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Apple Announces App Store Small Business Program

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Re: Apple Announces App Store Small Business Program

#91

Post by sheeshkebab »

summerlight wrote: post #71

It'd be interesting to see how Apple decided $1M as the threshold of this change. My expectation is that this change probably contributes to less than 1~2% of the total App store revenue, given that a large fraction of the app store revenue are driven by a bunch of $100M games with loot box IAP. But I don't really have data to support this estimation.

Probably based on their own internal metrics around range that would minimize their losses.

Small business size definitions in US are managed by SBA and they have very specific revenue ranges that defines what that is for each NAISC code https://www.sba.gov/sites/default/files/2019-08/SBA%20Table%...

Re: Apple Announces App Store Small Business Program

#92

Post by foepys »

xuki wrote: post #69
asadkn wrote: post #23

All about PR. Pretty sure they make the big bucks off the $1million+ earners.

My income just increases 20% from next year for doing nothing. I'll take that.

Another way to look at it is that you severely overpaid before. It's not like Apple innovated by using cheaper materials, more automation, less hardware, or made a lot more profit recently to give back to the developers that are providing value to their platform.

Re: Apple Announces App Store Small Business Program

#93

Post by simonh »

varispeed wrote: post #60
breakfastduck wrote: post #31

Earlier quoted context omitted.

Yes but many of the larger players who are willing to go to war use the 'its not fair on smaller developers' argument against them. This really slaps down the ability to use that.

15% is still not fair.

For app store listing and promotion, application delivery all over the world to hundreds of millions of devices, access to back end services like notifications and iCloud storage, and sales transaction processing? Really?

Imagine if you had to develop or pay for all of those services individually. Your own download site, product promotion, services, a third party transaction processor, a content delivery network, bespoke cloud syncing, etc, etc.

Re: Apple Announces App Store Small Business Program

#94

Post by gzimhelshani »

madeofpalk wrote: post #90
HatchedLake721 wrote: post #58

Earlier quoted context omitted.

It's progressive. You pay 15% on first million you make. 30% on amount thereafter. EDIT: It looks like I am wrong, ignore me.

Except then the next year you get kicked out of the program and back to 30% on every dollar?

No, you start by 15% default until you reach the $1m threshold. After that you pay 30% for the remainder of that year. Please correct me if I'm wrong.

Re: Apple Announces App Store Small Business Program

#95

Post by konschubert »

karolkozub wrote: post #47

Wow. That's amazing. That's a 20% increase in revenue for those eligible. I'm guessing they decided the increased value of their products from more smaller developers creating apps for the platform is greater than the lost revenue. If I understand correctly though, since it's a hard cutoff it creates this gap between 1m and ~1.2m where you're actually worse off by making more money pre-tax. 999k --[-15%]--> 849k 1000…

Yep. Apple should have handled this like tax brackets: The first million gets taxed 15% and anything beyond that gets taxed 30%.

I wonder why they're not doing that and creating all kinds of weird edge cases that will encourage hacky workarounds.

I guess they didn't want to lose out on the first million from those who are above the first bracket.

Re: Apple Announces App Store Small Business Program

#97

Post by syshum »

HatchedLake721 wrote: post #29
Aissen wrote: post #15

Weird how this is the exact opposite of Valve's strategy: > For all sales between $10 million and $50 million, the split goes to 25 percent. And for every sale after the initial $50 million, Steam will take just a 20 percent cut. https://www.theverge.com/2018/11/30/18120577/valve-steam-gam...

Why weird? 2 different strategies with completely different goals. Valve's strategy looks like to maximise revenue and get big companies on board that do $10+ mil in sales giving them incentives and discounts to be on the platform. (I think of it as tax break to incentivise high-earners to stay in the state/country) Apple's strategy looks like to put more money into small companies/developers, while still charging th…

Not weird, but it is an interesting dynamic when you have an open platform that has to compete in the marketplace, vs a closed ecosystem that has to compete in PR / Legal battle.

Apple is clearly attempting to reverse some of the bad PR, and divide the Dev Community so the calls for Anti-Trust action is lessened as the "small devs" will consider Apple "on their side" by giving them a competitive advantage over larger shops

Clever move, time will tell if anyone buys it for more than what it really is, a PR stunt designed to ensure no real change happens

Re: Apple Announces App Store Small Business Program

#98

Post by Zobat »

konschubert wrote: post #95
karolkozub wrote: post #47

Wow. That's amazing. That's a 20% increase in revenue for those eligible. I'm guessing they decided the increased value of their products from more smaller developers creating apps for the platform is greater than the lost revenue. If I understand correctly though, since it's a hard cutoff it creates this gap between 1m and ~1.2m where you're actually worse off by making more money pre-tax. 999k --[-15%]--> 849k 1000…

Yep. Apple should have handled this like tax brackets: The first million gets taxed 15% and anything beyond that gets taxed 30%. I wonder why they're not doing that and creating all kinds of weird edge cases that will encourage hacky workarounds. I guess they didn't want to lose out on the first million from those who are above the first bracket.

From the annoncement: "If a participating developer surpasses the $1 million threshold, the standard commission rate will apply for the remainder of the year."

Re: Apple Announces App Store Small Business Program

#99

Post by Leherenn »

jakozaur wrote: post #19

Great move! 30% is a case for antitrust given how big Apple App Store today is. 15% seems reasonable, 10% would be ideal. Though it should be 15% for everybody, no artificial caps. Moreover, I believe once you become a platform there should be an independent nano-courthouse where you can appeal. Today being rejected by Apple, Amazon, or Google platform is equivalent to the economical death penalty for many individual…

I have to admit I don't understand this, all those numbers are completely arbitrary and seem to be based on what you think is right and not on any economic data.

It seems to me the real question is whether the Apple App Store should be regulated or not. If it reaches the legal threshold to be regulated, then either they should open up to competition and let the market do the price discovery or be regulated like a utility and have the price set for them. If they don't reach the threshold, then they should be free to set whatever price they want, and you're free to go elsewhere if you don't like it.

Of course, the big question is whether the app store reaches that threshold, but I'm not sure whether they charge 30% or 20 changes anything.

Re: Apple Announces App Store Small Business Program

#100

Post by aikinai »

jakozaur wrote: post #19

Great move! 30% is a case for antitrust given how big Apple App Store today is. 15% seems reasonable, 10% would be ideal. Though it should be 15% for everybody, no artificial caps. Moreover, I believe once you become a platform there should be an independent nano-courthouse where you can appeal. Today being rejected by Apple, Amazon, or Google platform is equivalent to the economical death penalty for many individual…

How do people come up with these arbitrary rates? How is 30% anticompetitive and 15% okay? 30% was standard long before the App Store, so why does Apple have to lower it now that they're the most profitable app platform?
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