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Apple's bad faith 27% tax on web purchases

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Re: Apple's bad faith 27% tax on web purchases

#291

I mean I gotta give respect to Apple. They seem to have done the minimal technical compliance with the order. Users can make a purchase for their app outside of the App Store. But at the same time they put in as much friction as they could, including reframing the charge to developer as a lead commission - and the net cost to developer is HIGHER than using Apple. Of course epic is going to challenge the spirit of the…

> They seem to have done the minimal technical compliance with the order.

Not at all. Both the district court as well as the 9th circuit who affirmed the district court’s judgment explicitly stated that only the anti-steering guideline needs to be scrapped, that Apple is still entitled to their commission because it serves as payment for their IP and that Apple would be entitled to include an auditing provision in their developer agreement.

In fact, the courts noted how cumbersome this auditing process and after the fact collection of the commission would be.

In other words, this is not only fully sanctioned by the courts, but the expected outcome.

> But at the same time they put in as much friction as they could, including reframing the charge to developer as a lead commission

There was no reframing. It was always defined as such. Or to be more specific, the developer agreement always designated Apple as an agent to the developer, akin to a literary agent, and explicitly defined the commission as a payment for those agent services and Apple’s IP.

The commission has also never legally been tied to IAP or payment through the App Store, but rather directly tied to sales in general.

All the big parties that are now acting “shocked” that Apple would do this, such as Epic and Spotify, etc, have well paid legal departments that explained all of the above to the people in charge, so none of this is a surprise to any of them.

They just bank on you not knowing so you’ll be a willing pawn in their push to make their profits go up.

> Of course epic is going to challenge the spirit of the implementation but this definitely makes it murkier - can you still claim a monopoly if developers can technically allow purchase outside and have a choice?

There’s nothing to challenge. The courts have spoken and SCOTUS declined to hear the case.

It’s the law of the land and honestly, spelled out in a crystal clear plain language way in the judgments. None of this should be surprise to anyone.

Re: Apple's bad faith 27% tax on web purchases

#292

Earlier quoted context omitted.

How is a phone that I pay for at all analagous to Walmart?

I thought we were trying to make statements that made no sense.

Nothing nonsensical about developers wanting better treatment or a better deal from a company asking for 30% of their gross margin.

Insofar that Walmart extracts margin out of its small suppliers, we don't see a lot of third parties sitting on the sidelines telling suppliers trying to negotiate better contracts that they need to shut up, pay up and that the third parties are "on Walmarts side".

To the extent that small suppliers wish to negotiate better contracts or apply pressure to a behemoth company for a better deal, I say 'have at it'.

Re: Apple's bad faith 27% tax on web purchases

#293

Earlier quoted context omitted.

If that option is important to you, why deeply embed yourself in an ecosystem that doesn't have it when others exist?

I know many people who find themselves stuck in Apple's ecosystem since while they personally could switch out their computer and relearn everything, they can't really disrupt the things their older family are used to on other devices and expect them to relearn everything. Combined with Apple's love of walled gardens (and therefore very limited interoperability with other platforms), switching out would cause too muc…

>It's always kind of annoying seeing this "just don't use it" argument, as it completely ignores that part of the point of the walled garden is that it gradually forces people to be so invested in the garden that it becomes increasingly expensive to leave it.

My personal experience doesn't leave me super convinced of this, which is why I asked. I don't think I use any apps I've purchased on the regular anymore. There are a few I subscribe to, but that's an ongoing fee I could continue to pay on Android (if the app exists) and I'll buy a game every now and then, but I rarely go back to them, so I'm not sure that I'm personally losing a ton of sleep over the loss of access to Magic Research. The cost of moving is going to be my time in migration.

The issue you describe (parents preferring iOS over Android) sounds rather distinct of an issue to a walled garden.

Re: Apple's bad faith 27% tax on web purchases

#294
post #32

Ongoing big discussion at https://news.ycombinator.com/item?id=39020365

Thanks! Macroexpanded:

US developers can offer non-app store purchasing, Apple still collect commission - https://news.ycombinator.com/item?id=39020365 - Jan 2024 (1204 comments)

US Supreme Court declines to hear appeals in Apple-Epic Games legal battle - https://news.ycombinator.com/item?id=39014642 - Jan 2024 (199 comments)

Re: Apple's bad faith 27% tax on web purchases

#296

Epic says this is about protecting small developers... which, frankly, is BS. Epic charges $100 per game in their store, vs. Apple's $99/yr for access to the store, and the latest tools. This is pretty much a wash, unless you're not regularly releasing games. Epic charges 12% for their game store. For most developers, those earning less than $1M, Apple charges 15%. So again, pretty much a wash. Epic doesn't take a fe…

Not sure why you are comparing Epic's prices to Apples' instead of comparing to Epic's actual game store competitor Steam.

Re: Apple's bad faith 27% tax on web purchases

#297
post #295

Does anyone here work in the back office of a grocery chain? What’s the typical markup on a gallon of milk or a frozen dinner? I’d bet that Apple’s 27% isn’t as egregious as it sounds.

The grocery chain has to spend money to buy the products.

A better comparison might be a flea market or fair where the organizers take 27% of gross receipts from each vendor, even if the customer went to the vendors store outside of the fair to buy. Which sounds egregious to me, moreso if it was the only fair that existed for a large demographic.

Re: Apple's bad faith 27% tax on web purchases

#298
post #78

I think what’s missing here is sideloading. The new terms apple set are ridiculous, but it’s their App Store, so whatever. However, this iPhone is my device and I should be able to install whatever app I’d like on it. Without that freedom, Apple has no competition and can set their fees as high as they please.

I think that anno 2024 it’s well known that you own the physical device but you license the software it runs on in exchange for agreeing with the license agreement. So I don’t think there’s much insight to be added there.

But you do bring up an interesting point by mentioning sideloading.

The courts have established in this case that Apple can charge their commission regardless on the premise that it’s a payment in exchange for the use of their IP. All in all not a shocking decision really because it just continues on the standing law regarding property rights.

But it might have ramifications for sideload apps, unless you really want to get down and dirty those will be using Apple’s IP as well and in some cases there’s not even an alternative unless the iPhone is jailbroken.

Because the developers of those app will be using Apple’s IP, Apple can extract payment from them.

Perhaps not the full 30% because presumably they wouldn’t have agreed to Apple’s developer agreement, but it won’t be $0 either.

Similar legal gaps exist in the impending EU regulation. Believe it or not, they too have well established property rights surrounding IP and there too there are courts who will be the final arbiters in this.

Many seem to think that just because the EU says or does something it’s the law of the land, but like with legislation in the US it can be fought and I’d say even more so there because a lot of the regulations originate from the EU Commission, which is just the EU’s sparkling executive branch.

While the dust is starting to settle here in the US, we will more than likely see some cases starting in the EU.

Re: Apple's bad faith 27% tax on web purchases

#299
post #252

Earlier quoted context omitted.

> we shouldn't try to help protect hundreds of millions of users No need. Market is functioning reasonably well, as Android, PineOS, FirefoxOS, and similar alternatives exist. Just because someone purchased a product doesn't mean they were coerced into the purchase. Apple products still function fine and legally, if not ongoing service isn't exactly ethically run by the company management.

> No need. Market is functioning reasonably well, as Android, PineOS, FirefoxOS, and similar alternatives exist. I'm not sure I'd like a government (whom at least in theory, exists to protect & provide as much collective good for their constituents as possible) to approach the situation in such a cold strictly economic fashion. Hundreds of millions of people unfairly being taken advantage of to the benefit of a small…

I appreciate the time you put into your thought. Fundamentally, I disagree with the assertion that because a minor consumer purchase goes south and charges an unarguably illegal processing fee (for interchange) now deemed legal for hardware providers that the usual moral justification for this, consumer welfare, is harmed as the BATNA is simple - get a different maker's phone. Varying qualities of substitutes are easily attainable.

No, where Apple goes wrong and will lose the market is through the exercise of market access to developers, as they lock the currently largest market down. It's also a implicit tax for purchasing.

But the legal remedies are already stymied. We are stuck with the stupidity of the decision for awhile despite the minor migration inconvenience.

Thus ends the House of Jobs, not with a fight but with a pyhric win.

Re: Apple's bad faith 27% tax on web purchases

#300

Earlier quoted context omitted.

But again, you have the choice of not using Epic. You can use Unity, or any other game engine, or even make your own if you're so inclined. With Apple, you don't have a choice if you want to be on iOS (which has close to 60% marketshare in the US). And I'm not arguing that apple needs to reduce the fee. They can charge whatever they want for their IAP system. But, other companies that have software/services that are…

releasing on Unity instead of Unreal is similar to releasing on Android instead of iOS

Not especially; if you release on Android but not iOS, the customers that you would have reached on iOS are not reachable. (Except for the people who simultaneously use an iPhone and an Android phone...)

Nothing similar is the case for Unity vs Unreal; the customer base is the same either way.

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