Apple says reduction in App Store commission rate would impact bottom line

Posted:
in General Discussion
Apple warned investors that changes to its App Store commission could hurt its bottom line in a regulatory filing that also highlighted the MacBook Pro as the primary driver of 2020 Mac sales.

Credit: WikiCommons
Credit: WikiCommons


Both tidbits were included in Apple's Form 10-K for its 2020 fiscal year. Form 10-K is a summary of a company's financial status that the Securities and Exchange Commission requires of companies that meet specific criteria.

Amid scrutiny of its 30% commission on in-app purchases and subscriptions, Apple cautioned investors in this year's 10-K that any changes to that cut could negatively impact its financial results.

"If the rate of the commission that the Company retains on such sales is reduced, or if it is otherwise narrowed in scope or eliminated, the Company's financial condition and operating results could be materially adversely affected," Apple wrote in the filing.

Apple has come under fire from from antitrust regulators, lawmakers, and developers for imposing a 30% cut on App Store sales. Some of the most notable critics include Microsoft, Facebook, and Epic Games.

The filing also reveals that Apple has indeed seen tailwinds from new work-at-home and remote learning trends during the coronavirus pandemic.

Net sales of MacBook Pro models, for example, were highlighted at the primary reason for an overall uptick in Mac sales throughout 2020. Sales of iPads were also up, and attributed to 10-inch versions of the iPad, iPad Air, and iPad Pro.

Beyond the details about the App Store commission and Mac and iPad sales, most other data in the filing appeared routine. Taxes were nominal, and was only a typical increase in Apple's research and development spending.
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Comments

  • Reply 1 of 46
    sflocalsflocal Posts: 6,090member
    Whiny developers that have issues with the 30% are more than welcome to go to another platform.  Please.  Just go.  Apple did all the work to create an ecosystem and marketplace so freeloaders like you could spend time to make your product.

    Disclaimer:  I'm a developer too and have zero issue with the 30%.  Why?  Because I remember the days of boxed software and all the overhead required to find buyers to buy it, and stores in which to carry it.  That was WAY more than 30% that Apple charges for doing everything.

    Take a hike.
    rob53Beatspeterhartmac_dogcornchipentropysjas99jaureJinTechDogperson
  • Reply 2 of 46
    rob53rob53 Posts: 3,239member
    sflocal said:
    Whiny developers that have issues with the 30% are more than welcome to go to another platform.  Please.  Just go.  Apple did all the work to create an ecosystem and marketplace so freeloaders like you could spend time to make your product.

    Disclaimer:  I'm a developer too and have zero issue with the 30%.  Why?  Because I remember the days of boxed software and all the overhead required to find buyers to buy it, and stores in which to carry it.  That was WAY more than 30% that Apple charges for doing everything.

    Take a hike.
    Someone like you needs to remind the money grabbers in Washington and around the world that the 30% is actually a very reasonable amount to charge. I'd like to know how much overhead other industries charge, like oil companies, clothing manufacturers, and food processing companies.
    peterhartgenovelleSpamSandwichjas99jaureDogpersonbshankrezwitsjony0
  • Reply 3 of 46
    BeatsBeats Posts: 3,073member
    sflocal said:
    Whiny developers that have issues with the 30% are more than welcome to go to another platform.  Please.  Just go.  Apple did all the work to create an ecosystem and marketplace so freeloaders like you could spend time to make your product.

    Disclaimer:  I'm a developer too and have zero issue with the 30%.  Why?  Because I remember the days of boxed software and all the overhead required to find buyers to buy it, and stores in which to carry it.  That was WAY more than 30% that Apple charges for doing everything.

    Take a hike.

    The problem is, Millennials and other morons grew up entitled. They want your stuff for free.
    peterhartgenovelleentropysjas99JinTechbshankjony0
  • Reply 4 of 46
    KTRKTR Posts: 278member
    sflocal said:
    Whiny developers that have issues with the 30% are more than welcome to go to another platform.  Please.  Just go.  Apple did all the work to create an ecosystem and marketplace so freeloaders like you could spend time to make your product.

    Disclaimer:  I'm a developer too and have zero issue with the 30%.  Why?  Because I remember the days of boxed software and all the overhead required to find buyers to buy it, and stores in which to carry it.  That was WAY more than 30% that Apple charges for doing everything.

    Take a hike.
    GREEEEEEAAAT POINT.  To me, there seems to be a conspiracy theory;  that people want to see Apple fail.  JMO.
    genovellecornchipSpamSandwichjas99Dogpersonbshankrezwitsjony0
  • Reply 5 of 46
    genovellegenovelle Posts: 1,480member
    KTR said:
    sflocal said:
    Whiny developers that have issues with the 30% are more than welcome to go to another platform.  Please.  Just go.  Apple did all the work to create an ecosystem and marketplace so freeloaders like you could spend time to make your product.

    Disclaimer:  I'm a developer too and have zero issue with the 30%.  Why?  Because I remember the days of boxed software and all the overhead required to find buyers to buy it, and stores in which to carry it.  That was WAY more than 30% that Apple charges for doing everything.

    Take a hike.
    GREEEEEEAAAT POINT.  To me, there seems to be a conspiracy theory;  that people want to see Apple fail.  JMO.
    Agreed
    SpamSandwichjas99
  • Reply 6 of 46
    wood1208wood1208 Posts: 2,904member
    God, no need to convince investors your business strategy. Charging 30% is reasonable and if someone doesn't want to pay than they should build their own platform. Apple employees worked hard to build secured, trusted IOS/IpadOS/MacOS/TVOS platforms for every App makers to sell,thrive on it. Not open for debate.

    jas99rezwitsjony0
  • Reply 7 of 46
    wood1208 said:
    God, no need to convince investors your business strategy. Charging 30% is reasonable and if someone doesn't want to pay than they should build their own platform. Apple employees worked hard to build secured, trusted IOS/IpadOS/MacOS/TVOS platforms for every App makers to sell,thrive on it. Not open for debate.

    Lately there has been a sense of entitlement when it comes to the general public’s perception of Apple.  From the greedy bastards at Epic and their freeloading fans who think Apple is the reason why they can’t play Fortnite on their Apple devices, to the greedy investors who are disappointed that Apple only beat expectations during a pandemic and are shocked that China didn’t buy as much this year. Forgetting that they were locked down worse than other countries. 
    jas99Dogpersonbshankrezwitsjony0
  • Reply 8 of 46
    genovellegenovelle Posts: 1,480member
    wood1208 said:
    God, no need to convince investors your business strategy. Charging 30% is reasonable and if someone doesn't want to pay than they should build their own platform. Apple employees worked hard to build secured, trusted IOS/IpadOS/MacOS/TVOS platforms for every App makers to sell,thrive on it. Not open for debate.

    Lately there has been a sense of entitlement when it comes to the general public’s perception of Apple.  From the greedy bastards at Epic and their freeloading fans who think Apple is the reason why they can’t play Fortnite on their Apple devices, to the greedy investors who are disappointed that Apple only beat expectations during a pandemic and are shocked that China didn’t buy as much this year. Forgetting that they were locked down worse than other countries. 
    How true. Apple mentioning this on the call is a big deal. Letting investors know that they are concerned. I think Apple would cut investment in the platform if it became unprofitable. 
    cornchipjas99
  • Reply 9 of 46
    cornchipcornchip Posts: 1,945member
    sflocal said:
    Whiny developers that have issues with the 30% are more than welcome to go to another platform.  Please.  Just go.  Apple did all the work to create an ecosystem and marketplace so freeloaders like you could spend time to make your product.

    Disclaimer:  I'm a developer too and have zero issue with the 30%.  Why?  Because I remember the days of boxed software and all the overhead required to find buyers to buy it, and stores in which to carry it.  That was WAY more than 30% that Apple charges for doing everything.

    Take a hike.


    The typical art galleries are 50%+ 





    KTR said:


    GREEEEEEAAAT POINT.  To me, there seems to be a conspiracy theory;  that people want to see Apple fail.  JMO.

    Yeah, nobody could ever prove this, but I think at least some of it has to do with the co-founder. Guy wasn’t an [actual] engineer, wasn’t a “business type”; dropped out of a non-Ivey-league institution and built the world’s most kickass tech company and showed the world what’s up and made it look fucking easy. 



    edited October 2020 jas99rezwitsjony0
  • Reply 10 of 46
    Tim needs to buck up and hit back the critics very hard on this one. Apple is no monopoly and they are very fair with their fees. If Apple fails to lay the hammer down, they’ll get railroaded.
    jas99
  • Reply 11 of 46
    entropysentropys Posts: 4,148member
    cornchip said:
    sflocal said:
    Whiny developers that have issues with the 30% are more than welcome to go to another platform.  Please.  Just go.  Apple did all the work to create an ecosystem and marketplace so freeloaders like you could spend time to make your product.

    Disclaimer:  I'm a developer too and have zero issue with the 30%.  Why?  Because I remember the days of boxed software and all the overhead required to find buyers to buy it, and stores in which to carry it.  That was WAY more than 30% that Apple charges for doing everything.

    Take a hike.


    The typical art galleries are 50%+ 





    KTR said:


    GREEEEEEAAAT POINT.  To me, there seems to be a conspiracy theory;  that people want to see Apple fail.  JMO.

    Yeah, nobody could ever prove this, but I think at least some of it has to do with the co-founder. Guy wasn’t an [actual] engineer, wasn’t a “business type”; dropped out of a non-Ivey-league institution and built the world’s most kickass tech company and showed the world what’s up and made it look fucking easy. 



    Yes, but it also because back in the day they cool kids had macs and the geeks had windows 3.1. And for the hyena media class, the tall poppy is always the most fun to pull down.
    jas99
  • Reply 12 of 46
    elijahgelijahg Posts: 2,753member
    I don’t really support or oppose the 30% myself, but I’m I’m sure if Apple didn’t have such a massive cash pile people wouldn’t complain so much. A $1.5tn company with $190bn cash on hand looks pretty petty defending a 30% cut against devs making a few thousand dollars a year from their app. 

    Apple is almost guaranteed to lose the antitrust suits somewhere in the world, so they’re going to have to either change their cut, change the App Store rules, allow third party stores, or drop out of the jurisdiction where they lose the antitrust suit. It would be better to capitulate now and for Apple to decide on the compromises, than having them court decided and forced, plus the negative publicity. 
    edited October 2020 muthuk_vanalingam
  • Reply 13 of 46
    Beats said:
    sflocal said:
    Whiny developers that have issues with the 30% are more than welcome to go to another platform.  Please.  Just go.  Apple did all the work to create an ecosystem and marketplace so freeloaders like you could spend time to make your product.

    Disclaimer:  I'm a developer too and have zero issue with the 30%.  Why?  Because I remember the days of boxed software and all the overhead required to find buyers to buy it, and stores in which to carry it.  That was WAY more than 30% that Apple charges for doing everything.

    Take a hike.

    The problem is, Millennials and other morons grew up entitled. They want your stuff for free.
    So, your opinion is that Millennials are morons?  What other classes of people are part of the "other morons"?  Just curious...
    muthuk_vanalingam
  • Reply 14 of 46
    rob53 said:
    sflocal said:
    Whiny developers that have issues with the 30% are more than welcome to go to another platform.  Please.  Just go.  Apple did all the work to create an ecosystem and marketplace so freeloaders like you could spend time to make your product.

    Disclaimer:  I'm a developer too and have zero issue with the 30%.  Why?  Because I remember the days of boxed software and all the overhead required to find buyers to buy it, and stores in which to carry it.  That was WAY more than 30% that Apple charges for doing everything.

    Take a hike.
    Someone like you needs to remind the money grabbers in Washington and around the world that the 30% is actually a very reasonable amount to charge. I'd like to know how much overhead other industries charge, like oil companies, clothing manufacturers, and food processing companies.
    Every industry you listed actually MAKES something.  Apple doesn't MAKE the apps.  They distribute them.  And they've cleverly locked down their ecosystem so that only THEY can distribute them.  The "if you don't like it, go somewhere else" mentality doesn't really hold up.  We have trade and consumer laws in the US against things like that.  

    The real question is whether 30% is considered fair, or even whether Apple will need to allow app developers for it's devices to be able to distribute directly or not.  Think about it...given your examples (or any industry, really), a manufacturer is not restricted from selling direct.  They can sell through retail or they can sell direct, where they are in control of the costs to sell their own products.  It's the same thing here.
    elijahgNotoriousDEVmuthuk_vanalingam
  • Reply 15 of 46
    Apple created the App Store to assist developers. Now the developers want to bite the hand that feeds them. If it weren’t for Apple, developers wouldn’t have access to the worlds largest ecosystem. Apple should be able to charge whatever they want to charge, as long as everyone is charged equally. Apple should also be able to use their own payment systems in their App Store. There are lots of retailers that except MasterCard and Visa but not Discovery or Amex. You have to pay to play. If you don’t want to follow the rules, then don’t sign up.
    Dogperson
  • Reply 16 of 46
    entropys said:
    back in the day they cool kids had macs and the geeks had windows 3.1.
    No geek back in the day would want to be running Win 3.1. All the geeks I know (myself included) were running Unix. And thanks to Mac OS X+ we still are. 
    Dogperson
  • Reply 17 of 46
    avon b7avon b7 Posts: 7,591member
    n2macs said:
    Apple created the App Store to assist developers. Now the developers want to bite the hand that feeds them. If it weren’t for Apple, developers wouldn’t have access to the worlds largest ecosystem. Apple should be able to charge whatever they want to charge, as long as everyone is charged equally. Apple should also be able to use their own payment systems in their App Store. There are lots of retailers that except MasterCard and Visa but not Discovery or Amex. You have to pay to play. If you don’t want to follow the rules, then don’t sign up.
    Apple charging what it wants to charge isn't the issue that government agencies are looking at. That is completely irrelevant. 

    The issue revolves around whether Apple should be the only entity allowed to operate an App Store on iDevices.

    That is a completely different angle. 
    elijahgNotoriousDEVmuthuk_vanalingam
  • Reply 18 of 46
    elijahgelijahg Posts: 2,753member
    n2macs said:
    Apple created the App Store to assist developers. Now the developers want to bite the hand that feeds them. If it weren’t for Apple, developers wouldn’t have access to the worlds largest ecosystem. Apple should be able to charge whatever they want to charge, as long as everyone is charged equally. Apple should also be able to use their own payment systems in their App Store. There are lots of retailers that except MasterCard and Visa but not Discovery or Amex. You have to pay to play. If you don’t want to follow the rules, then don’t sign up.
    Don't kid yourself. Steve was persuaded to allow creation of the App Store, without which the iPhone would be nowhere near as successful as it is today. Apple needs devs as much as devs need Apple.
    NotoriousDEVmuthuk_vanalingam
  • Reply 19 of 46
    sflocalsflocal Posts: 6,090member
    avon b7 said:
    n2macs said:
    Apple created the App Store to assist developers. Now the developers want to bite the hand that feeds them. If it weren’t for Apple, developers wouldn’t have access to the worlds largest ecosystem. Apple should be able to charge whatever they want to charge, as long as everyone is charged equally. Apple should also be able to use their own payment systems in their App Store. There are lots of retailers that except MasterCard and Visa but not Discovery or Amex. You have to pay to play. If you don’t want to follow the rules, then don’t sign up.
    Apple charging what it wants to charge isn't the issue that government agencies are looking at. That is completely irrelevant. 

    The issue revolves around whether Apple should be the only entity allowed to operate an App Store on iDevices.

    That is a completely different angle. 
    Actually, it's not.  Apple is being put together with Android (Google), and Windows (Microsoft) and therein lies the confusion that the folks in DC refuse to admit.  Apple owns the OS and hardware.  Android and Windows is pure software and requires cooperation with hardware vendors to make their product successful.  It's why Microsoft got in trouble (and rightfully so) back in the 1990's and early 2000's when it was extorting computer makers and using its domination of Windows to tie the hands of manufacturers.

    Apple doesn't have that problem.  The iPhone is owned/operation/and maintained by Apple alone.  You too know that.  There is no way Apple is going to be forced to allow other stores not owned by Apple to run on its proprietary system.  You can keep preaching that, but that doesn't mean anything.

    I don't understand people like you.  A developer with an iOS App is no different than a bread maker asking Costco for permission to sell its bread in their stores.  It is EXACTLY the same thing.  Developers are whining that they should be allowed to set up shop in front of Apple and sell their stuff to Apple's customers, bypassing Apple entirely.  Lets see that bread-maker set up a booth in front of a Costco store's front door and see what happens.
    roundaboutnowDogpersonjony0
  • Reply 20 of 46
    Apple should add "the worlds smallest violin" to Garage Band.
    FileMakerFeller
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