| > when I use what is essentially a glorified website builder to build a site they don't get to tell me who i can put my money through or dictate anything about how i run my business beyond hosting and the builder. Actually, they do if it is in the contract. The problem with Apple's 30% cut is they are a gatekeeper any business operating on the iPhone and they are using this market power in a oligopolistic fashion (the other player being Google) to engage in rentseeking behavior. There are no alternatives to the Apple app store when it comes to iOS by Apple's design, so they are stifling competition. In contrast, there are plenty of competitors to Shopify AND Shopify is not using some forced barrier to entry to prevent competition. For example, Amazon being the place of discovery for goods means that Amazon's network effect of being the marketplace where everyone goes to look for any good gives them market power and is a barrier to entry. In contrast, Shopify is not about a marketplace. Each store appears as its own website from the consumers' perspective. Thus, a business can switch to a different e-commerce platform and not be hurt by some market power derived situation. Thus, it is totally legitimate for Shopify to make such a demand of all customers must use their billing. Their business model is give away X for free (e-commerce website tech) and make money on billing. So long as they aren't engaged in some monopolistic/oligopolistic practice, then they can structure their terms however they please because it isn't causing a market failure and enabling rentseeking. In the Apple and Google case, 30% would be totally fine if there were alternative app stores, a low barrier to entry to finding those app stores, or the ability to find and install applications from anywhere (again with an easy discovery mechanism for finding those apps). The counter often made to not allowing other app stores on iOS or installing apps from anywhere is the security risk and potential harm to the consumer. While valid, I think this is disingenuous by Apple. There could be ways to enforce comparable security standards in a more open (not totally open), but more open ecosystem. Here are some contrived examples:
- Properly limited OS APIs to prevent overly broad usage by any app. For example, the move from asking for generic location access to having to specifically ask for background location access vs only while the app is in use.
- Then to manage signing permissions, Apple could grant other app stores a new kind signing permissions coupled with a contractual requirement to ensure apps abide by certain security standards (which Apple claims they abide by). This could have stiff penalties, paid by the other app store to a consumer fund similarly to how in an ideal world data breaches should have financial consequences and consumer renumeration. EDIT: Upon inspection, I realize this 20% by Shopify is for their app marketplace. In that regard, it is more similar to the Amazon example I gave above. I still don't think this is as problematic or comparable to iOS App store as there are tons of alternatives to Shopify and their market power is more limited. Nonetheless, their behavior here is more problematic as it is one of exercising market power to undermine competition in a space that they are becoming increasingly dominant. Thus, it could approach the Amazon situation soon enough. That being said, neither their app marketplace or Amazon's marketplace are anywhere near the true monopolistic behavior that is Apple and Google with their app store pricing. Amazon, for example, is a website where I can easily search different e-commerce websites. There is a much lower switching cost to Amazon on a per purchase basis (I recently bought directly from Home Depot for a bunch of things instead of Amazon). There are no alternatives to the iOS app store if you have an iPhone. |