Your Thoughts on the App Store: Apple Should Change, but Voluntarily

When I’m trying to find something in the App Store, I often think back to the good ol’ days of User Groups, shareware, floppy disks; and fondly remember all the fun things I installed on my Mac to make it more fun, prettier, and more functional. Of course, some of those apps caused my Mac to crash, or interfered with other programs that I was running, but it was actually fun. Now I’d be screaming at the top of my lungs if I had to deal with all of that. Ahhhh … life is different now.

I wouldn’t have an issue with Apple being broken up. As long as other duopolies be broken up as well. Amazon, Google, Facebook, the 3 remaining US cell carriers, etc. All too big to fail which is why they keep getting away with all the crap they pull. In the old days huge companies were broken up. That was obviously when politics still owned making policy rather than choose to have it dictated to them by their corporate overloads who bought them wholesale through PACs and Super PACs. Capitalism relies on free markets to work. We cannot have those market dynamics work for us, when as consumers we’re forced to choose from 2-3 companies per segment with no real competition.

I apparently slept through the call for reader input on the App Store. I think breaking Apple apart is a terrible idea. I also think the Apple’s 30% cut is exorbitant.

My primary objection to sideloading is about malware. I don’t know whether Apple’s review process helps prevent privacy infringement, but if it does, that would be another reason against.

Finally, I don’t know how or if any of this affects family sharing of in-app purchases, but lack of support for that is an extreme irritant.

I found this link amusing:

It does, and Apple has a very strict security vetting process. In addition to vetting and security, Apple is also responsible for payments, distribution and promotion for App Store developers. They also spend many billions every year on iPhone and iPad hardware and iOS software development.

And Apple’s App Store provides an audience that very significantly outspends Google’s:

Apple’s App Store generated an estimated $32.8 billion globally from in-app purchases, subscriptions, and premium apps and games in the first half of 2020. This figure is 24.7 percent more year-over-year from the $26.3 billion spent during the same period in 2019. Spending on Apple’s marketplace was nearly twice the estimated gross revenue on Google Play, which clocked in at $17.3 billion. That was up 21 percent Y/Y from the first half of 2019, when we estimate consumers spent $14.3 billion on Google Play.

Android takes the same 30% commission that Apple does. But when you walk in to a department store and see the makeup and accessories areas, as well as what products are featured where in sporting goods and big box store they take a % on that as well. Supermarkets, both big and small charge slotting allowances as well as for freestanding displays, and for special displays for holidays, seasons, back to school. Before Amazon became a big thing, book and magazines publishers were charged big bucks for premium in store positions as well.

Before Amazon bought Whole Foods, small purveyors of fresh and shelf stable products were up in arms because the original owners made a point of discovering and displaying local brands that couldn’t afford slotting allowances, and encouraged them to do in store sampling at no extra cost. That went out the door once Amazon bought it. Amazon also charges for search optimization, as does Google.

It’s not like Apple is charging game developers anything different that Sony (who also charges 30% for PlayStation games) Google or Microsoft is charging. And it’s not like they are doing anything other than mass or midsized retailers have been doing for more than a century. And IMHO, Fortnight needs Apple and Android more than Apple and Android need them.

Don’t know how I missed this but hey I did.

• Don’t want sideloading.
• Happy with the App Store as a user bar the search.
• Apple should treat developers fairly and equitably and they don’t.
• 30% could come down at this point.
• I like governments and they should keep an eye on legitimate concerns and enquire as necessary but should not be legislating beyond existing consumer protections.
• the breakup of Apple is the end of what makes it great, the ecosystem thrives because Apple can stay responsive in what it focusses upon.

In this process there are three major stakeholders Apple, the developers and the customer. As In any contract it is not good if it is not a win win win. Everyone needs to set aside their egos and do what is best for all parties. I personally am mostly happy with the App Store but I know several are not. does this mean Apple needs to stop or reduce some of their control? Does it mean that the developers will pay less? Does it mean that the user will have more choice?

The answer lies somewhere in the middle of that triangle.

Apparently, you included the survey about the App Store in an article about the App Store and Developers. I think that those of us who are not developers (like me) wouldn’t read an article like that when we’re busy so it doesn’t represent all your readership.

As a long-time Apple user, I’m generally happy with the App Store and have no problems with it.

Yep, Snaggy and Nitrozac knocked it out of the park with that one!

And the Fortnight people developed a truly great, not to be missed, “Nineteen Eighty Fortnight” video:

Just one economic comparison point: at least in The Before Time, around five or six years ago (don’t know what it was like in, say, December, 2019), movie theaters typically got 40% of the price of a ticket, plus all the overhead they could add to refreshments (served only in large, gigantic, or galactic sized portions). Of the remaining 60%, maybe 10% goes for promotion, so the distributors, before they take their cut, can’t hand over more than 50% to the people who actually made the movie (writers/director/producers/cast/support personnel/SFX &c.).

What, exactly, os so unfair about Apple’s 30/70 split?

I think, in principle, nothing. Provided it’s applied equally to all developers. Apple itself has however through their actions and recently released emails cast doubt on that though.

That aside, you could also argue that if developers/users don’t like Apple funneling off 30% they could choose another ecosystem. Of course the latter argument falls apart because the only real competitor, the Google Play Store, charges the exact same 30%, i.e. customers cannot vote with their wallets.

This IMHO is the real problem. Apple should be able to charge what they want and customers should be able to choose what they want. If Apple is right, they’ll remain in business. If not, they either smarten up or their store goes out of business. The real problem is those market forces cannot come into play because there is no market. There is a duopoly and customers can only choose whom to hand over their money. Our regulators should never have stood by idle while this situation unfolded (and case in point: if Apple and Google actually had a contract where they stipulated they’d both charge 30% their CEOs would be facing jail time).

And it’s not just the app store where we have this problem. US consumers are faced with pseudo competition all over. You can only choose from 2 smartphone ecosystems, you can only choose from 3 cellular providers, we are down to 4 nationally operating air majors etc. We need more competition and it needs to be fierce. You don’t get that with two fat companies who are content splitting up the pie 60-40 and keeping it that way for all times with zero newcomers able to enter the race. Those are the situations where it appears to me breaking up companies to brute force many-company competitive market places are required to end duopolies and return to working free market capitalism that benefits consumers. IMHO our regulators have failed us by allowing too many mergers (eg. Facebook) and not breaking up companies before they became dominant.

I probably agree with more things you said than disagree, but I will point out one thing: the last time there multiple, profitable US airlines was back in the 1970s, when they were (1) regulated and (2) pacified with US Air Mail contracts (in the latter case, as they had been since the 1920s). We had age 12 - 21 50% standby fares, middle seats were almost never occupied, and it wasn’t outrageously expensive to fly. Oh, and there were direct flights from cost to coast as well as almost everywhere in between. If you were flying a a small airport you could get flights there on multiple airlines from multiple large airports. Hub and spoke did not exist, because there was no need to squeeze every last penny out of the operation. And it may be my geezer memory going, but I seem to remember decent food you could actually taste, in coach. It’s cutthroat competition that has made flying a miserable experience for everyone not in GOP class, up front.

So I’m a little restrained in my support for cutthroat competition. Free market capitalism is good for the consumer, up to a point — the point at which government needs to step to make certain the consumer is not screwed or, as in the “good old days” before the Pure Food and Drug Act, poisoned.

Isn’t that the anti-Apple ad from whinny Epic? I can’t tell because all I get is an error message:
“An error occurred. Please try again later. (Playback ID: -Jo_yEWf_UfSdrci)”

With the one big difference being that Android users don’t have to buy from the Play Store. There are other Android app stores (including one run by Amazon). You can also download the .apk package from another source (e.g. directly from a publisher) and manually install it. It’s an extra step to authorize a third-party store or your local file system as an installation source, but it’s also not a big deal.

Sure, you risk getting malware, but given the state of the Google Play Store, I wouldn’t consider it perfectly safe either. You just have to be careful what you’re downloading from where - just like we all had to do in the days before app stores.

It is applied equally. In addition to Apple, Google, Amazon and Samsung also have App Stores. They all charge 30% for the first year and for subscriptions, 15% after that, just like Apple:

https://www.amazon.com/gp/mas/get/amazonap

Tencent, Baidu and Oppo have very successful App Stores in China, and there are other competive stores to Apple and Google around the world. They all charge 30% for starters:

“Our study shows that Apple’s App Store commission rate is similar in magnitude to the commission rates charged by many other app stores and digital content marketplaces. The commission rates charged by digital marketplaces most similar to the App Store, such as other app stores and video game digital marketplaces, are generally around 30%.
Marketplaces that distribute digital content such as videos, podcasts, eBooks, and audiobooks generally charge commission rates of 30% or more. Commission rates charged by e-commerce marketplaces vary by industry but sometimes exceed 30%”

Epic Games should stop whining about Apple. If they don’t like the App Store’s commission fee, they can withdraw from the service. Then they see how much money they can make from a side loaded app.

I originally found it here. I think it’s really cool regardless of the cheesey animation:

Compare it to the production values and originality of the original “1984” Apple ad at the bottom of the page.

I think you paint those who favor regulating companies such as Apple and Google with too broad a brush when you label them confused and uninformed, and I have to question your political bent and ethics when you call out two Democrats, specifically. Only in the article for which you provided a link does it say that conservatives are actually more in favor of regulation.
I found Senator Warren’s argument for splitting up these giant companies at least worthy of consideration. She makes a good case as to why managing the store where your goods compete against others probably tilts the game in your favor and diminishes competition and service to the consumer that might have resulted from fairer competition.
As to your contention that Apple can’t protect us from apps that are bad actors if they don’t manage the store where they are sold seems preposterous on the face of it.
Given a choice of sourcing an app directly from its developer, or from the Apple App Store, I ALWAYS choose dealing directly with the app developer. He gets my money; I get his app. Most times, I also get support, including timely updates, that is not available from the Apple App Store.
I like macs and iPhones. Apple makes good products. I just wish they’d put more priority on making them better and less on becoming a behemoth purveyor of exorbitant luxury items and services.

I mentioned two Democrats because Republican lawmakers don’t talk about the App Store much. Republicans generally focus on three issues surrounding tech companies:

1. Production of devices outside the United States, specifically in China.
2. Collaboration with China.
3. Bias against conservatives on social media.

@Shamino:

Epic chose to put Fortnite back in the Google Play store after finding that life “outside” was more challenging, so their arguments hold even less water for me.

Both parties have taken extreme positions, but I expect Epic to blink first. As they should. Either complain about the 30% everywhere (Apple, Google, Sony, Microsoft, Nintendo, etc.) or suck it up and deal with it as a business decision.

Cheers,
Jon

It looks like for now, Fortnite won’t be allowed back in the App Store, but Apple has been blocked from yanking Epic’s developer certificate.

https://www.bloomberg.com/news/articles/2020-08-25/apple-defeats-epic-s-effort-to-restore-fortnite-on-app-store

I’m getting the same error on that site. I can go to YouTube direct and view one of many though. I watched this one: https://www.youtube.com/watch?v=h62AhBb5N1Q

I missed the survey as well.

One of the reasons that I chose the iPhone is the managed and curated App Store. I like that there is one place, and one place only, to find apps. There are policies in the App Store that should probably be changed, but I am not at all bothered by App Store restrictions. As for the other questions:

Yes, there should probably be some government regulation of internal app stores. I’m not sure that we can trust for-profit companies with little competition from making nothing but benign choices. There likely should be regulation that farly protect the interests of consumers and developers alike.

I have no idea as a consumer if developers are treated fairly by Apple. My gut feel is that they are.

If side loading is allowed on iOS, I want to make sure that there is a way to prevent it on my iOS devices.

I have no way to know if the 30% fee (and 15% subscription fee after one year) is fair or not. As a consumer I think in most cases if the fee was reduced, developers would keep most or sometimes all of the extra. I do think that some of the fees and restrictions are ludicrous, namely trying to capture fees of items like Kindle books, Netflix or Hulu subscriptions, etc. - I am not subscribing to these services because Apple happened to show them in the App Store - I am subscribing to most services because I heard about them elsewhere. I also, however, worry that other companies will not protect the privacy of my transaction data for internal purchases - I like having as few places to purchase from as possible. As an example, I have a local newspaper delivered to me most of the year, but I am away from home during the summer, so I suspend my delivery. The newspaper has a decent iOS app so I can read the paper during the summer, and I can subscribe using an in-app payment in the App Store. I could also subscribe through the newspaper itself, but when I did this last year, I spent half an hour on the phone trying to cancel my subscription when the summer was over. From waiting for a customer service rep to answer to refusing several offers to continue the subscription before they would finally process the cancelation, it took that long. In the App Store I will just click a button to stop the ongoing renewal and I will be done. There is a something enjoyable about such a simple interaction.

I would prefer that there not being multiple app stores on iOS. One concern is that specific apps might become exclusive to particular app stores, meaning that setting up a new device from scratch would require having to remember which app came from which store. As I said previously, I also trust Apple to keep my purchase history more private than I would other companies. I also worry about something like an app becoming exclusive on one store and then becoming exclusive on a second one at a later period. Would that mean that I would have to re-purchase the app from the second store? Personally I like the fact that there is one place to find apps, and I think Apple has done a decent job with it.

Lastly, and for what its worth, I really don’t want a huge number of apps anyway. I really don’t use more than a couple of handfuls of apps, and some of them are installed mostly so I can get notifications from them (e.g., from my bank to get a notification of questionable charges, etc.)

I can agree with that. I personally like the app store and the convenience and security that comes with it. I don’t like that it’s starting to feel like Apple is using it to stifle market forces.

I too don’t feel the urge to sideload. I do, however, under the current circumstances believe it should be made possible. iOS can give users a switch to lock down to app store-only apps – just like macOS. That way people who value the walled garden above all else retain just that. At the same time people who want to go beyond and make sure Apple can’t just muscle them into a certain mindset gain a new option.

On macOS we know this works. People have the option to go app store-only or to allow downloads directly from devs. We have a working Mac app store and it faces competition from other sources. It’s perhaps a bit weak compared to the iOS store, but that’s most likely for historical reasons (in the iOS case the reverse would be the case) and due to the fact that it competes poorly with what many independent devs have been able to offer. And that’s ok. That kind of competition would serve iOS well for those willing to allow it. And for everybody else nothing needs to change.

What if Apple charged a fee for having a presence on the Apple Store and gave people the choice to buy product on the App Store or go to developer site to purchase? The presence fee would be based on the number of hits a product got on the App Store.
Developer site would offer more detail and support. App Store would just offer purchase convenience. Developers could choose either purchase option and would only pay for presence fees if purchases from their site was provided. If developer site purchase was not an option provided - no presence fees would be charged and the existing 30% would be charged by Apple.

Perhaps the title was off-putting, but we very seldom publish any articles that we do not think are relevant or of interest to all TidBITS readers. Developers have complaints with the App Store, and those complaints directly impact how those developers provide users with apps.

We’re not talking about movies being shown in physical theaters, we’re talking about digital goods that have no marginal cost. As we outlined in the original article, the real comparison is with Internet sales, where developers are charged transaction fees of between 2.9% and maybe 10%, depending on the commerce platform. Internet sales predated the App Store by many years (Kagi started in 1994), and most Mac developers still rely on them. It’s just too easy to run your own Web-based store and process through Stripe or Shopify or rely on a platform like FastSpring or one of the Digital River subsidiaries.

Speaking of marginal cost, Ben Thompson is coming down on the issue much as we are, although he fleshes a suggestion out better than we did in our distinction between digital and real-world charges.

It is applied equally. In addition to Google, Amazon also has an App Store. They also charge 30%:

https://www.amazon.com/gp/mas/get/amazonapp

So does Samsung:

As a Mac developer, I think side loading with restrictions is a really good option. On the Mac, consumer oriented Mac Apps are strongly incentivized to be signed and notarized by Apple (unlike open source UNIX apps mostly used by developers). On iOS, requiring all Apps to be signed and notarized by Apple could be a reasonable compromise. This accomplishes three important objectives:

1. It gives Apple the control they need to ensure the integrity of the platform.

2. It forces Apple to justify their commission versus other alternatives that might become available. Apple is a fierce competitor and should be encouraged to win on the merits of what they offer.

3. It will force most developers to see the value of the App Store compared the alternatives.

From my perspective, it attempts to address the biggest issues without fundamentally breaking what’s great about the App Store and iOS.

Agree with the above. My gripe is when you search for an app, the find comes up in second place. That is sleezy.

I’ve been reading a lot in the ad and marketing trade press about Apple eliminating its Identifier For Advertisers (IDFA) in iOS. It means the end of precision tracking and targeting for ads. I got to thinking about whether the IDFA was used for extensive offsite tracking by gaming apps, and it most certainly is.

I was quite surprised about how much off-site tracking was possible via games, and I thought this could possibly be a contributing factor to Epic Games, etc. going ballistic about App Store fees. Epic Games does very successfully sell ads on Fortnight, and they do have extensive, super mega ad buying and PR operations.

This is a rather lengthy article that does a good job of summarizing the magnitude of the tracking opportunities that Apple is slamming the door on:

“Of course, this poll is small and far from scientific,”

No, if your fingers properly counted results, your poll is likely quite scientific; it’s is just not necessarily “representative” of any known universe, except perhaps average TidBits responders to past TidBits surveys. You even nicely report the n, number fo replies, for each question/answer. You even comment how your responders likely differ from the universe of all Apple users (my inference from your implicit comparison, “our audience tends to lean older and toward cautious usage patterns.” Even some of the best polling and polling analyses (eg FiveThirtyEight.com) make estimates and compromises. And so many polls today are based on who can be gotten to reply, often without explicit report, much less data, on how responders differ from known demographic etc data. Daniel Kegan, Chicago, Elan Associates.

Hah! Well-said. It’s likely an accurate representation of the subset of TidBITS readers who chose to respond, and extrapolating beyond that is a stretch. Except when we think we’re right, of course.

All surveys measure only those who are willing to respond.

I’ve always wondered, when seeing a news report about some poll that says “20% said X and 80% said Y”, about how many people refused to take the survey.

I think the public would have a very different opinion if they reported (for example) that “2% said X, 8% said Y and 90% told the pollster to take a flying leap”.

Reputable advertising market research and media surveys are sent out in waves to random samples in a representative market. They need to achieve a minimum in two or three waves, with three sometimes not passing the smell test. The minimum response rate, depending on the study, is 60% for print, 50% for email, but the bigger the response, the better. If you don’t make it by wave two, you’re allowed a third, but three just passes the smell test. The best and most respected studies are conducted by independent research firms. One of the challenges in the age of new media development is the the rise of an infinite number of new research companies, many of which are rather dubious. And there is also the issue of off the shelf digital research apps.

Polls that are posted on a web page are a totally different animal, as they are only conducted among people who happened to land on the page, weather they have paid to access the content or not.

My younger brother is an econometrics professor who deals a lot with how data gets collected and the methods used to evaluate it. What I have gathered from what he tells me is that truly good polls consist of a huge amount of work to determine which fraction of those 90% that told the pollster to take a hike would actually prefer X vs. Y. Ultimately, the good poll doesn’t tell you what people told the pollster, they aim to tell you what all people (or at least those you’re targeting) really think. That requires a lot of careful modeling, since as you correctly point out, if you rely solely on those who answer, you’re bound to get a skewed result.

I am not a Dev but I have used the App store infrequently. Mostly for updates to apps. But even then, I am greeted by large, obnoxious game suggestions. I don’t use my Mac nor my i-device for gaming. I have a PC and consoles for that. If you like to game on Apple products, then so be it. But I don’t and not given that Option-Out of obnoxious Play Me! And the search…I agree with the others on how it caters to you as an after thought.
As for 30%, I think its reasonable except that there needs to be a tier for Devs that are Small, Medium or Large players. Imagine with your credit cards if they all were 30%. Or that your tax on income was 30%. For some, its not much of a hit. But for small devs that have maybe 2-3 apps, unless hugely popular, 30% is a large chunk. Ofcourse, what lurks behind NDAs?
I don’t care for Fortnight or Epic. And frankly, want Apple to expand and stick with Enterprise apps and support. Nothing more frustrating than working to support Apple in a Business and need AppleID so software. Everything will be on the server, I mean cloud.

I’m really not at all a fan of Facebook (to put it mildly), but after reading about Apple forcing Facebook to remove a notice telling users how much of their in-app purchase actually goes to the small business they’re trying to support strikes me as draconian and in no way justified. Regardless of where you stand on the app store debate, can we agree that informing customers ahead of purchase about which portion of the proceeds go to which party is desirable in a free market economy whereas actively complicating customers’ access to such information is borderline nefarious? I can understand Apple will not allow devs to advertise how to circumvent app store purchases within these app store apps, but going so far as to restrict even simple factual information, such as “only 70% of your donation will end up with the donee”, IMHO goes too far.

Facebook is significantly adding to its bottom line by gathering information about everyone who sees the content and what and how much they pay for whatever, all of which will be lumped in to their tracking and ad serving treasure trove. They did not say anything about it being an ad free zone. They will most certainly be profiting from this even though they “won’t collect any fees from paid online events for at least the next year”

“We asked Apple to reduce its 30% App Store tax or allow us to offer Facebook Pay so we could absorb all costs for businesses struggling during COVID-19.” Did Facebook announce that they would donate a % of the money this channel will rake in from its first, second and third party tracking and ad serving businesses? Facebook will be profiting from every click, the amount of time spent + billions and billions of new highly targeted tracking and internal and external ad serving opportunities. They might not be collecting fees, but they will be raking in a big load of money by establishing new and profitable revenue streams, and the yield will be an extremely large load more than Apple will earn from its 30% cut.

Facebook is also getting a s—load of good publicity from whining about Apple’s 30%, especially at a time when a new, super effective tracking block is a default in the new iOS, putting a humongous kabosh on Facebook’s biggest revenue stream, a default that will block cookies in apps as well as web cookies:

Facebook just admitted they will probably loose 50% of its total audience revenue due to iOS 14’s anti tracking:

This is probably a big reason why Spotify is whining about the App Store as well.

I’m not a gamer, and I don’t know anything about Fortnight other than that it’s a very popular, wildly successful app that is giving Apple grief about App Store commissions. So I decided to check out whether or not Epic Games sells ads on Fortnight. Ads are a huge revenue stream:

“Fortnite is still a battle royale game at its core, but it has since evolved into more of a social tool and advertising opportunity for many big-named brands. Sites joke that Fortnite is no longer a game, but one big advertisement — and there is some truth to that. It’s exaggerated a bit, for sure, as Fortnite is still very much a game; but, it’s become so much more than that.“

Epic Games is probably going to be affected at least as badly by the new iOS anti tracking feature as Facebook will. And I couldn’t find out whether or not Epic Games is a part of Facebook’s in app ad network, which will be affected as well.

I think the discussion has been entirely dominated by developers and anyone who bias against Apple.

Epic’s strategy is clear. Knowing that users for the most part don’t care, intentionally getting their platform banned is simply an effort to create outrage amongst users against Apple. What’s my proof? The video they pre-produced.

Is 30% too much? Maybe. But if Epic is paying out 30% to other unnamed console makers and the Google Play store while complaining about Apple, they are being disingenuous.

Any ruling against Apple is bound to affect unnamed console makers and Google Play, along with other stores and platforms in other industries. Be careful what you wish for.

I agree…the other stores, including Epics own IIRC all charge 30% so how this is a great imposition I am having a hard time grokking. Rene Ritchie and Andy Inatkho seem to think that Apples cut is egregious…but it is their store and they are not a monopoly despite what Zucker tug said…so my thought is that if you don’t want to pay them…get the heck outa the App Store and quit whining about it. I sincerely hope that Apple doesn’t knuckle under to the extortion and threats that are being conducted…one of the bit reasons we have Apple devices is the security provided by the store rules.

When it comes to a web site for downloading software, this is what I want:

1. A list of software with a brief, accurate description of each program.
2. A long list—longer than ten at a time, so I don’t have to click through many pages
3. The ability to sort the list by:
   a) Paid/Free
   b) Number of Downloads
   c) possibly date of release
   d) possibly by reviews (stars) if the reviews are reliable
   e) possibly by type of program
4. System requirements should be shown clearly and accurately.
5. The download link should be obvious and easy to find. It should lead directly to the download and it should work.
6. The information, such as the version number, should be accurate.
7. The ability to open a link in a tab. I use tabs all the time.

The App Store fails on nearly every point.

What is also not taken into account is that if Apple allowed side loading the Apple Genius Bar would become overwhelmed with users having problems they created themselves. There is a cost not only to the user but to Apple. Apple prevents all of this Chaos which is clear as day on Android and Windows by vetting software, setting rules and enforcing those rules - yet another cost.

I’m at the point where I’m calling bullshit on Epic and developers.

An important point is that when someone writes an app then they make use of Apple’s ecosystem. One way of charging for this is to take a percentage of the fee. One problem that Apple may also experience is that competition for phones becomes more intense, pushing prices down. Then it will be much like the printer market. Printers are sold at unrealistically low prices, and then the manufacturers make money from the sale of consumables.It won’t progress as far, as it is unlikely that someone would spend $1000 on apps, but it is a nice earner.

I remember back when the App Store was a new thing, the 30% cut was compared against the costs of traditional publishing (get a company to manufacture CDs or floppy disks) and put them on store shelves).

With physical packaging, the publisher and distributor typically applied a 50-100% markup each, plus what the retailer charges. So an author may only see $5 from the sale of a title that costs $30 in a retail store (in other words, “the system” taking a >80% cut).

Apple’s 30% was seen as incredibly cheap, especially because it includes hosting, distribution and payment processing.

Today, over 10 years later, retail sales have almost completely dried up, being unable to compete with app stores and direct downloads, and now that 30% is considered extortion. Not because it’s so horribly expensive but because the alternatives that were horribly expensive no longer exist.

Then why not ban third-party software altogether like they did in the early days of iOS? And why not impose the same set of rules on the Mac platform? Because customers would revolt. They would buy other products and file lawsuits. And in mane cases, they would win those suits.

Lowering support costs can’t be used as justification for every business decision you make.

I forget exactly where I read this, but recently somebody pointed out that for small sales (~$5) card terminal fees usually amount to about 6% (flat fee plus percentage commission). Obviously that just accounts for payment transaction, not the app vetting process, the dev tools, the security effort, etc. But at least for simple in-app payments (such as Fortnite’s V-bucks) I guess you could argue a 30% cut is excessive.

On one hand I want to say, so what, people can leave iOS where they’re forced to use the app store, if they find the prices there too high. On the other hand I also realize that in the US iOS has a ~45% phone market share and there’s only one other competitor (who incidentally also charges that very same 30% commission). Customers don’t have a free market to choose from. In that sense I feel Apple (and Google, although there you can argue since they allow sideloading they are already exposed to competition) obviously can (and probably should) be regulated.

The competition for mobile phone sales has been increasing since the debut of iPhones. Apple always flourished when it focused on the high end of the market. And when Apple shifted to competing in terms of price and licensed the Mac system to hardware cloners? Mac and iOS software is what sells their premium priced hardware, and saved Apple from imminent doom.

Yes they do…as you noted they can switch to Android. Just because they pay the same 30% there doesn’t mean they have no choice.

Earlier post in the thread talked about how 30% was so much cheaper and better for both buyers and developers than the box on the store shelf model of software sales.

Frankly…I hope Apple does not knuckle under to Epic and give them a break. Yes…they do occasionally make special deals but a game seller…even a big one like Epic…isn’t worthy of a special deal. Apple provides security, payment, distribution of proceeds and a lot of other things for their 30%…and it is their store and their business decision about what to charge. And all of the whining because some other billionaire wants an even bigger slice of the billions their app makes is just a pile of BS and should be ignored as such. I heard on Macbreak Weekly yesterday a long discussion about this…and it appears that Rene and Andy (the two extreme liberals on the panel) are thinking that Apple is in the wrong here and should change their store because…well just because.

Don’t work that way. I realize that Apple…at least according to the media…is under “intense scrutiny for their monopolistic practices and needs to be broken up”…but Apple isn’t a monopoly with 15ish% of worldwide market share of smart phones. They do pretty much monopolize the profits in the industry…but that isn’t illegal…the reason they make all the profits is because they provide a platform, experience, and security that people are willing to pay for…and Apple refuses to lose money on every sale because they will “make it up in volume”…an argument that’s never made any sense.

In an earlier post I mentioned just some of all the the other app stores that exist. And there is nothing restraining another developer from introducing another operating system, or opening another App Store. though they won’t be able to run on Apple hardware.

Remember how Windows Phone was going to conquer the world? It was as successful as Zune.

I agree with this 100%. To date, Epic hasn’t broken out its earnings for Fortnight, but I did find out what Fortnight earned this past April:

"In 2019, Epic Games reported $4.2 billion in revenue and $730 million in earnings before interest, taxes, depreciation, and amortization (EBITDA, a key measure of profitability). Revenue for 2020 is forecast to be $5 billion, with EBITDA of $1 billion.

In April alone, thanks to the pandemic, Fortnite revenue was $400 million, sources told me. Epic has said that in April, players spent 3.2 billion hours in the battle royale shooter. Fortnite also garnered a huge amount of attention for staging a virtual Travis Scott concert that drew more than 27 million people."

https://venturebeat.com/2020/06/15/epic-games-shareholders-seeking-to-sell-stake-for-750-million-at-17-billion-valuation/

Something else I find even more interesting in the article quoted above about the ownership of Epic:

“Tencent bought 40% of the company in 2012 and it remains a shareholder.”

Tencent developed and owns We Chat, the biggest ecommerce retailer and biggest of all retailers, in China. Tencent, at one point, made a big stink about Apple’s 30% revenue cut but ended up paying it. Tencent recently agreed to paying Apple 30% of what is now a paid news app:

Tencent is also the biggest Chinese online game developer. And Tencent has its own App Store and its own payment systems:

https://appstore.tencent.com

And here’s the cut they are getting for their games:

“The social media giant is seeking as much as 70% of the sales generated from its games, up from just 50% now, said the people, who requested anonymity discussing private negotiations. That would bring Tencent’s portion in line with the proportion shared with game publishers on other platforms, including Apple Inc.’s iOS store and Google Play, which each keep 30% of revenue that comes from apps.”

https://www.bloomberg.com/news/articles/2019-07-11/tencent-presses-chinese-app-stores-for-bigger-cut-of-game-sales

As long as there are alternatives to the App Store, I don’t care much about what Apple does with it. But given how they use it to squeeze out the competition, that’s bad news for all of us. The App Store is now an integral part of the OS that you can’t avoid. It’s a loose comparison, but I remember when Microsoft integrated Internet Explorer into their OS, and they were sued for monopolistic practices. That was a long time ago.

What evidence do you have that they are doing that? I have yet to see any concrete examples, other than whiners such as Spotify that complain, and a sort of general meme that Apple’s abusing their power.

As far as I’ve seen, whenever Apple has restrictions on iOS there are sound security and policy reasons for doing so. For instance, Apple doesn’t allow any other web browsers than the built-in Webkit engine on iOS (so “alternative” browsers on iOS are really just a different user interface on the same underlying tech that Safari uses). Some consider this unfairly restrictive, but browsers are a huge security hole (especially javascript) and Apple is smart for limiting infection vectors.

I find plenty of competition on iOS and you aren’t restricted to Apple’s solutions – Apple’s apps and services are often just easier and better integrated. That’s not unfair, just a side effect of them building the platform and they’d be fools to not take advantage of their position.

I actually wish Apple was more strict with app developers. There are so many junky and scammy apps that while technically in compliance with Store rules, aren’t benefiting anyone. If you look through the history of the App Store, every time Apple opens a window there are dozens of developers trying to make it a door. (A good example are the scumbags who took advantage of Apple’s screen time monitoring APIs to abuse privacy and track users.) I love Apple’s recent trends to improving privacy and stop user tracking.

I’m not saying the Store or Apple is perfect – I certainly wish Apple was clearer in their rules and less absolute in some of their decisions – but they are always trying to improve and make things better. (For example, I just read about a developer that successfully used Apple’s new appeals process to overturn their app rejection. The reviewer had misapplied a rule that didn’t apply to their product. Prior to this summer if that had happened, the developer’s only recourse was to change their app or whine to the media and hope Apple would notice.)

MS lost the US anti trust case that went all the way up through the Supreme Court because of monopolistic restraint of trade; the case had nothing to do with pricing. Weather or not MS integrated IE’s software into the OS wasn’t the problem either; all operating systems developers can build whatever they want unless it’s something illegal. Microsoft lost because they made it impossible to install another browser on Windows. It was Netscape, who was then owned by AOL, who brought the case.

Anyone who wants to avoid downloading an app from Apple’s App Store can side load an app. It might be a PITA to do so, and sideloading means throwing anything resembling caution or a concern about privacy, to the wind. But Apple created the App Store to encourage developers to build quality products that would work beautifully and safely on iOS, which is the opposite of the road MS took at the time.

That’s exactly the problem. They only allow this one venue to get apps.

Nobody is arguing it shouldn’t be possible for users to restrict themselves to the walled garden. But for those users who prefer choice and competition over nanny Apple exclusivity, there should be a sideloading option. Just as on the Mac. No Mac user would ever argue the current situation with MAS as well as independent dev distribution is untenable. It’s just fine. And if it works on my Mac, it can work on my iPhone.

I don’'t think it’s about support costs since Apple would just charge to clean up the mess. It’s about the user experience and that would cost the user and Apple more than money. While iPhones and iPads can do a lot, they are still more about consumption. Most people would not benefit much from side loading.

Perhaps, but I’ve never heard any indication that Apple support is significantly impacted by support for independent Mac apps causing problems.

As we’ve noted in the articles, a great deal of Mac software was sold directly via developers using services like Kagi and eSellerate that charged far, far less than 30%. I’d have to research this, but my impression is that boxed Mac software in a retail channel went away well before 2008 when the App Store launched. For instance, from Wikipedia:

Crushed by competition from online and other brick-and-mortar retailers, CompUSA began closing locations in 2006. By 2008 only 16 locations were left to be sold to Systemax. In 2012, remaining CompUSA and Circuit City stores were converted to TigerDirect stores, and later closed. CompUSA now operates as an online-only retailer.

When the App Store was announced, here’s what we we wrote:

Response to the revenue sharing among the developer community was largely positive, with many saying they’d expected a 60:40 split, and would have of course preferred an 80:20 split. 70:30 is entirely reasonable in our opinion, partly because that’s an all-inclusive fee covering processing, bandwidth, hosting, and marketing; in the traditional book world, for instance, the split between publishers and bookstores is often 50:50. Many ecommerce providers charge 10 to 15 percent for less than Apple will be providing via the App Store’s directory and interface.

In retrospect, yes, the App Store provides more than a straight ecommerce provider did, but it also came with a lot of headaches and limitations that were unique to Apple. And the advantages to the developer, like marketing and discovery, seem to have disappeared with the App Store given the vast number of apps and the need to pay for ads.

Standard transaction fees from the likes PayPal and Stripe are 2.9% plus $0.30. Apple gets around that in part by bundling multiple transactions together. And probably lower negotiated fees from credit card companies due to volume.

From what I last read iOS user outnumber macOS users by 10-1. In short there are well over 1 billion iOS users. So the scale of support is quite different from the Mac and like Windows it would be a juice target for malware hackers.

As someone who tries to use language precisely, I would like to make a quick but pertinent point.

These words are not identical or interchangeable: criticism, complaining, whining. Each has its own meaning.

This is obvious exaggeration, to the point of being false.

This is called an article of faith.

My guess is that the primary concern of the current executives at Apple is in making as much money as possible, not in improving its products. This is true of most companies in the world and, let’s face it, most people. I want money, too. I like it, too. But it’s not the number one arbiter of every decision I make and every action I take. I prefer moderation to fanaticism and obsessiveness.

Let us look at the App store as a substitute for the retail store.

1. many companies if not all PAY to be on the shelf of the store and the more visible the location the higher the price.
2. The product must give the store a profit based on the selling price of the product. Counting on the type of product the store gets a higher or lower percentage. Also the markup (the multiple the retail customer is charged ex. for a quart of milk the multiple many be x1.5 meaning that if the store pays $1.00 for the the container the the retail customer pay 1.3x that amount or $1.30. the reason for the low multiple is that you will buy milk about one a week so it goes off the shelf quickly. the other extreme is a pair of prescription glasses. Because you will by a pair maybe once every 2-4 years the multiple can be from 5-3X the higher multiple being for lower cost frames so let us take the same $1.00at the low end, not even close to real #'s , so the lower cost frame would be $1.00 x5 or $5.00for a higher priced frame let us say $3.00 x 3 giving a price of $9.00. these difference are caused by the fact the higher price item will be on the shelf longer or people will pay a premium for a name brand. there is also the cost maintaining the stock on the shelf longer.

But the App store doesn’t do this it charges the same cost to the end user 30% no matter the price meaning that the profit it get is determined by the price the manufactures charge. It is not a tax, with all of the negative connotations of that term, but merely the charge to the manufacturer of maintaining a place that people feel secure in buying their products from.
We don’t call the profit the Amazon, Walmart, Target, B&N, Adorama etc charge a TAX because it is not. It the way that sites make their profits to maintain there business.
In addition Apple tries to makes sure that all of the programs have no security problems for the purchaser, They don’t always succeed but they try. That is more then most if not all retail stores do.

No, it’s based on evidence. I watch what Apple does and they keep adding features to the App Store, like appeals process I mentioned. In the past they’ve made review times faster and improved the user interface and presentation of the store. They’re not done by a long shot, but they’re still working, slowly but surely.

Why can’t they do both? I see it as more of a tick-tock syndrome, where for a time they focus on certain money issues, then back on products. For instance, a few years ago the stock was dreadfully undervalued as Wall Street focused exclusively on iPhone sales and Apple began making noise about their services business. Now that has taken the focus on Wall Street has realized that 1B iOS users means a steady stream of revenue for Apple regardless of if iPhone sales are up or down a hair and the company is worth $2.2T.

Recently Apple (finally) fixed their laptop keyboard issues with a return to a better design. It took too long, but maybe they were distracted by other more pressing issues (laptop sales are a drop in the revenue bucket compared to iPhone sales, so not the highest priority).

This is 100% true, and this is not like Apple is skimming vigorish off of bets or loans like bookies do. And Tencent, who owns 40% of Epic Games, recently reduced the % they charge in their App Store from 40% to 30%. They also have the option not to develop or update an iOS or Mac version of any of their games if they object to the charge so much. It’s not like they were unaware of the 30% when they decided to develop Fortnight; there wasn’t any whining about it at the time.

I still suspect the real issue behind all this is about how the upcoming iOS 14 privacy controls will significantly decimate Fortnight’s even more lucrative ad sales and sponsorship revenues. Persistent tracking is not an issue that consumers will be up in arms to prevent, but they are scoring points with crocodile tears by whining about excessive vig.

But it’s not. Particularly in the Mac world, essentially no software has been sold in a retail store in many years. Heck, Macs haven’t even had optical drives since 2011-2012, so even if you could find software in a retail store, you’d have no way to install it without downloading it anyway.

Well perhaps a good time to say that this week saw the arrival of my first set of boxed software in what must be fifteen years.

Antidote states on their site that you can download and pay them directly or you can buy from a reseller and it will be cheaper. So I checked on Amazon and sure enough it was 60% of the cost. Thing is they ship you a box, with a printed manual (in French…), and yes… a download code to enter.

And we all got a kick, given these times, of me unpacking a box and saying “hey, the antidote is here.”

Wow, that’s not something I’ve seen in decades either. I would question the economics of producing a box and 224-page manual and selling it for a lot less than they could get directly. I have to assume they feel like they’re getting sufficient distribution to make it worthwhile, but given that they’re distributing mostly near Montreal and in France, I suspect that someone at the company has connections with the FNAC chain in France (nearly all the locations there) and something equivalent in Canada. The fact that they say you need to check for availability before visiting says to me that many resellers may not actually stock it.

I respectfully disagree with your economic analysis, and don’t even understand what you mean by “no marginal costs” for “digital goods.” A game that provides entertainment and enjoyment — which is where this all started — is in ever more ways indistinguishable from a movie/video experience, as creators try to develop as much interactive experience as possible. I would argue that there s no business model close to a mobile device platform that allows access to a variety of media, interactive and otherwise, and a theater owner’s selling tickets to movies.

My point is that movie theaters have a significant overhead in rent, salaries, and maintenance, among much else. Movie ticket prices build in those costs.

Software sold online has essentially no extra costs. You can sell 1000 copies for the same investment as selling 10 copies. Increase your sales to 10,000 or 100,000 copies and your costs may go up, but only slightly. Storage and bandwidth costs are infinitesimal on a per-copy basis.

That’s why I suggested that they’re entirely different business models.

A very interesting development in Russia re: Apple and Google’s App Store commissions:

Let’s see how this plays out.

It’s a quite a bit different from retail stores, or what are called brick and mortar stores.

It’s a store that doesn’t exist physically, selling products you can’t hold in your hands. The products aren’t static. They change, get updated. The prices change. You might pay for the product several times due to updates or the creepy subscription model. There’s usually no instruction manual. You don’t know where it was built or who built it or how. You can’t fix it on your own. It’s not property in the traditional sense. A Canadian at 1Password told me the program isn’t my property because I’m only buying a license to use it, not the actual product. It can be altered by people outside your home via your computer. It can be broken by OS updates and other means. Or rendered obsolete. Some programs spy on you and send information back to the mothership.

Not something my Estwing hammer does, as far as I know.

I just stumbled upon something interesting…Sony, who also takes a 30% cut of their App Store purchases, recently acquired a stake in Epic Games, though it’s a small stake of about $253,000,000. Epic Games did not mention the Sony or any of the Tencent/WeChat App Stores (of which they own 40%) in the antitrust lawsuit:

Epic Games just singled out two companies that do not own any of their stock. It sounds even more like a pure PR play to me. It wouldn’t be wise for them to bite the hands of the people who feed them.

I just stumbled upon an interesting new development:

Apple has updated its App Store guidelines. Probably the most interesting thing is that game streaming services are technically allowed, but only if each individual game is available in the App Store.

This is very interesting. It gives some insight into Apple’s motivation. They don’t seem to be concerned about the concept of streaming, but with the nature of the games that might be streamed.

Which makes sense, given the fact that they censor the App Store itself based on similar criteria, but it still begs the question about why they don’t do this for all other Internet-hosted services (including web pages). I guess they figure the backlash over mandating Net Nanny would be too great, but people won’t complain too much if they apply it to video games.

I’m curious, do they also refuse to stream certain movies because of e.g. violence? Or sell certain explicit books? Or is the “nanny thing” restricted to App Store?

There’s no pornography available in the store, so, yes, they refuse to stream certain movies.

I suspect it’s because App Store games are a totally different type of streaming service than apps like that just deliver subscription content like periodicals, book purchases or downloads, or a streaming TV or movie service where end users just watch, listen to, or read whatever content they choose. There are usually no other, or fewer, in-app sales opportunities other than for the subscription itself. Usually there are fewer tracking or ad sales opportunities than cloud based gaming offers. I think these are biggest reasons why Google, Microsoft, and other gaming services have their nickers in a twist.

I also think the new rule will enable Apple to more easily review every app that is locked up within a service. It also creates an option for people who just want to play one or just a few games rather than shell out bigger bucks for the full service with many games they will never want to play.

Marco Arment has a funny (as in, it hurts when I laugh) summary of the changes:

https://marco.org/2020/09/11/app-review-changes

So Apple is granting Facebook a temporary reprieve. I’m curious how they came to this decision in light of the fact that it will equip their various opponents with proof that Apple does not treat all devs equally and indeed does make special exceptions for some.

It looks like Apple is being hammered by bad publicity. As I mentioned before, Facebook anticipates loosing roughly 50% of its total revenue once Apple unleashes its Identifier For Advertisers in Safari. And if they are currently admitting to 50%, it’s likely that the reality could be worse:

“While it’s difficult to quantify the impact to publishers and developers at this point with so many unknowns, in testing we’ve seen more than a 50% drop in Audience Network publisher revenue when personalization was removed from mobile app ad install campaigns. In reality, the impact to Audience Network on iOS 14 may be much more, so we are working on short-and long-term strategies to support publishers through these changes.”

This a one time exception to the rule, not a policy change. It’s a brilliant PR move by Facebook, whose bottom line will benefit greatly from the wealth of information they will gather on each participant to sell advertising, both during and forever after the event. Whatever revenue they collect from this event will be microscopic from the $$$$$$$$$$$$$$ they will accumulate during and after. If their motives were benevolent, they would at least donate the ad revenue rather than the cost of the tickets. If they were truly benevolent, they would donate the total revenue throughout the year. Facebook can afford it without making a dent in their current bank.

Apple is getting unfairly clobbered in the press about the 30%. Nobody is whining about what Facebook charges for ad rates, or is insisting on limits on what they can charge. Nobody is whining about the cut Amazon, Etsy, eBay, etc. takes on their third party sales. But this is distracting the press and the reading public away from coverage about all the daily disinformation, hate and bullying that’s a 24/7 issue on Facebook.

Except for the trade press, Apple is not getting much, if any, coverage about how the IDFA ban will protect the privacy of Apple device owners.

I have no sympathy for a company whose entire business model is based on spying on their customers and selling information about their browsing habits without their knowledge or consent.

Any company that answers “yes” to the question “would we lose all our revenue if our customers knew the truth about what we’re doing?” doesn’t deserve to exist.

Google and Facebook: I’m looking at you right now.

Seconded.

But you know, it’s not like people would be powerless against Facebook shenanigans. Facebook would adopt their policies in a heartbeat if people actually voted with their feet. But can you imagine the amount of excuses I’ve heard why people can’t close their FB accounts? Apparently the only possible way to stay in touch with Uncle Al in Topeka is thanks to FB. That must be worth sacrificing your privacy and your freedom over. /sigh

Facebook gets away with it because they can. The current administration won’t change that. And it’s unlikely the next one will either. Consumers could change that. But so far they have caved. And so Facebook just keeps on doing whatever they want and get rich doing so. IMHO people need to finally take responsibility and stop waiting for a solution to drop into their laps from the heavens.

[Apologies, just realized we’re straying quite off topic now.]

If you want to take responsibility for what you see on FB you can do so on Mac OS by downloading the free Social Fixer. It is a multifaceted blocker and display modification.

If you use it, please send the developer a donation of whatever you can afford and think it is worth. Social Fixer makes Facebook actually enjoyable to use.

Read more on their website: https://socialfixer.com/

Uh, okay. Getting away with it is not the same as it being right, right?

What bothers me even more is that Facebook is tracking me even though I have never been, and never will be, a participant. Their third party Audience Network probably includes just about everyone on the planet who uses the WWW:

https://www.reuters.com/article/us-facebook-privacy-tracking/facebook-fuels-broad-privacy-debate-by-tracking-non-users-idUSKBN1HM0DR

And Facebook’s Audience Network is going to be hamstrung in a particularly deadly manner by Apple’s IDFA. They have already announced they are shutting down the mobile arm of the program, probably because the IDFA has been only iOS to date. Facebook has even been making noises about having to shut the Audience Network down entirely, most probably because of Apple:

But Facebook has accumulated a rap sheet many millions of miles long that includes about just about everyone who has never been a member. Via their third party ad network, they serve ads to just about everyone on the planet who serfs the Web.

And regarding the upcoming concert, it can be streamed, both live and afterwards, by anyone who is not a member:

I’ll bet a huge majority of non members who sign up for this don’t realize they are also signing their lives away, including their credit card numbers. The moral of the story, I think, is that Facebook is getting away with positioning itself as Red Riding Hood with this concert, and casting Apple as the Big Bad Wolf over the 30%.

Alright, I’m no fan of Facebook, but let’s keep this specific to issues with Apple App Store.

And the saga continues…

Yeah, I will admit that I’ve shied away from this whole Epic versus Apple battle because it’s so involved and changing so fast, and of course, it’s all inside baseball. The likelihood of it having a significant effect on everyday users is, in my opinion, fairly small. And already we’re looking at a July 2021 trial date, so nothing will change for a year at the most.

A new chapter in the never ending saga:

It was voted down in the ND senate: North Dakota senate votes down anti-App Store bill first given to lawmaker by Coalition for App Fairness lobbyist - 9to5Mac