Yes, and they take a 30% cut, with is insane. Like, completely nutso absurd. 30% is a reasonable tax rate for a government that provides roads, schools, defense, social security, etc., not a reasonable fee for a company to process electronic payments. But Google (like Apple) has no incentive whatsoever to reduce the price, because they have a captive audience.

If Google took a more reasonable cut, like 5%, maybe even 10%, then sure, I wouldn't be so bothered by them insisting that this app use in-app purchases for donations.

Google has reduced the cut to 15% for revenue below $1 million.

But as long as they force you into their payment plan AND not allow competition (ie additional stores) there definitely seems to be anti-trust problems.

So good luck getting funding for something that you tell the funder could earn millions if it works out. That means less greenfield investment, and ultimately less investment for apps that make less than a million, since only X% will end up doing so, but investment will be impacted for all.

I mentioned this in the context of this particular post where the person is soliciting donations, not the overall app ecosystem. I doubt he's making > 1 million in donations.

Solely under threat of upcoming litigation, yes, they now rip people off half as much.

Are you claiming that the 30% (or 15%) cut is to only support the payments infra, and isn't supporting the android ecosystem as a whole?

1. I think they should support the ecosystem by selling phones. That would result in far fewer perverse incentives and market distortions compared to their approach of taxing developers.

2. I don't think Google actually needs a 30%/15% cut to "support the Android ecosystem". I think they're charging way more than necessary, just because they can.

(Same arguments for Apple.)

I won't argue with 2 (I don't think either of us can really say with certainty, and then there's the second layer of arguments about what is "necessary" in a profit situation)

But for 1, this has some significant downsides to consumers. As it stands assuming most of the support comes from the android platform (ads and fees), you get price discrimination. The people who just want a phone to use the internet or stay connected or whatever don't have to subsidize people who do more.

I generally think having power users subsidize non power users is an ethical form of price discrimination. Thoughts?

> I won't argue with 2 (I don't think either of us can really say with certainty, and then there's the second layer of arguments about what is "necessary" in a profit situation)

Both Google and Apple have been stockpiling money for some time. Each company has over $100B of cash sitting in a bank account doing nothing, and the number increases every year. This suggests a market failure has taken place. In a competitive market, they would either be cutting prices or reinvesting profits into their product.

In Google's case, Android is not their main business so it's admittedly a little harder to say whether Android specifically "needs" to take a 30% cut of app sales to sustain itself. But I don't believe for a second that Google chose that number based on any notion of "need", I believe they chose it because that's what Apple had already set as the standard. And when it comes to Apple, the iPhone is their core business, it is wildly profitable, and the evidence seems clear that they are not doing anything useful with the money (see above).

So yeah, I do actually believe there's pretty clear evidence that these fees are just greed and not needed to subsidize anything about the platform. Whether or not such subsidization is ethical is a moot point.

It's really not the same thing. With Donations you want a subset of users to pay for the app, who really want to. With a paid app, every one needs to pay.

Also, a donation is very different than selling something from a legal point of view. When selling, you need to pay VAT.

One could keep two apps, one paid and one free, but then on the paid one you're essentially paying 30% to Google and about 20% more to VAT. So you're effectively losing half the money and having to do lots more work to maintain two apps, and their subsequent ASO.

Why can't you do an in-app purchase that is the donation and doesn't unlock anything? Yeah, you're still paying the various taxes, but you don't need two apps.

Yup. You're right. You can do that.

You then have the problem of writing and maintaining the code for the IAP, which isn't always trivial. But yes, absolutely do-able.

At this point it's the same thing as selling an invisible skin for your app. The fundamental issue is that of selling vs donating.

Yep. And if you are in-tune with your users, create something the power-users will appreciate.