flydog

hammeroftruth said:

I wonder how many developers have gone out and priced what it would cost to maintain their own server to download their app, the cost of securing it so it doesn’t get hacked and the app replaced by a malicious clone, the cost to process payments for the app, and the cost to maintain correct accounting of app sales. 

30% might seem high to some, but they haven’t really come forward publicly to give an alternative or explain why a smaller percentage would be beneficial to both parties. 

Sorry, I don’t believe Spotify’s crocodile tears when it comes to a developer making a point about paying fees to Apple. IMHO, they are mad because they are getting squeezed by the RIAA and feel Apple is taking up whatever profits they would get for the price they are charging. 

Nothing you mentioned comes anywhere close to 30%, individually or collectively. 

Hosting Apps

Maintaining a server to host downloads costs next to nothing. Our app is under 15 MB, which Apple hosts on the App Store, but it requires downloading content between 100 and 500 MB depending on the user.  That content is hosted on our own servers, and it costs a fraction of a penny per user.  Most developers have to maintain servers for other purposes anyway, especially if their app is cross-platform, and hosting app downloads would be a microscopic fraction of overall costs.  Our back end infrastructure for app functionality that is unrelated to hosting content is 99.99% of our costs, and is something we would need anyway. 

Apple does provide alternatives to setting up your own back end infrastructure (database, storage, etc), but that locks you into Apple's ecosystem, and makes it difficult or impossible to sell your app or content on other platforms.  Also, Apple's services are down more often than our own services. There have been numerous iCloud outages this year, whereas our services have been continuously up for the past three years. 

Transaction Costs

We sell content on the App Store as IAPs and offer the same content on our own store at a discount to the App Store price.  Selling the same content via the App Store costs 30% versus 2% on our own store.  

Accounting

Accounting of app sales seems like something you just threw in there to make the argument more persuasive, but is a non-issue.  Not sure what you think Apple provides in this regard, but sales reports are often delayed and are very sparse in their content.  We do not know who our customers are, can't provide refunds, or answer questions about the purchase.  The information that Stripe or Square provide for credit card sales is just as good and often better than what Apple provides, and as I noted, costs under 2% for each sale. Stripe and Square also integrate with accounting software, the App Store reporting does not.  

Security

The security issue you raised is a red herring for a number of reasons. First, it is in Apple's best interest to provide a method to secure apps for the benefit of its customers. The only benefit to developers is it makes it difficult to pirate apps, but in our case it is a non-issue because most of our apps are free, and we secure the content that we sell for use in those apps. Again, the cost is nominal.


The benefit of selling apps on the App Store has little to do with the factors you mentioned.  The benefit is exposure to over a billion users, essentially free advertising. For a very small developer just starting out, the 30% is well worth it when compared to the costs of advertising an app outside the App Store. But as app revenues move past $1 million, there is very little benefit from the 30% paid to Apple. And for well-known companies like Netflix and Spotify there is zero benefit since people know who they are and just need a client app to consume the content. 

I see more and more developers moving to a model where the app is free and functionality/content is sold outside the App Store.  There really is nothing the App Store offers us developers aside from exposure to new customers.  Moreover, dealing with Apple is often frustrating.  Their developer support is not at all like the customer support you get when you buy an iPad or iPhone. You are not allowed to call Developer Support, and any message you send via the developer portal is met with canned responses that often have no relevance at all. If you are lucky enough you may receive a phone call from someone who is clearly trained in conflict resolution, but who will not actually fix anything. 
I no longer bother unless the issue is critical.

Deploying new apps and app versions is time consuming. Whenever we need to deploy a new app version to the App Store, I have to devote most of the day to that process.  
Screenshots have to be uploaded for every single device class.  iTunes Connect returns cryptic errors that the screenshot is the wrong size, when it is in fact exactly what Apple requires in its documentation. Creating app preview videos requires paying $299 for Final Cut Pro because video recordings from the actual device are incompatible. Then you need to spend half an hour archiving and uploading a bundle.  After you spend all that time uploading a bundle, it may reject the bundle, often with some cryptic error message that needs to be googled because Apple does not provide any context or information. After the bundle is uploaded, then App Store then needs to process it, which takes anywhere from 30 minutes to over a day.  It could be rejected again for some other reason, which requires you to start the process anew. In contrast, when we deploy a new web app, it takes a button push and 30 seconds of configuration.   

App reviews can be arbitrary, and appeals can take weeks, during which time your app is not being sold.  Even if you win, the next time you submit the app a different reviewer will reject it for the same reason.  And if your only source of income is the App Store there is always the danger that Apple will yank your developer privileges and put you out of business. 

To be fair, the issues I mentioned above don't occur every time, but often enough to make developers wonder why we pay so much money for Apple's service.

maestro64 said:

As someone pointed out Pixar was successful for Steve and he sold it to Disney, maybe not a smart move if Steve had thought about the overall Apple content directions. Steve thought years in the future about products, but he kind of missed this one.

Steve didn't miss anything because he considered facts that you did not.  He also did not have the benefit of your 13 years of hindsight.

First, Pixar did not own any of the movies it produced in the 10 or so years leading up to the sale.  Disney had exclusive ownership and control over the content, and was solely responsible for marketing and distribution. Pixar was basically nothing without Disney, and if it still existed today, it's not clear how that would benefit Apple.  

Second, Pixar was a public company, and Jobs owed a fiduciary duty to shareholders to maximize value for the company.  Holding on to a company for the sake of some vision that may or may not materialize 10-20 years in the future would be criminally insane. 

Third, Apple did not own Pixar. Your analysis that it was not a "smart move" therefore necessarily assumes that Apple would eventually buy Pixar, or enter into the same sort of agreement that Apple now has with Disney with respect to content distribution.  But Apple does have that agreement, so the only benefit would be some cost savings from ownership.

But Apple buying Pixar made zero sense then, and really doesn't make much sense now.  At the time Apple was fundamentally a hardware company, and was knee deep in developing the first iPhone.  Even if Steve Jobs was  psychic, it would have been nuts for Apple to spend $7 billion for a business that bore zero rational relationship to its then-current business simply so it could have content for some undefined service that may or may not exist 15 years down the road. Plus it would still not own the content.

An absurdly long article to support a subjective opinion.  It's clear that Gates viewed Apple and Microsoft as rivals for the 30 years leading in the iPhone launch, and thus viewed the two as natural competitors in the nascent smartphone market.  Whether Microsoft could or couldn't compete for whatever reason doesn't change that.

davgreg said:

Until irresponsible people in government are prosecuted for flouting the law this kind of thing will continue to be a problem.

Being irresponsible is not illegal.

Guess you missed this part:

When enabled, Silence unknown callers "uses Siri intelligence to allow calls to ring your phone from numbers in Contacts, Mail, and Messages.”