Spotify says Apple rejected update over App Store policies, 'causing grave harm' to service

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  • Reply 61 of 143
    dick applebaumdick applebaum Posts: 12,527member
    Apparently Spotify took out in-app subscription in their latest update and Apple has refused to approve the update.
    If true, Apple had every right to do so -- Spotify were not following the rules of the App Store -- and trying to do an end-run around paying subscription fees as the cost of doing business in the App Store.

    Wouldn't you?

    As others have said, if Apple were to allow this, every developer would change his app to a free subscription app with user purchases made at an external web site*.   The App Store would not be a viable investment for Apple and would, likely be discontinued.

    * Another cost of doing business

    Is there some App Store rule that requires subscriptions to be purchased in-app? Amazon doesn't offer in-app subscription. You can't buy books from inside the Barnes & Noble or Kindle app. I thought the only rules were you couldn't provide a link for alternate payment method or verbiage providing people a url of where to go to sign up. Perhaps that's what Spotify did in their app update. But what's the difference between signing up via the web or signing up via the app? Either way Spotify is making money of someone using an iOS device. The only difference is if you're signing up via the app Apple is processing the credit card transaction.
    Yes, if you sell a subscription service it must be payed for in-app so Apple gets paid their 30%-15%.

    Don't know or care what the others do -- this the App Store.

    This has nothing to do with processing the CC transaction.


    Apple is in business to make money -- so is Spotify.

    If Spotify wants to put an app on the iPhone, the must abide by Apple's rules and pay the subscription percentage.

    Otherwise. Spotify can setup a web site to stream music through your browser.  An iPhone owner would use his browser to subscribe and to stream music.

    Likely, (with today's tech) that would be an inferior experience than streaming through an iPhone app.

    I suspect that Spotify would lose business to their competition.

    As I see it, Spotify has 3 choices:
    1. Leave the App Store and abandon a native app/service
    2. Stay on the App Store and play by the rules
    3. Stay on the App Store and adjust their prices and services to be competitive

    It is important that it is Spotify who has a problem -- not Apple.

    Business 101:  The purpose of a business is to make a profit at the risk of a loss!

    edited June 2016 nolamacguylatifbpwonkothesaneSpamSandwichbrucemcpscooter63
  • Reply 62 of 143
    rogifan_newrogifan_new Posts: 4,297member
    Is there some App Store rule that requires subscriptions to be purchased in-app? Amazon doesn't offer in-app subscription. You can't buy books from inside the Barnes & Noble or Kindle app. I thought the only rules were you couldn't provide a link for alternate payment method or verbiage providing people a url of where to go to sign up. Perhaps that's what Spotify did in their app update. But what's the difference between signing up via the web or signing up via the app? Either way Spotify is making money of someone using an iOS device. The only difference is if you're signing up via the app Apple is processing the credit card transaction.
    Yes, if you sell a subscription service it must be payed for in-app so Apple gets paid their 30%-15%.

    Don't know or care what the others do -- this the App Store.

    This has nothing to do with processing the CC transaction.


    Apple is in business to make money -- so is Spotify.

    If Spotify wants to put an app on the iPhone, the must abide by Apple's rules and pay the subscription percentage.

    Otherwise. Spotify can setup a web site to stream music through your browser.  An iPhone owner would use his browser to subscribe and to stream music.

    Likely, (with today's tech) that would be an inferior experience than streaming through an iPhone app.

    I suspect that Spotify would lose business to their competition.

    As I see it, Spotify has 3 choices:
    1. Leave the App Store and abandon a native app/service
    2. Stay on the App Store and play by the rules
    3. Stay on the App Store and adjust their prices and services to be competitive

    It is important that it is Spotify who has a problem -- not Apple.

    Business 101:  The purpose of a business is to make a profit at the risk of a loss!

    When I was a Spotify subscriber I signed up via their website not inside the Spotify app. As far as Apple being in the business of making money, I'd love to see the breakdown of the price of an iPhone and what Apple attributes it to. I would assume a not insignificant portion of the price is attributable to all the maintenance and back end required to support the App Store.
    edited June 2016
  • Reply 63 of 143
    I keep hearing the mall reference as an example of how Apple is right

    First of all, if the app store is a mall, and they gave spotify space in their mall and charged them 30% of sales, that's fine.

    If the app store is a mall, and they set up a completely similar store that sells almost exactly the same merchandise (Apple Music) right next to the Spotify store, but charged it 0% of sales (Since it owns it), then that's wrong. It gives the Apple Music store unfair advantage in pricing, as it can pass on the 30% savings onto consumers, and gain unfair market advantage.

    dasanman69
  • Reply 64 of 143
    rogifan_newrogifan_new Posts: 4,297member
    Apple needs to be careful here. Apple Music isn't even something you have to seek out on the App Store and download. They just updated the native music app that's pre-installed on every phone. Look what happened with Microsoft and IE. And the DOJ already has contempt for Apple. Last thing Apple needs is a whole can of worms opened up about only being able to install software from the App Store. 
    edited June 2016 singularity
  • Reply 65 of 143
    jbdragonjbdragon Posts: 2,297member
    You know, Spotify can just make a web app, that its users can use and not have to go through the app store at all!!!.  In fact most people wouldn't even be able to tell.  You click on a icon like any other app.   They could then have it do anything they want and Apple would have zero say in the matter.  There's zero % fee going too Apple!!! 

    Some of these company's are really clueless.
    loquitur
  • Reply 66 of 143
    latifbplatifbp Posts: 544member
    cpsro said:
    latifbp said:

    All Spotify paying users should be questioning why Spotify needles its customers by forcing them to pay business operation expenses. That 30% fee is a business expense, one they can and I'm sure they do write off at tax time. BUT, not only do they write it off (so it doesn't cost them much or anything at all) but they force you, their customer, to pay more anyway. They're screwing you and any other dope who decides to believe this victim sob story.
    Spotify never sees the +30% they add to iOS-based subscriptions--there's nothing to write off. That +30% goes to Apple.
    It's an operating cost
  • Reply 67 of 143
    tdsmactdsmac Posts: 13member
    The 30% or 15% is a cost of doing business to sell via this outlet. That's it period. Spotify can still sell their paid service for $10 and end up with $7. But they choose to tack it on to charge more. That is also their right. But you can't make a stink about it. You know those were the rules to sell on this platform from the start.

    This is no different then hiring an outside marketing and sales rep company to sell your product who wants a 30% commission. Happens all the time. Yes you can sell it on your own but if you hire the sales and marketing company who has large customer base then you are choosing more sales for less profit. That is how business works. 

    But, let's all see this for what it is. The sole reason Spotify is doing this is for the free advertising and exposure. The more this is discussed the more people hear about the issue and how they can sign up with Spotify direct and pay just $10 a month. Or make the service known to those who are unaware or even get those who maybe signed up paying $13 a month to cancel and then signup direct and pay then $10 a month and use the free app. Basically, this is a way to circumvent violating App Store rules with a link to your site to sign up. 


  • Reply 68 of 143
    tdsmactdsmac Posts: 13member
    When I was a Spotify subscriber I signed up via their website not inside the Spotify app. As far as Apple being in the business of making money, I'd love to see the breakdown of the price of an iPhone and what Apple attributes it to. I would assume a not insignificant portion of the price is attributable to all the maintenance and back end required to support the App Store.
    You say you "were" a Spotify customer. Why no longer. 
  • Reply 69 of 143
    moreckmoreck Posts: 187member
    I'm glad Spotify is doing this. Apple should allow subscription apps to offer a redirect to the browser to sign up. There's no reason Apple should be taking 30% of someone's monthly Spotify fee. They're not hosting any content. And it certainly doesn't cost them $3 to process the credit card transaction. Google allows alternate payment methods. Apple should do the same. How hard would it be for Spotify to have a link in the app that takes you out to Safari to sign up? It wouldn't be. This is all about $$$ for Apple. 
    ...and what's your point? Apple can do what they want with their platform. Spotify can choose to work with them or not.
    dasanman69brucemc
  • Reply 70 of 143
    redefilerredefiler Posts: 323member
    Does Target get 30% of every magazine subscription for magazines it sells in its stores? Should Apple pay 30% of stores sales to every mall owner where they have a store located? Most of the apps on my iOS devices I downloaded for free. Should there be no free apps on the App Store? Is Apple's support for CNN's free app different than their support for the Spotify app (other than the credit card transaction for Spotify's service)?
    Too stupid.  Yes, if you buy thru Target's store, at their registers, Target takes a cut.  When you buy a subscription card for Xbox Live at Target, they take a very healthy cut. 
    edited June 2016 nolamacguylatifbpbrucemcVisualSeedloquitur
  • Reply 71 of 143
    tdsmactdsmac Posts: 13member

    Apple needs to be careful here. Apple Music isn't even something you have to seek out on the App Store and download. They just updated the native music app that's pre-installed on every phone. Look what happened with Microsoft and IE. And the DOJ already has contempt for Apple. Last thing Apple needs is a whole can of worms opened up about only being able to install software from the App Store. 
    Huge difference. Microsoft had a monopoly. A monopoly is not on a particular platform but on all devices. Microsoft only sold software and not the hardware that the software was put on. So they weren't also selling their own "platform". The WinTel alliance put Windows on every manufacturers desktop hardware. Thus, leading to a monopoly in the market. 

    Apple makes the hardware and is controlled by its own software. Unless either Apple's hardware takes over 90% of the market or Apple starts selling its iOS to other manufacturers hardware,  leading to a monopoly of the device market then nothing they are doing is Illegal. 
    latifbpbrucemc
  • Reply 72 of 143
    tdsmactdsmac Posts: 13member

    I keep hearing the mall reference as an example of how Apple is right

    First of all, if the app store is a mall, and they gave spotify space in their mall and charged them 30% of sales, that's fine.

    If the app store is a mall, and they set up a completely similar store that sells almost exactly the same merchandise (Apple Music) right next to the Spotify store, but charged it 0% of sales (Since it owns it), then that's wrong. It gives the Apple Music store unfair advantage in pricing, as it can pass on the 30% savings onto consumers, and gain unfair market advantage.

    Your example happens all the time. As a matter of fact, Apple tends to strike those very deals, since their retail stores happen to create a huge draw of foot traffic. Thus leading to additional sales and revenue for other stores in the mall.
  • Reply 73 of 143
    MarvinMarvin Posts: 15,268moderator
    I'm glad Spotify is doing this. Apple should allow subscription apps to offer a redirect to the browser to sign up. There's no reason Apple should be taking 30% of someone's monthly Spotify fee. They're not hosting any content. And it certainly doesn't cost them $3 to process the credit card transaction. Google allows alternate payment methods. Apple should do the same. How hard would it be for Spotify to have a link in the app that takes you out to Safari to sign up? It wouldn't be. This is all about $$$ for Apple. 
    Other stores have restrictions on subscriptions:

    https://developer.android.com/google/play/billing/billing_subscriptions.html

    "In general, the terms of Google Play allow you to sell in-app subscriptions only through the standard payment processor, Google payments. For purchases of any subscription products, the transaction fee is the same as the transaction fee for application purchases (30%)."

    While there are some ways of bypassing their payments, Apple's restriction on signups is no different from any arbitrary store payment restriction. Spotify also partners with Google in a number of ways:

    https://techcrunch.com/2016/02/23/spotify-announces-google-cloud-platform-partnership/
    http://www.musicbusinessworldwide.com/spotify-and-google-get-cosier-with-chromecast-partnership/

    They use Google's DoubleClick network to show ads so Google gets a cut of their ad revenue.

    Apple offers a free app hosting option to developers who make no money but their app hosting comes at a cost in terms of servers, staff support, downloads on multiple devices, updates etc. When developers offer free apps but make a lot of revenue through subscriptions, it's fair to expect them to pay something towards the cost of the store.

    A percentage fee of a subscription might seem unfair but people don't complain about the fee for IAPs. What's the difference between paying for a self-hosted IAP vs paying for a subscription? If the in-app download is self-hosted, it also costs Apple nothing but those are still the rules they set.

    This likely has something to do with Apple Music because Apple's fee exceeds Spotify's own profit margins (they've never made a profit) so they will be annoyed that Apple (now a streaming competitor) is profiting more from Spotify's paying subscribers than they are. That's their fault for having a terrible business model.

    If Apple made externally hosted streaming content free for the developer, they have to pay for the support costs for 100 million users downloading apps through their store at a loss while the developer gets paid. Developers who have IAPs would then wonder why they get charged a fee and subscription apps don't. It pushes developers to find ways to get their content on subscriptions and avoid paying Apple at all.

    Expecting Apple to make a loss for Spotify's benefit is unfair. They said they want more flexible terms so it's not just the fee:

    http://www.theverge.com/2016/6/9/11895084/spotify-says-apple-app-store-changes-not-good-enough

    The Spotify employee says:

    "Apple still insists on inserting itself between developers and their customers, which means developers will continue to lack visibility into why customers churn — or who even qualifies as a long-term subscriber."

    That sounds like a privacy issue where they aren't getting the data they want on subscribers. That would make sense why they want to push people to subscribe elsewhere as they aren't losing money through the in-app signup (they are just less competitive and it's harder to offer discounts) but they could lose out on some customer info. They make 90% of their revenue from the subscribers so they will want as much info as possible on how to keep people subscribing.

    Apple's privacy rules are there to protect customers though. If they let Spotify get away with a redirect, apps will all start doing this and having people signing up for newsletters and all sorts of spam. Apple knows what companies are like and they go out of their way to make the customer experience better as they've always done. No amount of complaining about the impact it has to a business model matters.
    latifbptmaypscooter63bestkeptsecret
  • Reply 74 of 143
    redefilerredefiler Posts: 323member
    tdsmac said:

    Apple needs to be careful here. Apple Music isn't even something you have to seek out on the App Store and download. They just updated the native music app that's pre-installed on every phone. Look what happened with Microsoft and IE. And the DOJ already has contempt for Apple. Last thing Apple needs is a whole can of worms opened up about only being able to install software from the App Store. 
    Huge difference. Microsoft had a monopoly. A monopoly is not on a particular platform but on all devices. Microsoft only sold software and not the hardware that the software was put on. So they weren't also selling their own "platform". The WinTel alliance put Windows on every manufacturers desktop hardware. Thus, leading to a monopoly in the market. 

    Apple makes the hardware and is controlled by its own software. Unless either Apple's hardware takes over 90% of the market or Apple starts selling its iOS to other manufacturers hardware,  leading to a monopoly of the device market then nothing they are doing is Illegal. 
    Don't bother, your logic is far too keen.  It's taken four pages of remedial explanation, and rogifan still fails to grasp.  It's either willful ignorance, or an issue that can't be corrected with words.
    nolamacguylatifbpbrucemc
  • Reply 75 of 143
    While I'm a confirmed Apple fanboy, Apple is quickly becoming "the evil empire".

    They crush their competition and in doing so stifle development and creativity by some equally skilled external companies.
    dasanman69singularity
  • Reply 76 of 143
    SpamSandwichSpamSandwich Posts: 33,407member
    Will someone pay these idiots to shut up? 
    They deserve nothing.
    latifbp
  • Reply 77 of 143
    SpamSandwichSpamSandwich Posts: 33,407member
    Apple needs to be careful here. Apple Music isn't even something you have to seek out on the App Store and download. They just updated the native music app that's pre-installed on every phone. Look what happened with Microsoft and IE. And the DOJ already has contempt for Apple. Last thing Apple needs is a whole can of worms opened up about only being able to install software from the App Store. 
    Except Spotify is engaging in misdirection. The problem is they shut down in-app purchase in their app and included a link to their web site, which is in clear violation of the App Store rules. Screw 'em! I'm guessing they are losing money at an accelerated rate and could be facing bankruptcy quite soon.
    edited June 2016 latifbpbrucemc
  • Reply 78 of 143
    The latest Spotify app works great on my Android phone.
  • Reply 79 of 143
    rogifan_newrogifan_new Posts: 4,297member
    Apple needs to be careful here. Apple Music isn't even something you have to seek out on the App Store and download. They just updated the native music app that's pre-installed on every phone. Look what happened with Microsoft and IE. And the DOJ already has contempt for Apple. Last thing Apple needs is a whole can of worms opened up about only being able to install software from the App Store. 
    Except Spotify is engaging in misdirection. The problem is they shut down in-app purchase in their app and included a link to their web site, which is in clear violation of the App Store rules. Screw 'em! I'm guessing they are losing money at an accelerated rate and could be facing bankruptcy quite soon.
    Of course they did it on purpose. Why can't the app include a link to their website? It's a valid way to subscribe,
    dasanman69
  • Reply 80 of 143
    SpamSandwichSpamSandwich Posts: 33,407member
    Except Spotify is engaging in misdirection. The problem is they shut down in-app purchase in their app and included a link to their web site, which is in clear violation of the App Store rules. Screw 'em! I'm guessing they are losing money at an accelerated rate and could be facing bankruptcy quite soon.
    Of course they did it on purpose. Why can't the app include a link to their website? It's a valid way to subscribe,
    Do you recall how Amazon did it? They actually followed the App Store rules after complaining about Apple getting their cut. Look it up.
    edited June 2016 latifbp
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