Comment by nabla9

Comment by nabla9 3 days ago

249 replies

Apple’s App Store profits on commissions from digital sales

    Revenue          $32 B
    Operating Costs   $7 B [1]
    Estimated Profit $25 B 
    Operating Margin ~78%
[1] R&D, security, hosting, human review, and including building and maintaining developer tools Xcode, APIs, and SDKs.

Apple could take just 7% cut and still make 20% profits.

Fun Fact: During the Epic trial, it was revealed that Apple's profit margins on the App Store were so high that even Apple's own executives were sometimes surprised by the internal financial reports.

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edit: There is no ideological argument for voluntary action here. The entire goal is to force regulators to step in. The debate over 'good vs. bad companies' is just online noise and rhetorical trik, no one on either side of the political spectrum wants these systems to be fixed voluntarily with corporate altruism.

nabla9 3 days ago

The operating cost is the maximum Apple can come up with when their accountants attribute everything they possibly can to digital sales for the sake of legal argument. R&D shouldn't really be included, and Apple uses those same tools and APIs themselves. I think the actual profit margin is closer to 90%, and Apple could maintain a 20% margin with just a 3–4% fee.

  • rob74 3 days ago

    I'd say that in the case of Patreon, any fee for Apple is unjustified. Apple can justify their fee on app purchases/subscriptions in the app store, but Patreon is not an app subscription, the money goes mostly from the patrons to the people they support. Ok, Patreon takes a cut to cover their operating costs, and also make a profit (not sure how profitable they are currently), but I really can't see how Apple, who don't have anything to do with this process except for listing the Patreon app on the app store, can justify taking a cut.

    • silvestrov 3 days ago

      You could make the argument that Patreon isn't much more than a banking app.

      It just focuses on the receiver of the money than the sender.

      I think Apple is slowly killing apps with this policy. Everybody will slowly move to "web only" as 30% would kill their ability to compete with anybody else. This will likely be much stronger in countries where iPhones do not have the same market share as in the US.

      • josephcsible 3 days ago

        > Everybody will slowly move to "web only" as 30% would kill their ability to compete with anybody else.

        This is why Apple makes PWAs so miserable in Safari and disallows other browsers unless they're just Safari with lipstick.

      • direwolf20 3 days ago

        Apple users seem to be fine with everything being much more expensive. Not only the 30% apple tax itself, developers know Apple users pay more and specify higher prices on Apple.

      • Spoom 3 days ago

        > Everybody will slowly move to "web only" as 30% would kill their ability to compete with anybody else.

        Frankly, yes, please. I mean, I'm biased as my whole career is in web app development, but there are so many things these days that do not need a whole native app. They're just communicating with a server backend somewhere, using none of the unique native functionality of the phone (much of which is available in browser APIs these days anyway). I can block ads in a web app much more easily. It's much harder to do customer-hostile things like block screenshots in a web app.

        Native apps definitely have a place, but I think they're very overused, mostly for reasons that benefit the business at the expense of the customer.

      • Almondsetat 3 days ago

        You couldn't make that argument because Patreon is also a platform to host content, not just send money. If it was something like a twitch donation app the argument would make more sense

      • rkagerer 3 days ago

        Next up, Apple starts taking a cut of every money transfer you do with your banking app.

      • barnas2 3 days ago

        > You could make the argument that Patreon isn't much more than a banking app.

        Don't give them any ideas.

      • wlesieutre 3 days ago

        Honestly I wouldn't be that shocked if Apple tried demanding a 30% royalty on bank deposits and bills paid using iPhone apps. They've decided the future of their company depends on being huge assholes about it.

      • crabmusket 3 days ago

        Imagine seeing a popup banner in an app each time you open it that interrupts whatever you're trying to do to say "open on our website!"

        (Apple's censorship notwithstanding)

    • yibg 3 days ago

      No kidding. Imagine if Apple took 30% of your Venmo transfers.

    • akerl_ 3 days ago

      Why are you ok with Patreon taking a cut but not Apple?

    • MadameMinty 3 days ago

      Next up, 2% cut whenever you use any banking or payment app. Only 1.5% when you use Apple Pay!

      • odo1242 3 days ago

        They currently do charge 0.15% on Apple Pay actually.

    • saimiam 3 days ago

      If a user almost exclusively uses the Patreon ios app to consume the artist’s content and likes to live inside the ios ecosystem for frictionless payments using the card on file/privacy/UX/whatever, then I feel apple should get to set the terms of engagement.

      If you were a chain store in a high end mall where customers cars were all parked for free by valets, mall staff knew their names, and generally made them feel special, you’d not balk at a higher commission to be paid to mall for access to their customers, right? Airports come to mind for this.

      I believe apple lets you set whatever price you want on their store, just not tell customers that they could get a lower price elsewhere/on the vendor’s website (I don’t follow App Store policies very closely so my info is probably out of date).

      • TheDong 3 days ago

        Presumably you also would agree that it's fair if Chrome, Windows, and Lenovo all charged me 30% each for using Patreon via Chrome+Windows on a thinkpad, right?

        They're doing about as much to facilitate my use of Patreon as Apple is.

        This isn't like a mall at all. This is like a web browser, where apps are webpages, and Apple is insisting that the contents of that webpage are something they can dictate all payment terms on.

        For the airport analogy to work, it would have to be that you go to the Airport, go into the electronics store, buy a Kindle, and then the Airport insists it can take 30% not just on the purchase of the kindle, but 30% on every single book you buy on the kindle forever.

        Apple taking a cut on the purchase price of an app that a user found via the app store does make some sense. Apple taking a cut of an in-app interaction with a creator that the user almost certainly found elsewhere is nonsense.

        What next, should apple take a 30% cut of my rent because I found my apartment on the Craigslist app? Should they take a 30% of my train ticket that I purchased using the Safari app? Why does Patreon have to add a 30% cut on in-app content, when Safari lets me pay for in-app content with my credit card without taking any cut?

      • hshdhdhj4444 3 days ago

        > If a user almost exclusively uses the Patreon ios app to consume the artist’s content and likes to live inside the ios ecosystem for frictionless payments using the card on file/privacy/UX/whatever, then I feel apple should get to set the terms of engagement.

        When I paid over $1000 to buy an iPhone I thought I was buying a technological product that I could use to improve my life.

        I didn’t realize I was buying a ticket to Disneyland where the seller of the product decided how I interacted with everything the device enabled.

        I don’t think this should be disallowed. I certainly think it’s incredibly false marketing for Apple to claim I bought an iphone, when in reality I paid upfront for essentially AOL.

      • pc86 3 days ago

        I subscribe to a half dozen creators and I have exclusively used the web interface to subscribe and consume this content. You cannot tell me with a straight face that if the only difference was I subscribed on my phone to someone who charges me $10/mo, Apple is entitled to $36 for the first year and $18/yr in perpetuity thereafter.

      • rubyfan 3 days ago

        I don’t think anyone suggests Apple should get nothing for their app store services, just that it shouldn’t be 30% of every transaction processed through every iOS app.

      • wolvoleo 3 days ago

        Yes it's fine but the 30% should be charged to the customer who wants to stay within that ecosystem of course. If they want that white glove treatment they can pay for it. Of course once the users see how much that fluffy ecosystem actually costs them I bet most of them will just pay patreon directly :)

        If the platform like patreon is supposed to absorb that fee they will increase prices for everyone even people who won't touch Apple like me. That's not fair. Or more likely, they will just give less to the content creators.

        In the EU it's already forbidden to force payments through Apple or to forbid the platforms to charge the fee back to the customer.

      • mrighele 3 days ago

        Should Ford get a 30% cut every time you fill your gas tank ?

        • mrguyorama 3 days ago

          Don't worry, we are well into "car branded fuel only" territory with electric vehicles.

          "Buy our electricity at a huge markup to power your vehicle. Oh, you don't have one of our vehicles? Sorry, that's an extra 10% on top"

          This was dystopic scifi like 20 years ago and Americans are so clueless they just sleepwalked into it because they'd rather not have a government at all.

  • seemaze 3 days ago

    Certainly not defending Apple's behavior in this instance, but isn't the success of the larger product ecosystem a direct driver of their App Store profitability? To strictly evaluate the App Store finances in isolation seems to be the sort of accusation you've levied against Apple in the opposite direction..

    I like Apple less and less these days for various reasons, but I haven't purchased an app on the App Store in more than a decade. It's strictly a vehicle for local utilities when, for whatever reason, a browser will not suffice. Nearly all purchasing is done on the 'open' web.

  • jbs789 3 days ago

    Or you could argue the App Store wouldn’t exist without the hardware, so the relevant reporting is both combined - lower margins.

  • parineum 3 days ago

    > ...for the sake of legal argument. R&D shouldn't really be included

    That's an incredibly ridiculous take. R&D is an operating cost and it's an ongoing expense related to the app store existing.

    > I think the actual profit margin is closer to ...

    You can replace "think" there with "feel".

SwtCyber 3 days ago

What really makes it uncomfortable is that Apple isn't just a neutral marketplace. They control the OS, the distribution channel, and the payment rails, so creators and platforms like Patreon can't realistically opt out

  • chii 3 days ago

    They could opt out - by sticking to web platforms.

    Apple cannot charge for that. However, apple does attempt to gimp the web platforms on mobile to "subtly" push for apps.

    • pornel 3 days ago

      The whole Epic vs Apple was about Apple blocking this. Before being slapped by regulators, Apple had anti-steering policies forbidding iOS apps from even mentioning that purchasing elsewhere is possible.

      Even after EU DSA told them to allow purchases via Web, Apple literally demanded a 27% cut from purchases happening outside of App Store (and then a bunch of other arrogantly greedy fee structures that keeps them in courts).

      Apple knows how hard is not to be in the duopoly of app stores. They keep web apps half-assed, won't direct users to them, but allow knock-off apps to use your trademarks in their search keywords.

    • archerx 3 days ago

      They do and it’s awful. I’m making a browser based game and it works great on desktop browsers but Apple refuses to allow css filters on canvas forcing you to build your own filters and apply them to image data. The web audio api is also a pain to get working properly on iOS safari and a bunch of other arbitrary but feels like they’re intentional obstacles found only on iOS. I’m almost considering just using webgl instead of a 2d context but who knows what obstacles apple is hiding there also it will make everything so much more verbose for no real gain.

      Not even in the days of IE was I ever this frustrated.

      • nozzlegear 3 days ago

        > Not even in the days of IE was I ever this frustrated.

        I've been web devving since the days of IE as well and this reeks of hyperbole. Maybe things are different for browser games, but for me, everything has vastly improved since those days.

      • danielvaughn 3 days ago

        I tried something similar a couple years back, and fully agree. Safari is atrocious for trying to create a good mobile experience. It almost feels intentional.

    • stavros 3 days ago

      They can opt out like you can opt out of using a phone. Sure, you won't die, but you won't have much of a social life either.

      • chii 3 days ago

        You do know a phone has a browser installed right?

    • 7bit 2 days ago

      This rethoric is destructive and threatens society and democracy alike. Apple is not just some company that you can just opt out of, if you're working in a certain field. Just like you can't opt out to YouTube if you're a content creator.

      It not like an email service where you can just switch from Gmail to fastmail to proton or to any of the other dozens of big email providers.

      There's apple. There Google. That's it.

      Opt out. Jesus Christ...

    • sidewndr46 3 days ago

      Why could Apple not charge a percentage for any user using their mobile device? Why would it be limited to app store?

      • direwolf20 3 days ago

        Because they don't control those. Apple could choose to only allow users to access websites that pay them a bit 30% fee, but users would notice the web was turned off on their device. They don't notice when the app store does it.

  • randallsquared 3 days ago

    While inconvenient and likely to reduce patrons, the article does describe how they can opt out: use the web to do any payment activity.

  • gumby271 3 days ago

    Don't forget they also directly compete with Patreon with podcast subscriptions. You can support a podcast through Apple podcasts or Patreon, but only one of those has a 30% chunk taken out.

    • dwaite 3 days ago

      IIRC Premium Apple podcasts charge their standard subscription fees (eg 30% the first year, 15% the years after that)

  • StopDisinfo910 3 days ago

    That's pretty much the conclusion the EU came to and why they introduced the notion of gatekeepers in the DMA.

    It doesn't matter if you are not technically in a dominant position if your special role in a large ecosystem basically allows you to act like one in your own purview.

    You could say this kind of move invites more scrutiny but the regulators are already there watching every Apple's move with a microscope and their patience with Apple attempts at thwarting compliance is apparently wearing thin at least in the EU if you look at preliminary findings.

  • patanegra 3 days ago

    Yeah, because they built it. If people were using Linux everywhere, the situation would be different.

uyzstvqs 3 days ago

The problem is the monopoly over distribution channels. Regulation needs to force devices to allow A) downloading and using packages & executables from the internet, and B) any app to download and install other apps.

Regulating the fees for one central app store is no solution.

  • stouset 3 days ago

    > downloading and using packages & executables from the internet

    Oh boy, now my mom can get the full experience of having malware on her phone too!

    • ulrikrasmussen 3 days ago

      With freedom also comes responsibility, and some innocent people will inevitably shoot themselves in the foot. This is not a strong enough argument for putting everybody else in a cage and letting a duopoly take over virtually all of the distribution of consumer software.

      • ericmay 3 days ago

        It might be a strong argument depending on the negative effects - I don't think it's very clear cut. Also no, neither Apple nor Google have a duopoly on the distribution of all consumer software. Microsoft exists, for example.

        The other problem consideration here is negotiating power.

        Today consumers don't have negotiating power over individual developers, but both Apple and Google do. If you complain to Meta about their unwanted tracking, you don't really have many options besides deleting the app (which you should do anyway). But if enough people complain to Apple or Google, they are more inclined to do something and have the power.

        While it may be a marriage of convenience, it's undeniable that both companies through their app distribution models have also provided benefits to consumers that developers otherwise would have abused - privacy, screen recording, malicious advertising, &c.

        If you want to argue from the standpoint of pro-consumer action, you have to remember that "developers" are usually pretty awful too and will get away with anything they can, even if it harms their customers. A good balance, instead of ideological purity about one "side" or the other is the smarter move. I tend to come down on the side of the mainstream app stores precisely because those asking for more "freedom" to do as they wish are a tiny minority and are usually more technical. I.e. they can jump through the hoops to install 3rd party app stores and jailbreak their phones today, and since you already can do what you want, maybe it's best to just leave the masses alone since they're very obviously happy with the duopoly.

      • hombre_fatal 3 days ago

        Well, you have to balance it with how much you want to line the coffers of malicious actors.

        If you go all the way to "everyone should have the freedom to get pwned", then you are also funneling the money of innocents into the pockets of some of the worst people in the world, and that's not a great outcome just to make life more convient for some HNers.

        The question is about what trade-off makes sense for most people. That probably is some sort of escape hatch nontech people just won't do.

        Maybe it's a hard thing to appreciate until you've watched aging family members get tricked by absolute scum, mostly enabled by how loosey-goosey modern computing can still be.

    • rpdillon 3 days ago

      Let's not put everybody in a cage because we can't stop dumb people from walking off cliffs.

    • samrus 3 days ago

      I hate the classic apple users' "mom" argument. Why are all your moms morons? And why do you want to fuck up the entire mobile landscape to baby proof it for them. Im not gonna ruin my experience with technology because you dont expect your mom to be able to wipe her ass without apple's help

      • linkregister 3 days ago

        There is nothing stopping you from using non-Apple hardware to escape restrictions on downloading unreviewed software.

        • array_key_first 3 days ago

          There are many things impeding you from doing so and you know it, because Apple designed it that way. Walled garden, remember?

      • stouset 3 days ago

        I hate the classic “everyone should be an expert at IT and it’s their fault and they had it coming due to their own ignorance if they make mistakes” argument far more than you hate mine.

funkyfiddler369 3 days ago

> no one on either side of the political spectrum wants these systems to be fixed voluntarily with corporate altruism

Right on. But that's exactly the wiggle room where voters could pull some of those cards like "climate change mitigation (of consequences)", "climate change preparation", "upcoming waves of climate change refugees", "AI dividing the population", "Universal Basic Income", all of which are things companies like Apple won't do anything for (or against) while their goods are still mostly for proper earners and not for people who buy stuff at a discount (I'm exaggerating).

Since corporate altruism is definitely not on the menu, government institutions and NGOs will have to pick up way more than they are currently prepared for.

We are in a strange phase of calm before the storm, despite all those wars and conflicts--or in spite of them, I don't know. Shits' gonna hit the fan sooner or later and it's up to the voters to demand adequate preparation.

Big Corps caused significantly more damage than they had to cause for all those profits, whether as a side effect or not, and they did that long enough.

Job cuts, whether due to AI or not, will remain a thing while no "new" giants will rise for quite a while ... and corporations will sing the song "it's what the people want" only as long as voters will stay quiet.

Sure, bribes, corruption and blablabla, but it doesn't change how votes work and none of it changes how the devoted clerks in the administration do their jobs and write laws (if they have to have to) ...

blahgeek 3 days ago

> Apple could take just 7% cut and still make 20% profits.

We can say this to any company, "$X could reduce price by $Y and still make $Z profits", but it doesn't really make any sense. Making profits is what makes a company a company instead of a non-profit organization.

  • awesan 3 days ago

    It does make sense to highlight, because this kind of statistic is a very strong indicator that the market is not competitive. This is not a normal kind of profit margin and basically everyone except for Apple would benefit from them lowering the margins.

    In normal markets there are competitors who force each other to keep reasonable profit margins and to improve their product as opposed to milking other people's hard work at the expense of the consumer.

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    • newsclues 3 days ago

      Might not be competitive but it’s totally voluntary. No one needs app, it’s not food or shelter, so clearly consumers are willing and able to pay this.

      The consumer is willing to pay the price based on the perceived value from the App Store

      • lozenge 3 days ago

        The relevant market here is the creators not the consumers. As a creator you have no choice but to accept whatever fees Apple, Google, Steam etc set. Or whatever rates Spotify pays you per stream. The fact you "could" host your own website is irrelevant when the reality is nobody will visit it.

      • account42 3 days ago

        What is also totally voluntary is our decision to let Apple exist as an entitiy, to give them a government enforced monopoly over certain things, to make it illegal to break their technical protections of their monopoly etc.

      • matkoniecz 3 days ago

        > No one needs app, it’s not food or shelter

        "No one needs app" is not the same as "No one has biological mandatory need to have an app"

  • vasco 3 days ago

    When parts of a market become dominated by one or few companies operating in a limited choice environment, consumers can't just opt to not use both Apple and Play store. You need to choose one in practice.

    At this point the regulators should investigate what the barriers are to new entrants and if it's too costly and nobody has managed to cut in the last few years, establishing some rules is probably a good thing. This happens as industries mature and become critical, it happened in transportation (most bus, train companies), energy, water supply, trash, etc, depending on the country and market conditions.

    • ThunderSizzle 3 days ago

      Barrier to entry is simple: both Google and Apple heavily discourage "sideloading" or make it practically impossible.

      Google is moving in that direction.

  • account42 3 days ago

    High profit margins are a sign of market failure.

    • 9rx 3 days ago

      Not so much a failure. Rather, there is no intent for there to be a market here at all. A market relies on offerings being reproducible. Intellectual property laws are designed specifically to prevent reproduction.

  • ibejoeb 3 days ago

    Agreed, but this is about to be a special case if it's not already. We're contending with compulsory digital IDs and cashless economies that must be used on authorized devices, and Apple is one of the two makers. While it's certainly not necessary to use Patreon, not having it or something like it is an actual barrier to individual trade. I don't think I can get behind a schema that means Apple can take whatever portion it wants from a transaction initiated on a device that it creates and that is otherwise fairly necessary for day-to-day life in the developed world.

  • bryanrasmussen 3 days ago

    it sounds like it does make sense because if they are making $Z profits then they are still making profits and are not non-profit.

    there could also be cases where cutting back to $Z profits might be preferable in case not doing so were to prompt legislation causing someone to be forcibly cut to $Z-1 or even $0 profits from a particular profit source.

    Which it has been my observation that when someone is saying "X could reduce price by $Y and still make $Z profits" it often coincides with saying therefore company X should be legislated on this particular profit source.

    Note: $X didn't make much rhetorical sense.

    • rubyfan 3 days ago

      >there could also be cases where cutting back to $Z profits might be preferable in case not doing so were to prompt legislation causing someone to be forcibly cut to $Z-1 or even $0 profits from a particular profit source.

      Not in an environment where regulatory capture costs so much less than any change legislation could bring. The remedy in almost every recent monopoly case has been remarkably nothing. Politicians don’t actually want change, they want the threat of legislation so that industries bring truckloads of money to line their pockets.

  • ImHereToVote 3 days ago

    I think it's a little known fact that societies don't exist for the benefit of companies. It's actually the other way around.

    • [removed] 3 days ago
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  • gortok 3 days ago

    “Growth is what makes a cell a cell.”

    Until it turns into cancer because of unrestrained growth.

    Like it or not capitalism is a part of an ecosystem. We’ve been “educated” to believe that unrestrained growth in profits is what makes capitalism work, and yet day after day there are fresh examples of how our experience as consumers has gotten worse under capitalism because of the idea that profits should forever be growing.

  • croes 3 days ago

    It makes sense that regulators can step in without destroying a company.

  • FatherOfCurses 3 days ago

    "Why wait until tomorrow to get one golden egg when I can kill the goose today and get all the golden eggs?"

matt-p 3 days ago

Let's be honest if this was a European company it would be capped by law at 5-10%. Problem is who has an incentive to do the right thing here? Not apple and certainly not the US government (most of this revenue comes from outside the US).Nobody can defend it, yet nobody wishes to stop it.

  • eloisant 3 days ago

    The US government should absolutely do that, but they won't because they defends the interests of big companies rather than the interests of small companies or US citizens.

chrisan 3 days ago

> even Apple's own executives were sometimes surprised by the internal financial reports.

Was this recorded or just people drawing lines between Epic's expert witness claims and the executives trying to down play them?

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andrekandre a day ago

  > developer tools Xcode
also now one of the worst ide in mobile/desktop development and an embarrassment for a company of apple's size and profits

them taking more and rents from their store-related operations is hard to justify from software product-quality perspective; its like a slap in the face

CGMthrowaway 3 days ago

That's not how business works. The App Store in current form would not exist without all the collective investment that went into all of Apple's hardware, for instance.

Microsoft Office: Revenue $45B Operating Costs $12B Profit $33B Operating Margin 75%

Google Search Ads: Revenue $175B Operating Costs $45B Profit $130B Operating Margin 75%

  • devmor 3 days ago

    > That's not how business works. The App Store in current form would not exist without all the collective investment that went into all of Apple's hardware, for instance.

    While technically true, this argument doesn't provide any merit to the discussion. The App Store backed purchase for the Patreon subscription would not exist at all without the creator's work and investment in creating their form of content.

    In the absence of the App Store, the creator would still have access to their patrons via mobile web and payment via the methods already provided by Patreon. The app is merely a convenience - it's a hard sell that this convenience is worth 30% of the creator's revenue through the platform.

    • CGMthrowaway 3 days ago

      > The App Store backed purchase for the Patreon subscription would not exist at all without the creator's work and investment in creating their form of content.

      Both parties are getting the chance to set whatever price they want. Up to the market to resolve supply/demand equilibrium

      • devmor 3 days ago

        Creators on Patreon are already loosely bound to the market of other creators. Not all creators are affected by this change.

        The app store payment cut harms only creators who have disproportionately high percentages of patrons that primarily consume their content from iPhones - a demographic that they have no control over.

        If they wish to increase their price to make up for this, they then are forced to risk turning away their other, non-iPhone-primary patrons. Notably, Patreon is forbidden by Apple from making this pricing scheme transparent and up-charging only iPhone users to keep the creator whole.

        The only party with power here is Apple - and they are using it to strongarm.

  • sfblah 3 days ago

    Being a monopolist is good fun until they storm the Bastille.

pier25 3 days ago

Plus more than $20B for the Apple developer fee without which you cannot publish the their stores.

throwaway85825 2 days ago

All of this could be solved easily if developers were allowed to pass on the apple tax to consumers and advertise discounts for not using the App Store. No one wants to pay more for nothing.

micromacrofoot 3 days ago

I don't think Apple could actually, unless they could prove to shareholders that it would create more value

  • Herring 3 days ago

    > shareholders

    Yeah that has to be a good 95% of why businesses do bad things.

    The last thing Apple wants is for people to think they've plateaued. Stock starts going down to normal P/E ratios, expensive engineers leave, etc.

ripped_britches 3 days ago

I’m surprised they were surprised because operating costs should be pretty much nil. What do they do, pay a few thousand app reviewers, a few hundred software engineers? Pretty sure if they had to, they could operate App Store for a few tens of millions of dollars per year.

musicale 3 days ago

Apple's App Store business model is the same as Nintendo's eShop business model.

Obviously Epic would like to pay lower platform fees to Apple than it pays to Nintendo, but there is no logical reason why it should.

ksec a day ago

Are those number App Store revenue or services revenue ? Because both seems to be inaccurate.

jszymborski 3 days ago

> The debate over 'good vs. bad companies' is just online noise and rhetorical trik...

Agreed, there are bad privately held corps, and worse privately held corps, with badness usually proportional to their size and profit.

danielvaughn 3 days ago

I really think I might be done with Apple. The only thing keeping me using them is how much I hate Android. The _millisecond_ a competitor arrives, I'm dropping my iPhone like a bad habit.

  • vlod 3 days ago

    Off topic, but is there anything specific that you hate about Android? I find it acceptable. I'm trying to cut down my phone usage so maybe I'm more tolerant.

    • goatking 3 days ago

      Not OP, but: "acceptable", that's the problem. Also I dislike Google more than Apple.

      • Zak 3 days ago

        I'm wondering what adjectives you hope to apply to a phone operating system. I'm content with mine when I don't have to think about it, for which "acceptable" seems about right, and discontent when I do.

  • drnick1 3 days ago

    GrapheneOS on a Pixel is that competitor. Open source, more secure than Apple, compatible with nearly all Android apps. It's all the positive aspects of Android without the downsides (Google).

    • eloisant 3 days ago

      > compatible with nearly all Android apps

      The "nearly" is the issue. Opting out of the Apple/Google duopoly comes at a great cost.

      • saintfire 3 days ago

        I've used it for 3 years and the only app I couldn't use has been Google pay/wallet.

        Truly is nearly. Some apps (banks) you need to toggle a compat mode.

  • RDaneel0livaw 3 days ago

    I keep hoping and wishing for a daily drivable linux phone that's compatible with all the us networks to come along. I'll keep hoping and wishing. Someday I hope we will get there!

patanegra 3 days ago

One company's margin, is other company's opportunity.

  • ulrikrasmussen 3 days ago

    The problem is that Apple owns the platform and half of the mobile ecosystem. You can't just launch a competitive marketplace which could compete alongside Apple's app store, nor can you launch an alternative operating system. You have to launch a whole new smartphone stack complete with operating system, app distribution and app ecosystem.

    • Ylpertnodi 3 days ago

      Or not use apple.

      • ulrikrasmussen 2 days ago

        I also don't use Apple, and I try to avoid the only other alternative by using GrapheneOS instead of an official Android build.

        But at some point everything is going to be so closely tied to Google as well that that way of living is also going to become too painful, and at that point "or not use Apple or Google" is a bit like saying "or not use the roads".

      • observationist 3 days ago

        This. Doing business with almost any major company is unethical, but Apple sits near the top of the big tech companies people shouldn't do business with. They are not a force for good in the world.

  • eviks 3 days ago

    Indeed, that's why the former blocks the latter: not to lose margins to those opportunities

ghtbircshotbe 3 days ago

They could lower the rates even more and still afford the government bribes and solid gold tchotchkes, but the whole point of the bribes is to not do that.

jama211 3 days ago

Well said. Glad to see this at the top. Google also takes 30%. And I think steam too. This is 100% a regulatory issue.

  • Manuel_D 3 days ago

    But competitors to Steam exist: Epic Games Store only takes a 12% cut. Publishers have an option to use other distributors but choose not to.

    • jama211 2 days ago

      Sure, and you can buy an android phone and use the play store instead and still get charged 30%. Or you could sideload, but let’s be real 99.9% of users aren’t gonna do that, and similarly most gamers are gonna buy everything on steam.

      The exceptions here prove the rule I’m afraid, if anything.

    • eloisant 3 days ago

      > Publishers have an option to use other distributors but choose not to

      They can choose to sell in the store where all users are, or in the store nobody goes.

      • Manuel_D 3 days ago

        Correct, but that means that publishers are choosing to distribute via Steam, despite the existence of other options, because Steam's superior features, user base, etc. justify paying that premium. They could distribute on Epic games, or even self-distribute like how Blizzard does, but they choose Steam.

        It's not analogous to iOS that has no other options for distribution.

dmix 3 days ago

Those margins are pretty normal in software, especially a mature product like that.

wosined 3 days ago

But people still use/buy it so why would they cut the cost?

  • nabla9 3 days ago

    There is no ideological argument for voluntary action here. The entire goal is to force regulators to step in. The debate over 'good vs. bad companies' is just online noise and rhetorical trik, no one on either side of the political spectrum wants these systems to be fixed voluntarily with corporate altruism.

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    • NewsaHackO 3 days ago

      But what are they even doing for regulators to have to step in? Making profits from someone selling their product in your market seems pretty valid to me. Are you saying this is anticompetitive to other possible app store storefronts like Google Play or something?

      • rpdillon 3 days ago

        Just to ground the discussion in Apple's criminal behavior a bit, here's some excerpts from a 2025 ruling about Apple's behavior in this regard:

        > Apple’s response to the Injunction strains credulity. After two sets of evidentiary hearings, the truth emerged. Apple, despite knowing its obligations thereunder, thwarted the Injunction’s goals, and continued its anticompetitive conduct solely to maintain its revenue stream. Remarkably, Apple believed that this Court would not see through its obvious cover-up (the 2024 evidentiary hearing). To unveil Apple’s actual decision-making process, not the one tailor-made for litigation, the Court ordered production of real-time documents and ultimately held a second set of hearings in 2025.

        > To summarize: One, after trial, the Court found that Apple’s 30 percent commission “allowed it to reap supracompetitive operating margins” and was not tied to the value of its intellectual property, and thus, was anticompetitive. Apple’s response: charge a 27 percent commission (again tied to nothing) on off-app purchases, where it had previously charged nothing,and extend the commission for a period of seven days after the consumer linked-out of the app. Apple’s goal: maintain its anticompetitive revenue stream. Two, the Court had prohibited Apple from denying developers the ability to communicate with, and direct consumers to, other purchasing mechanisms. Apple’s response: impose new barriers and new requirements to increase friction and increase breakage rates with full page “scare” screens, static URLs, and generic statements. Apple’s goal: to dissuade customer usage of alternative purchase opportunities and maintain its anticompetitive revenue stream. In the end, Apple sought to maintain a revenue stream worth billions in direct defiance of this Court’s Injunction.

        https://storage.courtlistener.com/recap/gov.uscourts.cand.36...

      • gabaix 3 days ago

        They are not allowing other marketplaces, or creators themselves, to run apps on Apple devices directly.

        • NewsaHackO 3 days ago

          Why should they have to allow third parties to run apps on their platform? The fact that it is a clear security risk already gives them justification, but even looking past that, Apple is not the only platform that bars users from running third-party software or marketplaces on their products. For example, playstation, xbox, and switch all disallow running unauthorized games on their platforms. What makes Apple different?

      • nabla9 3 days ago

        No. This is a result of a market failure caused by monopoly power. Regulators must make sure market capitalism works.

        I'm not sure what is the basis for your question but using market definition where Google Play and Apple Store are in the same market is not correct (market definition is essential part of any monopoly regulation).

        Markets are defined by choice of practice, not by choice in principle.

  • vincnetas 3 days ago

    and that exactly what monopoly allows you to do.

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absynth 3 days ago

This is all money that is reducing expenditure elsewhere. I get it: capitalism and economics. Yet I still think humanity could do better and I think capitalism itself suffers. Economics theory is broken if it thinks this is good for society in general.

u8080 3 days ago

But those profits made possible by actually having other infrastructure parts existing(OS, hardware, marketing, etc).

  • eloisant 3 days ago

    The $160 billion of cash Apple is sitting on doesn't contribute to any infrastructure.

godelski 3 days ago

I think what confuses me is that Apple is taking so much profit that it reduces their profits.

It's a classic direct-indirect management problem. Think about Android for a second. It costs nothing to put an app on their app store. People can make apps for themselves and then just publish because either "why not" or it's an easy way to distribute to friends and family. So basically it is making app creation easy. Meanwhile Apple charges you $100/yr to even put something up on the store, makes it hard to sideload, and consequently people charge for apps, which Apple rejoices as they get a 30% cut (already double dipping: profiting from devs, profiting from the devs' customers).

BUT WE'RE TALKING ABOUT SMARTPHONES

A smartphone is useless without apps! People frustrated they can't find the apps they want on iPhone? They switch to Android. People on Android want to get away from Google but they can't do half the shit they want to on iPhones (and the other half costs $0.99/mo)? They bite their tongue or rage quit to Graphene.

The only reason this "fuck over the user" strategy works is because there's an effective monopoly.

All of this is incredibly idiotic as the point of a smartphone is that it is a computer that also makes phone calls. We have made a grave mistake in thinking they are anything but general purpose computers. All our conversations around them seem really silly or down right idiotic when you recognize they are general purpose computers. And surprise surprise, the result is that seeing how profitable and abusive the smartphone market can be leads to a pretty obvious result: turn your laptops and desktops into smartphone like devices. Where everything must be done through the app stores, where they lock you out of basic functionalities, where they turn the general purpose computer into a locked down for-their-purposes computer.

The thing that made the smartphone and the computer so great was the ability to write programs. The ability to do with it as you want. It's because you can't build a product for everyone. But the computer? It's an environment. You can make an environment that anyone can turn into the thing they want and they need. THAT is the magic of computers. So why are we trying to kill that magic?

It doesn't matter that 90% of people don't use it that way, and all those arguments are idiotic. Like with everything else, it is a small minority of people that move things forward. A small percentage of players account for the majority of microtransactions in videogames. A small percentage of fans buy the majority of merchandise from their favorite musicians. And in just the same way, it is a small number of computer users (i.e. "powerusers") that drive most of the innovation, find most of the bugs, and do most of the things. I mean come on, how long did it take Apple and Google to put a fucking flashlight into the OS? It was the most popular apps on both their stores for a long time before it got built in. Do you really think they're going to be able to do all the things?

thegrimmest 3 days ago

Advocating for regulators to step in is already a value judgement. Why is "high profitability" a cause for regulatory scrutiny? The optimal behaviour in any ecosystem (corporate or natural) is to defend as much territory as is within your power, not to keep only to what covers your "needs". Why have you deemed this behaviour, which is emergent anywhere competition between organisms exists, as in need of regulation?

Apple is succeeding largely on merit, within the bounds of civilized, peaceful competition. Shouldn't we all just be grateful for the contributions they have made to our civilization?

dimitrios1 3 days ago

> force regulators to step in

> force

> regulators

That's my whole problem, personally.

What we need much, much less of in this world is government force, especially during these trying times of government force and outreach (something I expected my more left side of the isle colleagues to have finally realized by now).

COIVD really was a test of how much governmental draconianism we would take, and we failed spectacularly, and not only that, but are demanding more government.

So no, we don't need more regulation, especially given this country's history of regulatory capture. We need new solutions.

  • Atreiden 3 days ago

    We don't need "more" government, we need the government to do its job. We need the regulators who have been legally appointed to oversee these areas to actually respond to these behaviors. Regulatory capture is the issue, but the solution isn't less government. It's getting corporate money and lobbying out of the government (Citizens United is to blame for most of our woes), increase the enforcement of anti-corruption laws, and get antitrust back on the table.

    I want big corporations to be scared. I want them to fear for their own survival, and to tread lightly lest the sword of damocles fall upon them.

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