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Apple’s defense of the App Store just shows how hard it is to compete with Apple (theverge.com)
75 points by jmsflknr 20 days ago | hide | past | web | favorite | 56 comments



> The message here seems to be that if companies don’t like Apple’s policies, they’ve got other options. Go find your riches on Android or make a Roku app. But developers have a huge financial incentive to be in the App Store. It’s often been reported that iOS users spend more money on apps than people with Android phones, and Apple leans on that advantage.

Apple's argument would seem to be that this financial incentive is the direct result of their policies, so forcing them to change those policies would reduce or eliminate this financial incentive.

It's a reasonable argument, although I think it's unknowable whether it's true.

Legally, it might not matter.


I tend to agree with this argument, and here’s why: Apple’s brand across the board is about controlling every aspect of the user experience so they can make it a cohesive experience the user enjoys. They do this at the expense of short-term monetary gains from things like advertising, and don’t give a damn about making life difficult for their business partners. This is not the result of their success but likely the reason for it. There’s a reason it was so culturally difficult for them to license “clone” Mac hardware in the 1990s; it’s just not in their DNA.

They understand that the end user relationship is all that matters. For Apple’s brand to succeed, they have to own the relationship entirely so they can protect their users from bad actors. That is literally why a large segment of people choose Apple products. Do iPhones have malware problems on the scale of Android? No, because of Apple’s heavy-handed control of the App Store. I honestly think Apple would shut down the App Store entirely in favor of something more universal like WASM before ceding control of the user experience. General platform security / privacy also benefit from this approach.


Are we justifying potentially illegal behavior by saying "that's their brand" and it helps them get wealthy in the long run?

Monsanto does the same with seeds. They do RnD, develop seeds and force farmers to buy seeds directly from them, control end to end and probably produce higher-yield crops with lesser diseases. It is their "brand" but should we justify that behavior?


> justifying potentially illegal behavior

No, that's putting the cart before the horse. The question isn't "is this (presumed) illegal behavior justified?"; the question is "this behavior is illegal if it is unjustified -- is it justified?". The illegality (should) be a result of answering the question "is someone hurt unfairly?" If the behavior in question is profiting from their own hard+smart work and not sharing the wealth as much as partners want, it shouldn't be illegal (or at most, the illegality is in keeping too high a share of the profits). If the behavior is bait-and-switch trapping people and ripping them off by hooking them with deceptively low onboarding price with high back-end "debt service", then it should be illegal.

This is the principle underlying anti-trust/monopoly law.


I think we simply need to look at the iPhone as a platform on its own. Sure, they own a sizable chunk of the market, but so does Android. People are free to develop on Android, it’s just they don’t as often because Android made some platform decisions that for whatever reason caused people to not make App Store purchases.

There is a choice in platforms — but the monetization situation on the Android platform makes it unattractive to developers for whatever reason. Why are users more willing to spend money buying apps on Apple’s store than Google’s? I suspect it is because of Apple’s stringent App Store screening process. Yeah, it sucks ass for developers but again, this is Apple’s MO. Apple takes care of their end users, Google takes care of their business partners (and this is a pretty consistent theme across both companies and apparent in their approach to product support).

I often find this is useful if followed up with another question: Is there a market for tablets, or is there just an iPad market? Would the entire model have been as successful without Apple’s approach? Remember, Windows tablets and netbooks had hyped and fizzled long before the iPad. Would it have gotten off the ground before fragmenting the user experience into a thousand pieces?


>Apple's argument would seem to be that this financial incentive is the direct result of their policies, so forcing them to change those policies would reduce or eliminate this financial incentive.

I think that Apple's policies are definitely what makes people spend more money through the app store, but that in itself is only really a financial incentive for Apple. Changing their policies would mean more apps distributed outside the app store, which would probably mean more money for developers (but less for Apple).

For an example of this, see Fortnite being distributed outside of the Google Play store. Google didn't get a cut of all the Fortnite in-app purchases, but Apple did.


It's funny that Apple shows competing alternatives to Safari on iOS when in fact all iOS browsers use the same engine.

https://www.apple.com/ios/app-store/principles-practices/


Relevant article by former App Approval Chief at Apple: https://medium.com/@phillipshoemaker/apple-v-everybody-59030...


I feel strongly that his comparison to Target doesn't really apply. Shopping at Target can be compared to browsing the App Store, but it should not be compared to In App Purchases.

When you install an app from the App Store, Apple obviously is involved because they are providing the marketplace. It's like walking up to the cashier at Target and paying for a laptop. Of course Target gets a cut, it's their store. But after you take that laptop home, Target doesn't have a claim on anything related to it anymore. If you use that same laptop to sign up for Spotify, Target doesn't have claim to a 30% cut of the Spotify subscription.

I wonder how Apple would feel if Target started requiring a 30% cut from Apple for every app store purchase made on iPhones that were bought at Target?


The comparison to Target doesnt apply at all because I can go buy the same product from Target at Walmart or Bestbuy or etc..... Sure Target makes money off of the item but I do not have to choose shop at Target unless Im buying a Target brand item.


From the article:

> Target, for example, is a standard, old-school brick and mortar shop. You go to find specific products and walk up and down aisles. When you find something that interests you, you don’t purchase it through that product. Instead you bring it to the Target checkout clerk, and they will charge you for it. And believe me, Target gets their fair share of the purchase of that item. If Target finds that the product has stickers telling you to purchase this item from Amazon or another location for a lesser amount, Target will remove the item from the shelves, and rightfully so. It is their brand that is bringing in the customers, not the products.

It seems at first glance like this would largely contradict Apple's earlier arguments that purchases are between app developers and consumers, and that it's just an intermediary in the process[0]. Anyone willing to comment about a subtlety to this argument I could be missing?

[0]: https://www.mercurynews.com/2019/05/13/apple-app-store-lawsu...


I don't believe it contradicts it. Apple claims that it does not set the price, the developers do. That's what they mean when they are just the intermediary, they facilitate the transaction but are not part of it.

I think his example is poor because Target does set the prices on products, for the most part. I think something better would be a flee market. The flee market operators provide services to facilitate the sales of the vendors and they can also choose which vendors are allowed to sell in their market, but they do not control the prices the vendors sell at.


Just as a point of precision, Target does not technically set the price of any given manufacturer's goods. What they do when you get to that point in your talks with them, (and only if you're not ginormous), is to strongly suggest that you sell your product at such and such price. If you don't, they're gonna walk and sign on your competitor instead.

It's devilishly ingenious, because, as I found out the hard way, in a court of law, they don't consider that to be setting the price. You still have the power to set your own price. You just won't be in Target if you pick the wrong price.


What do you mean? Target doesn't by wholesale and resell? They don't sell products for their own revenue, and pay for those products as an expense? Is the retail sale price a factor in the computation of how much the wholesale provider is paid?


Ok my mistake, I thought target purchased goods at wholesale price and then re-sold them at whatever price they wanted. So Target was a good example after all.


The analogy sounds good, up until the product has stickers telling you to purchase this item from Amazon. That's disingenuous. The stickers in this analogy would tell customers that they can go to the product's own web site to register for a subscription. That's what Apple doesn't allow.


He was also recently on a podcast with Mark Gurman: https://twitter.com/markgurman/status/1133500919667187712


If you think it's tough dealing with Apple, try running an app that allows adult content.

We're not allowed in the app store, we're not welcome on any major payment platform, and thanks to Apple dragging their heels on PWA support in Safari, we don't have any access to push notifications (or most of the other major native features).

The vast majority of our traffic is on iOS, but we're completely locked out from providing a native experience thanks to Apple's bullshit policies.



Apple needs to allow you to change the default apps (similar to how you can change the keyboard) for this argument to hold up.


Also allow apps to allow purchases inside without going through Apple's in-app purchases. Maybe they need to decide on a case-by-case basis, or maybe only for apps for companies with a large external presence, but not being able to buy eBooks through the Kindle app, because Apple wants it to go through their own in-app purchases instead of Amazon's own payment gateway, is frustrating.


Also...

- Kindle

- Kobo

- Audible

- Audiobooks.com

They're all equally frustrating as one another on iPhone. It pisses me off that I can't just do a one click purchase and listen on my iPhone or a "Read next book in series" button. I have to log into the website and purchase and go through a whole fucking song and dance just to get a book to listen to on my journey. The user experience for this use case quite frankly sucks balls.

I love my iPhone, I tried to become an Android lover a while back but went back to my iPhone because I want a device that just works without making me jump through a million hoops and my iPhone does - except for this use case which is about a thousand times worse than Android.


If they allow enough In app purchases not to go through the store then they have no way to collect money from anyone, Since all apps could then just collect their money that way.

If you limit it only to an anointed group of large companies then you have formed a cartel, which itself is likely illegal.


They could do something like Microsoft has with Azure where you have an Enterprise Agreement whereby you pay some licensing fee and then they allow companies to route through their own payment gateways to make for a better user experience.

People say Apple care about the user, but they don't, they care only insofar as ensuring lock in. They don't care if you hate Apple, just so long as you keep giving them your money. As long as you don't hate them enough to leave, they've done enough.

The only way to fix it is if enough companies make their user experience so much better on Android that having an Android device is a more attractive offering than an Apple one and enough users flee Apple for alternatives... but companies don't give a shit if you want Android or Apple, what they care about is how much they have to pay developers to win your money and your eyeballs on their products.

I've worked on a number of high value development teams for these types of apps across mobile platforms and this attitude has been common across all of them: If they can still win your money through a crippled user experience that it costs them a minimal amount to maintain across both platforms, that's what they do. They want Apple's market. They want Android's market. They don't want to maintain two applications and two development teams because that increases costs and they want similar user experiences on each device because brand fragmentation hurts their image. So in this sense Apple is also hurting Android and it's evidence they don't really give much of a fuck about the user as long as they're getting your money.

I say this as someone who has experience on the inside of development teams that provide the apps you love on the devices you love, and I say this as someone who loves my Apple devices but am by no means an iFanboy.


Your arguments rest on the idea that the independent software providers don’t care about the user experience and are simply going to try to minimize costs. You said as much.

Therefore, If Apple allowed alternative in app purchase experiences, there would simply be a race to the bottom to provide the cheapest user experience they could get away with on both Apple and Android devices.


> People say Apple care about the user, but they don't, they care only insofar as ensuring lock in. They don't care if you hate Apple, just so long as you keep giving them your money. As long as you don't hate them enough to leave, they've done enough

Welcome to every service platform ever.

If you build the platform, there is no reason you should not have control over it and profit from it. You are not providing a public service. You are providing a private storefront on a private platform.

This is like if I had a lemonade stand in my backyard, and people walked in and started complaining that the lemonade I sell is marked-up and too expensive, and that they should be allowed to build their own lemonade stands in my backyard. And that I should provide them with the tools to do so.


They could start with a specific list of allowed uses:

* purchasing a physical item * purchasing an electronic item accessible outside of the app * subscribing to a service accessible outside of the app * purchasing things through the app owner's own payment gateway

And then expand from there as necessary. Probably the restrictions would need to be tighter than that, but something along those lines.


Some of those already allowed.


Exactly. I would even go a step further, considering Microsoft’s antitrust issues from tying Netscape to the Windows OS: most of the iPhone’s preloaded default applications shouldn’t be there at all. Ideally users would be prompted at setup whether they’d like to install the Apple version.


IE, not Netscape. And didn't history show that shipping a default browser in the OS (which can be used to install additional alternate browsers) wasn't so bad after all?


Also I'd need to believe that these competing apps are genuinely on the same playing field as Apple's.

For example, why is there still no Spotify app for the Watch that matches Apple's Music app? I can't believe Spotify isn't interested in making one...


Spotify says Apple didn't allow them [0]:

> When Apple launches their new Apple Watch, they dismiss our proposals and won’t work with us to develop an app for it.

Apple denies this[1]:

> When Spotify submitted their Apple Watch app in September 2018, we reviewed and approved it with the same process and speed with which we would any other app. In fact, the Spotify Watch app is currently the No. 1 app in the Watch Music category.

0: https://timetoplayfair.com/timeline/

1: https://www.apple.com/newsroom/2019/03/addressing-spotifys-c...


But the most interesting parts of this new site relate to competition. In one section, Apple goes over the core, built-in apps on iOS and lists the many popular third-party options that are available from the App Store in each category as alternatives.

I dare someone to try it. Take all of the default apps and hide them away in a folder somewhere and replace all of them with alternatives. Let me know 1) the quality of your user experience and 2) of all of the annoyances, how many of them are due to the lack of "special" capabilities and integration only available to the in-house apps?


2 things I really hope from this. Apple can no longer block side-loading, and the dumb restriction on browser engines goes away, but I guess I will see how this law suite goes.

Also It's hilarious how they claim it's competitive. You can only install one app store.


" (Apple takes a 30 percent cut of subscriptions for the first year a customer is signed up and 15 percent for each year thereafter."

That is a considerable amount of paper.. How do you make any money when their cut is so high? Anybody with experience? I wonder how this shakes out annually with an app like Netflix.


Netflix doesn't give up 30% or 15%. It's listed as an example of a "Reader" app, so Netflix subscriptions take place entirely outside of Apple's infrastructure[0] and therefore Apple get zero of that money.

> How do you make any money...

The remaining 70%/85% is a pretty good start. As they say before that point, "developers have earned more than $120 billion worldwide"

[0] The point Apple glosses over here is that Netflix isn't even allowed to provide a link back to their site for subscribing within the app, which seems difficult to defend.


Netflix only recently removed in-app subscriptions; before that they were paying X% to Apple for every subscriber who paid via iTunes. And still are for anyone who is still paying that way. Although surely it was a sweetheart deal always below 30%, and potentially below the 15%.


Fair enough. Still a rather large margin.

More to the article's/ your point, not being able to provide a link back to your app is kind of kind of anti-competitive. They want you to subscribe using their own systems.


> The point Apple glosses over here is that Netflix isn't even allowed to provide a link back to their site for subscribing within the app, which seems difficult to defend.

How is it difficult to defend? If I am selling my product in a Target, I am not allowed to put stickers all over it telling people to buy it from Amazon instead. No reasonable storefront would allow this, really.


Don't sell on the App Store if you can't handle the 30% margin.


Apple's market share is low enough that it may continue to be unchallenged by enforcing all its own apps to be the default apps. Antitrust will probably not apply to them, I suspect.


This gets into an interesting consideration around what monopoly means. Up until now it's always been about market share, but the interesting trick apple has pulled is, while not having a great chunk of the market, they DO have a massive chunk of mobile app revenue, hence mobile devs so focused on iOS in spite of total available user base relative to Android.


The US government (for example) doesn’t care about Apple’s world wide market share, they care about the US.

And in the US Apple’s market share is MUCH higher.


Still 10% below Android though.


Not according to [1]. Install base of iOS is higher in the US

[1]: http://gs.statcounter.com/os-market-share/mobile/united-stat...


Not even close to anti-trust triggering size though


I am not a lawyer by any stretch, but I remember from conversations here recently about anti-trust, is that it all depends on how the "market" is defined. Apple has a non-monopoly share of the smartphone market, or even the app market, but they do have a monopoly share of the iPhone market. Sometimes, that's the relevant metric.


By that logic, any manufacturer who doesn’t produce a commodity is automatically a monopolist.


The metrics might be how far they are using their weight to one-up competition within their ecosystem.

The same point has been raised with Amazon using its platform wide vision to see market trends and enter profitable niches with its own brand.

There’s an effort to redefine anti-competitive behaviors within a platform, it might end up being called something else than anti-trust, but it’s a real effort.


Not just any arbitrary one, but certainly one that is big enough is a monopolist. This seems obviously true to me.

The big insight from Lina Khan's work is that harm to consumer welfare is sufficient but not necessary for an entity to be a monopoly. Bigness itself is a problem for society.


What’s the definition of bigness in this work?


There are debates to be had at the borders, but FAANG are clearly on the wrong side of it.


That’s a non answer. There must be a structural definition, otherwise who gets to decide?


If Microsoft defaulting IE8 can result in a antitrust lawsuit, I believe we will see the same applied here when it comes to assistants, google maps, browsers and such.


I had three apps denied because they where 'too close to existing Apple products'. (They where not). Break that monopoly!


What a joke! Apple made a product people enjoy using and an App Store people trust. Now, companies are complaining that Apple is stifling innovation because their App Store is charging 30% and making competitive products. Tough shit. It's their walled garden. Don't build for the App Store if you're afraid of competition.




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