They could have made small concessions and avoided so much of this. But every step of the way they act like a child throwing a tantrum, adhering to an interpretation of the rulings that obviously don’t fall within the spirit of the rulings. My 10 year old pulls these kind of stunts, ever careful to do what I said, knowing exactly what the intent was.
They could adjust the app store tax to a more reasonable level, such as flat 15%. Even 20% would make it much less severe. But those bean counters never wanted to take charge of this revenue drop and losing competitive price advantage from the 30% fee on other services, so there they are.
As I have been saying this since 2015, they should have launch the Game Store as a separate thing, and keep that 30% cut. Gaming accounts for ~75% to 80% of all App Store revenue.
And then just gradually lower the other App category 5% every 3-4 years, We would have arrived at 20% by now and looking at 15% in ~2025 without possibly little backlash.
Instead they decide to keep those 30%, and continue to offer AppleTV+, Apple Music, Arcade, Fitness, News and all other services operating at zero margin for potential to customer lock in.
From all the public information and readings I am willing bet this is a strategy championed by Eddy Cue and ultimately won in the internal Apple Discussions.
You needed Visual C++ (which if you could use the standard edition, looks like it would run you ~$120). $400 annual signing certificate, $1500 for the BREW Builder compiler, anywhere from $750 to $3,600 in testing and certification costs depending on what functionality your app needed, what additional testing the carriers required and how fast you wanted it done. Finally after all of that, you still needed to negotiate your pricing plan with each carrier, of which you as a developer got to keep 80% of the wholesale (not retail) price of your application.
So in sum, to start developing for phones, you needed to have between ~$2,700 and ~$5,500 in up front cash costs. Not counting the costs for phones to test on because realistically you need that today too. Then you got 80% of your wholesale price to each carrier. And while I don't have numbers for the retail markup the carriers were applying, I'd bet it was higher than 10%.
Given that, what's Apple's incentive to voluntarily go down to 15%. If 10 years from now they're fighting the same battles again and people are asking why they don't just go to a "reasonable 7.5%", what good did they do dropping the price before they absolutely had to?
> The thing is a flat 30% used to be the "reasonable level".
That's almost 20 years ago and the market size was significantly smaller, so they could justify 30% to run the ecosystem. In fact, Phil Schiller actually thought 30% won't last forever if there's any competition. The only reason they could keep the 30% tax is the mobile market duopoly.
Phil Schiller is in the process of following SEGA footsteps, turning XBox into a brand for Microsoft Game Studios, where the XBox console becomes irrelevant, if it stays around even.
So naturally he cares about what other stores outside XBox charge.
You won't see him proposing cheaper charges for game devs targeting the XBox console.
The incentive is that the alternative is a fair competitive market is forced upon them and they find that market forces drive the rate down to basically no profit because it’s “just” software distribution.
You're right. I can only hope this sort of short-sightedness bites it the same way it has always bitten groaning lurching too-big-to-fail beancounters running tech companies.
not really when some of their personal wealth + pension funds and some other financial made up products are relying on Apple and big tech stocks being intact :) simple.
Judge: "viewed holistically, Apple’s practice changes undermine the spirit of the injunction"
This is not how law works. If Apple complies with the text of the ruling, it's in compliance. You can't hold anyone in contempt for violating hand-wavy holistic spirits.
If Epic wants to claim that the remedy was insufficient, that's a different appeal.
Your binary take is not how American law works nor has it ever worked that way.
Utilizing the intent of the law/ruling is a completely valid school of legal thought that is regularly practiced.
If you disagree with it, you may wish to talk to your state legislature about proposing a constitutional amendment barring the practice. But incorrectly claiming how it isn’t how things work won’t change this practice.
