Apple only has ~ 35% share of smartphone sales in the U.S. And UK, where spottily operates. Android dominates volumes. Apple does not in any way have a monopoly
Spotify customers are free to sign up at the lower price outside Apple's store and reap the free benefits
Apple created and runs the whole infrastructure, including the App platform and API that make this all poosible. Invests billions a year in data center which allow the seamless downloads of the Spotify app. Provides untold free customer acquisition to Spotify for users who see who see the app in the store and on the leaderboards. Drives massive conversion by not requiring users to provide their credit card to Spotify
It is Apple's store. If your unhappy with the arrangement you agreed to when you entered the store, leave the store
I have zero respect for a company that whines like this. It's not a company that is going to win in the long run
This is bullshit. The govt can kiss my ass. I guess it's ok for only Amazon to undercut competitors. Apple has barely entered the streaming arena. How can it have this much power?
It's time for Apple to consider splitting itself into three separate companies: hardware, software, and content. Almost all of Apple's regulatory problems seem to arise on the content side of the business, which is the least important for the company in terms of revenue and cash flow. Yet, content-related issues generate the vast amount of negative buzz about the company, dragging down its stock.
Go back 20+\- years. The government was doing the same thing with Microsoft. Think like a consumer and drop your corporation worship. If you have a problem, write your Senator.
No one is worshiping anyone. The bottom line is that the 30% rule has been in effect for years without issue. Secondly, Apple was already in the process of amending its 30% rule for subscription services. Thirdly, Apple has to tread carefully because if they play dirty app makers can go to other platforms. The market can sort this stuff out. This isn't analogous to 20 years ago when MSFT was giving stuff away for free. Apple isn't giving anything away for free. In fact they've made it a point not to offer up Apple Music for free. Spotify is the only one with a free tier and student tier. So you're wrong.
It just sounds like Spotify's business model isn't working because they've never been able to do anything other than lose money hand over fist even with ad supported music. then they have student edition. There is nothing wrong with directing people to get the cheaper rates on their site in exchange for giving up more of your data directly to them.
Right, and I have to wonder if Disney or Carnival contemplated buying Greece with the Euro being weak . BTW I was staggered to read the entire population is about that of Miami.
1. When Apple started App site it basically said it will operate near or at cost and if you sell on the site you pay 30% to Apple if you offer free you pay nothing.
2. You cannot get Apple App site exposure. services. etc. for free if you merely point to an external web site to pay.
Basically Apple runs the App store at or near cost and it is not a charity for other companies whether directly or indirectly competing with Apple. For some this is not acceptable and they do not use the App Store [this is particularly true of Mac App Store] however, you cannot use the infrastructure, good will, etc. of the App Store for free.
If the FTC wants to get into a snit on this, they need to explain how Apple is expected to recover costs for the App Store - it is a business. If the FTC thinks the costs are excessive, 30%, then this will be tricky to really prove. There are a lot of cost covered in that 30% including the infrastructure, curation, payment system [there are not credit card charges and payment is prompt], development for App store improvements, etc.
Note this same rule applied to magazines, newspapers, etc., who had to adopt to the new business model.
When the App store was first introduced developers paid 70% and up to put their app on sites and had no support and carried all the credit card costs.
The fact that Apple sold iWorks, iPhoto, etc. on their App store did not excuse Adobe or MS from the 30% cost if they wanted to sell on the store, I do not see this as a different issue than streaming music, which by the way, is dominated by others NOT Apple.
The US has a lower debt-to-GDP ratio (72.5%) than the UK (90%), France (89.9%), Germany (79.9%), Canada (84.1%), and Japan (226%). Except for Russia, as you recall went bankrupt in 1998 and defaulted on its debt, the US has the lowest debt-to-GDP in the G8.
Enjoy your 20% VAT.
Not only that, but I think your numbers reflect the cumulative debt. The annual debt ratio to GDP is (obviously) far lower and very manageable. The 2016 budget is expected to come in with a deficit of 2.5% of GDP and the 2017 budget (last Obama budget) is expected to come in at 2.3% of GDP. The highest since 1980 was the last Bush budget (2009), which came in at 9.8% of GDP. The only years since 1980 in which there was a surplus were the four final years under Clinton - the 1998 to 2001 budgets.
As for VAT, you really have to look at it combined with income taxes and evaluate under which system we would pay more. Plenty of fiscal conservatives argue for the elimination of the income tax and for a VAT instead, but even if people did save money overall, the shell shock of paying a 20% VAT on top of local sales taxes (around 9% in most locales) would never be accepted in the U.S. IMO. And of course, VAT is a regressive tax and it reduces consumption (which is good from an environmental standpoint, but bad from an economic standpoint).
As for the actual topic, FTC scrutiny on this is ridiculous. There have been plenty of exclusives in the past, including CDs originally sold only at Starbucks and exclusives either on movies themselves or special editions of the movies (with unique extras) sold exclusively either by Amazon, Wal-Mart, Best Buy or Target. There was never any investigation of those practices.
Companies are complaining that Apple is taking 30%? That's actually a hell of a good deal, especially considering that Apple handles all payment and credit card fees. But I do understand their complaints on in-app purchases. If I use the Amazon app on my iPhone, Apple doesn't take a 30% cut of everything I order, right? So why should the streaming companies have to pay that, if indeed they are?
1. When Apple started App site it basically said it will operate near or at cost and if you sell on the site you pay 30% to Apple if you offer free you pay nothing.
Basically Apple runs the App store at or near cost
Apple has made billions in profit from the App Store, roughly $10B to date minimally by my estimation. They don't operate "near cost".
This is so stupid. Don't offer in app subscriptions. People can sign up via your website. That's what people do with Amazon and Barnes & Noble when they buy books. It's not that complicated.
This is bullshit. The govt can kiss my ass. I guess it's ok for only Amazon to undercut competitors. Apple has barely entered the streaming arena. How can it have this much power?
Just follow the money. Like someone else said, Apple has a pile of cash sitting overseas and the government is salivating over it. If the can't get Apple to bring it back then they will look for other means to get Apple to pay. With everything in the USA that the government should be worrying about, streaming music services shouldn't even be on the list. If Apple stepped up the kickbacks, I mean lobbying, the government wouldn't even be giving this a second look.
So, you have no idea. Did you subtract the cost of free apps from your equation?
:???: The figure came from the amount Apple paid out from the revenue they took in, $43B based on a 30% pay-out. Surely you wouldn't believe it cost Apple $13B to run the App Store for the 7 years it's existed.
It's time for Apple to consider splitting itself into three separate companies: hardware, software, and content. Almost all of Apple's regulatory problems seem to arise on the content side of the business, which is the least important for the company in terms of revenue and cash flow. Yet, content-related issues generate the vast amount of negative buzz about the company, dragging down its stock.
I don't know. If they wanted to keep their current level of integration among the three areas, the companies would have to cooperate to a degree where govt agencies would probably charge them with all kinds of collusion. It might make things worse.
Comments
Spotify customers are free to sign up at the lower price outside Apple's store and reap the free benefits
Apple created and runs the whole infrastructure, including the App platform and API that make this all poosible. Invests billions a year in data center which allow the seamless downloads of the Spotify app. Provides untold free customer acquisition to Spotify for users who see who see the app in the store and on the leaderboards. Drives massive conversion by not requiring users to provide their credit card to Spotify
It is Apple's store. If your unhappy with the arrangement you agreed to when you entered the store, leave the store
I have zero respect for a company that whines like this. It's not a company that is going to win in the long run
Go back 20+\- years. The government was doing the same thing with Microsoft. Think like a consumer and drop your corporation worship. If you have a problem, write your Senator.
No one is worshiping anyone. The bottom line is that the 30% rule has been in effect for years without issue. Secondly, Apple was already in the process of amending its 30% rule for subscription services. Thirdly, Apple has to tread carefully because if they play dirty app makers can go to other platforms. The market can sort this stuff out. This isn't analogous to 20 years ago when MSFT was giving stuff away for free. Apple isn't giving anything away for free. In fact they've made it a point not to offer up Apple Music for free. Spotify is the only one with a free tier and student tier. So you're wrong.
It just sounds like Spotify's business model isn't working because they've never been able to do anything other than lose money hand over fist even with ad supported music. then they have student edition. There is nothing wrong with directing people to get the cheaper rates on their site in exchange for giving up more of your data directly to them.
I vote for Richard Branson to make a bid...
1. When Apple started App site it basically said it will operate near or at cost and if you sell on the site you pay 30% to Apple if you offer free you pay nothing.
2. You cannot get Apple App site exposure. services. etc. for free if you merely point to an external web site to pay.
Basically Apple runs the App store at or near cost and it is not a charity for other companies whether directly or indirectly competing with Apple. For some this is not acceptable and they do not use the App Store [this is particularly true of Mac App Store] however, you cannot use the infrastructure, good will, etc. of the App Store for free.
If the FTC wants to get into a snit on this, they need to explain how Apple is expected to recover costs for the App Store - it is a business. If the FTC thinks the costs are excessive, 30%, then this will be tricky to really prove. There are a lot of cost covered in that 30% including the infrastructure, curation, payment system [there are not credit card charges and payment is prompt], development for App store improvements, etc.
Note this same rule applied to magazines, newspapers, etc., who had to adopt to the new business model.
When the App store was first introduced developers paid 70% and up to put their app on sites and had no support and carried all the credit card costs.
The fact that Apple sold iWorks, iPhoto, etc. on their App store did not excuse Adobe or MS from the 30% cost if they wanted to sell on the store, I do not see this as a different issue than streaming music, which by the way, is dominated by others NOT Apple.
The US has a lower debt-to-GDP ratio (72.5%) than the UK (90%), France (89.9%), Germany (79.9%), Canada (84.1%), and Japan (226%). Except for Russia, as you recall went bankrupt in 1998 and defaulted on its debt, the US has the lowest debt-to-GDP in the G8.
Enjoy your 20% VAT.
Not only that, but I think your numbers reflect the cumulative debt. The annual debt ratio to GDP is (obviously) far lower and very manageable. The 2016 budget is expected to come in with a deficit of 2.5% of GDP and the 2017 budget (last Obama budget) is expected to come in at 2.3% of GDP. The highest since 1980 was the last Bush budget (2009), which came in at 9.8% of GDP. The only years since 1980 in which there was a surplus were the four final years under Clinton - the 1998 to 2001 budgets.
As for VAT, you really have to look at it combined with income taxes and evaluate under which system we would pay more. Plenty of fiscal conservatives argue for the elimination of the income tax and for a VAT instead, but even if people did save money overall, the shell shock of paying a 20% VAT on top of local sales taxes (around 9% in most locales) would never be accepted in the U.S. IMO. And of course, VAT is a regressive tax and it reduces consumption (which is good from an environmental standpoint, but bad from an economic standpoint).
As for the actual topic, FTC scrutiny on this is ridiculous. There have been plenty of exclusives in the past, including CDs originally sold only at Starbucks and exclusives either on movies themselves or special editions of the movies (with unique extras) sold exclusively either by Amazon, Wal-Mart, Best Buy or Target. There was never any investigation of those practices.
Companies are complaining that Apple is taking 30%? That's actually a hell of a good deal, especially considering that Apple handles all payment and credit card fees. But I do understand their complaints on in-app purchases. If I use the Amazon app on my iPhone, Apple doesn't take a 30% cut of everything I order, right? So why should the streaming companies have to pay that, if indeed they are?
Apple has made billions in profit from the App Store, roughly $10B to date minimally by my estimation. They don't operate "near cost".
What's your source for that figure.
So you're saying the 30% Apple charges goes directly to the bottom line?
Just follow the money. Like someone else said, Apple has a pile of cash sitting overseas and the government is salivating over it. If the can't get Apple to bring it back then they will look for other means to get Apple to pay. With everything in the USA that the government should be worrying about, streaming music services shouldn't even be on the list. If Apple stepped up the kickbacks, I mean lobbying, the government wouldn't even be giving this a second look.
Nope. I'm saying there's no way the App Store cost $10B to operate, so it's not done "at or near cost"..
So, you have no idea. Did you subtract the cost of free apps from your equation?
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So you are saying there is no cost associated to Apple for hosting free apps?
I don't know. If they wanted to keep their current level of integration among the three areas, the companies would have to cooperate to a degree where govt agencies would probably charge them with all kinds of collusion. It might make things worse.