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When a customer refunds your paid app, Apple refunds its 30% cut [edited]

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Re: When a customer refunds your paid app, Apple refunds its 30% cut [edited]

#361

Post by emtel »

jclardy wrote: post #278
wlesieutre wrote: post #7

Does this mean if there's a developer I don't like, I can buy their stuff and refund it to arbitrarily cost them money at no cost to myself and there's nothing they can do about it? That seems ... not great, especially these days. What happens when mobs of internet morons decide review bombing isn't sufficient and realize Apple will help them cause direct financial harm instead?

I think this is part of what is holding back iPad software. You can't charge $100 for Sketch and lose $30 when someone asks for a refund. Apple designed this around $1-$10 apps where losing $2 at volume is fine. What is worse, is that Apple doesn't remove the app from the user's device. When you get a refund of a paid app it is on the honor system for them to delete it. It is removed from their account, so they can n…

Can you explain that point a bit more? It doesn't seem to make any sense to me. You revenue is going to be number of sales * price - (number of refunds * price * 0.3). Factor, and you get price * (sales - number of refunds * 0.3). Your unit cost is 0, so the only thing that matters is if your revenue exceeds your fixed costs.

I don't see how this would explain a disincentive to charge higher prices.

Re: When a customer refunds your paid app, Apple refunds its 30% cut [edited]

#362

Post by newen »

simonh wrote: post #220
hrhrhrd wrote: post #202

Earlier quoted context omitted.

I'm not a legislator, but I'd like to be able to run an app store of my choosing. I'd like to be able to use my general purpose computing device as a general purpose computer, instead of Apple's business connections deciding who I get to do business with. So far as not implementing features, if the bare tech were exposed, I'm sure people would be very happy to implement it outside of Apple. Just because they perpetua…

I think this is where we get into the weeds. How do we specify what is a general purpose computer? How do we specify a legally mandated mechanism for installing software? I'm not expecting you to do so now obviously, but isn't the fact that it's so hard part of the problem? This is an incredibly tricky area to start legislating about. Theres much more to this to hitting Apple with a 'monopolist' stick.

This is why there are regulatory bodies and people's entire career devoted to this. The government can create regulatory bodies to answer these questions and then regulate companies.

Re: When a customer refunds your paid app, Apple refunds its 30% cut [edited]

#363

Post by rpdillon »

simonh wrote: post #161
hrhrhrd wrote: post #138

Earlier quoted context omitted.

Anti-monopoly legislation seems like a good starting place. Game console app stores are, at least in my opinion, equally exploitative, but Apple is one of the most problematic publishers out there. Being able to run whatever software you want on general purpose hardware isn't what this is about (although you should be able to, as the FSF has been saying for years). It's that Apple can't monopolise the market like thi…

Apple has a monopoly on designing the features of it's products and on deciding who they do business with and on what terms, that's all. What other monopoly do they have? Youre not actually answering my questions. Exactly what features should Apple, Samsung, Pinephone, etc be required to implement? How should we decide what products these new requirements should apply to? Who gets to specify those features and certif…

I'd advocate for letting customers choose where they get their software after they've bought a device. Artificially coupling device and software repository increases switching cost, stifling competition.

Re: When a customer refunds your paid app, Apple refunds its 30% cut [edited]

#364

Post by sbarre »

Spivak wrote: post #213
sbarre wrote: post #199

Earlier quoted context omitted.

As per the thread: You buy an app for $10, Apple gets $3, the developer gets $7. You refund the app (through the Apple App Store), you get your 10$ back, but that whole 10$ comes from the developer, unlike the 7/3 split when you first purchased it. So in the end, the developer has lost money due to the refund.

This is just sales commission rules though. If I get a 30% commission for a sale when the customer is referred by me and at some point in the future the customer asks for a refund I don't give my commission back. Our transaction was done when the original sale was made.

This is not a valid comparison, there is no referral or commission happening here.

Compare it more to sales tax, which is a much closer comparison because it is required as part of the transaction in a monopoly ecosystem (much like a sales tax is in a country).

If a vendor adds tax to a price, and then charges the customer, and the customer gets a refund, the customer get the sales tax back, but the vendor then doesn't have to remit that tax to the government (and if they've already remitted it, they can apply for a credit).

Re: When a customer refunds your paid app, Apple refunds its 30% cut [edited]

#365

Post by slivanes »

42droids wrote: post #311
mattferderer wrote: post #214

Earlier quoted context omitted.

Ditto. Helping some non-profits, we were really hurt by people typo-ing a $10,000 donation when they meant to only donate $100. We quickly learned from that mistake. We also learned about how credit card thieves test credit cards. We saw hundreds of donation attempts. Stripe had us refund those that went threw, which costed us money in fees. Fortunately we were able to put some quick measures in place to stop them te…

I am curious what measures did you put in place?

A common way to prevent that is to authorize only first - settle/charge that payment at a later time when you think it's not a typo.

Re: When a customer refunds your paid app, Apple refunds its 30% cut [edited]

#366

Post by erikrothoff »

saurik wrote: post #345
gamblor956 wrote: post #268

Earlier quoted context omitted.

Credit card companies (i.e., Visa, Mastercard) absolutely do refund fees on payments when the retailer processes a refund. This is why retailers generally require you to use the same method of payment to get your refund. It's uniquely online processors that do not refund fees.

My experience with PayPal was that they almost always gave me my fees back when I processed a refund (there were corner cases where that didn't happen); it is possible the rules changed or that I am misremembering the extent of the cases when they don't, though (I haven't processed payments in a year and a half).

No, OP is just plain wrong.

Re: When a customer refunds your paid app, Apple refunds its 30% cut [edited]

#367

Post by chrisshroba »

mywittyname wrote: post #282
jclardy wrote: post #278

Earlier quoted context omitted.

I think this is part of what is holding back iPad software. You can't charge $100 for Sketch and lose $30 when someone asks for a refund. Apple designed this around $1-$10 apps where losing $2 at volume is fine. What is worse, is that Apple doesn't remove the app from the user's device. When you get a refund of a paid app it is on the honor system for them to delete it. It is removed from their account, so they can n…

> What is worse, is that Apple doesn't remove the app from the user's device. This. Is. Ridiculous. We all know this is an intentional design decision by Apple and that they would absolutely not have designed the workflow this way if they had to dogfood their own platform.

Serious question: Is this refund problem as big an issue as commenters here are implying? Is there data that shows that app developers are losing significant money due to Apple's fees not being refunded? I would have guessed that very few people ever request a refund on an app they purchase, but I have no data to back this up.

Re: When a customer refunds your paid app, Apple refunds its 30% cut [edited]

#368

Post by bronzeage »

jfkebwjsbx wrote: post #264
bronzeage wrote: post #8

App stores need heavy regulations. It's not only Apple but Google and even steam to a small extent. Apple is of course the biggest offender as they heavily guard their monopoly with code signing enforcement. This shouldn't have been legal. They are the very definitions of predatory competition squashing monopolies.

Steam is the very opposite of a walled garden. Putting them in the list but leaving out all console manufacturers and operating system devs? Strange.

I think all gaming consoles are similar. It's actually because steam is something I use while consoles aren't that I didn't think about that.

Re: When a customer refunds your paid app, Apple refunds its 30% cut [edited]

#369

Post by tyingq »

gamblor956 wrote: post #268
chadlavi wrote: post #102

Payment processors generally don't refund fees on payments when the payments are refunded, this isn't new. It's remarkable mainly because (a) it's 30%, not 3% and (b) the App store doesn't position itself as a payments processor the way Stripe does, so it sounds really weird that they would act like one. If the app store took a 3% chunk and never refunded it regardless of the ongoing status of the transaction, that w…

Credit card companies (i.e., Visa, Mastercard) absolutely do refund fees on payments when the retailer processes a refund. This is why retailers generally require you to use the same method of payment to get your refund. It's uniquely online processors that do not refund fees.

"It's uniquely online processors that do not refund fees"

Uniquely those that provide some higher level thing, like PayPal or Stripe. If you have a merchant account, you can get an actual refund for online purchases.

Re: When a customer refunds your paid app, Apple refunds its 30% cut [edited]

#370

Post by esrauch »

emtel wrote: post #361
jclardy wrote: post #278

Earlier quoted context omitted.

I think this is part of what is holding back iPad software. You can't charge $100 for Sketch and lose $30 when someone asks for a refund. Apple designed this around $1-$10 apps where losing $2 at volume is fine. What is worse, is that Apple doesn't remove the app from the user's device. When you get a refund of a paid app it is on the honor system for them to delete it. It is removed from their account, so they can n…

Can you explain that point a bit more? It doesn't seem to make any sense to me. You revenue is going to be number of sales * price - (number of refunds * price * 0.3). Factor, and you get price * (sales - number of refunds * 0.3). Your unit cost is 0, so the only thing that matters is if your revenue exceeds your fixed costs. I don't see how this would explain a disincentive to charge higher prices.

Perhaps the refund-rate is higher on $100 apps than $1 ones? If you find out your kid made an unauthorized purchase of $2 you're not likely to refund it, if its $100 you definitely will.
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