[dragonwriter]

> Just wait until you learn what % retail used to charge developers for promoting, distributing, and selling software.

Zero %.

Retail used to buy boxed software and sell it at risk. Were Apple buying units of software/service up front and the taking a risk reselling it, it would be valid to compare the split of end-user cost with classic retail, but Apple's not doing that, so it isn't.

[setpatchaddress]

That is a historically inaccurate take. s/retail/distributor/ if it helps. The point is that a software developer would have been very lucky to earn a significant fraction of the retail price. 70%? Not even close. The App Store completely reversed this model.

That said, it's valid to acknowledge this history and still think 30% is too much for distribution overhead in 2020. I do not have an opinion on the latter.

[mthoms]

What the parent said is 100% accurate.

They pointed out that retailers would buy the software up front (at wholesale price), and assume the rest of the risk for "promoting, distributing, and selling" themselves. Thus, the retailer did not "charge developers" for those things[0].

I realize this is a bit pedantic but it's not fair to say the parent has said something "historically inaccurate".

[0] There were special marketing or buyback arrangements in some cases, but what's described above is the default retail model.

[pkaye]

> Retail used to buy boxed software and sell it at risk.

I though they just returned unsold boxes back to the vendor?

[dragonwriter]

> I thought they just returned unsold boxes back to the vendor?

Even in the cases where the vendor/distributor allowed that (and discount bins were a thing because they often did not, at least at no restocking fee), the retailer still accepted the risk that the vendor or distributor would be defunct. If they had a consignment model where they only paid contingent on a retail sale, that was different, but (at least AFAIK) that was never the norm for boxed software.

[reaperducer]

The discount bins you mention illustrate the previous poster's point: That developers used to get far less before the App Store existed.

If Electronics Boutique can dump a $50.00 game in a discount bin for $3.00, how much do you think it paid for that game in the first place? And how much of that amount went to the author?

[lenzm]

The amount they spent in the first place is irrelevant, that's the sunk cost fallacy. They sell it for three dollars because that's their best expected return (weighing in factors like opportunity cost of keeping the box on the shelf).

[dmitriid]

They may have meant mobile marketplaces before AppStore. Those charged anywhere up to 90%.

And retail doesn't charge "0%" on boxed products, or they would go out of business. Logistics, distribution, and store markup all add up to the final price of the product on the shelf.

[dragonwriter]

> And retail doesn't charge "0%" on boxed products

Yes, they do, unless it's consignment model, which wasn't usually the case for boxed software. The retail sale happens after retail has made the purchase. It’s obviously usually at a higher price than the retailer paid, but they don't take a cut of what the vendor is asking for the software. They pay whatever the vendor (or, often in real retail, a distributor that sits in between) is offering to sell the product for, in advance, and takes a risk that they will be able to sell the units they have purchased at a higher price.

It's structurally not at all the same as what an app store does, where it pays no one, anything (indeed, often charges an access fee up front to the seller) before a sale is made, and then pockets a share of the sale at no risk.

[setpatchaddress]

You seem to be getting stuck on the word "retail" referring to point-of-sale-to-end-user, where other people are using it to refer to the cost of the entire retail model, which is the comparable thing in this discussion.

[nodamage]

This seems like splitting hairs. At the end of the day, if the consumer buys an app for $10, the developer gets some portion of that, and the retail store gets the other.

Whether that happens in one simultaneous transaction or two different ones doesn't really make a difference to how much the developer gets paid in the end, which is less with the retail store model compared to the current digital storefront model.

Let's also not forget that Steam launched with a 30% cut a full 5 years before the App Store ever existed, so it's not like Apple dictated this price, they were following industry norms at the time.

[onion2k]

Stores buy products wholesale and sell them on, and accept the risk of the products not selling.

Apple act as a middleman and and add on their fees, with absolutely no risk to themselves.

They're very different business models.

[thewebcount]

Right, but stores buy from distributors who take 50%+ of the amount they make. So the developer is still getting less than the App Store.

[srtjstjsj]

That's not how IP publishing works.

https://en.m.wikipedia.org/wiki/Remaindered_book

https://en.m.wikipedia.org/wiki/Cut-out_(recording_industry)

[mthoms]

The idea that you can return unsold product to the supplier is a relatively new idea for most industries. When retail boxed software was at its peak (in the 90's), it wasn't very common at all.

I can't find anything current for boxed software (for obvious reasons), but boxed video and board games cannot be returned unless the retailer has a special deal with the publisher (rare).

https://www.polygon.com/2017/7/17/15974096/what-it-costs-to-...

https://www.ign.com/articles/2014/03/05/inside-the-secret-wo...

https://www.reddit.com/r/boardgames/comments/6asinu/can_reta...

[dragonwriter]

It's not how the mass market book and (I assumw from your other link title) at least popular recording industries work, but it's how lots of the rest of the physical retail industries, including IP-based ones, work and have worked, and a big part of why (for instance), TSR (the original publishers of D&D), who sold IP-based products (including books) outside of the mass book trade was completely unprepared for the “success” of getting it's books into the mass book trade, where failing to adequately account for costs of remaindering almost drove them out of business before Wizards of the Coast bought them for the IP.