> Apple wants their cut. This is the only way for them to get any cut at all. It’s either this rule or $0 revenue.

Why do they deserve a cut?

Uber and Lyft, deliver a material service, Apple have not contributed to that in any way beyond existing as a general purpose computer manufacturer.

Take an alternative, food delivery service, you pay a monthly subscription for a set selection of fruit and veg delivered every week. The cost is made up of food cost and delivery cost... You could sign up through a website, or you could sign up through an app on Apple's app store, in the later case the only option would be to increase the price by 30%, because there is no where near 30% profit left over.

Not convinced? Ok lets go to an extreme, what about a mortgage monthly repayment app, that's essentially a subscription to your home right? Do you think Apple deserve to have almost 30% of the value of your house for the privilege of letting you use an app to pay? Does their App store really deliver that much value?

Before, it was sort of justifiable when people were trying their get rich quick schemes with flappy bird clones... because the argument from the other side was a weak "but that's my get rich quick scheme", Apple's platform and what they shove in front of users faces made a real difference to the almost pure profit of those Apps, the apps simply would not be popular without Apple... but as soon as we start talking about apps that deliver material services and other significant value it makes no sense to argue that Apple deserve even 1 penny. Apple have gone completely fucking mental with their own greed, they think they deserve a slice of the entire world.

Where's Uber without a trustworthy, city-corner-accurate GPS location for every driver and rider? Where's Instacart without a high-quality barcode scanner^W^Wcamera in the pocket of every shopper? The platform and software Apple delivered enabled those physical businesses.

> Where's Instacart without a high-quality barcode scanner^W^Wcamera in the pocket of every shopper?

Fairly certain that I, the iPhone owner, paid for that in full. Plus a healthy margin.

I guess but that's not really how services like that work. And iOS is 100% a service with customer owned hardware. The real cost of your iPhone is paid by every publisher that wants to sell you stuff on your phone.

Amazon operates this way, DoorDash operates this way. You aren't paying the cost of your deliveries, sure you get charged a fee but the bulk is paid by the seller forking over 30% of their revenue for the privilege of selling to you.

Just because you're paying doesn't mean you aren't the product.

Your argument is essentially the same as for patents... "I invented this tech, everyone can use it to create whole new things, I deserve a cut for my investment."

But Apple didn't invent GPS, it didn't invent the barcode scanner. Apple sells a hardware with a ridiculous profit margin. Devices that only have value through the software that is written for them, Uber is not selling a device with a GPS, they are selling a taxi service (for better or worse), and they will use whatever is available on the device to make that work well.

Developers for 10+ years abandoned Symbian, BlackBerry, webOS, Windows Phone and everything else and instead focused on better hardware, software and developer APIs (iOS and Android) and led other companies to die because either their hardware wasn’t good enough or consumers were abandoning them because they couldn’t download their favorite apps.

So maybe Apple did something “right” to deserve millions of developers and billion+ consumers to chose them instead of others?

It’s awesome to be in 2022 and act like “Apple doesn’t deserve anything”. Look at last 15 years of mobile history and what Apple has done to this industry.

Apple did do something right a long time ago... but it doesn't mean they get an indefinite 30% cut of the entire world.

I don't have a stake in this, I don't own an iPhone or Android phone, or any smart phone and never have... I just see a rent seeker abusing their position as much as possible.

> Developers for 10+ years abandoned Symbian, BlackBerry, webOS, Windows Phone and everything else and instead focused on better hardware, software and developer APIs [...]

Note that we are discussing a huge markup on a material service, not merely software.

You know something else that enabled that? The internet. And mobile connectivity. So 30 % to each of these as well would be more than fair, right?

> Uber and Lyft, deliver a material service, Apple have not contributed to that in any way beyond existing as a general purpose computer manufacturer.

If the iPhone was a general purpose computer, we wouldn't be having this conversation.

Well that's the problem in a nut shell. It is and it isn't... but it should be.

Yeah that's the problem entirely. We need legal regulations here to force Apples hand. If you can't define in simple terms what specific category of entertainment your device falls under then you've made a general purpose computing device and that must come with requirements that users can load whatever code they desire onto it with your blessing.

Allow users to do that and they can put whatever rules they want on their store.

Feel free to start your own company that makes phones that behave however you want. Why should you get to decide what other people’s products “should be”?

why shouldn't people that have to use the platform have some influence over it given the level of integration iOs seeks to have in their users lives

> Uber and Lyft, deliver a material service,

And Apple's not asking for a cut of that. Apple is asking for 30% of the monthly Uber Membership fees, created as an IAP. The part that is completely non-scaling to the amount of rides the person takes. The part that is practically guaranteed to come from Uber's profits and not from the end users or from drivers.

So, I really find it hard to care about big companies fighting about it.

> e, what about a mortgage monthly repayment app, that's essentially a subscription to your home right? Do you think Apple deserve to have almost 30% of the value of your house for the privilege of letting you use an app to pay?

Apple's made it a point that they don't collect 30% on real (non-digital) purchases. Like a mortgage. They would be collecting 30% of the $25 convenience fee your bank slaps on, not the mortgage payment. Which may make it less likely a bank decides to add those fees.

Why does your grocery store deserve a cut? I’m struggling w how to apply this to other industries.

I mostly support the argument that EVERY middleman is useless but…we kinda live in a world of middlemen.

Some middlemen are completely useless, others play a critical and necessary role in providing access to a product, and there is a whole spectrum in between.

There is some reasonable cost involved in sourcing food from different countries reliably, regularly, in quantity into your local supermarket. Sure they take a profit, but they invested in infrastructure and employ people to put it all together, without which you wouldn't have a good selection of affordable food... They add a tangible value, and in fact effectively reduce the cost of the end product through scale (it's more cost efficient to deliver a million oranges over a long distance than single oranges in a disorganised manner).

Apple are not part of this equation, without Apple it would still exist, it might only be slighly less convenient to pay and select via a native app.

In short, Apple is an artificial middleman... they are at the extreme end of the useless scale, the rent seekers with an outrageous markup. They are not part of the chain of people involved in delivering food or picking up passengers, they are at most a transaction fee handler, and even then they are forcibly a transaction handler. Everything about it is artificial.

Thank you for your thoughtful response! I think we’re in full agreement — which is weird on the Internet.

> There is some reasonable cost involved […]

Apple is just taking a profit like your corner store, COOP, Migros, etc. Is it reasonable? Don’t know! Are profit margins how most business operate? That is for sure.

Superbly well put, bravo!

Should Apple take a cut when I order my groceries using an iPhone through my grocery's store app?

> Why do they deserve a cut?

I don't know if you're trolling or not... but are you seriously unaware of the value they're providing? Is this some kind of mystery to many people?

In the PC/Linux space -- where traditionally no online marketplace existed with wide reach -- if you want to sell your software you have to pull yourself up by your own bootstraps:

1. Create a website.

2. Market your software. Nobody will see it. Spend more money on more marketing, and then maybe -- just maybe -- you might reach 1-10% of your potential market.

3. Sign up with a credit card payment processor. Find out that people will navigate all the way to your store page, see the CC entry form, and click cancel. A lot of people. Like... 50%.

4. Discover that you're treated like the dirt stuck to the bottom of the payment processor's shoes, and they charge a lot of overhead too. Especially for small transcations. You have no hope, ever, of selling 1 million copies of your small app for $1 and make anywhere near a million dollars.

5. Get hacked because you can't afford a full security team to babysit your online store 24/7.

6. Discover that you're on the second page of Google's search results for your exact product name because of competitor's SEO.

7. And so on. And on, and on...

Apple's 30% cut is cheap. It's notably less than doing it yourself at a small scale, under one million dollars or so.

They instantly provide you with hundreds of millions of potential customers, free marketing and exposure, frictionless payment processing that goes down to the single-dollar range efficiently, secure systems for all of that, and more.

Everybody in the mobile app industry knows that while there are more Android devices out there, the profit is in the Apple ecosystem.

An ecosystem Apple created at enormous expense.

An ecosystem that has devices that are mostly kept up-to-date (by Apple! For 6+ years! At huge expense!), massively reducing development and test effort. Notably, unlike the Android platform which is a shit-show of bargain basement garbage with either zero vendor support, or next to zero.

An ecosystem where customers feel safe because of the security guarantees provided by Apple! Confident customers spend more. A lot more. The Android marketplace is like 30% malware at this point, for comparison. Customers don't feel safe spending their money there. I know I don't.

I could go on like this for pages and pages, but I hope you get the point.

You're getting the end-result of the main product of the world's biggest company. If you think this is worthless, literally without value, then you're probably one of those people that also think that they could reproduce the Uber app over a weekend...

You wrote this block of text but missed the whole point of the link: they didn't end up charging this fee, at all. They got 0%. The cut didn't go up. The store didn't close. There was never a basis in cost, whatsoever.

> There was never a basis in cost, whatsoever.

Price is not based on cost.

No possible percentages in between 0 and 30%?

It's the industry standard. Most similar marketplaces (e.g.: Steam store, etc...) charge 30%.

  It's reasonable to assume that Apple chose 30% because that was the prevailing standard in the physical retail world.

That markup has been competed away in some circumstances (eg Costco) but otherwise still holds generally (Walmart 32%) It reflects unavoidable costs to all retailers, like local rents, staffing, transport etc Given that tech does not have a retail's fixed costs why has that markup not been competed away to establish a markup based on tech's unavoidable fixed costs?

What is your argument here? That Apple's services cost literally nothing to provide?

Apple provides developers access to an enormous marketplace that they run. A marketplace with hundreds of millions of "high value" customers pre-configured for payments. All sorts of related services are included, such as fraud detection, currency conversion, etc...

What do you think Apple does? Just skim 30% off the top without doing anything else?

Seriously, some people live in this fantasy world where all products should be worth 100% of their raw material cost, and services should cost only what the showroom rent+aircon costs to provide.

Apple's profit margin on the App Store was ~80% in 2019[1]. In a healthy market, competition would lead to increased efficiencies and more savings for consumers that would cut into those margins. Instead the market has stagnated because competition was forbidden, and one company profits handsomely from it.

[1] https://www.bloomberg.com/news/articles/2021-05-01/apple-s-a...

steam charges 20-25%