Because they're not worrying about bandwidth costs, credit card services etc. They instantly get access to hundreds of millions of people who can buy their app with the touch of a button. Their app business probably wouldn't even have existed if not for the App Store.
Spotify CEO pleads for iPhone users to stop paying through Apple's App Store
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Because they're not worrying about bandwidth costs, credit card services etc. They instantly get access to hundreds of millions of people who can buy their app with the touch of a button. Their app business probably wouldn't even have existed if not for the App Store.
Pops Maellard
Member
Except publishers don't charge $60 on their website for a game and $78 on Steam just so they make an even $60 no matter where you buy it from. It's $60 on Steam and they just deal with the comparative loss.
And Apple doesn't? They even have people like Matt Casamassina that curate and look for great games.
Yeah I was going to say it's weird to praise Steam for taking a 30% share and use it for the business, but criticize Apple for doing that exact same thing. Bandwidth costs, payment transactions, etc.
The Faceless Master
Member
comparing to steam etc whatever is a poor choice in this case because of the specific costs that are agreed upon by streaming music subscription services and music rights holders.
what game publisher would sell their $60 game with a ~70% fixed cost going to a 3rd party and the other ~30% going to the storefront?
what game publisher would sell their $60 game with a ~70% fixed cost going to a 3rd party and the other ~30% going to the storefront?
Ingueferroque
Banned
Err... and Apple?
deltatheta
Member
I think the fact that Apple's decided that they're going to be taking 30% of the revenue that's made on a computing platform is ridiculous and I can't believe that people are okay with it.
30% of the app store revenue is kind of iffy when you have as much market power as Apple does, but to prevent in-app purchases except through Apple with them taking a huge cut is indefensible.
I'd bitch if Valve somehow managed to prevent competing services on the entire PC platform and required all software to be sold through Steam, yeah.
30% of the app store revenue is kind of iffy when you have as much market power as Apple does, but to prevent in-app purchases except through Apple with them taking a huge cut is indefensible.
I'd bitch if Valve somehow managed to prevent competing services on the entire PC platform and required all software to be sold through Steam, yeah.
It's 70% of revenue. So in this hypothetical, it's 30% off the top and then 70% of what is left after that is paid to a third party.
How, in anyway, is this Apple's fault?
Its not like Apple hid these terms away from developers and consumers.
How is this not a case of these companies not giving up 30% to apple to place their items on their App store?
Its not like Apple is saying, "hey you're app is 9.99 but it has to be 12.99 on our store".
Apple clearly laid out their terms and companies such as Spotify and Rdio, instead of accepting these terms, have decided to find a work around in charging extra for IAP.
Sure 30% is probably too big an amount but lets not act as if Apple is jacking the price up.
Its not like Apple hid these terms away from developers and consumers.
How is this not a case of these companies not giving up 30% to apple to place their items on their App store?
Its not like Apple is saying, "hey you're app is 9.99 but it has to be 12.99 on our store".
Apple clearly laid out their terms and companies such as Spotify and Rdio, instead of accepting these terms, have decided to find a work around in charging extra for IAP.
Sure 30% is probably too big an amount but lets not act as if Apple is jacking the price up.
I think this is what people are not understanding.
deltatheta
Member
Apple can charge whatever percentage they want. I just take issue with the fact that Apple requires all payments to go through them. Why can't Spotify just link to their webpage from the app for people to sign up? I don't think there's any reason that Apple is entitled to that revenue, and I find it really troubling that Apple has set themselves up as the gatekeeper for all software on a large segment of the mobile market, when the computing world used to be pretty open.
They're only entitled to it if Spotify chooses to use that infrastructure to collect subscription payments. It's entirely their own decision.
The Faceless Master
Member
what?
that's what people said years ago. it's surprising that they flipped on the part where they previously said that the prices couldn't be higher there than elsewhere.
deltatheta
Member
I think you're purposely leaving out information and you're not discussing this in good faith
The 30% off the top isn't revenue, so the 70% is taken from what's left. Or, in other words, 70% of the remaining 70%.
I didn't purposely leave anything out, no. Spotify doesn't have to offer customers the ability to sign up through the iOS app if they don't want to. Plenty of apps assume a paid subscription and request a login.
What are you not understanding? Apple provides Spotify with a lot of benefits that it enjoys. It's features to hundreds of millions of people that can buy their subscription with the click of a button. Free marketing and infrastructure but that is according to you worthless? You didn't even have a problem with the percentage but just claim Apple who is fronting costs for Spotify have no right to charge for it at all.
deltatheta
Member
I don't have any problem with Apple offering a payment service to app developers. I just have an issue with Apple requiring their service be used on all in-app payments (except for physical goods, which I believe is the only exemption.)
I'm not sure if I wasn't clear, but it seems like KHarvey is either misunderstanding my point or deliberately trying to obfuscate the issue.
I'm on my iPad right now and it looks like using Safari I can go to spotify.com and sign up there and setup billing through a credit card. Then I can download the app and signin with those credentials and nothing has been paid through iTunes.
If you download the app, and choose to setup payment through iTunes you can as well. Spottily chose tondo that, most likely because they knew the ease of use would be appealing to customers.
Apples not holding a gun to their head and enforcing that Spotify subscriptions be routed through iTunes or it won't work. It allows both ways, and Spotify has worked this way for years without issue.
If you download the app, and choose to setup payment through iTunes you can as well. Spottily chose tondo that, most likely because they knew the ease of use would be appealing to customers.
Apples not holding a gun to their head and enforcing that Spotify subscriptions be routed through iTunes or it won't work. It allows both ways, and Spotify has worked this way for years without issue.
I'm not misunderstanding or obfuscating. Spotify does not have to use in-app purchases at all. If they choose to, they have to pay Apple for that service.
deltatheta
Member
Yeah, but there's other restrictions that you're not mentioning.
The Faceless Master
Member
it's 100% of 70% of $60 as the talk was about the hypothetical $78 game on steam vs $60 elsewhere because of the extra $18 to recoup the 30% losses. the point was the comparison to steam was bad because of the fixed costs of ~$7 per subscriber to music rights holders.
Like what?
It isn't fixed at $7, it's fixed at 70%. It's $7 paid per subscriber when revenue is $10, but if 30% goes to Apple they pay 70% of $7.
The Faceless Master
Member
lots of devs worked with the third option, direct linking in their apps to their own billing, for years without issue.
then Apple made it an issue.
using 'both ways' and 'convenient' are funny because now the third option is nothing.
The Faceless Master
Member
from what i've read before it's fixed at an amount near $7, not $7 exactly, but pretty close.
also, remember the stories that Apple wanted to charge $8/mo and the big record companies said Apple would have to eat the costs (aka take the ~$1, not budging on their cut) and that didn't work out?
I can't believe that there are so many people defending Apple here. I really like Apple products, I really like my iPhone... but it is very obvious that *sometimes* Apple's policies are very negative for customers.
Even worse are, in my opinion, the people who actually do recognise the anti-customer and anti-competitive policies, but go like "so what, Apple's device, Apple's ecosystem... they decide what happens."
The thing is: if you're in charge of a multi-billion dollar company, you can't use your power to block competition as much as you can.
Even worse are, in my opinion, the people who actually do recognise the anti-customer and anti-competitive policies, but go like "so what, Apple's device, Apple's ecosystem... they decide what happens."
The thing is: if you're in charge of a multi-billion dollar company, you can't use your power to block competition as much as you can.
Apple rejects apps that do this.
So now they are suddenly looking out for the customers? I wonder what happened.
Yeah no. If you want the exposure of the Apple App Store, you eat the fee. It's how it works. Spotify is the scummy one here for even pushing that fee on it's customers instead of dealing with it themselves. No streaming service does this.
Yeah no. If you want the exposure of the Apple App Store, you eat the fee. It's how it works. Spotify is the scummy one here for even pushing that fee on it's customers instead of dealing with it themselves. No streaming service does this.
It actually is fixed for paid subscriptions. They have separate deals for their $5 student deals, trial period and the $0 ad-supported subscription.
Let's say Spotify would charge $9.99 even through the App Store. That would mean $3.00 would go straight to Apple. 70% of the $9.99 (that's $6.99) still goes straight to the publishers. That leaves exactly $0.01 for Spotify to run their business... which you can imagine is not enough.
At the same time, Apple has its own music streaming service, also at $9.99. Roughly $3 goes straight to them to run their service, instead of the measly $0.01 Spotify gets. Let this sink in, Apple is not merely offering a platform to Spotify for which they ask a 30% cut. Apple is actively competing with Spotify - and when that's the case, Spotify should have equal opportunities without limitations.
Yup, Spotify - a company that isn't making any profit - must pay a 30% cut for every subscription it sells on the App Store to Apple, while Apple - a company that makes tens of billions of profits each year - has none of these extra costs.
The Faceless Master
Member
but this very thread shows that's not true.
I believe that, for the people who agree with Spotify, it comes down this:
It's fine that Apple takes a 30% cut, but as soon as they start actively competing with an app, the situation changes - especially because it's a multi-billion dollar company.
Stop twisting shit, you can sign up to subscriptions through the web browser thereby circumventing paying through the App Store and giving Apple any money. In fact you could do it on the phone itself using Safari, so it's just an Apple hate thing.
The Faceless Master
Member
can't mention that in the app or description.
It's a bit more complicated than that. If you're accepting payments for the functionality of your application (eg subscriptions, extra storage space on dropbox) then the Apple Store policy is that your app MUST use iAP and MUST NOT direct users to use your website instead.
The exception is the 'Amazon clause' whereby if you're selling goods (even if they are consumed by the app, e.g. audio books) you can link through to your website and take payment there.
Stallion Dan
Member
Isn't that what the Sony PS store app does though?
I personally believe it is massively anti-competitive on Apple's part.
I absolutely don't have a problem with them asking a 30% cut of any transaction processed with their payment system. It's an exceedingly high cut (compared to any other competing payment provider) so it's hard to justify given they are not providing additional services in these cases (no app hosting, advertising, etc). But that on its own isn't the problem. It's the enforcement that any service available on their platform *must* use their payment system for any transaction which disgusts me. It is obscene in my opinion.
I would liken it to a hypothetical ISP forcing websites to use their payment system if the user is from that ISP - otherwise blocking that user from seeing the website.
This would be especially insane if the ISP have their own competing websites that don't pay the 30%.
Yet it's really not that different from the Apple situation in my opinion. App stores are a ubiquitous service just like web access or (for example) search engines, they should not be a tool for the owning company to force a disadvantage on their competition - just like google isn't allowed to use their ubiquitous services to disadvantage Microsoft, etc.
I absolutely don't have a problem with them asking a 30% cut of any transaction processed with their payment system. It's an exceedingly high cut (compared to any other competing payment provider) so it's hard to justify given they are not providing additional services in these cases (no app hosting, advertising, etc). But that on its own isn't the problem. It's the enforcement that any service available on their platform *must* use their payment system for any transaction which disgusts me. It is obscene in my opinion.
I would liken it to a hypothetical ISP forcing websites to use their payment system if the user is from that ISP - otherwise blocking that user from seeing the website.
This would be especially insane if the ISP have their own competing websites that don't pay the 30%.
Yet it's really not that different from the Apple situation in my opinion. App stores are a ubiquitous service just like web access or (for example) search engines, they should not be a tool for the owning company to force a disadvantage on their competition - just like google isn't allowed to use their ubiquitous services to disadvantage Microsoft, etc.
Oh dip another TekGryphon Apple rant! These are always good.
liliththepale
Banned
Yes, but PSN isn't a competing service.
Don't want to pay via AppStore? Take it to Safari. I don't see a problem here. As for the In-App purchases, this is basically the bulk of the money in mobile right now, there's no way any company sits on the side while games like Clash of the Clans rake in billions from In-App purchases. I am not sure when Apple added this policy but I distinctly remember a few years back I downloaded a game that let me play up to a certain point and then asked me to purchase the full game via an IAP. Maybe they are cracking down on this sort of stuff.
Of course, that's how Apple makes it's money from the AppStore. That doesn't mean there isn't an alternative, you just do your business on Safari.
Because that makes no business sense. Tell me, does Valve allow game developers to say they can buy the game cheaper from a different source?
In this very thread people have pointed out that Google and Steam also have a 30% cut, but again-this only seems to be an issue for Apple.
Do you know why this is? Because I do.
Wiktor
Member
It really depends on a model. Spotify probably shares that % from 9 bucks they're lft with. Meanwhile with ebook stores that 30% would kill all the profits they could get. Hence why you can't buy books directly from Kindle App. Of course Amazon could just raise the prices 30% for people who buy through the app, but at that point it just makes more sense to funnel people to website, since they're more likely to buy other stuff while visiting.
Of course..Amazon could afford to do that, because iBooks' is a joke on ebook market. Apple never managed to get a big foothold in that area. For App devs it's different story. App Store is the main game in town. At least when it comes to mobile games. Of course, now developers are slowly moving away from mobile to PC, because there's more money there, but this isn't because of 30% cut that Apple takes. Different things make earning profit on Apps so terribly difficult on mobile
The Faceless Master
Member
and that's exactly why a dev wouldn't charge the same amount on the Apple store. plus, the convenience of an uninterrupted iOS experience us surely worth the cut Apple gets and Apple consumers tend to have a higher average income anyway.
Wiktor
Member
AFAIR Valve takes only 10-15% cut from micros and only those made through steam wallet. You can still buy through the game, launched through Steam, directly from the dev, without giving Valve a cut.
It's a ridiculous policy to say you can't tell your customers where they can buy your services. It's absolutely true that iAP offers a valuable service to developers, but if they don't want that service, they should be able to opt out of it run their own payments.
The Faceless Master
Member
Google Play and Steam aren't the sole storefronts for their respective platforms and Google Play also allows 3rd party payment processing.
And what percentage do Steam and Google take, for the record?
The Faceless Master
Member
The Faceless Master
Member
that has nothing to do with marketshare
Dude. You're dancing around the answer. Cmon. It's the same percentage taken by all stores. But because Apple does it too, it's too high for them.
30% for delivering content owned by the publisher is one thing
30% for simply taking payment is another. Apple are not using any bandwidth or delivering anything for that - nothing like DLC or monthly magazine downloads - spotify is handling all of that.
also as mentioned this is a very thin margin game - music labels and publishers get most of the money. Spotify would most likely lose money if they charged $10 and let Apple have a 30% cut. Apple would make more money from spotify subscribers than Spotify would. Actually even at $12.99, I'd bet that Apple are making more money from spotify users than spotify are.
30% for simply taking payment is another. Apple are not using any bandwidth or delivering anything for that - nothing like DLC or monthly magazine downloads - spotify is handling all of that.
also as mentioned this is a very thin margin game - music labels and publishers get most of the money. Spotify would most likely lose money if they charged $10 and let Apple have a 30% cut. Apple would make more money from spotify subscribers than Spotify would. Actually even at $12.99, I'd bet that Apple are making more money from spotify users than spotify are.
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