I want mozilla to charge a reasonable price for app developers. Basically, not 30%, but 10%. I want them to be self sustaining and successful, but also apply pricing pressure on the other markets who are just charging waaayyyy too much. I can't believe even MS is getting into the game, making an app used to be free...
In order to provide phone-bill based billing, opposed to credit card based, Mozilla will need a large healthy margin.
Phone companies want semi-ridiculous fees which make paypal & credit card's 3% look generous. Yet I think Mozilla would be wise to leave phonebilling open as an option. Carriers demand profit and are scared of Apple making them redundant.
That 30% is thus leverage and running things close to cost at 10% would reduce Firefox OS's appeal to carriers. At the end of the day Mozilla needs to keep the carriers happy to succeed.
I was confused by this statement, which I think you're referring to:
"Firefox add-ons are free and those for Firefox OS will certainly be free also."
I'm not sure if that means there will be no paid apps for Firefox OS, or that Mozilla won't take a cut on paid apps, or just that Mozilla won't charge developers a fee to list an app.
I hope it's the last option. They should allow paid apps and take a small cut, as you said, so they have a funding source other than Google, increasingly their competitor.
But they have time to figure out the funding aspect. I just looked up the story about the latest Google/Mozilla deal in December (I'd forgotten the details), and it turns out it's almost $900 million over three years: https://allthingsd.com/20111222/google-will-pay-mozilla-almo...
I agree so much. Not-for-profit asking 30% ? Really? Really-really? Yes sure you need money to go on making stuff, but as much as Apple and Google? Give me a break.
That's for-profit, nothing more, nothing less.
Want devs? Well, just take whatever is needed to drive the infrastructure, not a penny more.
I would be interested in seeing the numbers on this, as I have a hard time figuring out how they could not make a huge profit on selling other people's work.
Thanks for the link. It may not be a cash cow in comparison to the rest of Apple's business, but a 44% gross profit margin sounds pretty substantial to me.
I think you misread that article. In the most basic sense, it isn't possible for Apple to get 44% profit margin when developers get 70%.
Here's how I understand the argument in the article (but keep in mind the numbers are as of 2010 so they aren't current.)
Basically, the article is saying that Apple claimed that developers earned $1 billion through 2010. Since developers earn 70%, the total revenue coming into Apple would be a billion / .7 = 1.428 billion giving them a profit of $428 million (matching the figure in the article). Then the article does some estimations about how much of that $428 million goes to the credit card company and is used for processing instead of being Apple's profit and calculates that Apple only gets 44% of their 30% as profit. (Although comments on the article suggest that Apple might be able to get more favorable deals with the credit card company than what was used in the estimations.)
So if you trust the article's credit processing fee assumptions, then Apple gets $189 million of the $1.428 billion which is about 13%. And if you factor in their costs for free apps ($81 million is cited in the article), the effective percentage becomes ((189-81)/189) * 13% = 7%.
Edit: I'm pretty sure these numbers are the right interpretation of the article. Somebody in the comments mentioned that the 44% should be 14% net profit since it matches some graph that I haven't seen and that seems similar to the 13% I got in the above calculations.
I don't know anything about the app store, but the 70% is purportedly the developer's revenue from someone's app purchase. The 44% profit margin would mean that about half of Apple's 30% app-revenue-cut goes to the cost of running the store and a little less than half goes to Apple's coffers.
Right. But I think the more significant number is what percentage of a user's purchase becomes profit for Apple. After including expenses for free apps (assuming the numbers in the article are accurate and keeping in mind this is old data), the profit margin on that 30% drops from 44% to around 25% such that Apple nets about 7% of App Store sales.
Before you make such demands, it is not perhaps a good idea to understand where that 30% fee goes? Hosting, distribution, payment collection etc are an important part of an app market and they aren't free.
They won't lock down the distribution source as Apple does so you might have competition among marketplace providers. If you think 30% is too high, you are free to create your own marketplace with a 10% cut.
