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Epic direct payment on mobile

epicgames.com

331–340 of 371 posts

Re: Epic direct payment on mobile

#331

Earlier quoted context omitted.

> Well, every app would easily be able to offer you a 25% discount (30% - 5% to account for transaction fees), since they would not be paying the Apple fee. Since when have companies passed on fee decreases to their customers instead of accepting the effectively free higher margins?

> Since when have companies passed on fee decreases to their customers instead of accepting the effectively free higher margins? Since companies had to compete with other companies. The moment the Apple tax is lifted, at least one company will lower prices. Other companies will be forced to follow suit. I'm not saying ALL the price decrease will be passed to consumers, but some of it definitely will. Especially since…

I think this model looks at apps as widgets too much. People don't price compare IAPs. Nobody's like "well fortnite charges X for Y, but Minecraft charges A for B." App store revenues are probably largely games or similar things that don't really have a competitor you can easily price compare against.

App developers set their prices at whatever maximizes revenue (which is often determined by testing) and the payment processing fee has no effect. It's more like Coke pricing at an airport than Coke pricing at a gas station with another gas station next door.

I expect they'd offer whatever discount maximized revenue, so the real question is how much of a discount do they need to offer to get you to switch from app store payments to some other method? Other methods are largely pretty seamless these days too, so the answer is probably not much. I expect consumers would barely benefit.

(Source: been doing games with IAPs for 13 years).

Re: Epic direct payment on mobile

#332

Earlier quoted context omitted.

> a non existing digital item That's a weird thing to read in a place populated by software people.

I'm sure you don't have to look too far to find someone who believes all software should be free (and open source).

Sure, but that doesn't mean this is how all software should be…

Re: Epic direct payment on mobile

#333

This puts Apple in a very tough spot. Last week, Tim Cook was questioned in an antitrust hearing re: Apple's anticompetitive practices (along with Jeff Bezos, Mark Zuckerberg, and Sundar Pichai). The spotlight is already pointing right at them, so any move they make here is going to be noticed by lawmakers. If they remove Fortnite from the App Store, Apple will probably be seen as the bad guy. After all, Epic is not…

I agree with most of your statement, but I have a question about this bit > After all, Epic is not taking anything off the top here; Apple and Google take 30% and they are giving a 20% discount if you pay directly, so isn't there a 10% difference that they would be taking "off the top"? Or am I missing something?

The percentages aren't quite additive like that. Say Epic gets $1 per sale, and the consumer pays $1.3 with the 30% Apple cut. A discount of ~23% (1/1.3) gets the sale price back down to $1. Include chargebacks and such for the missing ~2%.

Re: Epic direct payment on mobile

#334

Earlier quoted context omitted.

> Other than the non-Apple part, that's how it pretty much works now. Only 3% and 8% of apps in the stores are paid on Android and iOS respectively, and counted by downloads it's probably much lower. IAPs might be over 99% of revenue. Yes, but all IAPs now go through Apple and they get their 30% cut. > hey're so seamless that as a customer, I'd probably still use them unless I were getting a substantial discount to d…

Right, I was just pointing out that for the consumer, there's basically no difference in app business models. It just may be a different payment processor and maybe lower prices.

My original point wasn't that there will be a visible difference to the consumers but that all app purchases and in-app-purchases will be structured so that Apple's cut goes to zero.

If Apple allows non-apple payment without major restrictions, it's revenue from app store will trend towards zero (save for inertia).

Re: Epic direct payment on mobile

#335

Earlier quoted context omitted.

You seem young and naive.... For many, their iOS device (iPad or iPhone) is their primary computing device.... it is not like a PS4, which is mainly for games. Back in the 90's If Microsoft didn't get 'checked' with a threat to be broken up, we would have ended up with Pay MSFT 30% tax on every software you installed and purchased. It it time to 'check' both Apple and Google on their practices... In this case, Google…

You seem condescending and annoying.... I was alive and working during the 90's and a massive linux/freebsd user then. What Microsoft was doing, forcing the hardware manufacturers to install windows or lose their business - forcing the bundling of internet explorer, is absolutely and completely different than what Apple is doing. It's their platform, the are not forcing any one to do anything.

Isnt that the same argument from Windows?

Windows is their platform, their choice for what's installed with it and who can sell computers with windows on it

Re: Epic direct payment on mobile

#336
post #3

My money is on Apple cracking down hard on this. It looks clearly as if Epic remotely activated this direct payment option, thereby bypassing Apple's App Review. Apple will not take kindly to this. Best case scenario for Epic (and Fortnite players): they invite Sweeney in for some hard negotiations. Worst case: Fortnite ends up getting removed from iOS for this.

It’s possible Epic are baiting the app stores, betting that the current anti-trust questions around Apple and Google support a change. Either Apple and Google capitulate to this move by Epic, and Epic wins. Or Google and/or Apple come after Epic, creating a public scene that emphasizes their monopoly-like behavior, and failed lawsuits or government action mean a win for Epic. The third option—the big guys come after…

That's exactly what happened as Epic has filed a lawsuit immediately after Apple banned them today.

Re: Epic direct payment on mobile

#337

Earlier quoted context omitted.

Consoles and marketplaces like Steam take 30% of digital game sales.

If that is true, how do you explain that they are not implementing this new payment option on those platforms?

Isn't this payment option for things other than the game itself?

Re: Epic direct payment on mobile

#338

Earlier quoted context omitted.

> Other than the non-Apple part, that's how it pretty much works now. Only 3% and 8% of apps in the stores are paid on Android and iOS respectively, and counted by downloads it's probably much lower. IAPs might be over 99% of revenue. Yes, but all IAPs now go through Apple and they get their 30% cut. > hey're so seamless that as a customer, I'd probably still use them unless I were getting a substantial discount to d…

> Well, every app would easily be able to offer you a 25% discount (30% - 5% to account for transaction fees), since they would not be paying the Apple fee. Since when have companies passed on fee decreases to their customers instead of accepting the effectively free higher margins?

Yeah, they wouldn't. Marginal costs to app developers are effectively 0, so profits and revenue are synonymous.Thus prices are set to maximize revenue. If setting my IAP at $10 maximizes revenue, that's true whether the processing fee is 0% or 30%. Cost to consumer is determinant.

Now if I'm given the options of accepting App store payments at 30%, and let's say PayPal at 3%, I'm going to offer the customer a little discount to switch to PayPal. That too will be whatever discount maximizes profit. That wouldn't be too hard to determine with testing, and would depend on how easy the payment methods are and how much customers love the convenience/security of Apple's payment system.

For me as a consumer, if I got offered a 10% discount and had something comparably easy to use I'd probably go with it on small transactions. If I had to enter a credit card, I'm not going to bother on a $1 or maybe even $10 purchase for that little.

Re: Epic direct payment on mobile

#339

Earlier quoted context omitted.

Still, it does create a bit of a contradiction. We don't know what Sony and Microsoft charge, but we can reasonably assume it isn't zero, and it's also probably more than whatever Epic pays for their internal payment processing. Epic could still turn around and say "well, the price would be even lower if not for Sony and Microsoft," but I'm not sure how much they want to piss off the console manufacturers, who—all th…

AFAIK Sweeney isn’t against stores taking a cut he just sees the 30% as egregious. V-Bucks whilst costing nothing to create are exchanged for things that did cost money to create and as a means to fund the existence of the game itself.

Epic are not Costco and the amount they charge for items is not simply designed to repay what it costs to create the items and the game - in fact by all accounts they're raking it in. I'd be very surprised if they hadn't carefully tried to optimize their pricing based on what they expected to give the most revenue, which of course would lead to a pricing model very much like the one they actually had prior to this PR stunt where the pricing is independent of whether Google or Apple or Sony are taking a cut, and the amount taken by the platform only affects how much of that price Epic get to keep.

Re: Epic direct payment on mobile

#340
post #75

I love how they are "passing the savings down to us" from a non existing digital item that they set the price of. Ugh. Anyway, this should be absolutely fascinating to watch how the antitrust cases against the app stores go!

I'd like to hear the argument for digital things not 'existing'
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