Live data from Hacker News

Apple Fires Back at Spotify for Asking for 'Preferential Treatment'

buzzfeed.com

31–40 of 222 posts

Re: Apple Fires Back at Spotify for Asking for 'Preferential Treatment'

#31
post #17

How exactly does Apple's payment system work for companies that are cross platform? If I have a Dropcam subscription and am using the ios app, is Dropcam paying Apple 15% of my subscription cost? That seems nuts.

IIRC any subscriptions and/or purchases driven by apps downloaded from the App Store are subject to a fee paid to Apple. That's according to their (garbage) App Store rules.

Are there many commercial stores (especially one pushing 50 billions of product) without such "garbage" (sic) rules?

Re: Apple Fires Back at Spotify for Asking for 'Preferential Treatment'

#32
post #5

You mean kind of like how Apple asks for preferential treatment from every other entity? You know, for things like: - Being able to install updates without asking the ISP. - Fast lanes for their services with ISPs. - Special or even FREE rent for their physical store fronts (see Grand Central Terminal and many others.) - Making illegal deals with book publishers so they get preferential pricing. Same for music. The l…

>- Being able to install updates without asking the ISP.

Why the fuck should they "ask the ISP"?

Re: Apple Fires Back at Spotify for Asking for 'Preferential Treatment'

#33

Apple's App Store has always been an antitrust violation waiting to happen. and by happen, I mean filed in a court. There is nothing "applied equally" to other developers. Onlookers will say developers agreed to the contract, so no sympathy, a Federal Judge on the other hand will rip that contract to shreds and take a dim view on Apple's practices. And no, Google Play's robo rejector isn't exempt.

Curious on what grounds are you making these claims?

Would you disagree if this was a startup whom had built an app store over a decade and was getting violated?

I am not a fan of jagurnaut tech companies but the rules are the rules. They built it and from what I can see (I am an IOS developer) the payment system is indeed in violation.

The guidelines clearly say that apple payment system MUST be used. It doesn't matter if you are Spotify or an indie game dev.

is 30% steep? absolutely! But hey if it was my business I would love it its a great margin - so would you.

Bottom line is Spotify is in violation and they don't want to pay the 30% which Is understandable but Apple will not budge because they don't half too.

TLDR; "Apple to Spotify: Kiss my Ass".

Re: Apple Fires Back at Spotify for Asking for 'Preferential Treatment'

#34
post #22
post #2

Who is the bad-guy here? (Both probably, but who is the worse bad-guy?) Obviously Apple's letter makes it seem as though they are being perfectly reasonable, but neither of the articles that I read have provided much analysis.

Apple is being a bit greedy when it comes to subscriptions for high-grossing services IMO. Spotify already has razor thin margins and paying out minuscule licensing fees to content producers, it's not viable to pay out 15-30% off the top to Apple. However, Apple clearly should be able to require a fee for providing the marketplace and payment framework, and you can see their point in not wanting apps to circumvent th…

I think we can expect more of this increased rent seeking behavior from Apple as they continue their shift to a "services" business.

Re: Apple Fires Back at Spotify for Asking for 'Preferential Treatment'

#35
post #21
post #9

I believe that in this specific case Spotify makes a very compelling argument. App publishers that do not directly compete with Apple have a level playing field although the Apple tax certainly hurts. But Spotify directly competes with Apple, and while Apple does not have to pay this tax as they can (probably) use their own billing services cheaper, Spotify couldn't do the same even if they implemented their own bill…

30% isnt a payment processing fee, its a commission + infrastructure tax. You make money off your app? Because apple made it discoverable in the app store! You make money off your app, pay a share back for os/api r&d!

The problem that I have is that there's no way around this gatekeeper. With Android and Windows Phone I don't have to publish my app to their app stores if I don't want to--they allow me and my customers figure out how to handle this. With Apple, it's either follow their rules or nothing. I don't understand how they feel justified charging an ongoing 30% monthly subscription for hosting some assets.

Re: Apple Fires Back at Spotify for Asking for 'Preferential Treatment'

#36
post #30
post #18

Earlier quoted context omitted.

If you subscribe through the iOS app, Apple gets 30% of the subscription. That 30% drops to 15% after a year. You also can't advertise signing up for the subscription outside of the app.

>> You also can't advertise signing up for the subscription outside of the app. Amazon Prime does this, no. In the Amazon iOS app, you can browse, but cannot buy items. You can still login using your Prime account.

In-App Purchase: If you want to unlock features or functionality within your app, (by way of example: subscriptions, in-game currencies, game levels, access to premium content, or unlocking a full version), you must use in-app purchase. Apps may not include buttons, external links, or other calls to action that direct customers to purchasing mechanisms other than IAP.

https://developer.apple.com/app-store/review/guidelines/

Re: Apple Fires Back at Spotify for Asking for 'Preferential Treatment'

#37
When Apple says Spotify is asking for preferential treatment over developers of other apps, does that include the developers of Apple Music?

Does Apple Music go through the same sort of independent and opaque approval process Spotify does? Do they have to wait the same time? Do they get rejected for unapproved business models?

Does Apple Music take 30% of it's cut and give it away to the rest of the company?

While I am not entirely unsympathetic to Apple's position, I think the preferential treatment argument is BS when Spotify's biggest competitor is Apple Music.

Re: Apple Fires Back at Spotify for Asking for 'Preferential Treatment'

#38
post #9

I believe that in this specific case Spotify makes a very compelling argument. App publishers that do not directly compete with Apple have a level playing field although the Apple tax certainly hurts. But Spotify directly competes with Apple, and while Apple does not have to pay this tax as they can (probably) use their own billing services cheaper, Spotify couldn't do the same even if they implemented their own bill…

Yeah, I agree, Spotify's case is pretty compelling.

I'm not a lawyer, but my understanding of the Sherman Antitrust Act (I wrote a paper on this in engineering law undergrad about the Intel/AMD case) is that whenever a company uses its dominant position in one market to attempt to restrict competition in an adjacent market, that's called "tying" and it's illegal.

And this seems like a pretty textbook case of it: Apple has a strong, powerful position in mobile devices, and they're making it harder for Spotify to compete with them for music streaming services.

Apple's argument would probably be "we do this to everyone, our behavior isn't specifically to reduce competition, it's standard commercial practice for all apps".

Ben Thompson of stretechery has been commenting on this recently, mentioning that US antitrust law is based more on how people compete (following rules) vs. EU antitrust, which is based more on consumer outcomes and harm. And the harm in this case seems pretty clear: Apple's behavior, though perhaps unintentionally, is making it very difficult for Spotify to compete with Apple Music -- EVEN THOUGH (in the US regulators' view) they aren't acting with any kind of malice, or illegal intent (their view).

The hard legal question is how to ensure competitive markets when tech platform operators make products that inevitably lead to monopolies, like the App Store. That one really should be legislated because it's a big, complex question that will come up with escalating frequency as more businesses exhibit tech-like winner-take-all dynamics.

Re: Apple Fires Back at Spotify for Asking for 'Preferential Treatment'

#39
post #25
post #6

Regardless of pricing, this is Windows/Internet explorer vs. Netscape all over. Easy to see Apple introduce features tied to Apple Music that Spotify can't because it doesn't have the same control over iOS

Except Apple/iOS doesn't have the majority market share as MS did. (not that I don't despise this, just stating).

True. Just that I bet with the $$$ that iPhone owners have, a massive chunk of Spotify's revenue comes from iPhone owners

Re: Apple Fires Back at Spotify for Asking for 'Preferential Treatment'

#40
post #15
post #4

Earlier quoted context omitted.

Neither are being bad, but Spotify is clearly trying to force the issue around the App Store generally. Spotify is clearly at fault here (and the way it's been handled in the media suggests some machination, perhaps), but Apple's revenue model with App Store is just as good or bad as it has always been (or maybe better, now that there's the 85/15 split option).

But remember that the 85/15 split only occurs after a year, so Spotify would still need to charge more. I also don't know if the app store is flexible enough to lower the customer's price after that year cut goes into affect.

The cut happens automatically, and it's in place now for all subscriptions.

So any Spotify subscriptions that started through the app at least a year ago are now getting the 85/15 split, without Spotify having to do anything.

Post reply on HN