Comment by 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.
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.
> 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.
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.
> 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.
Apple makes sure it's not practical.
You still can't have a "share to" target that is a web app on iOS. And the data your can store in local storage on safari is a joke.
Of course, forget about background tasks and integrated notifications.
In fact, even on Android you miss features with web apps, like widgets for quick actions, mapping actions to buttons and so on.
And no matter how good you cache things, the mobile browser will unload the app, and you will always get this friction when you load the web app on the new render you don't have on regular apps.
> I think they're very overused
I disagree, native apps on iOS have important abilities that no web application can match. The inability to control cache long-term is alone a dealbreaker if trying to create an experience with minimal friction.
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
You could if they built a donation & support trading app separate from the content app?
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.
I would be surprised by that because iPhone users would notice that. I think the App Store model relies on their fee being invisible to consumers, and the increased price you’re paying not being linked to them. AFAIK apps aren’t allowed to explain that they charge more if you subscribe on iPhone to users either, or why they do so.
When you use Apple Pay, Apple collects ~0.15% (15 bps) from the issuing banks for credit. $1B in transaction volume = $1.5M
In 2022 the total volume was estimated at $6T * .15% = $9B. Real number would be maybe half due to lower fees on debit, but it's hugely profitable for Apple, and carries zero risk.
Something interesting is that Apple and Google Pay charge a tiny commission (don't have the number at hand). Which banks didn't like, so at least on Android they created their own NFC payment stacks for a while. Only to then discover that maintaining such a stack cost them more per year than the commission.
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)
Next up, 2% cut whenever you use any banking or payment app. Only 1.5% when you use Apple Pay!
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).
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?
> certainly found elsewhere
I agree that if someone discovered the artist elsewhere, Apple has weaker standing in claiming a huge commission. But if they found an artist elsewhere, they would also know that they can support that artist elsewhere and not through the iOS app. If the patron found them through the patreon iOS app and use the app to consume the artist's content, then clearly the patron has indicated that they prefer the iOS experience.
Chrome, Windows and Lenovo don't have the payment system baked in, with all the consumer protections that come with it.
I'm not entirely pro-Apple percentage in this argument, but I think people often dismiss the magical thing that Apple created with the app store and their payment/subscription system. The rest of the world keeps ripping users off, and Apple's walled garden is as protected a thing as it gets.
I've gone directly to my bank for subscription charges billed directly to my credit card and they wouldn't reverse or stop them. Cancelling and reversing on the App Store is basic, easy, and friction-free.
Plus, the Android environment doesn't yield nearly the same sales volume even with significantly more installed units.
People spend on iOS and they don't spend on other platforms.
30% hurts and it sucks, but.. Patreon will probably take it because they'll do the math and it won't come out in favor of the alternative. That's what really sucks, beyond Apple max-max-maxing this.
>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?
Sure they could, and usage of those products to purchase goods would nominally drop to 0%. People do not care about a lot of things, but they do care about losing money.
> 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.
> 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.
If you're the sort of person who posts on HN and you bought an iPhone after they hit the $1000 price point, you probably did know that.
It surprises me a little that so many people who do know still make that choice.
> 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.
I wonder if that has ever been tried against Apple or a similar company in a court of law, because I think there might be real merit there. One would have to get a bunch of people together claiming a refund on the purchase price on the grounds that ownership hasn't been transferred and therefore Apple is in breach of contract in relation to the contract for sale of an iPhone. Then those people would have to bring a class action, and the case would revolve around the concept of "ownership". Because "ownership", to a first approximation, means the legal right to do with some piece of property essentially as you please, and Apple is clearly basing much of their business on the assumption that users do not have those rights and is taking positive action to prevent users from exercising such rights.
I don't know much about the law in the rest of the world, except Germany, but in Germany that would certainly be the case, and there is a surprising amount of case law revolving around such things as horses or other animals being sold, and the former owner then trying to restrict the new owner in exercising their ownership rights, which generally end with ownership rights being upheld by courts.
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.
The EU has the right approach. Don't try to legislate exactly what is a fair/unfair amount of profit to make - change the rules of the game by requiring third party marketplaces and payment platforms so apple has to lower rates or lose every app into a third party store.
Apple can easily say "Use our store exclusively and you get our security/privacy guarantees. Go outside our store and you're in the wild west". App developers can then decide how much fee they are willing to pay for access to the user base who refuse to venture into the wild west. Other stores might try to persuade users that they are more secure and more private too via stricter review policies or more locked down permissions etc.
I think that is in fact exactly what GP is suggesting.
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.
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.
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.
> ...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".
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.