched to Overcast instead.
Because apps are the lowest-friction path to users. If you publish a tool that targets an audience of more than a very specific niche of people, you'll get people asking for an app literally every day. My inbox used to be full of them.
That's not a reasonable solution. Have you used the Patreon app? I use it regularly on Android, and have dozens of audio podcast files downloaded through it.
I still can't believe developers love to work for this feudal overlord. They are building a wall around our profession. Have a little foresight and move your business elsewhere.
It's not so much that I love giving 30% to Apple, and more that there is no way to move your business elsewhere because Apple monopolizes mobile app distribution.
And the other half of the mobile app market is monopolized by Google who copies the pricing model while delivering even worse (if any) service to developers.
It's either getting out of mobile apps or paying up.
This is not going to change without drastic steps by regulators, which both Apple and Google fight tooth and nail.
You know some of us remember Mac System [7|8|9] and how MSFT pretty much ruled everything (Apple had low %).
We kept working on the platform and developing tools and things changed. Of course Apple is a lot more powerful than MSFT back then and the general population is their target.
Readit News
Apple could take just 7% cut and still make 20% profits.
Fun Fact: During the Epic trial, it was revealed that Apple's profit margins on the App Store were so high that even Apple's own executives were sometimes surprised by the internal financial reports.
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edit: There is no ideological argument for voluntary action here. The entire goal is to force regulators to step in. The debate over 'good vs. bad companies' is just online noise and rhetorical trik, no one on either side of the political spectrum wants these systems to be fixed voluntarily with corporate altruism.
I like Apple less and less these days for various reasons, but I haven't purchased an app on the App Store in more than a decade. It's strictly a vehicle for local utilities when, for whatever reason, a browser will not suffice. Nearly all purchasing is done on the 'open' web.
That's an incredibly ridiculous take. R&D is an operating cost and it's an ongoing expense related to the app store existing.
> I think the actual profit margin is closer to ...
You can replace "think" there with "feel".
Apple cannot charge for that. However, apple does attempt to gimp the web platforms on mobile to "subtly" push for apps.
It doesn't matter if you are not technically in a dominant position if your special role in a large ecosystem basically allows you to act like one in your own purview.
You could say this kind of move invites more scrutiny but the regulators are already there watching every Apple's move with a microscope and their patience with Apple attempts at thwarting compliance is apparently wearing thin at least in the EU if you look at preliminary findings.
Regulating the fees for one central app store is no solution.
Oh boy, now my mom can get the full experience of having malware on her phone too!
Right on. But that's exactly the wiggle room where voters could pull some of those cards like "climate change mitigation (of consequences)", "climate change preparation", "upcoming waves of climate change refugees", "AI dividing the population", "Universal Basic Income", all of which are things companies like Apple won't do anything for (or against) while their goods are still mostly for proper earners and not for people who buy stuff at a discount (I'm exaggerating).
Since corporate altruism is definitely not on the menu, government institutions and NGOs will have to pick up way more than they are currently prepared for.
We are in a strange phase of calm before the storm, despite all those wars and conflicts--or in spite of them, I don't know. Shits' gonna hit the fan sooner or later and it's up to the voters to demand adequate preparation.
Big Corps caused significantly more damage than they had to cause for all those profits, whether as a side effect or not, and they did that long enough.
Job cuts, whether due to AI or not, will remain a thing while no "new" giants will rise for quite a while ... and corporations will sing the song "it's what the people want" only as long as voters will stay quiet.
Sure, bribes, corruption and blablabla, but it doesn't change how votes work and none of it changes how the devoted clerks in the administration do their jobs and write laws (if they have to have to) ...
We can say this to any company, "$X could reduce price by $Y and still make $Z profits", but it doesn't really make any sense. Making profits is what makes a company a company instead of a non-profit organization.
In normal markets there are competitors who force each other to keep reasonable profit margins and to improve their product as opposed to milking other people's hard work at the expense of the consumer.
At this point the regulators should investigate what the barriers are to new entrants and if it's too costly and nobody has managed to cut in the last few years, establishing some rules is probably a good thing. This happens as industries mature and become critical, it happened in transportation (most bus, train companies), energy, water supply, trash, etc, depending on the country and market conditions.
there could also be cases where cutting back to $Z profits might be preferable in case not doing so were to prompt legislation causing someone to be forcibly cut to $Z-1 or even $0 profits from a particular profit source.
Which it has been my observation that when someone is saying "X could reduce price by $Y and still make $Z profits" it often coincides with saying therefore company X should be legislated on this particular profit source.
Note: $X didn't make much rhetorical sense.
Until it turns into cancer because of unrestrained growth.
Like it or not capitalism is a part of an ecosystem. We’ve been “educated” to believe that unrestrained growth in profits is what makes capitalism work, and yet day after day there are fresh examples of how our experience as consumers has gotten worse under capitalism because of the idea that profits should forever be growing.
Was this recorded or just people drawing lines between Epic's expert witness claims and the executives trying to down play them?
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Microsoft Office: Revenue $45B Operating Costs $12B Profit $33B Operating Margin 75%
Google Search Ads: Revenue $175B Operating Costs $45B Profit $130B Operating Margin 75%
While technically true, this argument doesn't provide any merit to the discussion. The App Store backed purchase for the Patreon subscription would not exist at all without the creator's work and investment in creating their form of content.
In the absence of the App Store, the creator would still have access to their patrons via mobile web and payment via the methods already provided by Patreon. The app is merely a convenience - it's a hard sell that this convenience is worth 30% of the creator's revenue through the platform.
them taking more and rents from their store-related operations is hard to justify from software product-quality perspective; its like a slap in the face
Yeah that has to be a good 95% of why businesses do bad things.
The last thing Apple wants is for people to think they've plateaued. Stock starts going down to normal P/E ratios, expensive engineers leave, etc.
Obviously Epic would like to pay lower platform fees to Apple than it pays to Nintendo, but there is no logical reason why it should.
Agreed, there are bad privately held corps, and worse privately held corps, with badness usually proportional to their size and profit.
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It's a classic direct-indirect management problem. Think about Android for a second. It costs nothing to put an app on their app store. People can make apps for themselves and then just publish because either "why not" or it's an easy way to distribute to friends and family. So basically it is making app creation easy. Meanwhile Apple charges you $100/yr to even put something up on the store, makes it hard to sideload, and consequently people charge for apps, which Apple rejoices as they get a 30% cut (already double dipping: profiting from devs, profiting from the devs' customers).
BUT WE'RE TALKING ABOUT SMARTPHONES
A smartphone is useless without apps! People frustrated they can't find the apps they want on iPhone? They switch to Android. People on Android want to get away from Google but they can't do half the shit they want to on iPhones (and the other half costs $0.99/mo)? They bite their tongue or rage quit to Graphene.
The only reason this "fuck over the user" strategy works is because there's an effective monopoly.
All of this is incredibly idiotic as the point of a smartphone is that it is a computer that also makes phone calls. We have made a grave mistake in thinking they are anything but general purpose computers. All our conversations around them seem really silly or down right idiotic when you recognize they are general purpose computers. And surprise surprise, the result is that seeing how profitable and abusive the smartphone market can be leads to a pretty obvious result: turn your laptops and desktops into smartphone like devices. Where everything must be done through the app stores, where they lock you out of basic functionalities, where they turn the general purpose computer into a locked down for-their-purposes computer.
The thing that made the smartphone and the computer so great was the ability to write programs. The ability to do with it as you want. It's because you can't build a product for everyone. But the computer? It's an environment. You can make an environment that anyone can turn into the thing they want and they need. THAT is the magic of computers. So why are we trying to kill that magic?
It doesn't matter that 90% of people don't use it that way, and all those arguments are idiotic. Like with everything else, it is a small minority of people that move things forward. A small percentage of players account for the majority of microtransactions in videogames. A small percentage of fans buy the majority of merchandise from their favorite musicians. And in just the same way, it is a small number of computer users (i.e. "powerusers") that drive most of the innovation, find most of the bugs, and do most of the things. I mean come on, how long did it take Apple and Google to put a fucking flashlight into the OS? It was the most popular apps on both their stores for a long time before it got built in. Do you really think they're going to be able to do all the things?
Apple is succeeding largely on merit, within the bounds of civilized, peaceful competition. Shouldn't we all just be grateful for the contributions they have made to our civilization?
> force
> regulators
That's my whole problem, personally.
What we need much, much less of in this world is government force, especially during these trying times of government force and outreach (something I expected my more left side of the isle colleagues to have finally realized by now).
COIVD really was a test of how much governmental draconianism we would take, and we failed spectacularly, and not only that, but are demanding more government.
So no, we don't need more regulation, especially given this country's history of regulatory capture. We need new solutions.
I want big corporations to be scared. I want them to fear for their own survival, and to tread lightly lest the sword of damocles fall upon them.
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Edit: Maybe I am greedy now, but it would be nice if large transactions like say buying a house only would cost me a 15% transaction fee to Apple.
Wouldn’t be surprised if macOS starts locking down CLI tools towards an App Store model too.
If gaming on Macs ever became popular though this would be a real risk.
That pales in comparison to the hardware & subscription revenues Apple brings in by being a dev-friendly OS.
The day that happens is the day Apple sees a mass exodus of developers to Linux, I don't think they'd be that stupid. They enjoy enough goodwill right now as the platform of choice (vs. Windows for those that don't want to run desktop Linux), I can't imagine they'd casually just throw that away.
They would also be sandboxed such that the app wouldn't have access to the level of system integration it needs.
Think about how many lives were improved just by M* CPUs or Siri
/s
Since various countries have regulated the ability to do third party payments from apps, Apple has since added API to launch said payments, to help generate statistics on use so that they can then demand third party auditing that the commissions are still being properly paid.
In the US there was a court decision that they couldn't meter or charge commission, which may very well be walked back and will lead to lots of fun future articles.
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So everyone raced to the iOS app store, it was only 30%, what a great deal!
The problem is that two decades later it is no longer that great deal in mobile duopoly world.
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The Mafia can learn a thing or two from Cook.
When they do something marginally nice: "omg apple is so great :D" when they do something stupid: "poor apple is being forced by the market :'("
Both employ mafia tactics
The real innovation was convincing us this was inevitable.
Reality disagrees: https://www.irishtimes.com/business/2024/12/13/data-regulato...
30% is just so unreasonable that it would be totally understandable if someone would believe this.
Apple chose 30% because they knew they weren't a retailer. You can hunt for a cheaper Diablo II copy online or at Wal-Mart, but not on iPhone.
It’s egregious now but at the time it wasn’t crazy because software developers often made way less than that when going through traditional publishing routes. Plus everyone was just happy to be making money off the new platform.
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In all seriousness, finance people see everything through the lens of margins and money primarily. Since any company's function is to deliver value to its shareholders, if allowed, bean counters will scorch the earth for it.
Ultimately, this is at odds on how Jobs approached things, i.e., money was not the end all be all.
However, newspapers and content creators are popular in a way that carries political weight. It'd be wise for Apple exempt these categories and write off the few hundred million in forgone revenue as a political expense.
For example allowing the NYT or Joe Rogan to have nice paid apps with no fees would be a much more effective use of money than the same amount in political donations.
Meanwhile I continue doing the Lords work by telling kids that apps are not the internet. Hopefully, that 95% percentage will eventually decrease.
We do mobile friendly Web UIs, that is enough.
Their customes, employees, go to the respective company website, get a responsive UI for their device, done, the services require to be online anyway.
You could accompany it with some copy explaining how it keeps the service efficient and affordable, i.e., possible stating if you were to offer an app you would have to increase the price by 75% to pay Apple their fee and for the extra costs.
I suspect other arguments for PWAs would not really matter, like that you have no need to track them or use other abilities an app affords, etc. Most people only care about very few things engineers actually care, let alone know about.
I’ve always been an advocate of PWAs whenever it makes sense and will even design and architect to that objective. But even when I would deal with clients, I think the real “up hill battle” is that apps allow for higher fees and charges because they’re more work and come with greater expenses for for-profit apps, so there has been very little incentive to spread general user awareness about the “add to Home Screen”/PWA.
It’s a bit of a paradox, but I guess that seems to be an under-appreciated driver in something like “advanced consumer capitalist economies”, where the “rational actor” simply does not exist anymore.
Because in my circle, power-users and beyond. Everybody is angry with apps needed for everything, you want buy bread in store, "do you have our app?" It's a meme here. And in our local subreddit, 600k users. Sentiment is the same.
We also tried to bypass stores apps with generating new accounts and distributing QR/cards for free to everyone. It was kinda popular.
And problems are more real with each day, eg.: scammers have their work way easier, since dumb users can take a huge loan directly from banking app in their phone.
Also small EU country, btw.
Basically you just ask their email address and add it to a list in Firebase. Upload your ipa to firebase and the user will receive an email with a link to download
Specifically, do people not use websites that have rich/complex data driven functionality anymore?
If they do, I'm wondering what determines whether an application is seen as needing a mobile app vs being ok as a regular web app.
Did you ask them why?
I write cross platform apps using Vue/Quasar (previous Angular/Ionic, and before that Titanium), I have put up a web-based version of their app (as a fallback and as an early MVP) and it’s like pulling teeth to get anyone to even play with it. Then you put an app up on TestFlight and suddenly they are using it.
And that’s just trying to get the to use the web while I’m still setting up crap for a “native” app. The idea of not having an app is a non-starter.
Again, I don’t agree with them, I’m just telling you what it’s like out there if you are developing software for other people. An app brings “prestige”, they want be able to say “we have an app”. And no, saving a webpage to the home screen is not a viable alternative (trust me, I’ve tried). Clients and customers reject that and there are extra limitations with that approach (or there were last time I tried, around using the camera feed, things that work fine in mobile Safari).
The app might make it easier for them to enforce DRM-like behaviors to prevent people from pirating creators content, but I strongly suspect people aren't doing that on iOS regardless.
For those that are not aware, on Android you can install Firefox and Ublock-Origin. Life saver!
My sister and my parents basically ~only read newspapers from their apps, despite it being static text with some images.
I don't know how, but Google and Apple are really good at nudging people to use apps instead of websites.
- how to install them
- what advantages (and disadvantages) they have. In particular regarding censorship and privacy!
Apple and Google need to be pressured to make PWAs
- easier to install
- more capable
- less buggy (Mobile Safari in particular).
If your app's needs can be met with a PWA, you owe it to your users to offer one!
Here are a few PWA showcase links:
https://pwa-showcase.com/#/all-cards
https://whatpwacando.today/
And a lazy AI-generated list of things that PWAs can do today on top of the things a normal web page can do:
https://www.perplexity.ai/search/make-a-list-of-all-things-p...
If your TV supports AirPlay, you just tap the icon on a video in Safari.
[0] https://web.dev/articles/storage-for-the-web
Sure you could do it in a browser, but half the time the credentials dont cache, or you have to waste 4 clicks and 20 seconds finding a bookmark.
They want convenience. For better or worse.
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Works offline?
b) if so, does it work any better than a web app can offline?
And the other half of the mobile app market is monopolized by Google who copies the pricing model while delivering even worse (if any) service to developers.
It's either getting out of mobile apps or paying up.
This is not going to change without drastic steps by regulators, which both Apple and Google fight tooth and nail.
This even includes developing open source tools for MacOS.
And even if it doesn't backfire it is largely a wasted effort.
We kept working on the platform and developing tools and things changed. Of course Apple is a lot more powerful than MSFT back then and the general population is their target.