Patreon doesn't pay Apple's 30% App Store commission, and its CEO isn't sure why not

Posted:
in General Discussion edited June 22
Patreon's CEO Jack Conte has confirmed that the platform doesn't pay the Apple's commission on App Store purchases -- and it doesn't have a special deal with the iPhone maker.

Credit: Patreon
Credit: Patreon


Apple takes a 30% (or 15%) cut of app and in-app purchases on the App Store. Patreon, a platform that allows fans to support content creators, doesn't pay that commission. In a recent interview with The Verge, Patreon CEO Jack Conte said that he isn't sure why the company isn't subject to the fees.

Conte confirmed that Patreon doesn't have any sort of special arrangement or contract with Apple. He added that Patreon has to "deal with the App Store policies and review process like anybody else."

He noted that sometimes there are delays in approval of updates, and changes need to be made.

"Why don't we have to pay fees? I think it's because, for whatever reason, we're within Apple's guidelines, and we haven't had to pay fees," Conte added.

Conte recalled one point, about four years prior, when Apple rejected the Patreon app, which led to a conversation between the two companies. Although Patreon's CEO didn't remember the specifics of the situation or what app changes were made, he said the parties eventually "figured it out" and Patreon got its approval.

The Patreon chief executive went on to explain that most of the engagement on the platform occurs on places outside the App Store, such as Discord. He also added that, currently, Patreon funnels users to a web flow for signups.

It isn't clear why Patreon is an exception to Apple's payment processing rules. Apple's guidelines do allow apps to bypass in-app purchases for certain monetary gifts, but that exception doesn't apply to gifts connected with digital content or services -- a common benefit given to fans by Patreon creators.

Conte reiterated that only a "tiny portion of pledges" actually occur on the iOS Patreon app.

The Verge also asked about a recent campaign by Fanhouse, which is similar to Patreon, that calls for Apple to decouple its commission policy from payments directly to content creators. Conte said he was aware of Fanhouse's campaign, but didn't add much else.

When asked again to offer clarity about any "direct conversations" with Apple's App Review team, Conte didn't offer much new information.

"Well, we have multiple times as we've gone through the review process. That has come up. I think it came up again a few years ago, and that's when we actually got delayed. And again, I don't remember what the changes were, but we made some changes, and then we passed the review process. And it worked," Conte said.

The Verge said it reached out to Apple to inquire why Patreon isn't subject to its payment processing rules, but has yet to hear back.

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Comments

  • Reply 1 of 12
    ppietrappietra Posts: 278member
    I don’t think it’s that hard to understand why! Patreon is also used for different purposes that are not related with digital content to be consumed on a device.
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  • Reply 2 of 12
    jslovejslove Posts: 11member
    This is not complicated nor mysterious.

    It's against the guidelines to advertise alternative payment methods in order to circumvent app store payments.  You can refer to payment methods as long as they don't circumvent payments Apple would feel entitled to a part of, as part of the guidelines.

    That plays out in the following very clear way:  You can't buy e-books from Amazon using either that Amazon nor the Kindle app.  You can buy physical goods.  The app says you have to buy e-books using their web site, but does not provide a link.  Providing a link would violate the guidelines.

    This is really really old news to Apple developers.  It's not magic; it's not mysterious; and it's all there in the terms and conditions we have to sign.  That the Patreon CEO doesn't know or recall the details is not surprising; lots of other stuff for a CEO to worry about when it's not a primarily Apple-centric business.
    thtbaconstangsully54davFileMakerFellerRayz2016emig647jony0
  • Reply 3 of 12
    When I buy something via the Amazon app, Apple doesn't take 30% (or 15%) of that transaction.  How is this any different?

    And note to CEOs: not usually a great idea to go public with your ignorance of business-essential contracts.
    thtsully54repressthisbshankjony0
  • Reply 4 of 12
    sflocalsflocal Posts: 5,820member
    The only think I got from this article is that the CEO is ignorant and lazy.  Jeez, at least he could have summoned the head of mobile development at Patreon before the interview and ask the person how it works.

    I just lost a huge amount of respect/care for Patreon.  Boot this CEO out and get someone that knows about tech.
    sully54Beatsbshank
  • Reply 5 of 12
    ppietra said:
    I don’t think it’s that hard to understand why! Patreon is also used for different purposes that are not related with digital content to be consumed on a device.
    Exactly. I think the whole 'app store fees' argument is disingenuous. If you want to place a product in a grocery store, you pay a shelving fee. And grocery stores charge more depending on what shelf your product is on! Eye level vs. bottom ETC. It's negotiated. Walmart decides what they will pay you as a manufacturer or wholesaler and then you take it or discuss or leave it. Then Walmart marks it up to what they think they can get. I think the people who are raising h*ll over 'app store fees and a monopoly' are either disingenuous (just manipulating the discussion so they can make more money) or don't understand anything about selling. 
    thtbaconstangBeatsBombdoewilliamlondonfahlman
  • Reply 6 of 12
    tokyojimutokyojimu Posts: 494member
    It’s simple. You don’t buy digital goods at Patreon. Patreon is just a way to support creators so it’s solely a monetary payment. Some may offer various types of rewards (digital and/or physical) in return, but it’s not a one-for-one purchase. 
    edited June 22 aderutterFileMakerFeller
  • Reply 7 of 12
    aderutteraderutter Posts: 485member
    tokyojimu said:
    It’s simple. You don’t buy digital goods at Patreon. Patreon is just a way to support creators so it’s solely a monetary payment. Some may offer various types of rewards (digital and/or physical) in return, but it’s not a one-for-one purchase. 
    It’s also not likely any rewards would be used in the patreon app either. In that case a monetary payment to get access to videos or artwork on a discord server accessed outside of the app shouldn’t require Apple’ commission. 
  • Reply 8 of 12
    BeatsBeats Posts: 2,642member
    When I buy something via the Amazon app, Apple doesn't take 30% (or 15%) of that transaction.  How is this any different?

    And note to CEOs: not usually a great idea to go public with your ignorance of business-essential contracts.

    It’s different because Patreon offers digital products like how you can’t buy eBooks on the Amazon app.

    I used to have a subscription to digital products on Patreon. Yes it cost money.

    Maybe the app removes access to digital goods?

    ppietra said:
    I don’t think it’s that hard to understand why! Patreon is also used for different purposes that are not related with digital content to be consumed on a device.

    So? If offering “different purposes” is a way to avoid App Store fees then MY GOODNESS we have a loophole ready to be exploited by everyone! Epic would just have to say “we do other things too!” And bam! Fee-free.

    I haven’t used the app so maybe they removed digital products on the app?
  • Reply 9 of 12
    …aaaaaaand you’re now hit with 30% transaction fees. Congratulations, you played yourself 
    Beatsdaveinpublic
  • Reply 10 of 12
    djfriardjfriar Posts: 26member
    sflocal said:
    The only think I got from this article is that the CEO is ignorant and lazy.  Jeez, at least he could have summoned the head of mobile development at Patreon before the interview and ask the person how it works.

    I just lost a huge amount of respect/care for Patreon.  Boot this CEO out and get someone that knows about tech.
    Jack is neither ignorant nor lazy. I strongly suggest you read the Verge interview that AI is paraphrasing here. While the summary here on AI is solely about App Store policy,  it was maybe 5% of the actual interview The Verge had with Jack. Also, The Verge called Jack out point blank on that "I don't know" response:

    "This sounds like something you should definitely know. Isn’t this a long-term risk to Patreon? That Apple will listen to this and wake up and give you a call and say, “Time to pay the fee.”

    That is the question directly following the quote where Jack doesn't really know why they don't pay it and the resulting convo goes into a far deeper explanation of why they likely aren't afoul of the rules (and wouldn't really care of Apple does start making them pay the fee).

    If you read the full interview and still think Jack is ignorant or lazy ... well, I'm all out of crayons, sorry.
    muthuk_vanalingamFileMakerFellerDogpersontenthousandthingsJapheyrandominternetpersonwilliamlondonbeowulfschmidt
  • Reply 11 of 12
    JapheyJaphey Posts: 985member
    sflocal said:
    The only think I got from this article is that the CEO is ignorant and lazy.  Jeez, at least he could have summoned the head of mobile development at Patreon before the interview and ask the person how it works.

    I just lost a huge amount of respect/care for Patreon.  Boot this CEO out and get someone that knows about tech.
    Great idea! Let’s just fire some guy based on a very brief summary of a much longer article. Cancel the bastard! 
    Ignorant and lazy…lol. 
    muthuk_vanalingamwilliamlondonfahlmantht
  • Reply 12 of 12
    sflocal said:
    The only think I got from this article is that the CEO is ignorant and lazy.  Jeez, at least he could have summoned the head of mobile development at Patreon before the interview and ask the person how it works.

    I just lost a huge amount of respect/care for Patreon.  Boot this CEO out and get someone that knows about tech.
    Yes, let's get someone who knows about the tech!
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