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nabla9 7 hours ago

Apple’s App Store profits on commissions from digital sales

    Revenue          $32 B
    Operating Costs   $7 B [1]
    Estimated Profit $25 B 
    Operating Margin ~78%
[1] R&D, security, hosting, human review, and including building and maintaining developer tools Xcode, APIs, and SDKs.

Apple could take just 7% cut and still make 20% profits.

Fun Fact: During the Epic trial, it was revealed that Apple's profit margins on the App Store were so high that even Apple's own executives were sometimes surprised by the internal financial reports.

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edit: There is no ideological argument for voluntary action here. The entire goal is to force regulators to step in. The debate over 'good vs. bad companies' is just online noise and rhetorical trik, no one on either side of the political spectrum wants these systems to be fixed voluntarily with corporate altruism.

nabla9 7 hours ago | parent | next [-]

The operating cost is the maximum Apple can come up with when their accountants attribute everything they possibly can to digital sales for the sake of legal argument. R&D shouldn't really be included, and Apple uses those same tools and APIs themselves. I think the actual profit margin is closer to 90%, and Apple could maintain a 20% margin with just a 3–4% fee.

rob74 6 hours ago | parent | next [-]

I'd say that in the case of Patreon, any fee for Apple is unjustified. Apple can justify their fee on app purchases/subscriptions in the app store, but Patreon is not an app subscription, the money goes mostly from the patrons to the people they support. Ok, Patreon takes a cut to cover their operating costs, and also make a profit (not sure how profitable they are currently), but I really can't see how Apple, who don't have anything to do with this process except for listing the Patreon app on the app store, can justify taking a cut.

silvestrov 3 hours ago | parent | next [-]

You could make the argument that Patreon isn't much more than a banking app.

It just focuses on the receiver of the money than the sender.

I think Apple is slowly killing apps with this policy. Everybody will slowly move to "web only" as 30% would kill their ability to compete with anybody else. This will likely be much stronger in countries where iPhones do not have the same market share as in the US.

josephcsible an hour ago | parent | next [-]

> Everybody will slowly move to "web only" as 30% would kill their ability to compete with anybody else.

This is why Apple makes PWAs so miserable in Safari and disallows other browsers unless they're just Safari with lipstick.

direwolf20 7 minutes ago | parent | prev | next [-]

Apple users seem to be fine with everything being much more expensive. Not only the 30% apple tax itself, developers know Apple users pay more and specify higher prices on Apple.

Almondsetat an hour ago | parent | prev | next [-]

You couldn't make that argument because Patreon is also a platform to host content, not just send money. If it was something like a twitch donation app the argument would make more sense

barnas2 31 minutes ago | parent | prev | next [-]

> You could make the argument that Patreon isn't much more than a banking app.

Don't give them any ideas.

rkagerer 18 minutes ago | parent | prev | next [-]

Next up, Apple starts taking a cut of every money transfer you do with your banking app.

wlesieutre 3 hours ago | parent | prev | next [-]

Honestly I wouldn't be that shocked if Apple tried demanding a 30% royalty on bank deposits and bills paid using iPhone apps. They've decided the future of their company depends on being huge assholes about it.

mcintyre1994 3 hours ago | parent | next [-]

I would be surprised by that because iPhone users would notice that. I think the App Store model relies on their fee being invisible to consumers, and the increased price you’re paying not being linked to them. AFAIK apps aren’t allowed to explain that they charge more if you subscribe on iPhone to users either, or why they do so.

wlesieutre 2 hours ago | parent | next [-]

True, hard for bank deposits where the user sees both ends of the transaction.

For bill payments though, they'd just insist on taking 30% of your electric bill payment and if the electric company's margins aren't high enough to absorb that then "Haha that sounds like a you problem" - Tim Cook, probably

odo1242 34 minutes ago | parent | prev | next [-]

Apps are allowed to link to web services to offer payment as an alternative to IAPs and offer a discount for doing so, thanks to Apple v Epic.

direwolf20 6 minutes ago | parent [-]

Can they, or will they be delisted if they do that?

dr-detroit 3 hours ago | parent | prev [-]

[dead]

burgreblast an hour ago | parent | prev | next [-]

When you use Apple Pay, Apple collects ~0.15% (15 bps) from the issuing banks for credit. $1B in transaction volume = $1.5M

In 2022 the total volume was estimated at $6T * .15% = $9B. Real number would be maybe half due to lower fees on debit, but it's hugely profitable for Apple, and carries zero risk.

direwolf20 6 minutes ago | parent [-]

They'd much rather have 30%.

jorvi 2 hours ago | parent | prev [-]

Something interesting is that Apple and Google Pay charge a tiny commission (don't have the number at hand). Which banks didn't like, so at least on Android they created their own NFC payment stacks for a while. Only to then discover that maintaining such a stack cost them more per year than the commission.

fauigerzigerk 2 hours ago | parent [-]

I think Google Pay does not charge a fee.

Spoom 2 hours ago | parent | prev [-]

> Everybody will slowly move to "web only" as 30% would kill their ability to compete with anybody else.

Frankly, yes, please. I mean, I'm biased as my whole career is in web app development, but there are so many things these days that do not need a whole native app. They're just communicating with a server backend somewhere, using none of the unique native functionality of the phone (much of which is available in browser APIs these days anyway). I can block ads in a web app much more easily. It's much harder to do customer-hostile things like block screenshots in a web app.

Native apps definitely have a place, but I think they're very overused, mostly for reasons that benefit the business at the expense of the customer.

xnyan 2 hours ago | parent | next [-]

> I think they're very overused

I disagree, native apps on iOS have important abilities that no web application can match. The inability to control cache long-term is alone a dealbreaker if trying to create an experience with minimal friction.

mircerlancerous an hour ago | parent | next [-]

Service workers allow you to control cache in web apps; you may be a bit out of date.

There are hardware APIs for some stuff that only works in native (cors, raw tcp), but 99% of apps don't need those.

pphysch 2 hours ago | parent | prev [-]

Those same elevated controls are used to steal PII and sell to data brokers. Again, it's the companies that are trying to force apps on their users. If it were genuinely a much better UX, they wouldn't have to do that.

xnyan an hour ago | parent [-]

I don’t think you are correct, but I could be wrong. For example, can you replicate the functionality of TikTok - autoplay unmuted videos as the user scroll down to new videos? It’s the experience that the user expects.

mrguyorama 7 minutes ago | parent [-]

I'm sorry but why do you think this can't be done in a website?

BiteCode_dev 2 hours ago | parent | prev [-]

Apple makes sure it's not practical.

You still can't have a "share to" target that is a web app on iOS. And the data your can store in local storage on safari is a joke.

Of course, forget about background tasks and integrated notifications.

In fact, even on Android you miss features with web apps, like widgets for quick actions, mapping actions to buttons and so on.

And no matter how good you cache things, the mobile browser will unload the app, and you will always get this friction when you load the web app on the new render you don't have on regular apps.

mircerlancerous an hour ago | parent [-]

Service workers solve the cache issue; web apps can run permanently offline after initial load. You may be a bit out of date on the state of the web.

MadameMinty 2 hours ago | parent | prev | next [-]

Next up, 2% cut whenever you use any banking or payment app. Only 1.5% when you use Apple Pay!

odo1242 30 minutes ago | parent [-]

They currently do charge 0.15% on Apple Pay actually.

saimiam 5 hours ago | parent | prev [-]

If a user almost exclusively uses the Patreon ios app to consume the artist’s content and likes to live inside the ios ecosystem for frictionless payments using the card on file/privacy/UX/whatever, then I feel apple should get to set the terms of engagement.

If you were a chain store in a high end mall where customers cars were all parked for free by valets, mall staff knew their names, and generally made them feel special, you’d not balk at a higher commission to be paid to mall for access to their customers, right? Airports come to mind for this.

I believe apple lets you set whatever price you want on their store, just not tell customers that they could get a lower price elsewhere/on the vendor’s website (I don’t follow App Store policies very closely so my info is probably out of date).

TheDong 4 hours ago | parent | next [-]

Presumably you also would agree that it's fair if Chrome, Windows, and Lenovo all charged me 30% each for using Patreon via Chrome+Windows on a thinkpad, right?

They're doing about as much to facilitate my use of Patreon as Apple is.

This isn't like a mall at all. This is like a web browser, where apps are webpages, and Apple is insisting that the contents of that webpage are something they can dictate all payment terms on.

For the airport analogy to work, it would have to be that you go to the Airport, go into the electronics store, buy a Kindle, and then the Airport insists it can take 30% not just on the purchase of the kindle, but 30% on every single book you buy on the kindle forever.

Apple taking a cut on the purchase price of an app that a user found via the app store does make some sense. Apple taking a cut of an in-app interaction with a creator that the user almost certainly found elsewhere is nonsense.

What next, should apple take a 30% cut of my rent because I found my apartment on the Craigslist app? Should they take a 30% of my train ticket that I purchased using the Safari app? Why does Patreon have to add a 30% cut on in-app content, when Safari lets me pay for in-app content with my credit card without taking any cut?

seemaze an hour ago | parent | next [-]

>What next, should apple take a 30% cut of my rent because I found my apartment on the Craigslist app? Should they take a 30% of my train ticket that I purchased using the Safari app?

Sure they could, and usage of those products to purchase goods would nominally drop to 0%. People do not care about a lot of things, but they do care about losing money.

odo1242 28 minutes ago | parent [-]

Apple would then force the with-IAP price to be the same as the without-IAP price so that they get a 30% cut of your rent regardless. You may be underestimating their willingness to tax all economic activity

saimiam 2 hours ago | parent | prev | next [-]

> certainly found elsewhere

I agree that if someone discovered the artist elsewhere, Apple has weaker standing in claiming a huge commission. But if they found an artist elsewhere, they would also know that they can support that artist elsewhere and not through the iOS app. If the patron found them through the patreon iOS app and use the app to consume the artist's content, then clearly the patron has indicated that they prefer the iOS experience.

TheDong 2 hours ago | parent [-]

And if I access Patreon via Chrome on Windows, and use Chrome on Windows to consume the artist's content, clearly I prefer the Chrome and Windows experience, so Microsoft and Google should be getting their 30% cut, right?

... and of course the user found the artist elsewhere than the iOS app store. They found them on youtube, or reddit, or _possibly_ on the webview inside the patreon iOS app, which is also _not_ apple's App Store content, it's content provided by Patreon.

Again, should accessing my bank via the Safari or Chrome iOS app mean apple gets 30% of all my bank transactions, just because they were displayed on a webview inside an iOS app?

tapoxi 2 hours ago | parent [-]

The logical conclusion is that if you buy an Apple device from www.apple.com on your Windows PC, Microsoft should get a 30% cut of that sale.

browningstreet 2 hours ago | parent | prev [-]

Chrome, Windows and Lenovo don't have the payment system baked in, with all the consumer protections that come with it.

I'm not entirely pro-Apple percentage in this argument, but I think people often dismiss the magical thing that Apple created with the app store and their payment/subscription system. The rest of the world keeps ripping users off, and Apple's walled garden is as protected a thing as it gets.

I've gone directly to my bank for subscription charges billed directly to my credit card and they wouldn't reverse or stop them. Cancelling and reversing on the App Store is basic, easy, and friction-free.

Plus, the Android environment doesn't yield nearly the same sales volume even with significantly more installed units.

People spend on iOS and they don't spend on other platforms.

30% hurts and it sucks, but.. Patreon will probably take it because they'll do the math and it won't come out in favor of the alternative. That's what really sucks, beyond Apple max-max-maxing this.

mrguyorama 2 minutes ago | parent | next [-]

Apple's walled garden couldn't even protect it's users from a literal LastPass scam app. It was reviewed by Apple. It passed. It was in the store.

The screenshots for the app had "Documets" and "Lasspass" prominently visible

Nothing about this is for your sake.

fauigerzigerk an hour ago | parent | prev | next [-]

>The rest of the world keeps ripping users off, and Apple's walled garden is as protected a thing as it gets.

This keeps getting repeated but it's not actually my experience. Not even Apple believes it, otherwise they could avoid a lot of legal and regulatory trouble by giving users a choice: Pay through Apple for an extra 30% protection fee.

Matl an hour ago | parent | prev | next [-]

> Chrome, Windows and Lenovo don't have the payment system baked in, with all the consumer protections that come with it.

Chrome definitely does, at least to a degree.

But you have the option to not use it, because guess what? You're supposed to own the device.

sroussey an hour ago | parent | prev | next [-]

The cost side of that protection is < 0.1% not 30%.

realusername 2 hours ago | parent | prev [-]

They can offer to cancel or reverse subscriptions because you paid 5x that subscription amount just in fees.

hshdhdhj4444 5 hours ago | parent | prev | next [-]

> If a user almost exclusively uses the Patreon ios app to consume the artist’s content and likes to live inside the ios ecosystem for frictionless payments using the card on file/privacy/UX/whatever, then I feel apple should get to set the terms of engagement.

When I paid over $1000 to buy an iPhone I thought I was buying a technological product that I could use to improve my life.

I didn’t realize I was buying a ticket to Disneyland where the seller of the product decided how I interacted with everything the device enabled.

I don’t think this should be disallowed. I certainly think it’s incredibly false marketing for Apple to claim I bought an iphone, when in reality I paid upfront for essentially AOL.

Zak an hour ago | parent | next [-]

> I didn’t realize I was buying a ticket to Disneyland where the seller of the product decided how I interacted with everything the device enabled.

If you're the sort of person who posts on HN and you bought an iPhone after they hit the $1000 price point, you probably did know that.

It surprises me a little that so many people who do know still make that choice.

Matl an hour ago | parent [-]

I think the point OP is making is not that they actually didn't know, but that they shouldn't have to know for that price.

gyulai 4 hours ago | parent | prev | next [-]

> I certainly think it’s incredibly false marketing for Apple to claim I bought an iphone, when in reality I paid upfront for essentially AOL.

I wonder if that has ever been tried against Apple or a similar company in a court of law, because I think there might be real merit there. One would have to get a bunch of people together claiming a refund on the purchase price on the grounds that ownership hasn't been transferred and therefore Apple is in breach of contract in relation to the contract for sale of an iPhone. Then those people would have to bring a class action, and the case would revolve around the concept of "ownership". Because "ownership", to a first approximation, means the legal right to do with some piece of property essentially as you please, and Apple is clearly basing much of their business on the assumption that users do not have those rights and is taking positive action to prevent users from exercising such rights.

I don't know much about the law in the rest of the world, except Germany, but in Germany that would certainly be the case, and there is a surprising amount of case law revolving around such things as horses or other animals being sold, and the former owner then trying to restrict the new owner in exercising their ownership rights, which generally end with ownership rights being upheld by courts.

Teever 4 hours ago | parent [-]

I’ve been thinking for a while now that a really effective way to deal with problem companies would be coordinate a mass action on small claims closets around the world all on the same day.

Often in small claims court you win by default if the other person doesn’t show up and I’m sure judges know average will sympathize with the kinds of arguments that you raised above.

gyulai 4 hours ago | parent [-]

I don't know. We don't have any such thing as small claims court in Germany, but my expectation would be that judges in low-level courts will try their very best not to get noticed for setting any kind of precedent whatsoever. The only thing that's going to happen if you rule against Apple in a low-level court is that they will go into revision, and carrying a high probability that the higher-level judge will overturn the decision and make the lower-level judge look bad in the process.

Also, any kind of effort to annoy someone by bringing coordinated actions in lots of venues all at the same time is probably abuse of process.

fauigerzigerk 29 minutes ago | parent | next [-]

>but my expectation would be that judges in low-level courts will try their very best not to get noticed for setting any kind of precedent whatsoever.

Is there even such a thing as precedent in the German legal system?

silon42 3 hours ago | parent | prev | next [-]

I think a fair coordination would be for someone somewhere to complain about this every single day (1/country).

Teever 3 hours ago | parent | prev [-]

The idea isn't just to use small claims courts, but to use whatever first level legal venue to seek redress you can find in your area. That might mean small claims courts, or consumer protection bureaus, or binding arbitration. Whatever it is the idea is to coordinate with others to do so in a way that strains the resources of the organization you're fighting against and is in venues that are sympathetic to consumers and are able to make clear judgements with little chance for the opposing side to appeal.

The goal of this isn't to annoy someone, the goal is to seek compensation for their unacceptable behavior and raise awareness of it so that others may do so as well.

With the mindboggling assymetry in resources between a single individual and an entity like Apple or Google it only makes sense for people to team up and coordinate against them.

patja 4 hours ago | parent | prev [-]

Is this sarcasm? Apple pretty much invented the walled garden of personal computing.

pc86 2 hours ago | parent | prev | next [-]

I subscribe to a half dozen creators and I have exclusively used the web interface to subscribe and consume this content. You cannot tell me with a straight face that if the only difference was I subscribed on my phone to someone who charges me $10/mo, Apple is entitled to $36 for the first year and $18/yr in perpetuity thereafter.

rubyfan 5 hours ago | parent | prev | next [-]

I don’t think anyone suggests Apple should get nothing for their app store services, just that it shouldn’t be 30% of every transaction processed through every iOS app.

londons_explore 4 hours ago | parent | next [-]

The EU has the right approach. Don't try to legislate exactly what is a fair/unfair amount of profit to make - change the rules of the game by requiring third party marketplaces and payment platforms so apple has to lower rates or lose every app into a third party store.

Apple can easily say "Use our store exclusively and you get our security/privacy guarantees. Go outside our store and you're in the wild west". App developers can then decide how much fee they are willing to pay for access to the user base who refuse to venture into the wild west. Other stores might try to persuade users that they are more secure and more private too via stricter review policies or more locked down permissions etc.

fauigerzigerk 17 minutes ago | parent [-]

From a consumer point of view, the best approach would be if devlopers had to sell their app in Apple's App Store (if Apple approves) and could optionally provide other purchasing options on top of that.

It would prevent fragmentation and give people a choice to pay up if they actually value Apple's extra protections (if any).

thfuran 3 hours ago | parent | prev | next [-]

What they should get is customers for their phones and computers.

idiotsecant 4 hours ago | parent | prev [-]

I think that is in fact exactly what GP is suggesting.

rubyfan an hour ago | parent [-]

I don’t read it that way. I think the point is it doesn’t make sense that apple is taking a cut of a transaction that is not in their payment rails*. Apple can still be compensated for their App store service without using a model that takes 30% of all transactions, e.g. a listing fee, an app review fee, etc.

*And anything on their payment rails should have a normal transaction fee, e.g. Stripe’s retail rate is 2.9% + $0.30.

wolvoleo 2 hours ago | parent | prev | next [-]

Yes it's fine but the 30% should be charged to the customer who wants to stay within that ecosystem of course. If they want that white glove treatment they can pay for it. Of course once the users see how much that fluffy ecosystem actually costs them I bet most of them will just pay patreon directly :)

If the platform like patreon is supposed to absorb that fee they will increase prices for everyone even people who won't touch Apple like me. That's not fair. Or more likely, they will just give less to the content creators.

In the EU it's already forbidden to force payments through Apple or to forbid the platforms to charge the fee back to the customer.

mrighele 2 hours ago | parent | prev [-]

Should Ford get a 30% cut every time you fill your gas tank ?

seemaze 2 hours ago | parent | prev | next [-]

Certainly not defending Apple's behavior in this instance, but isn't the success of the larger product ecosystem a direct driver of their App Store profitability? To strictly evaluate the App Store finances in isolation seems to be the sort of accusation you've levied against Apple in the opposite direction..

I like Apple less and less these days for various reasons, but I haven't purchased an app on the App Store in more than a decade. It's strictly a vehicle for local utilities when, for whatever reason, a browser will not suffice. Nearly all purchasing is done on the 'open' web.

parineum 22 minutes ago | parent | prev [-]

> ...for the sake of legal argument. R&D shouldn't really be included

That's an incredibly ridiculous take. R&D is an operating cost and it's an ongoing expense related to the app store existing.

> I think the actual profit margin is closer to ...

You can replace "think" there with "feel".

SwtCyber 6 hours ago | parent | prev | next [-]

What really makes it uncomfortable is that Apple isn't just a neutral marketplace. They control the OS, the distribution channel, and the payment rails, so creators and platforms like Patreon can't realistically opt out

chii 5 hours ago | parent | next [-]

They could opt out - by sticking to web platforms.

Apple cannot charge for that. However, apple does attempt to gimp the web platforms on mobile to "subtly" push for apps.

pornel 5 hours ago | parent | next [-]

The whole Epic vs Apple was about Apple blocking this. Before being slapped by regulators, Apple had anti-steering policies forbidding iOS apps from even mentioning that purchasing elsewhere is possible.

Even after EU DSA told them to allow purchases via Web, Apple literally demanded a 27% cut from purchases happening outside of App Store (and then a bunch of other arrogantly greedy fee structures that keeps them in courts).

Apple knows how hard is not to be in the duopoly of app stores. They keep web apps half-assed, won't direct users to them, but allow knock-off apps to use your trademarks in their search keywords.

archerx 5 hours ago | parent | prev | next [-]

They do and it’s awful. I’m making a browser based game and it works great on desktop browsers but Apple refuses to allow css filters on canvas forcing you to build your own filters and apply them to image data. The web audio api is also a pain to get working properly on iOS safari and a bunch of other arbitrary but feels like they’re intentional obstacles found only on iOS. I’m almost considering just using webgl instead of a 2d context but who knows what obstacles apple is hiding there also it will make everything so much more verbose for no real gain.

Not even in the days of IE was I ever this frustrated.

nozzlegear an hour ago | parent | next [-]

> Not even in the days of IE was I ever this frustrated.

I've been web devving since the days of IE as well and this reeks of hyperbole. Maybe things are different for browser games, but for me, everything has vastly improved since those days.

danielvaughn 3 hours ago | parent | prev [-]

I tried something similar a couple years back, and fully agree. Safari is atrocious for trying to create a good mobile experience. It almost feels intentional.

sidewndr46 5 hours ago | parent | prev [-]

Why could Apple not charge a percentage for any user using their mobile device? Why would it be limited to app store?

direwolf20 5 hours ago | parent [-]

Because they don't control those. Apple could choose to only allow users to access websites that pay them a bit 30% fee, but users would notice the web was turned off on their device. They don't notice when the app store does it.

sidewndr46 3 hours ago | parent [-]

I don't think people would notice if Apple just made the website behind a paywall. Most people are not going to be aware that they can access the same content without paying a fee to Apple. They may only even have an Apple device to access the internet, so they'd just see it as normal

fauigerzigerk 5 minutes ago | parent [-]

I doubt it. People are pretty savvy when it's about getting something more cheaply or for free.

randallsquared 5 hours ago | parent | prev | next [-]

While inconvenient and likely to reduce patrons, the article does describe how they can opt out: use the web to do any payment activity.

gumby271 3 hours ago | parent | prev | next [-]

Don't forget they also directly compete with Patreon with podcast subscriptions. You can support a podcast through Apple podcasts or Patreon, but only one of those has a 30% chunk taken out.

patanegra 4 hours ago | parent | prev | next [-]

Yeah, because they built it. If people were using Linux everywhere, the situation would be different.

StopDisinfo910 4 hours ago | parent | prev [-]

That's pretty much the conclusion the EU came to and why they introduced the notion of gatekeepers in the DMA.

It doesn't matter if you are not technically in a dominant position if your special role in a large ecosystem basically allows you to act like one in your own purview.

You could say this kind of move invites more scrutiny but the regulators are already there watching every Apple's move with a microscope and their patience with Apple attempts at thwarting compliance is apparently wearing thin at least in the EU if you look at preliminary findings.

uyzstvqs 6 hours ago | parent | prev | next [-]

The problem is the monopoly over distribution channels. Regulation needs to force devices to allow A) downloading and using packages & executables from the internet, and B) any app to download and install other apps.

Regulating the fees for one central app store is no solution.

stouset 4 hours ago | parent [-]

> downloading and using packages & executables from the internet

Oh boy, now my mom can get the full experience of having malware on her phone too!

ulrikrasmussen 3 hours ago | parent | next [-]

With freedom also comes responsibility, and some innocent people will inevitably shoot themselves in the foot. This is not a strong enough argument for putting everybody else in a cage and letting a duopoly take over virtually all of the distribution of consumer software.

ericmay an hour ago | parent [-]

It might be a strong argument depending on the negative effects - I don't think it's very clear cut. Also no, neither Apple nor Google have a duopoly on the distribution of all consumer software. Microsoft exists, for example.

The other problem consideration here is negotiating power.

Today consumers don't have negotiating power over individual developers, but both Apple and Google do. If you complain to Meta about their unwanted tracking, you don't really have many options besides deleting the app (which you should do anyway). But if enough people complain to Apple or Google, they are more inclined to do something and have the power.

While it may be a marriage of convenience, it's undeniable that both companies through their app distribution models have also provided benefits to consumers that developers otherwise would have abused - privacy, screen recording, malicious advertising, &c.

If you want to argue from the standpoint of pro-consumer action, you have to remember that "developers" are usually pretty awful too and will get away with anything they can, even if it harms their customers. A good balance, instead of ideological purity about one "side" or the other is the smarter move. I tend to come down on the side of the mainstream app stores precisely because those asking for more "freedom" to do as they wish are a tiny minority and are usually more technical. I.e. they can jump through the hoops to install 3rd party app stores and jailbreak their phones today, and since you already can do what you want, maybe it's best to just leave the masses alone since they're very obviously happy with the duopoly.

rpdillon 3 hours ago | parent | prev | next [-]

Let's not put everybody in a cage because we can't stop dumb people from walking off cliffs.

samrus 3 hours ago | parent | prev [-]

I hate the classic apple users' "mom" argument. Why are all your moms morons? And why do you want to fuck up the entire mobile landscape to baby proof it for them. Im not gonna ruin my experience with technology because you dont expect your mom to be able to wipe her ass without apple's help

linkregister 2 hours ago | parent [-]

There is nothing stopping you from using non-Apple hardware to escape restrictions on downloading unreviewed software.

CGMthrowaway an hour ago | parent | prev | next [-]

That's not how business works. The App Store in current form would not exist without all the collective investment that went into all of Apple's hardware, for instance.

Microsoft Office: Revenue $45B Operating Costs $12B Profit $33B Operating Margin 75%

Google Search Ads: Revenue $175B Operating Costs $45B Profit $130B Operating Margin 75%

devmor an hour ago | parent [-]

> That's not how business works. The App Store in current form would not exist without all the collective investment that went into all of Apple's hardware, for instance.

While technically true, this argument doesn't provide any merit to the discussion. The App Store backed purchase for the Patreon subscription would not exist at all without the creator's work and investment in creating their form of content.

In the absence of the App Store, the creator would still have access to their patrons via mobile web and payment via the methods already provided by Patreon. The app is merely a convenience - it's a hard sell that this convenience is worth 30% of the creator's revenue through the platform.

matt-p an hour ago | parent | prev | next [-]

Let's be honest if this was a European company it would be capped by law at 5-10%. Problem is who has an incentive to do the right thing here? Not apple and certainly not the US government (most of this revenue comes from outside the US).Nobody can defend it, yet nobody wishes to stop it.

blahgeek 7 hours ago | parent | prev | next [-]

> Apple could take just 7% cut and still make 20% profits.

We can say this to any company, "$X could reduce price by $Y and still make $Z profits", but it doesn't really make any sense. Making profits is what makes a company a company instead of a non-profit organization.

awesan 7 hours ago | parent | next [-]

It does make sense to highlight, because this kind of statistic is a very strong indicator that the market is not competitive. This is not a normal kind of profit margin and basically everyone except for Apple would benefit from them lowering the margins.

In normal markets there are competitors who force each other to keep reasonable profit margins and to improve their product as opposed to milking other people's hard work at the expense of the consumer.

newsclues 6 hours ago | parent [-]

Might not be competitive but it’s totally voluntary. No one needs app, it’s not food or shelter, so clearly consumers are willing and able to pay this.

The consumer is willing to pay the price based on the perceived value from the App Store

lozenge 6 hours ago | parent | next [-]

The relevant market here is the creators not the consumers. As a creator you have no choice but to accept whatever fees Apple, Google, Steam etc set. Or whatever rates Spotify pays you per stream. The fact you "could" host your own website is irrelevant when the reality is nobody will visit it.

lelanthran 5 hours ago | parent [-]

> The relevant market here is the creators not the consumers. As a creator you have no choice but to accept whatever fees Apple, Google, Steam etc set. Or whatever rates Spotify pays you per stream. The fact you "could" host your own website is irrelevant when the reality is nobody will visit it.

Collective action by the creators would help.

All they have to do is dual-host (a fairly trivial matter, compared to organised collective action). What would make things even better is if they dual host on a competing platform and specify in their content that the competing platform charges lower fees. If even 10% of the creators did this:

1. Many of the consumers would switch. 2. Many of the creators not on the competing platform would also offer dual-hosting.

The problem is not "As a creator you have no choice but to accept whatever fees Apple, Google, Steam etc set". The problem is the mindset that their content is not their own.

I say it's their mindset, because they certainly don't act as if they own the content - when your content is available only via a single channel, you don't own your content, you are simply a supplier for that channel.

happymellon 5 hours ago | parent [-]

> specify in their content that the competing platform charges lower fees.

Apple will ban you for this.

lelanthran 4 hours ago | parent [-]

> Apple will ban you for this.

How? I thought it was a Patreon thing - the "competing platform" would be competing with the Patreon app.

I'm not familiar with Patreon, but I thought the way it worked was that you could tip content creators via the Patreon app. I'm pretty certain that Apple cannot tell Patreon (a third party) that they are only allowed to offer exclusive content.

iamnothere 3 hours ago | parent [-]

Apple doesn’t allow you to mention that you have alternate payment channels on other platforms. Can’t even allude to it.

To me this is the thing that should be outlawed. Let people pay the Apple tax if they want, but don’t prevent people from making other arrangements. Most people are lazy and will pay the tax, if it isn’t excessive.

account42 6 hours ago | parent | prev | next [-]

What is also totally voluntary is our decision to let Apple exist as an entitiy, to give them a government enforced monopoly over certain things, to make it illegal to break their technical protections of their monopoly etc.

matkoniecz 5 hours ago | parent | prev [-]

> No one needs app, it’s not food or shelter

"No one needs app" is not the same as "No one has biological mandatory need to have an app"

ibejoeb an hour ago | parent | prev | next [-]

Agreed, but this is about to be a special case if it's not already. We're contending with compulsory digital IDs and cashless economies that must be used on authorized devices, and Apple is one of the two makers. While it's certainly not necessary to use Patreon, not having it or something like it is an actual barrier to individual trade. I don't think I can get behind a schema that means Apple can take whatever portion it wants from a transaction initiated on a device that it creates and that is otherwise fairly necessary for day-to-day life in the developed world.

account42 6 hours ago | parent | prev | next [-]

High profit margins are a sign of market failure.

9rx 5 hours ago | parent | next [-]

Not so much a failure. Rather, there is no intent for there to be a market here at all. A market relies on offerings being reproducible. Intellectual property laws are designed specifically to prevent reproduction.

HPsquared 6 hours ago | parent | prev [-]

"Competition is for losers"

lz400 6 hours ago | parent | prev | next [-]

Makes me think of the concept of involution in Chinese business and how they understand all of this very differently, and how difficult it is to compete because of that.

RobotToaster 5 hours ago | parent [-]

For anyone else wondering https://en.wikipedia.org/wiki/Neijuan

bryanrasmussen 7 hours ago | parent | prev | next [-]

it sounds like it does make sense because if they are making $Z profits then they are still making profits and are not non-profit.

there could also be cases where cutting back to $Z profits might be preferable in case not doing so were to prompt legislation causing someone to be forcibly cut to $Z-1 or even $0 profits from a particular profit source.

Which it has been my observation that when someone is saying "X could reduce price by $Y and still make $Z profits" it often coincides with saying therefore company X should be legislated on this particular profit source.

Note: $X didn't make much rhetorical sense.

rubyfan 6 hours ago | parent [-]

>there could also be cases where cutting back to $Z profits might be preferable in case not doing so were to prompt legislation causing someone to be forcibly cut to $Z-1 or even $0 profits from a particular profit source.

Not in an environment where regulatory capture costs so much less than any change legislation could bring. The remedy in almost every recent monopoly case has been remarkably nothing. Politicians don’t actually want change, they want the threat of legislation so that industries bring truckloads of money to line their pockets.

vasco 7 hours ago | parent | prev | next [-]

When parts of a market become dominated by one or few companies operating in a limited choice environment, consumers can't just opt to not use both Apple and Play store. You need to choose one in practice.

At this point the regulators should investigate what the barriers are to new entrants and if it's too costly and nobody has managed to cut in the last few years, establishing some rules is probably a good thing. This happens as industries mature and become critical, it happened in transportation (most bus, train companies), energy, water supply, trash, etc, depending on the country and market conditions.

gortok 4 hours ago | parent | prev | next [-]

“Growth is what makes a cell a cell.”

Until it turns into cancer because of unrestrained growth.

Like it or not capitalism is a part of an ecosystem. We’ve been “educated” to believe that unrestrained growth in profits is what makes capitalism work, and yet day after day there are fresh examples of how our experience as consumers has gotten worse under capitalism because of the idea that profits should forever be growing.

FatherOfCurses 3 hours ago | parent | prev | next [-]

"Why wait until tomorrow to get one golden egg when I can kill the goose today and get all the golden eggs?"

ImHereToVote 7 hours ago | parent | prev | next [-]

I think it's a little known fact that societies don't exist for the benefit of companies. It's actually the other way around.

6 hours ago | parent [-]
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croes 7 hours ago | parent | prev [-]

It makes sense that regulators can step in without destroying a company.

4 hours ago | parent | prev | next [-]
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chrisan 7 hours ago | parent | prev | next [-]

> even Apple's own executives were sometimes surprised by the internal financial reports.

Was this recorded or just people drawing lines between Epic's expert witness claims and the executives trying to down play them?

pier25 2 hours ago | parent | prev | next [-]

Plus more than $20B for the Apple developer fee without which you cannot publish the their stores.

ghtbircshotbe 2 hours ago | parent | prev | next [-]

They could lower the rates even more and still afford the government bribes and solid gold tchotchkes, but the whole point of the bribes is to not do that.

dmix an hour ago | parent | prev | next [-]

Those margins are pretty normal in software, especially a mature product like that.

jszymborski 3 hours ago | parent | prev | next [-]

> The debate over 'good vs. bad companies' is just online noise and rhetorical trik...

Agreed, there are bad privately held corps, and worse privately held corps, with badness usually proportional to their size and profit.

danielvaughn 3 hours ago | parent | prev | next [-]

I really think I might be done with Apple. The only thing keeping me using them is how much I hate Android. The _millisecond_ a competitor arrives, I'm dropping my iPhone like a bad habit.

drnick1 10 minutes ago | parent | next [-]

GrapheneOS on a Pixel is that competitor. Open source, more secure than Apple, compatible with nearly all Android apps. It's all the positive aspects of Android without the downsides (Google).

vlod 3 hours ago | parent | prev | next [-]

Off topic, but is there anything specific that you hate about Android? I find it acceptable. I'm trying to cut down my phone usage so maybe I'm more tolerant.

RDaneel0livaw 3 hours ago | parent | prev [-]

I keep hoping and wishing for a daily drivable linux phone that's compatible with all the us networks to come along. I'll keep hoping and wishing. Someday I hope we will get there!

patanegra 4 hours ago | parent | prev | next [-]

One company's margin, is other company's opportunity.

ulrikrasmussen 3 hours ago | parent | next [-]

The problem is that Apple owns the platform and half of the mobile ecosystem. You can't just launch a competitive marketplace which could compete alongside Apple's app store, nor can you launch an alternative operating system. You have to launch a whole new smartphone stack complete with operating system, app distribution and app ecosystem.

Ylpertnodi 2 hours ago | parent [-]

Or not use apple.

observationist 2 hours ago | parent [-]

This. Doing business with almost any major company is unethical, but Apple sits near the top of the big tech companies people shouldn't do business with. They are not a force for good in the world.

eviks 3 hours ago | parent | prev [-]

Indeed, that's why the former blocks the latter: not to lose margins to those opportunities

micromacrofoot 3 hours ago | parent | prev | next [-]

I don't think Apple could actually, unless they could prove to shareholders that it would create more value

absynth 4 hours ago | parent | prev | next [-]

This is all money that is reducing expenditure elsewhere. I get it: capitalism and economics. Yet I still think humanity could do better and I think capitalism itself suffers. Economics theory is broken if it thinks this is good for society in general.

u8080 4 hours ago | parent | prev | next [-]

But those profits made possible by actually having other infrastructure parts existing(OS, hardware, marketing, etc).

wosined 7 hours ago | parent | prev | next [-]

But people still use/buy it so why would they cut the cost?

nabla9 7 hours ago | parent | next [-]

There is no ideological argument for voluntary action here. The entire goal is to force regulators to step in. The debate over 'good vs. bad companies' is just online noise and rhetorical trik, no one on either side of the political spectrum wants these systems to be fixed voluntarily with corporate altruism.

6 hours ago | parent | next [-]
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NewsaHackO 6 hours ago | parent | prev [-]

But what are they even doing for regulators to have to step in? Making profits from someone selling their product in your market seems pretty valid to me. Are you saying this is anticompetitive to other possible app store storefronts like Google Play or something?

rpdillon 2 hours ago | parent | next [-]

Just to ground the discussion in Apple's criminal behavior a bit, here's some excerpts from a 2025 ruling about Apple's behavior in this regard:

> Apple’s response to the Injunction strains credulity. After two sets of evidentiary hearings, the truth emerged. Apple, despite knowing its obligations thereunder, thwarted the Injunction’s goals, and continued its anticompetitive conduct solely to maintain its revenue stream. Remarkably, Apple believed that this Court would not see through its obvious cover-up (the 2024 evidentiary hearing). To unveil Apple’s actual decision-making process, not the one tailor-made for litigation, the Court ordered production of real-time documents and ultimately held a second set of hearings in 2025.

> To summarize: One, after trial, the Court found that Apple’s 30 percent commission “allowed it to reap supracompetitive operating margins” and was not tied to the value of its intellectual property, and thus, was anticompetitive. Apple’s response: charge a 27 percent commission (again tied to nothing) on off-app purchases, where it had previously charged nothing,and extend the commission for a period of seven days after the consumer linked-out of the app. Apple’s goal: maintain its anticompetitive revenue stream. Two, the Court had prohibited Apple from denying developers the ability to communicate with, and direct consumers to, other purchasing mechanisms. Apple’s response: impose new barriers and new requirements to increase friction and increase breakage rates with full page “scare” screens, static URLs, and generic statements. Apple’s goal: to dissuade customer usage of alternative purchase opportunities and maintain its anticompetitive revenue stream. In the end, Apple sought to maintain a revenue stream worth billions in direct defiance of this Court’s Injunction.

https://storage.courtlistener.com/recap/gov.uscourts.cand.36...

gabaix 5 hours ago | parent | prev | next [-]

They are not allowing other marketplaces, or creators themselves, to run apps on Apple devices directly.

NewsaHackO 4 hours ago | parent [-]

Why should they have to allow third parties to run apps on their platform? The fact that it is a clear security risk already gives them justification, but even looking past that, Apple is not the only platform that bars users from running third-party software or marketplaces on their products. For example, playstation, xbox, and switch all disallow running unauthorized games on their platforms. What makes Apple different?

nabla9 5 hours ago | parent | prev [-]

No. This is a result of a market failure caused by monopoly power. Regulators must make sure market capitalism works.

I'm not sure what is the basis for your question but using market definition where Google Play and Apple Store are in the same market is not correct (market definition is essential part of any monopoly regulation).

Markets are defined by choice of practice, not by choice in principle.

NewsaHackO 4 hours ago | parent [-]

My question is: what is the basis for asserting that this market failure is due to monopoly power? Is your argument that their excessive profits from the services provided result from anti-competitive behavior? If so, what specific anti-competitive behavior are you referring to?

nabla9 2 hours ago | parent [-]

The specific cited anti-competitive behaviors (from DOJ and EU Commission is) are related to violating anti-steering provisions (companies forbidden for directing towards other payments methods), tying and bundling (in-app purchase requirements), self-preferencing (obvious), "tap-to-pay" monopoly, and blocking third party app-stores.

vincnetas 7 hours ago | parent | prev | next [-]

and that exactly what monopoly allows you to do.

7 hours ago | parent | prev [-]
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thegrimmest 2 hours ago | parent | prev | next [-]

Advocating for regulators to step in is already a value judgement. Why is "high profitability" a cause for regulatory scrutiny? The optimal behaviour in any ecosystem (corporate or natural) is to defend as much territory as is within your power, not to keep only to what covers your "needs". Why have you deemed this behaviour, which is emergent anywhere competition between organisms exists, as in need of regulation?

Apple is succeeding largely on merit, within the bounds of civilized, peaceful competition. Shouldn't we all just be grateful for the contributions they have made to our civilization?

dimitrios1 3 hours ago | parent | prev [-]

> force regulators to step in

> force

> regulators

That's my whole problem, personally.

What we need much, much less of in this world is government force, especially during these trying times of government force and outreach (something I expected my more left side of the isle colleagues to have finally realized by now).

COIVD really was a test of how much governmental draconianism we would take, and we failed spectacularly, and not only that, but are demanding more government.

So no, we don't need more regulation, especially given this country's history of regulatory capture. We need new solutions.

Atreiden 3 hours ago | parent | next [-]

We don't need "more" government, we need the government to do its job. We need the regulators who have been legally appointed to oversee these areas to actually respond to these behaviors. Regulatory capture is the issue, but the solution isn't less government. It's getting corporate money and lobbying out of the government (Citizens United is to blame for most of our woes), increase the enforcement of anti-corruption laws, and get antitrust back on the table.

I want big corporations to be scared. I want them to fear for their own survival, and to tread lightly lest the sword of damocles fall upon them.

3 hours ago | parent | prev [-]
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