ClassPass and Airbnb speak out against Apple's 30% digital commission fee

Posted:
in General Discussion
When the coronavirus forced Airbnb and ClassPass to adapt, their new strategy marked them as digital content, causing Apple to prompting commissions.




Before the pandemic, both Airbnb and ClassPass offered users the ability to book in-person classes, events, and "experiences." As COVID-19 brought in-person events to a halt, both companies took their experiences to the digital realm.

Because the classes and events were now digital content, they were subject to Apple's 30% commission fee, which lowers to 15% in an app's second year.

Apple contacted the both ClassPass and Airbnb to inform them that they would need to pay the commission fee, according to The New York Times.

Apple claims that its intention was not to generate revenue, but rather enforce the ten-year-old commission rate rule. The company claims that it will not be waiving the fees as it would be unfair to other developers who have had to comply with the 30% cut for the last decade.

"To ensure every developer can create and grow a successful business, Apple maintains a clear, consistent set of guidelines that apply equally to everyone," the company said in a statement.

Both ClassPass and Airbnb have spoken to antitrust committees as the justice department investigates Apple's App Store after developers continue to raise concerns over anticompetitive behavior.

The U.S. House Judiciary Committee on Wednesday is holding a testimony titled "Online Platforms and Market Power, Part 6: Examining the Dominance of Amazon, Facebook, Google and Apple." It's part of a broader investigation by the U.S. House Judiciary Committee launched in June 2019. Specifically, the probe is an antitrust investigation that has examined dominant technology companies and platforms.

Tim Cook is set to appear alongside Alphabet and Google CEO Sundar Pichai, Facebook CEO Mark Zuckerberg, and Amazon CEO Jeff Bezos. The chiefs' meeting would be as part of a session where they would testify to the House Antitrust Subcommittee over the power the firms have over their competition and the market in general.

Developers have been complaining about Apple's cut for quite some time.

In 2015, Spotify publicly lashed back at Apple for the fee, and later went on to encourage users to subscribe via their website, rather than through an in-app purchase.

In Europe, Apple's App Store has long been the subject of debate for some time now, with government agencies launching antitrust probes into the company's behavior toward its competitors.
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Comments

  • Reply 1 of 29
    Rayz2016Rayz2016 Posts: 6,957member
    Well, there's something I hadn't thought about.

    This is why you can book flights through an app without the airline getting hit with the store fee.


    williamlondonmuthuk_vanalingam
  • Reply 2 of 29
    SpamSandwichSpamSandwich Posts: 33,407member
    They could always go Android-only if they’re that unhappy with Apple. Otherwise, screw ‘em.
    mwhitep-dogmike1aderutterBeatsjony0watto_cobra
  • Reply 3 of 29
    p-dogp-dog Posts: 121member
    Wow, airbnb, that’s very hypocritical of you. I guess you wouldn’t mind if your clients who offer rentals decided that they only wanted to pay you a pittance (or zero) of a commission based on the fees renters pay them. Of course, airbnb, you would claim that your front end guarantees the business that the renters need and helps secure (relatively) safe, violence-free non-criminal guests and that such a front end (read: App Store) doesn’t come cheaply (upkeep costs, etc.). The shoe is on the other foot now. Do as I say, don’t do as I do.

    The opportunistic, cowardly predators only “jump into the fray” once the large prey is being attacked by others sharing the same goal. In this case, that goal would be a free ride in a massively profit-generating, safe Apple App Store. 
    edited July 2020 williamlondonmike1aderutterBeatstmayDancingMonkeysFileMakerFellerMacProjony0watto_cobra
  • Reply 4 of 29
    p-dogp-dog Posts: 121member
    They could always go Android-only if they’re that unhappy with Apple. Otherwise, screw ‘em.
    Airbnb will pay a commission there too. Apple published a list of all of the app stores and marketplaces, almost all of which charged the same 30% rate. When the App Store come into existence in 2008, %30 was a bargain compared to anything else, especially compared to retail space.
    williamlondonSpamSandwichmike1chiaaderutterentropysjony0watto_cobra
  • Reply 5 of 29
    asdasdasdasd Posts: 5,686member
    Apple's rules on this are all over the place. Only if they host content ( as they do with in app purchases in most cases) should the fee be more than 5%. 

  • Reply 6 of 29
    croprcropr Posts: 1,100member
    p-dog said:
    They could always go Android-only if they’re that unhappy with Apple. Otherwise, screw ‘em.
    Airbnb will pay a commission there too. Apple published a list of all of the app stores and marketplaces, almost all of which charged the same 30% rate. When the App Store come into existence in 2008, %30 was a bargain compared to anything else, especially compared to retail space.
    On Android the rules are not so strict and a developer can choose to use its own payment processor, which for digital goods is not allowed on iOS.  Taken into account that Airbnb is already using such a payment processor for its web store,  this cannot be too hard.   

    The difference between in person classes and remote classes is pure artificial for me, the user gets the same content, whether is streamed or not.   As usual Apple is smelling money, but for the rest of the world it smells more like abuse of power


    muthuk_vanalingam
  • Reply 7 of 29
    mike1mike1 Posts: 3,178member
    Rayz2016 said:
    Well, there's something I hadn't thought about.

    This is why you can book flights through an app without the airline getting hit with the store fee.



    Same with hotel bookings and every online purchase through a store's app. (Target, Amazon Best Buy etc.). They're not delivering digital content which these online classes and events clearly are.
    entropyswatto_cobra
  • Reply 8 of 29
    mike1mike1 Posts: 3,178member
    cropr said:
    p-dog said:
    They could always go Android-only if they’re that unhappy with Apple. Otherwise, screw ‘em.
    Airbnb will pay a commission there too. Apple published a list of all of the app stores and marketplaces, almost all of which charged the same 30% rate. When the App Store come into existence in 2008, %30 was a bargain compared to anything else, especially compared to retail space.
    On Android the rules are not so strict and a developer can choose to use its own payment processor, which for digital goods is not allowed on iOS.  Taken into account that Airbnb is already using such a payment processor for its web store,  this cannot be too hard.   

    The difference between in person classes and remote classes is pure artificial for me, the user gets the same content, whether is streamed or not.   As usual Apple is smelling money, but for the rest of the world it smells more like abuse of power



    That's just ridiculous. The choice is simple. Offer the content through your web site.
    watto_cobra
  • Reply 9 of 29
    SpamSandwichSpamSandwich Posts: 33,407member
    asdasd said:
    Apple's rules on this are all over the place. Only if they host content ( as they do with in app purchases in most cases) should the fee be more than 5%. 

    How in the hell could you make any recommendations on fees if you don’t know their costs?
    BeatsFileMakerFellerwatto_cobra
  • Reply 10 of 29
    gatorguygatorguy Posts: 23,642member

    "ClassPass has a particularly compelling argument.

    With gyms shut down, ClassPass dropped its typical commission on virtual classes, passing along 100 percent of sales to gyms, the person close to the company said. That meant Apple would have taken its cut from hundreds of struggling independent fitness centers, yoga studios and boxing gyms.

    Apple may be right that it is simply being consistent, but it’s still not a good look for Apple to be demanding a 30% take from the very type of small business which is most at risk during the pandemic. For now, ClassPass has simply ceased sales of online classes."


    From another Apple fan blog

    FileMakerFellerelijahg
  • Reply 11 of 29
    Airbnb crying foul is truly the pot calling the kettle black. What about Airbnb double dipping with commissions and extraneous fees charged to both hosts and renters. If you don't like Apple's policy then delete your app. Otherwise...STFU.

    Also, few companies are any where near as anti-competitive and in need of an antitrust investigation than Airbnb!


    "Japan Fair Trade Commission (JFTC) opened the probe because Airbnb had forced certain clients not to list properties on a rival website, a move that would undermine competition"


    edited July 2020 BeatsFileMakerFellerjony0watto_cobra
  • Reply 12 of 29
    asdasdasdasd Posts: 5,686member
    asdasd said:
    Apple's rules on this are all over the place. Only if they host content ( as they do with in app purchases in most cases) should the fee be more than 5%. 

    How in the hell could you make any recommendations on fees if you don’t know their costs?
    Simple, the cost isnt 30% to not host digital content created, hosted and fulfilled by others. Its not 5% either. But I am nice.
    edited July 2020
  • Reply 13 of 29
    asdasdasdasd Posts: 5,686member
    Apple TV+ is on some other hardware devices right? Samsung for instance.

    If all apps on Samsung were forced to use Samsung's in app purchases to buy digital content or sign up, and Samsung took 30% of those recurring subscriptions would that be fair on Apple. Apple is creating and hosting the content. 
    edited July 2020
  • Reply 14 of 29
    p-dog said:
    They could always go Android-only if they’re that unhappy with Apple. Otherwise, screw ‘em.
    Airbnb will pay a commission there too. Apple published a list of all of the app stores and marketplaces, almost all of which charged the same 30% rate. When the App Store come into existence in 2008, %30 was a bargain compared to anything else, especially compared to retail space.
    Retail also never sold digital content outside of CDs, DVDs, and floppy disks, so this is a hard analogy to keep making.
    edited July 2020
  • Reply 15 of 29
    BeatsBeats Posts: 3,073member
    p-dog said:
    They could always go Android-only if they’re that unhappy with Apple. Otherwise, screw ‘em.
    Airbnb will pay a commission there too. Apple published a list of all of the app stores and marketplaces, almost all of which charged the same 30% rate. When the App Store come into existence in 2008, %30 was a bargain compared to anything else, especially compared to retail space.

    Geez they even copied the rate? Losers.
    p-dogwatto_cobra
  • Reply 16 of 29
    BeatsBeats Posts: 3,073member

    asdasd said:
    Apple's rules on this are all over the place. Only if they host content ( as they do with in app purchases in most cases) should the fee be more than 5%. 


    The App Store hosts 100% of app content.
  • Reply 17 of 29
    BeatsBeats Posts: 3,073member

    gatorguy said:

    "ClassPass has a particularly compelling argument.

    With gyms shut down, ClassPass dropped its typical commission on virtual classes, passing along 100 percent of sales to gyms, the person close to the company said. That meant Apple would have taken its cut from hundreds of struggling independent fitness centers, yoga studios and boxing gyms.

    Apple may be right that it is simply being consistent, but it’s still not a good look for Apple to be demanding a 30% take from the very type of small business which is most at risk during the pandemic. For now, ClassPass has simply ceased sales of online classes."


    From another Apple fan blog


    So now Apples job is to manage the world economy?

    Everyday Apple has a new job. Soon people will say Apple needs to pay for welfare.
    watto_cobra
  • Reply 18 of 29
    BeatsBeats Posts: 3,073member

    p-dog said:
    They could always go Android-only if they’re that unhappy with Apple. Otherwise, screw ‘em.
    Airbnb will pay a commission there too. Apple published a list of all of the app stores and marketplaces, almost all of which charged the same 30% rate. When the App Store come into existence in 2008, %30 was a bargain compared to anything else, especially compared to retail space.
    Retail also never sold digital content outside of CDs, DVDs, and floppy disks, so this is a hard analogy to keep making.

    It's the best analogy. Retail (including Apple) sold boxed software.
  • Reply 19 of 29
    robin huberrobin huber Posts: 3,789member
    What a shame that they are forced to use Apple’s services. There oughta be a law! Maybe a regulated economy where the government tells Apple (and Airbnb) what they can charge. 
    edited July 2020 watto_cobra
  • Reply 20 of 29
    asdasdasdasd Posts: 5,686member
    Beats said:

    asdasd said:
    Apple's rules on this are all over the place. Only if they host content ( as they do with in app purchases in most cases) should the fee be more than 5%. 


    The App Store hosts 100% of app content.
    Apple doesn’t host the digital content of Netflix and many other services. Of course not. 




    edited July 2020 gatorguyavon b7elijahg
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