
Last.fm co-founder: Apple just fucked over online music subs for the iPhone - Uncle_Sam
http://downloadsquad.switched.com/2011/02/17/apple-just-f-over-online-music-subs-for-the-iphone-lastfm/
======
eftpotrm
I suspect Apple may have to back down over this...

So much of the value they paint of the iOS ecosystem is in the apps - 'There's
an app for that' was a large campaign last year. Yet they're now threatening
to make a number of their more popular apps economically unviable according to
their creators.

In-app payment will mean a new app, no? Which won't get approved if it
contains a rant against Apple on that screen explaining the price hike they
need to make it viable. Yet the current versions contain links to web-based
payment, which would be relatively easy to update to include a page saying
'Apple are thieves' and explain why.

I'm well aware that many / most customers would see such a message, give a
stereotyically teenage _whatever_ reaction and move to a competitor, but a
good percentage won't and we've seen how fast bad news travels now. Enough
providers that customers value enough are now angry enough with Apple to try
their luck at this, particularly with a competing platform available and
growing without the same restriction, and I wouldn't like to bet on Apple
winning this.

~~~
rimantas
> Yet they're now threatening to make a number of their more > popular apps
> economically unviable according to their > creators.

How's that? Or are we again talking pandora and netflix there? In that case I
couldn't care less: these are not available in my country, and most likely
never will be. Heck, even iTunes Music is not available, only apps.

Now imagine you are a new company just going to start selling subscriptions in
iOS app. I'd say you get a lot of convenience with this Apple offering.

As for end user, there is no loss there: just a convenient way to buy
subscription with one tap.

All this sounds once again blown out of proportion, everyone is shouting
without any effort to really understand what they are shouting about.

~~~
sp332
It's not just that they're taking 30%. It's that they're disallowing authors
to charge any more than they do anywhere else, and _then_ taking 30%. So to
make the same amount of money on iPhone, you would have to increase your
prices everywhere else.

~~~
rimantas
Not allowing to charge more anywhere else is a win for me. Authors who don't
like this are free to skip iOS entirely, no?

~~~
shadowfox
They probably will. Which was probably the point :P

------
metabrew
I'm the one quoted there (RJ). It's worth pointing out that I've not worked at
Last.fm for a couple of years, and the chat log (which I posted) doesn't
mention Last.fm at all.

That said, I still think my analysis is bang on.

What Apple have done will really cripple anyone reselling/licensing content
(Spotify, Last.fm, Netflix etc).

~~~
Retric
The obvious long term result is Spotify, Last.fm, Netflix etc are going to
dump apple. Then a new company will resell Last.fm content at a 40% markup to
sidestep the apple rules. Bad PR is then going to force apple to rethink their
stance.

However, I expect Apple is going to offer "deals" to the major players.

~~~
coffeedrinker
I think Apple will be happy to have all the music subscription apps go away.
They bought lala.com and I expect them to have an iTunes subscription service
before long.

------
cletus
30% is simply an unsustainable cut of many things, of which music
subscriptions are just one example.

I've said before--and I stand by the statement--that Apple doesn't have a lot
of wiggle-room here without disrupting their retail channel for iTunes cards,
which (IMHO) is a really important competitive advantage they have over, say,
Android.

Having the retail credit channel is the equivalent of the importance of having
prepay options for cell phones vs postpay. Many people don't want to put CC
info in iTunes or they simply want to give gift cards to kids.

What Apple should do is make such a service optional. If it's compelling,
people will use it. I also believe that for some people this will be
compelling because they then don't have to deal with billing and all the
infrastructure (payment gateways, receipts, accounts departments and so forth)
that that entails.

Forcing it down people's throats is another matter entirely.

It's still unclear how this will relate to the Kindle, which is really what
interests me, as it is a mix of subscriptions and single-purchase
publications, all of which are purchased outside of the App Store.

Part of the problem is that there is an internal inconsistency in play. You
can subscribe to the Wall Street Journal Web edition and use that on Safari on
your iPad just fine. Why should the WSJ app that gives you access to that same
content be any different?

You could sell an app on the App Store for $10 and Apple would get their $3
cut. Give a free version away and offer a $10 in-app upgrade and Apple still
gets their $3 cut. From Apple's perspective, why are subscriptions any
different?

I guess Apple are seeing this as people making money off their platform so
they should get a cut. That position has superficial attractions but quickly
breaks down if you go deeper.

To me it's a lot like the ISPs who want to charge Netflix or Google for all
the bandwidth they use, which is nothing more than double-dipping. The
customer pays for the bandwidth. What they use that bandwidth for should be
immaterial to the ISP.

Personally I think Apple makes enough money from selling the devices, the App
Store and iTunes that just nickel-and-diming people who produce material users
subscribe to to the point of excluding such content from the device is really
not in their interest or the user's interest.

Not having Grooveshark on my iPhone/iPad is a problem (that predates this).
Losing other music services will be a problem. Losing the Kindle will be a
HUGE problem.

~~~
GrandMasterBirt
Sorry, you are wrong. The entire apple business model is about vendor lock-in.
Only recently did iTunes remove DRM from their songs. The reason is because
iTunes won. Apple used iTunes to lock people in by forcing them to use an iPod
if they wanted their music which they "own" or rather "lease". Sure you were
free to get ANY other mp3 player in the world, as long as you were ok with
losing all your music.

The same here. Vendor lock in. You got ebooks from the cheapest store (iBook?)
cool, iOS only, oh and a non-jailbroken one too.

Apple's history with the i... product line is content lock-in onto a device.
They lure you in with pretty interfaces, then they hold your stuff hostage.
Apple wants a piece of the pie, and they want to be able to undercut all
competition. They know they can't ban kindle or face antitrust so they will do
other things.

This is monopolizing pure and simple. It has nothing to do with apple making
"enough" they want to make sure that they sell the cheapest stuff on the iOS,
and they control where you can see the content - on the iOS - and if you leave
you are fucked.

~~~
Stormbringer
Sorry, but you're wrong. The iTunes DRM was ridiculously easy to circumvent
even in iTunes itself. No mad leet hackzor skillz required.

Since you could trivially turn aac files into mp3 files _in iTunes_ your
quote:

 _"Sure you were free to get ANY other mp3 player in the world, as long as you
were ok with losing all your music"_

Is completely wrong. I can only assume you are one of the vast throngs of
Apple haters who hate Apple and their products because it is trendy to hate
trendy things.

I know the iPad supports pdf format, and I think also the epub format(?),
which I believe is the big open standard that everyone 'should' be supporting?
How is that bad evil and wrong? Apple has great adoption of standards for its
web browsers (please don't complain about Flash, for starters it isn't a
standard, for seconds its horrible, for thirds it is used mainly for adds
which are also horrible, for fourths it violates usability and accessibility
for fifths its one good use is dinky little free games, of which let me assure
you I have it on good authority there are quite a few of those on the iOS).
Apple is by no means perfect nor lily white, but to attack them on standards
when they do so well in that area compared to most other companies is ...
bizarre.

The only 'entertainment' companies that I can think of that do better at
supporting a wide range of open formats are the small indie music and movie
makers. Why doesn't Apple work with the indies to help them bring their
content to a wider audience? _That_ would be awesome. _That_ you could
legitimately complain about. But no, you pick something that Apple are
actually good at to complain about. Why is it that when someone rants about
Apple it is always opposites day???

The hilarious thing about your complaint is that all of the examples you give
are obviously wrong, but there is a much better example: apps. Apps for iOS
don't run on any other device.

...

The problem is, if you complained about that, you'd look silly, because as a
general rule apps for one platform don't run on other platforms.

So anyway, to sum up the actual state of Apple 'lock-in':

(a) Open formats are supported on Apple products. (b) Some (e.g. music) closed
formats are trivially easy to convert to open formats. (Turns out there are
many converters for books that are cheap but not free, go figure) (c) iOS
specific stuff is iOS specific (spot the tautology)

Would I prefer to be able to write apps for iOS in any language I wanted to?
As a developer yes yes, OMG yes. As a consumer I would ask whether that means
giving up the protections I currently enjoy.

What protections? Surely Apple's only purpose in life is to sell me sufficient
numbers of these devices is to enslave my will to that of Skynet?

Not so! On my desktop I hardly download anything unless from a very highly
trusted source. I especially distrust the free stuff. On the iOS devices I go
wild and crazy, knowing that my private information is private, my data is
safe.

So are you complaining about the walled garden? Why? There are a great many
alternatives, none with gardens so nice. Leave the Apple lovers alone, the
chains that bind them are so nice and shiny and make such pretty bracelets.
Maybe if you're nice to them, one of them will bring you a drink of ice-water
in your 'warm cosy place'.

~~~
pavlov
_Sorry, but you're wrong. The iTunes DRM was ridiculously easy to circumvent
even in iTunes itself. No mad leet hackzor skillz required. Since you could
trivially turn aac files into mp3 files in iTunes [...]_

Do you mean the "semi-analog hole" of burning protected tracks in iTunes to a
CD-R, then ripping the disc back into MP3 tracks?

If so, I wouldn't call that trivial because it requires a physical medium and
some level of knowledge about audio formats to realize the possibility (I
think a layperson would not understand that AAC->CD->MP3 is no more lossy than
AAC->MP3).

~~~
chc
I think the layperson would not know the word "lossy" to begin with, and would
just know that doing X allows him to play his music.

------
asknemo
It is a bit emotional, but understandable. I believe the situation would have
been totally different if Apple has these 30% rules and things long before iOS
becomes the leading platform, when developers has the choice what and what not
offer, and they can decide whether they invest or not. But the situation we
have here now is that many of them has invested substantially in the iOS
platform. They have invested talents, and have definitely helped co-promote
the iOS in one way or the other and created a solid user base. This bomb is
understandably very very unpleasant to them. Honestly if a developer/company
give in and accept the 30% now, what stops Apple from charging 35%, 40%, 50%
in the long run? How are they going to report to their investors and convince
them that their business models is not controlled by some giant company's
policy that they have absolutely no say in?

------
gokhan
Apple tries to tax after sales usage of the device as if it's a leased device.
They don't want to give up the upfront sales revenue of the device, and still
want to get their cut for the usage.

This both can't happen. Give the device free and tax the usage, or sell it and
live with the fact that the device is now belongs to the customer.

And iXYZ owners want to believe that they own the device. They can't hack it,
they can't open it, they can't put software on it on their own. They can't
even freely access the storage inside. And this kind of actions from Apple
reminds them that they just don't own the device.

When it came to the question of who own the device, Apple customers always
gave up their right to own the device in return of ahead of the time features,
polish, being cool etc.

------
iuguy
The Internet will route around all obstructions. I wonder if any of these
content providers would get in trouble for providing jailbroken apps with
music subscriptions from their websites? They could then encourage people to
jailbreak their phones to get 'the full experience'. I think that would be a
nice way of flipping the bird to Apple.

------
halostatue
I strongly suspect most people who are commenting on this haven't read the iOS
developer terms or the updated guidelines. I think these updated terms are
crappy and unfair, but they're not at all what some of the more lurid claims
are making—including, IMO, the one made in the accompanying article.

These rules are all about iOS In App Purchases (IAP). If your app is not
_eligible_ for IAP, these rules don't apply. Period. End of story. If your app
is _eligible_ , these rules _probably_ apply.

So, what's not eligible?

* Goods or services for use outside of the app. This means that Linode, TheLadders.com, Chargify, WeightWatchers, etc., are all in the clear because they can't even offer their services through IAP.

* Currency of any form. Even if Facebook's mobile app offered FB Credit purchases, it wouldn't be allowed to do so through IAP.

* Rentals. Pre-determined-time-limited content access is disallowed for IAP.

If one were to look at all of the materials that Apple has published on this,
this primarily seems focussed around downloadable content, not around streamed
or "rented" content, and certainly not around non-app goods or services.

Yes, Last.fm, Pandora, Netflix, Hulu and the like are in a bit of a grey area
right now, but I strongly suspect that they will come out in the clear on this
because they essentially "rent" the content to you; you can't download it and
keep it—they're probably not _eligible_ for IAP in the first place. On "The
true cost of publishing on the Amazon Kindle"[1], I have a comment that
outlines the exact sections[2] with paraphrases of the text involved.

I also have a comment[3] on "Why are you people defending Apple?"[4] that
talks a bit more about who this hurts, namely reseller-distributors. Content
owners are (for the most part) going to be ecstatic about this if they offer
the content for sale directly.

[1] <http://news.ycombinator.com/item?id=2228839> [2]
<http://news.ycombinator.com/item?id=2229495> [3]
<http://news.ycombinator.com/item?id=2229353> [4]
<http://news.ycombinator.com/item?id=2228419>

~~~
kenjackson
_Rentals. Pre-determined-time-limited content access is disallowed for IAP._

So can one do book rentals? You get a book for 100 years?

100 Year Rental Price: $10.00

Price to Purchase: $13.00

~~~
halostatue
Rentals are disallowed.

~~~
ianferrel
Exactly. That means that an app that wants to offer a "rental" can continue to
do so via an in-app link to another purchase process, and does not need to
offer the same service (for the same price) in a way that Apple can get 30%.

The value proposition is pretty similar. Let's be honest. The chance that a
kindle book is going to still work in 100 years is vanishingly slim. Might be
unworkable marketing-wise, though.

~~~
chc
The new rules forbid linking to alternative purchase processes without
allowing an in-app option.

~~~
kenjackson
But this isn't a purchase. It's a rental. Apple really needs to get crisper on
this.

------
Supermighty
I can understand Apple wanting to increase revenues. And even getting a bit of
the subscription pie. But this whole thing seem wrong. It feels like Apple
didn't really look at the whole ecosystem to see the ramification. Or that
they did, but are overly confidant in their platform and reach to be able to
force subscribers into this model.

I don't see this ending well.

~~~
harshpotatoes
Perhaps they're hoping that this will force some of the subscription
businesses off their platform, forcing people into whatever services Apple can
give through subscription (iBooks, music). And then the businesses that do
remain can actually pay. In the short run, I can't imagine users would care
very much if they could only get their books from apple and not amazon, and it
would probably help Apple lock in users. But, lock-in and anticompetitive
behavior probably don't make for a good experience from the user's perspective
in the long run... So, maybe they have a different angle.

~~~
ROFISH
It's one thing if Apple provides a competing service to Netflix, Hulu,
Rhapsody, et al. (And may be accused on monopolism.)

The thing that boils my britches about this is that Apple _DOESN'T_ have a
competing service. When the services leave, the iPhone is left only with
iBooks and iTunes, both of which are expensive and not very good.

~~~
harshpotatoes
I agree, but I also don't think it would be impossible for Apple to have their
own hulu/netflix like service, after all, you can already buy some videos
through itunes.

I think this will only be bad for users, but not bad enough to force masses of
people to leave. There will always be a cost to leaving Apple behind (both
psychological and monetary), and if Apple had to invent their own services to
replace those that left, I think they would be more expensive and maybe not
quite as good as other products, but they wouldn't be so bad as to force
people to leave their iphone, which still has many fun/useful features that
don't have subscriptions.

I think the only businesses that are in danger of leaving the apple system
would be: Music streaming, video streaming, and books, and I think Apple would
be able to provide their own in house replacements for those that left (for
better or for worse).

------
djtumolo
Selling subscriptions is too broad. There's been a lot of talk about music and
magazine app requirements, but what about other business services? Chargify, a
subscription billing service, offers an iphone app for its customers. Do they
need to offer sign up in the app, and pay apple? What about TheLadders.com, or
WeightWatchers?

A huge number of companies with an app and a subscription business model just
got hosed.

------
tjansen
I guess in the long run, most multi-platform content providers will simply
have to offer two products: one with iOS support and a 30% surcharge, and a
cheaper one that only supports open systems like the web and (plain) Android.

No one can afford not to support iOS. But on the other hand, no one will be
able to charge 30% more than the competition on other platforms.

------
ig1
Are companies prohibited from charging iPhone users an extra 30% ?

~~~
count
Yes - you have to make the iphone price as cheap as a user can get it outside
of your app.

~~~
thalur
I was wondering if there might be a way around that rule by claiming that what
you sold in-app was a different product from what you sold out-of-app (e.g. on
your website), but I'm not sure it would really work.

E.g. you sell the in-app "iPhone exclusive" version for $x and the out-of-app
"everything except iPhone" version for ($x * 0.7) and then provide a "works on
iPhone for no extra cost" special offer.

~~~
corin_
Or a seperate company/brand?

If Spotify was called Spatify on the app store, operated by a company that's
owned by Spotify, their product wouldn't have to match the pricing of Spotify
products on non-apple platforms... and perhaps 'Spatify' could announce a deal
that allows Spotify customers to use their product for free.

Then it just comes down to whether Apple follow the rules by the letter, or
apply common sense and tell Spotify not to take the piss.

~~~
metageek
Yeah, but then Spotify users wouldn't find Spatify in the app store.

~~~
corin_
Possibly they could call the sub-company "Spotify Magic" (random example - but
something that will show up in search results for "spotify"), or possibly they
could just ensure that Spatify gets well enough known for people to search for
its new name.

I suspect if any company did this they would put a lot more research and
thought into it than I have for my two quick HN comments - I'm really just
wondering what, if somebody took this approach, Apple's response would be.

~~~
true_religion
They could but Apple doesn't have to accept them into the App store. They can
easily say "these two companies are the same", and enforce the same rules on
them.

They're not legalistic, they're moralistic.

------
slouch
The best part of this article is, "High Lord Jobs."

------
dalton
I wish I had the balls to have mentioned this particular risk in my startup
school talk re:music a few months ago. People probably would have thought I
was being paranoid/delusional.

The subscription model is already pretty f---ed even without a Deus Ex Machina
from Apple.

------
bradshaw1965
As an aside, what is the fist graphic in the posted article? I probably just
don't understand the mark, but I interpret that kind of logo with
revolutionary, "fight the power" kind of stuff and this is just corporate
positioning, not revolution.

~~~
Stormbringer
<http://en.wikipedia.org/wiki/Raised_fist>

Given my brief scan of that article, there are too many possible associations
for the meaning to actually be clear. It could be to do with politics -
anything from accusing Apple of being Nazi's, Communists, Communist Nazis
(etc) and then there's the racial overtones.

It might just be a call for Solidarity.

E.g. I don't like this, if I revolt will you revolt with me? [ ] Yes [ ] No.

------
p90x
Apple is the forbidden fruit. Tempting, seductive and ill get you kicked out
of paradise.

~~~
Stormbringer
You might be right about forbidden fruit, but Apples aren't mentioned in
Genesis at all. It turns out that the first reference to the Apple in the
Torah is this:

[http://www.biblegateway.com/passage/?search=Deuteronomy+32:1...](http://www.biblegateway.com/passage/?search=Deuteronomy+32:10&version=NIV)

Based on 40% of the verses in the Bible that mention Apples being in the Song
of Solomon, Apple is definitely a naughty little fruit. :D

~~~
p90x
That's interesting. Did you know that apple's original logo depicts Isaac
Newton under an apple tree?

[http://upload.wikimedia.org/wikipedia/commons/f/fa/Apple_fir...](http://upload.wikimedia.org/wikipedia/commons/f/fa/Apple_first_logo.png)

~~~
Stormbringer
Song of Solomon 8:5 (New International Version, ©2010)

    
    
       Friends
    
     5 Who is this coming up from the wilderness 
       leaning on her beloved?
    
       She
    
       Under the apple tree I roused you; 
       there your mother conceived you, 
       there she who was in labor gave you birth.

------
forgotAgain
It does seem like they over reached on this one.

~~~
kenjackson
It seems like Apple's MO now is to over reach on everything, and wait to see
how much people push back. It actually seems like a real business tactic
they're using now.

------
protomyth
I am fine with Apple hosted content being at 30%, but when I have to do all
the work for hosting and delivery, 30% is beyond reasonable.

I would even be fine if the rule said that an app developer can provide no
link / no in app purchase unless it is through Apple. People using Amazon,
B&N, Netflix, last.fm, etc. wouldn't of had a problem because they know to go
to the website to buy stuff. The "must also" crap is the problem.

------
scdc
Maybe it will cause last.FM to shut down, or maybe if last.FM pulls out of the
iTunes store, it will fuel iOS competition with Android. Or maybe it will fuel
mobile browser app development. I like how the market will decide how this all
plays out.

------
cynoclast
Why are people still blaming Apple in this?

It's the recording industry that is the root of the problem.

Apple is very, very late to the game in terms of trying to own ideas and sell
über-cheap copies of information like physical products.

------
thewileyone
I respect Steve Jobs as much as his fans love him, but I think that if this
was announced after he has departed, no one would buy into it.

------
marze
Can't last.fm or anyone else not accept new subscribers from within an app,
and be fine?

~~~
Manfred
Yes, they can. They're just not allowed to link to their subscription page
from within the app. If they offer in-app subscription purchases the pice of
that offer should be the same or lower as outside the app:

"If you would like to make a subscription offer outside of the app, the same
(or better) subscription price must be offered inside the app […]"

Some people misread this sentence as "you can't put a content app in the app
store without giving money to Apple".

~~~
tallanvor
No, it means if you offer a subscription product, people have to be able to
sign up for it through the app using Apple's subscription service. They can
still let people sign up on their website, but they also have to let people
sign up on the app, and they can't charge more even though Apple is taking a
30% cut.

What Apple is doing is worse than what credit card companies do. --At least
with credit cards merchants can offer a discount for paying with cash.

~~~
chadgeidel
Actually offering a discount for cash is typically a violation of the
agreement the merchant signs with Mastercard/Visa.

~~~
tallanvor
No, it's fine. Section 5.11.2 of the Mastercard agreement notes that "A
Merchant may provide a discount to its customers for cash payments". What is
usually prohibited is charging an extra fee for paying by credit card.

Reference: [http://www.mastercard.com/us/merchant/pdf/BM-
Entire_Manual_p...](http://www.mastercard.com/us/merchant/pdf/BM-
Entire_Manual_public.pdf)

------
colinplamondon
Use a browser.

------
oceanician
Which IRC channel was that on then?

------
lotusleaf1987
Zach said it best yesterday: <http://news.ycombinator.com/item?id=2224469>

Of course Rhapsody [insert Last.fm] can't sell their stuff for a 30% margin.
It's not their own stuff!

They're trying to be the last link in a chain of 90/10 (or more) splits. They
repackage record labels' repackaging of artists' content. Do you think the
artists would find 30% economically untenable?

The App Store is 70/30 because Apple can take things straight from content
producer to customer. When the Apple takes the place of publishing,
distribution, inventory, sales, payments and shipping, there's real value for
that 30%.

When all someone wants out of Apple is merely to process the payment and send
things down the pipe, gee, who do they think they are? But that's not what
Apple is actually holding themselves out as. Apple doesn't want to be in that
kind of commodity market anyway. Seems reasonable to me.

~~~
jaaron
I'm tired of seeing Zach's comment reposted as if it's some sort of inspired
gospel.

Apple is positioning itself as _both_ a platform for applications and services
_and_ as a consumer service. The services offered by Netflix, Hulu, Rhapsody,
Rdio and so on offer value consumers have time and time shown they are willing
to pay for. These are services the content owners (artists), studios and
labels do not provide or provide poorly. Claiming they simply "repackage ...
artist's content" is misleading.

These services are increasingly cross platform, available on the web, mobile
devices, internet connected consumer electronics, game consoles, etc. They add
value to those platforms and can complete when the platform is suitably
independent. Those platforms provide only a portion of the necessary
infrastructure to run a consumer service. Purchasing, bandwidth, hosting,
encoding, transcoding, metadata, social networking features, inventory and so
forth are typically still maintained by the consumer service itself. They
already have these services due to their web presence.

Apple tries to play the game both ways in an increasingly monopolistic
fashion. Before you go on and start harping about Android, recall that
Microsoft was convicted not because it was the only operating system (it
wasn't) but because it used it's market advantage in the OS to restrict
competitors in other markets (browsers). Apple is doing the same thing.

It's one thing for Apple to provide competing consumer services. It's another
when they intentional block competition on their supposedly independent
platform. Keep in mind, as a platform provider, Apple doesn't provide as many
services as Zach suggests. They are little more than a payment services
provider, though their rates and restrictions are completely out of line with
the rest of that market.

Consider for a moment if Apple were to do provide the same APIs and
restrictions on all of Mac OS. Applications can only be made available in the
Mac App Store. Applications must use Apple's subscription and purchasing API
and no other API for purchases. And so on. They have their own browser? Why
not offer an API for web apps as well. It would be secure and user friendly.

"Apple takes the place of publishing, distribution, inventory, sales, payments
and shipping... Seems reasonable to me." I'm sure it does.

~~~
lotusleaf1987
Monopolistic? Apple is in no way a monopoly. They have 4% of phone market
share. Do you know what a monopoly is? Because based off your comment I don't
think you do.

"In economics, a monopoly (from Greek monos / μονος (alone or single) + polein
/ πωλειν (to sell)) exists when a specific individual or an enterprise has
sufficient control over a particular product or service to determine
significantly the terms on which other individuals shall have access to it.":
<http://en.wikipedia.org/wiki/Monopoly>

So what product does Apple have a monopoly on? Laptops? No. Cell phones? No.
Mp3 players? No. App store? No: <https://market.android.com/>

There are alternatives to Apple, you just don't like them.

Apple is a middle man, just like Wal-Mart, eBay, or Amazon who all charge for
their service (selling your products).

If you don't like it, sell it somewhere else, but calling Apple monopolistic
is factually inaccurate and intellectually dishonest.

Oh, and the reason I cited Zach's comment, is because the topic whether it's
Rhapsody/Spotify/Last.fm/Pandora/Netflix still applies and credit is due to
Zach for his spot on comment/analysis of the situation.

~~~
akashs
Actually, before you go putting others down, you should read about how this
stuff works. It's highly dependent on what the market ends up being defined
as. If you're talking smartphones, Apple certainly has more than 4%. MP3
players, again more than 4%. Tablets, again more than 4%.

And if you don't like the app store, Apple prevents you from selling it to
customers through other means. So you can't exactly go somewhere else.
Customers also just can't pick up and move to Android because of all the money
they've spent on apps and content on an iPad.

Also, there's plenty of points that have been made as to why Zach's comment
isn't necessarily "spot on" across the many times it has been posted. Many of
them haven't really been addressed.

~~~
lotusleaf1987
There are more Android phones sold than iOS devices every month. Apple doesn't
have a monopoly on anything, however they do control/own _their_ app store and
they can refuse to sell whatever they want in it. If you don't like it then
don't support Apple by buying Apple products, sell your apps on Android.
Actions speak louder than words.

Also, Jaaron was much more condescending that I was: I'm tired of seeing
Zach's comment reposted as if it's some sort of inspired gospel.

~~~
akashs
Kindly explain to me where above I made any mention of Apple having a
monopoly. But if you must push me:
[http://www.google.com/search?btnG=1&pws=0&q=apple+mp...](http://www.google.com/search?btnG=1&pws=0&q=apple+mp3+market+share)
and
[http://www.google.com/search?sourceid=chrome&ie=UTF-8...](http://www.google.com/search?sourceid=chrome&ie=UTF-8&q=apple+tablet+market+share)

Now when you're trying to sell apps on those devices, and Apple wants to 30%
of anything that is sold for those devices and intentionally blocks out
perfectly reasonable businesses, that becomes anti-competitive

Edit: Btw, I have stopped. I just bought a DroidX instead of the Verizon
iPhone. But that won't get me my $600 back for my iPad or the money for my
iTouch. Or the money for the apps I've paid for.

~~~
lotusleaf1987
Read my first comment again quoting Zach, it's pretty clear:

"Of course Rhapsody [insert Last.fm] can't sell their stuff for a 30% margin.
It's not their own stuff!

They're trying to be the last link in a chain of 90/10 (or more) splits. They
repackage record labels' repackaging of artists' content. Do you think the
artists would find 30% economically untenable?

The App Store is 70/30 because Apple can take things straight from content
producer to customer. When the Apple takes the place of publishing,
distribution, inventory, sales, payments and shipping, there's real value for
that 30%.

When all someone wants out of Apple is merely to process the payment and send
things down the pipe, gee, who do they think they are? But that's not what
Apple is actually holding themselves out as. Apple doesn't want to be in that
kind of commodity market anyway. Seems reasonable to me."

Apple is giving them distribution, billing, discovery/advertising, inventory,
shipping, et al-- 30% is a pretty fair cut I'd say, but hey if you disagree,
don't support them.

And why would you expect to get your money back? You had no guarantee at the
time you bought the Apps or iPad that the marketplace rules wouldn't changes,
that's to be expected as nearly every marketplace's rules change frequently:
see Amazon, eBay, etsy, Wal-Mart, whoever. I really don't understand your
complaint.

Also, I'm tired of discussing this topic as it seems most people have already
made up their minds on the issue regardless of the facts surrounding the
situation.

Disclosure: typing on a Dell, I own a Blackberry and an HTC Aria, and I own a
Macbook. I am agnostic to corporate entities, but I can step back and try to
detach myself and be as objective as I can.

~~~
akashs
Yes, I've read the post several times, both the original and your many reposts
of it. The trouble is is that it's not clear at all.

How does Apple do any inventory management or "shipping" given we're talking
about digital goods? By having a counter for number of downloads? When have
they ever done advertising or promotion the 99% of apps not lucky to be
featured on in the ads? I'll agree they do some distribution and payment
processing, but that's about it.

And I never said I had an expectation to get my money back. But when I paid
money for hardware, I expect to be whatever I please with that hardware. I
didn't pay $600 just to get access to Apple's app store on a 10" screen. I
paid $600 to be able to take advantage of the capabilities of the iPad. Things
like netflix and Kindle were a big factor in that decision (and honestly are
some of the best things you can do with it).

Apple has blocked out any way of doing anything other than the app store, so
it is a big deal. The fact that they sold me hardware doesn't entitle them to
30% of revenues from everything anyone wants to use that for.

~~~
lotusleaf1987
|How does Apple do any inventory management or "shipping" given we're talking
about digital goods? By having a counter for number of downloads? When have
they ever done advertising or promotion the 99% of apps not lucky to be
featured on in the ads? I'll agree they do some distribution and payment
processing, but that's about it.

It's on their servers and using their bandwidth isn't it?

|Apple has blocked out any way of doing anything other than the app store, so
it is a big deal. The fact that they sold me hardware doesn't entitle them to
30% of revenues from everything anyone wants to use that for.

Jailbreak it then, you have alternatives, Apple just doesn't have to support
them. Your complaints are without merit.

And you were lecturing me for telling someone that they clearly don't know the
definition of a monopoly when you're the one being the condescending asshole:
Yes, I've read the post several times, both the original and your many reposts
of it. The trouble is is that it's not clear at all.

Many reposts? I reposted it here twice, in reply to you and only because you
clearly don't understand it and haven't given it any thought since you're
still complaining about paying for something you have every option not to pay
for.

~~~
akashs
How does using their servers mean they're doing inventory and shipping? I'm
not understanding how it's possible to pay UPS to ship an app. Do you think
anyone would have an issue if Apple just wanted to be compensated for that
piece of hosting it on their servers?

You and I are not the average person. I can jailbreak, my parents cannot.
Jailbreaking then voids the warranty, which is a part of the money I paid.

And when I do jailbreak, exactly how will that enable me to get Netflix,
Kindle, Last.fm, Rhapsody back?

~~~
lotusleaf1987
|Do you think anyone would have an issue if Apple just wanted to be
compensated for that piece of hosting it on their servers?

When did Apple, or Google for that matter, because non-profits? Your argument
is illogical.

Their hosting and bandwidth is the inventory, distribution, and shipping
aspect. They also provide: discovery on their app store browsed by millions,
billing, marketing, advertising, and promotion. The 30% is because there is
real tangible value in the service Apple is providing. If you don't like it--
WebOS, Android, Blackberry, WP7 are all available to you.

Edit: Thanks everyone, I wear the downvotes with pride because some of hive-
mind on HN can't think outside the ridiculous anti-Apple jealousy. Whatever,
if you're downvoting me for presenting facts you don't like but not
responding-- you're a coward and a sheep.

As I've said before: I'm using a DELL laptop right this moment, a Blackberry
in my pocket, an HTC Aria on my desk, and I have a Macbook at home. I'm
agnostic to corporations, but this hyperbolic anti-Apple jealousy/rage is
nonsense and hypocritical at best. This Apple hate is blinding many on HN of
the reality.

If anyone wants to reply to me, please don't. I'm done discussing this and I'm
not even an Apple fanatic, my next phone will most likely be a WP7.

But here are some comments I thought were actually informative:

From Vacri:<http://news.ycombinator.com/item?id=2232812>

Unsustainable? How about 'normal retail practice'? It's funny watching people
froth at the mouth about normal retail practice.

I don't like Apple or how they run their business, but a 30% cut for a
retailer is even be a little low. Go into a bricks-and-mortar store and
usually 30%+ of the price you see is markup on the wholesale price.

Apple provide a service: they deserve to get paid for it. Even if Apple
allowed apps to be sideloaded, you wouldn't sell anywhere near as many apps if
you marketed them yourself, not to mention having to deal with organising a
payment system and easy, integrated way of getting them.

App developers are the wholesalers. Apple is the retailer. If you want to be
both a wholesaler and retailer for your app, then Apple isn't for you. Go to
Android... but you'll find it's still better to give Google a cut and be on
their market as well...

Another from Cletus: <http://news.ycombinator.com/item?id=2231385>

People love to throw around the antritrust word without--and this isn't
necessarily directed at you personally--knowing what it actually means.

Does Apple have a monopoly on phones? Hardly. Look at HTC, Motorola, Samsung,
RIM, Nokia, etc.

Does Apple have a monopoly on music? No. You can buy it from Amazon and
elsewhere. Likewise you can use Grooveshark, Spotify, Rhapsody, Pandora, etc
for different services depending on what country you're in. iTunes sure is
dominant though.

Does Apple have a monopoly on ebooks? Hardly. Amazon is a far bigger player
here. Amazon is not dependent on Apple as a means of distribution, although
Apple devices are obviously important.

Does Apple have a monopoly on TV shows or movies? Hardly. You can buy DVDs
from any number of places and downloads from the likes of Amazon. Content
producers like Comedy Central, CBS, Fox and others also stream directly from
their Websites (and they could do this in HTML5 if they wanted to, allowing
them to be viewed on iDevices, but alas they still choose Flash almost
exclusively).

So where exactly is the monopoly (virtual or actual) here? You can say that
Apple is the only one who can sell apps on iDevices and you'd be right. So
what? NBC is the only one who can broadcast shows on their stations. That
doesn't make them a monopoly.

So unless someone can produce a cogent argument of how antitrust applies--and
I've yet to see one--can we please stop bandying the word around like it has
any relevance here?

This isn't to say that some Congressman or Senator won't speak out or possibly
there might be a House or Senate hearing but that's really about creating the
appearance of doing something rather than their being any justifiable basis
for investigation.

~~~
jarek
I accidentally upvoted you. Sorry about taking away some of the pride.

The last time I looked into this, HN was a pro-Apple hive-mind, an anti-Apple
hive-mind, a blatant Google fanboy den, a collection of privacy-minded
individuals who despise Google with a passion, a bunch of Nokia haters, and pg
all at the same time. Janus has nothing on us.

