[bsaul]

That's one way to look at it. All businesses come down to balancing income with expenses indeed. All i'm saying is that 30% cut on the income by apple makes it harder , and sometimes impossible , for some business model to survive.

[zepto]

This raises the question ‘harder than what’?

The services provided by the App Store would have to be present for the business exist at all.

So without the 30% Apple charges those businesses would certainly not survive unless they paid someone else for the services.

[scarface74]

Understood.

But do you know how many businesses would die to be able to sell products that had a 70% gross profit margin?

[bsaul]

I'm not sure about your calculation. A business with only 29% gross profit margin wouldn't be able to survive on the app store because they'd have to give 30% to apple.

[scarface74]

Where did you get 29% from? I’m assuming that you are the only developer working on this (you didn’t say otherwise), for every $1 that someone spends, you get .70 cents.

[bsaul]

But then why do you assume i've got no expenses ? Just because i'm the only one working on it doesn't mean i don't have to pay myself something to live. That's actually my point : the app doesn't generate enough revenue to cover my personnal expenses.

[scarface74]

The marginal profit is the price the good sold for - the marginal cost. The only thing Apple has to do with this is the 30%.

The only fixed cost imposed by Apple is the $100 developer fee and whatever it cost to buy a Mac.