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Peak app store was doodle jump. It's been all downhill from there
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Y Combinator files brief supporting Epic Games, says store fees stifle startups
11–20 of 247 posts
Re: Y Combinator files brief supporting Epic Games, says store fees stifle startups
#12[flagged]
Re: Y Combinator files brief supporting Epic Games, says store fees stifle startups
#13I recently wrote about how Apple now has the most hostile developer ecosystem of any major platform: https://www.magiclasso.co/insights/apple-development/ Good to see VCs and Y Combinator now supporting and pushing for change.
A family member of mine has an Apple phone, and the lack of availability of not just open source software but even freeware or freemium software astounds me. They make it so difficult to distribute anything, that it's not worth it unless you are getting significant revenue. This means that often the only option is something extremely scammy that charges monthly for the most trivial capabilities. Of course, Apple gets…
Is that an Apple thing? People trying to monetize anything they make seem to vastly outnumber those of us who just want to make stuff for other people to enjoy. When I turn off an adblocker I'm shocked how many hobby projects spam ads at their users to try to make a few pennies.
It feels like a social issue.
Re: Y Combinator files brief supporting Epic Games, says store fees stifle startups
#14I don’t know. You could just as well say, “A 3% merchant fee can easily be [… ruinous to a bunch of companies]”, and I’d be talking about Stripe, a Y Combinator company. In Europe they manage to cap interchange fees at 10x less, and there’s no less “payments innovation” or more “fraud” or whatever some nice red headed LISP brothers or some insightful patio furniture guy will say is eating into the 3% merchant fees.
People struggle with this: Stripe and Apple do the same thing wrt to the fees. They get all into a knot trying to explain how 3% of all revenue, successfully capped at 0.3% in Europe, is somehow different than Apple taking 30% of App Store IAP. We already live in the world where nice, red headed LISP brothers and insightful patio furniture guy is wrong. You don’t even need to talk about it or file a brief.
The reason the Epic case is tough is because the fee doesn’t matter. Like what is the right fee? Say a number. Clearly it doesn’t make sense to take a fee at all! Apple is doing something valuable - they are concentrating wealthy, good customers who overwhelming choose iPhones instead of Android phones - and instead of making iPhones more expensive they take from app developers. But if you did the sensible thing - force the platforms to charge the cut they are taking from the end user up front, when they buy the phone - nobody is going to do that.
It’s exactly the same problem as Europe saying Facebook has to be ads free. Nobody chose to pay for a Facebook subscription. The truth is the regulators are in between a rock and a hard place if they try to make changes to one number in the midst of the status quo. In the past, regulators took more drastic steps, they split up the monopolies, and once you understand how weak these regulations that people are litigating are, suddenly you will be much more sympathetic to the idea that the App Store and the iPhone have to be different businesses, or that private digital payments companies shouldn’t exist at all.
Re: Y Combinator files brief supporting Epic Games, says store fees stifle startups
#15[flagged]
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Re: Y Combinator files brief supporting Epic Games, says store fees stifle startups
#16[flagged]
30% fees are mental.
Most of my clients don't even bother/care and their competition doesn't bother/care either.
Re: Y Combinator files brief supporting Epic Games, says store fees stifle startups
#17“A 30% revenue share can easily be the difference between a company that can afford to scale, hire new employees, and reinvest in its product, and one that is perpetually struggling to stay afloat.” This brought up a fun thought exercise for me. Pretty sure that Y Combinator would argue that giving away 7% of one's company for access to intangible (but beneficial) things like funding, advisors, etc, is completely wor…
Far be it from me to defend Y Combinator or VCs in general but IMO the situation is a bit different because of the monopoly (or at least duopoly) power that Apple and Google hold as gatekeepers over the only practical way to sell to iOS and Android device users.
Of course, I'd also assume most or all the people associated with YC were part of the "fire Lina Khan because our whole business model is actually just taking advantage of FAANG acquihire panic" squad, making them hypocrites (in a slightly different way) for helping to prop up these monopolistic gatekeepers and then acting put upon by the results of that.
Re: Y Combinator files brief supporting Epic Games, says store fees stifle startups
#18I don’t know. You could just as well say, “A 3% merchant fee can easily be [… ruinous to a bunch of companies]”, and I’d be talking about Stripe, a Y Combinator company. In Europe they manage to cap interchange fees at 10x less, and there’s no less “payments innovation” or more “fraud” or whatever some nice red headed LISP brothers or some insightful patio furniture guy will say is eating into the 3% merchant fees. P…
Note that Stripe isn't really the problem with payments. AFAIK Stripe pays ~2.5% (mostly to banks) and they charge ~3%.
Re: Y Combinator files brief supporting Epic Games, says store fees stifle startups
#19I don’t know. You could just as well say, “A 3% merchant fee can easily be [… ruinous to a bunch of companies]”, and I’d be talking about Stripe, a Y Combinator company. In Europe they manage to cap interchange fees at 10x less, and there’s no less “payments innovation” or more “fraud” or whatever some nice red headed LISP brothers or some insightful patio furniture guy will say is eating into the 3% merchant fees. P…
If you think 3% is too much, there are plenty of other payment processors... the thing is, most of that 3% is not set by the processor (or kept by them) but is set by the card networks. It is the card networks that should be targeted by antitrust laws.
If there anyone could make an App Store, then we would have a better idea of what the market rate for app stores should be.
Re: Y Combinator files brief supporting Epic Games, says store fees stifle startups
#20“A 30% revenue share can easily be the difference between a company that can afford to scale, hire new employees, and reinvest in its product, and one that is perpetually struggling to stay afloat.” This brought up a fun thought exercise for me. Pretty sure that Y Combinator would argue that giving away 7% of one's company for access to intangible (but beneficial) things like funding, advisors, etc, is completely wor…
I thought the standard advice is to target 80-90% gross margin at early stage so you can easily eat 30% CAC. It probably starts to hurt as you scale though.