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Netflix stops paying the ‘Apple tax’ on its $853M in annual iOS revenue

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Re: Netflix stops paying the ‘Apple tax’ on its $853M in annual iOS revenue

#81

Post by briandear »

notatoad wrote: post #27
CamelCaseName wrote: post #21

Was it a mistake for Apply to set the precedent that they will not take action against large tech firms that do this? Regardless of what is a 'fair' fee, what happens when the handful of apps that generate the vast majority of revenue move their transactions away from the marketplace? What is Apple/Google's next move?

Apple's next move is to compete by charging reasonable rates, instead of completely unreasonable ones. Netflix is a low chargeback risk, high volume customer and should expect to be paying 1.5-2% for an initial charge and even less for continued payments on the same card. Apple is charging 30% for the first year of payments and 15% after that. 30% is reasonable for an app from an unknown dev where the platform might…

How is Netflix a low chargeback risk? I am curious about the data on this.

Re: Netflix stops paying the ‘Apple tax’ on its $853M in annual iOS revenue

#82

Post by bkraz »

kraftman wrote: post #18
MrMember wrote: post #5

Earlier quoted context omitted.

I was kind of surprised when I canceled my Netflix account. I had a laundry list of complaints I was going to put in the "why are you canceling" box but they never gave me one. Making it easy and painless to cancel is one of the few things they're still doing right.

What were your reasons?

I also recently canceled and was surprised they didn't ask why. My reason was that the selection of content has changed dramatically. When I first signed up, I could choose a movie that I had in mind. Now, the selection of movies on Netflix streaming is extremely bleak. It's almost entirely TV shows, and about half of it is Netflix-produced. The quality of it is fine, I just don't want TV shows. I want access to the majority of movies ever produced, and would pay much more for such a service.

Re: Netflix stops paying the ‘Apple tax’ on its $853M in annual iOS revenue

#83

Post by geofft »

ianai wrote: post #51

I’m devaluing this disagreement. Tell me one reason that we at the consumer level should care whether Apple or Netflix win this one? At my level, I see the smartphone market dominated by Apple and Google. If you don’t like what those two do then you can’t buy a smartphone. They own something like 99.9999% of the market. This is basically super large corporation vs large corporation. Wake me up for the fight to break…

> Tell me one reason that we at the consumer level should care whether Apple or Netflix win this one?

A 30% fee generally translates into 30% higher prices for all customers.

You see this with credit cards: because there's a ~3% fee and merchants are generally not allowed to have a credit card surcharge, prices as a whole rise ~3%. If you pay cash you might get a questionably-permissible discount from some places. Others don't take cards. If you're not using a 2% cash back card or equivalent, you're losing 2% of your spending, in effect. That matters to consumers at least as much as a 2% sales tax increase would matter.

30% is huge. When two elephants fight, of course they're not paying attention to the mice—but the mice certainly care about knowing where the elephants are likely to step.

Re: Netflix stops paying the ‘Apple tax’ on its $853M in annual iOS revenue

#84

Post by anonytrary »

The main reason I find app stores useful is that they are a third party data aggregator. You can see ratings, downloads, reviews and other statistics very easily. That does help me as someone deciding what apps I should download.

That said, Netflix is a company I've grown to trust. I have no reason to look at Netflix's app statistics in the app store. I have no incentive to make personal transactions with Netflix through a third party app store. I simply go to their website, enter my card information, and enjoy their service without thinking about it ever again.

Re: Netflix stops paying the ‘Apple tax’ on its $853M in annual iOS revenue

#85

Post by MrMember »

kraftman wrote: post #18
MrMember wrote: post #5

Earlier quoted context omitted.

I was kind of surprised when I canceled my Netflix account. I had a laundry list of complaints I was going to put in the "why are you canceling" box but they never gave me one. Making it easy and painless to cancel is one of the few things they're still doing right.

What were your reasons?

A lot of small issues that added up to an overall negative experience. The web UI redesign a few years ago that made it the same as the UI in Android, smart TVs, etc, but also slower and more difficult to use. Autoplaying something if you hover over it for more than a second (a cancerous UX design that has spread beyond Netflix now). UI inconsistencies like the "resume watching" row. 50% of the time it would be at the top where you would expect it, 25% of the time it would show up if you scrolled far enough, and 25% of the time it would never show up at all. I never understood that one, it was bizarre and unexpected behavior. Removing a lot of quality content and not replacing it equally high quality content. The overall decline in quality of Netflix's original series.

There wasn't any one thing that made me decide to cancel, one day I realized I hadn't used it in several months and the UI made it a pain to use when I did, so I canceled.

Re: Netflix stops paying the ‘Apple tax’ on its $853M in annual iOS revenue

#86

Post by na85 »

anonytrary wrote: post #84

The main reason I find app stores useful is that they are a third party data aggregator. You can see ratings, downloads, reviews and other statistics very easily. That does help me as someone deciding what apps I should download. That said, Netflix is a company I've grown to trust. I have no reason to look at Netflix's app statistics in the app store. I have no incentive to make personal transactions with Netflix thr…

Do you really believe the ratings and reviews are useful?

Most of the reviews I've seen are obvious shills, or else useless "works ok" reviews with a 5 star rating

Re: Netflix stops paying the ‘Apple tax’ on its $853M in annual iOS revenue

#87

Post by hombre_fatal »

Rjevski wrote: post #32
writepub wrote: post #30

It's ludicrous for Apple to state they somehow increased business for Netflix, because they allowed "sign-up" via iOS. That's like Google claiming they allowed sign-up via chrome, or AT&T claiming they allowed sign up via their Network. Apple adds ZERO value via the app store, both for devs and for the consumers.

Apple adds a lot of value via the App Store for initial app purchase/download. I agree they add very minimal value for recurring subscriptions, and their fee should be dialled back to be inline with what card processors charge (because they're essentially offering payment processing and not much else).

The app store provides value to customers for recurring charges by being a MitM and offering an interface for recurring subscriptions. I can go to the recurring charges bit of the interface and see all the apps that can charge me.

I never give CC info if I can help it. Once you give out your CC info, you have to be eternally vigilant because they can charge you on their terms. And to cancel, you have to hop through whichever hoops the company demands of you, like requiring a phone call.

For example, I would never have taken up Youtube's 3-months-for-$1 trail last week if I had to insert my CC info. I was only open to the idea because it went through Apple's payment system and it's easy to see that I'll be billed in March if I don't trivially cancel the subscription from the iPhone interface.

Since the app store billing system is the reason I coughed up the money to Youtube, it certainly makes sense for Apple to get some of that money. And I could make a case that they deserve a cut for the entire lifetime of my subscription.

Re: Netflix stops paying the ‘Apple tax’ on its $853M in annual iOS revenue

#88

Post by username3 »

makecheck wrote: post #66

I find it hard to blame anyone for leaving any store when there has been almost nothing of value added in years and things are even regressing. That 30% should have gone a lot further; after 10 years, I can’t even use two different search-and-sort criteria at once to find new apps (and I refuse to sit there and scroll through offensively-bad lists of useless results, much less buy them). I am however not surprised by…

No one gets 20% when retailers discount Apple iTunes gift cards 20%.

Re: Netflix stops paying the ‘Apple tax’ on its $853M in annual iOS revenue

#89

Post by hinkley »

electic wrote: post #77
wand3r wrote: post #19

The Apple store seems good for small apps because the “tax” pays for discovery/marketing, distribution, billing & payment, lends credibility to the application, etc. This is especially true for single purchases. Recurring revenue is a much different proposition— even for small or first time apps. A player like netflix which handles it’s own marketing, payment and all other ancilliary services doesn’t need to anything…

> The Apple store seems good for small apps This is simply not true. As a small app developer, I can tell you first hand that Apple only promotes and supports larger apps in the ecosystem. It is the exception, not the rule, when they promote a smaller app. As a developer, you are on your own on the marketing and discovery front. The billing infrastructure you allude to would be easily replaceable with a dozen or so s…

I have to agree with grandparent. You can't scale down international infrastructure like this. The cost per sale for someone managing a store for you has a certain minimum cost per month plus an amount per sale and per return.

Of course they're going to hype the big games. It's opportunity cost. Advertisement leads to sales, but feeding a hype train gets you more. If they stop advertising the hot new game to showcase yours then that person is not getting promoted. The guy who had no problems ignoring your game gets promoted and now everybody answers to them.

Is it awesome? No. Do I like it? Not really. But it's rational, and getting large companies to be rational is often better than you can expect.

Re: Netflix stops paying the ‘Apple tax’ on its $853M in annual iOS revenue

#90

Post by tanilama »

makecheck wrote: post #66

I find it hard to blame anyone for leaving any store when there has been almost nothing of value added in years and things are even regressing. That 30% should have gone a lot further; after 10 years, I can’t even use two different search-and-sort criteria at once to find new apps (and I refuse to sit there and scroll through offensively-bad lists of useless results, much less buy them). I am however not surprised by…

My thoughts as well. How could Apple's search so bad? If it indeed brings billions a year, why wouldn't they spend that money to improve the functionality of this revenue powerhouse?

Apple tax should be stopped, people are paying penalty to use their sub par software, this is as ridiculous as it gets.

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