This comparison doesn’t seem to address the issue of who you replied to. If I were running a streaming service, knew the business intimately, and still couldn’t figure out how Spotify had such an advantage against me, I would be both perplexed and need to admit defeat.
I wouldn’t have the same sentiment against YouTube music or Apple Music, because these are explicitly part of the same companies that host the marketplace.
That’s true. But it also raises question about whether the marketplace should be able to advantage itself for its own applications in the first place? It’s “might is right” but is it ethical and will it create a better society? It seems consolidation is inevitable and meaningful competition impossible.
I mean, ultimately, if you run a marketplace without posted rules and only let your friends and your own self succeed, aren’t you at a minimum sort of cheating? Like a Vegas house who claims fairness but the house gets special odds?
Yes and it is also a borderline thing to me. Amazon Basics does the same thing and it's pretty messed up that you can put a product in the same marketplace you control and run out the competition.
Retail shelf space is a constrained physical variable as opposed to screen space which is virtually unlimited. Putting own white label product on shelf incurs stocking and restocking costs as well as shelf space which could have been used to sale other branded products.
Apple/YouTube music not having any platform fee does give them an unfair advantage. Not sure how they rank in their own app stores in music categories though. Android user here so YouTube comes installed by default and even Yt music. Not sure if Apple music comes pre-installed as well. If it does, it does give another advantage to Apple.
The fact remains that plenty of people prefer the name brand, and there's a type of 'fairness' baked in to this scenario as the house brands are very often packaged in a way that looks, simply, cheap; the stores are often paid by the brand name marketers for shelf space so they have a vested interest in not competing too hard with their house brand, so they package in a way which makes it look a bit second rate.
A few years ago, I worked on a video game published by Microsoft. We ran game servers in Azure, and on Windows for obvious reasons. The project had to pay for the windows licenses from MS, despite being entirely funded by them, partially developed by an internal studio, on aMS first party IP.
I don't recall how much it cost exactly, but the cost of the per-core windows server license hourly is not far off the cost of a core on AWS these days.
What difference does that make? Surely, any business decisions would take into account that it is all still Microsoft’s money.
“Paying” for accounting purposes, and “paying” where the payer loses access to the funds has different consequences.
For example, Apple and Alphabet can account for YouTube and Apple Music paying App Store fees, but leadership can ignore the fees for the purposes of selling a loss leader. Spotify cannot ignore the fees, since it would run out of money to pay other bills (or negatively effect net income).
Have you any examples of this happening? Because every experience I've seen points to sweetheart deals (such as android + spotify) but internal teams have to play by the normal rules.
>Individuals pay $10 a month for the AI assistant. In the first few months of this year, the company [Microsoft] was losing on average more than $20 a month per user, according to a person familiar with the figures, who said some users were costing the company as much as $80 a month.
Who knows if Apple is earning a profit on its Music + Classical Music apps or whatever else it bundles into its products. Maybe they consider it to be a small enough loss to offset the chance that a customer buys an Apple One bundle, which then makes up for the loss because the margins on cloud storage are much higher.
For physical products, which makes sense. I can’t imagine Apple TV+ was (or probably still is) at all profitable (especially considering how low the monthly fee was and all the promotions at the beginning).
Theres a big difference between allowing a project to run at a loss over the short term (the article says first few months of this year), and using a different business vertical to allow an unprofitable venture to proceed.
Microsoft seem to be pushing Linux in Azure quite heavily nowadays. Surprised about the Windows thing. Especially for game servers where Linux is in it's element.
Also, my experience of working in games is that the developers are exclusively windows. The backend services might use other OS's, but all the game development happens on Windows. When this was going on, I don't think a single developer in our room would have know the first thing about Linux.
> Especially for game servers where Linux is in it's element.
I think you'd be surprised at just how many games use Windows servers :)
usually video game servers, need a like-for-like copy of the engine for sync purposes and to make sure the clients aren't lying about physics calculations. up until recently there hasn't been an incentive for game developers to use/work on linux support - so game servers use good old windows.
Your cellphone maker shouldn't be eating into Hollywood's business.
Your online Walmart is making Lord of the Rings.
And you pay a 30% fee just to deploy your software into their walled gardens, which they monitor, remove the customer relationship, and make you jump through hurdles. If you are successful, someone can pay to place ads in front of legitimate searches for your brand.
Edit: Can't respond to comments anymore after being downvoted, so my response:
> Where and how is the line drawn? Should a cellphone maker be eating into map maker’s business? Laptop maker’s business? Camera maker’s business? A secretary’s business?
Perhaps when there are more than two vendors for one of the most critical pieces of technology for modern civilization.
Perhaps when you can deploy apps without taxation, control over distribution, unfair competition, scare tactics, or adversarial ad placement.
Right now the two vendors wield absolute control over one of the most essential societal functions. It's almost as bad as if they controlled the internet itself.
> Your cellphone maker shouldn't be eating into Hollywood's business.
Where and how is the line drawn? Should a cellphone maker be eating into map maker’s business? Laptop maker’s business? Camera maker’s business? A secretary’s business?
That would be silly. If both entities (e.g. YouTube Music and Google Search) are owned by the same company, to whom would you pay a fee? It doesn’t make sense.
In big corpos such departments usually have their very own budget, and operate as a quasi-separate entity from the others. Paying fees inter-departments is a very common thing.
Hm yes but in general if this happens too much it's frowned upon. Because all the bookkeeping to shift money within the same company actually costs money for no real reason.
If this happens a lot the department bearing the cost is usually compensated with a bigger budget.
Yeah but it's often not real billing. It's just to put a price on it so internal departments don't waste a ton of company resources because it's 'free'.
I work for a very large enterprise also and we've been instructed to stop internal billing for everyhing less than 10k, and everything above 100k must be compensated in other ways, like shifting of responsibilities or personnel between teams. This was done because various departmental interests were basically trying to 'make money' at the expense of other internal departments and creating a complex mesh of internal contracts that was only wasting a huge amount of overhead :)
The problem with this thing is that it can become a goal of its own and some departments think they are making a ton of money even though they're only shifting internal funds and causing huge expenses in finance.
In which case the post I responded to is a red herring because they claim (without evidence) that the transfer pricing is happening in the case of YouTube Music and Apple Music.
Still applies. Apple Music and YouTube Music may show losses because of the transfer fees they pay. But Apple & Google can then decide to keep them around even with their paper losses because they make other divisions more profitable.
Why would it be silly? One division paying another division for resources. That happens a lot and it makes sense in that it helps to figure out just how much resources are needed.
This is a solved problem. Google may not care but in general companies want to know if one of their businesses is actually making money or just a perceived success because of the conglomerate. Of course a company may fudge the figures to lean the calculations one way or the other but enough theoretical and practical data exists for accounting costs.
- YouTube Music doesn't pay fees on the Google Play Store
- Apple Music doesn't pay fees on the Apple App Store