[tiagoleifert]

I think the answer is simple. If it was easy to advertise to the user other payment options, then what would stop developers from making free apps [0] that are unlocked in the developers website? Bypassing the Apple's cut.

I don't agree with this but I think it would be a good argument by Apple.

[0] Assuming that these free apps would be functional but very limited so they don't have the same problem as the Hey app.

[stirlo]

And what's wrong with this? If developers think Apples frictionless payment system is worth their cut then they'd still keep it. Otherwise consumers and developers now have choice. What marginal benefit does apple provide on the purchase of "v-bucks" to justify a 30% cut when processing costs are far lower?

[Otek]

Developers would stop offering Apple payment and only allowed to buy subscriptions and full products by their websites. It wouldn’t be cheaper for consumers, maybe on the beginning it would, as a PR move. But as a consumer I would lose this amazing Apple support, that allows me to return in few clicks game I didn’t like, subscription that didn’t offer what it promised and other services I was dissatisfied with. I would lose one interface to manage all my apps subscriptions, and had to give my credit card number left and right for every, even small app, I would want to try. No thanks

[cageface]

If the frictionless payment system was so much more appealing to users that it generated enough extra income to offset Apple's fess then devs would offer it. This is how marketplaces are supposed to work.

[simondotau]

It's frictionless in part because it's exclusive and universal. I don't even have to think about what the payment method is, or whether I should trust it, or whether I should choose another one. I'm not necessarily arguing for this, just pointing out that friction can be as much about uniformity as it as about choice.

And let's be clear, this isn't an argument over competing methods of payment, it's an argument about whether Apple should be entitled to a percentage of revenue for iOS app sales, regardless how they are sold, regardless where they are sold.

We should be mindful to keep this question separate from whether there should be more than one place to acquire apps, or whether it matters if the financial transaction occurs prior to downloading or after the app is installed.

[cageface]

If you don't like the payment options the app offers then you're free to choose another app that does. Isn't that the same justification Apple's defenders always give?

[simondotau]

To be clear, are you arguing that what matters is a choice in payment methods even if Apple takes a percentage either way, or is your argument that Apple shouldn't be entitled to a percentage of revenue from apps built with their tools and libraries?

If it's the latter, then Epic disagrees with you.

Epic's own business model says they're entitled to a cut of your revenue if you use their tools and libraries. They don't care what payment method you use. They don't care if you sell copies or sell in-game hats. If you make revenue, they're entitled to a slice of it.

(Yes, Epic does waive their fee for low revenue games. That's very nice of them, though in reality it's obviously a clever strategic move to lure game developers over to their ecosystem, in the hope that more breakout indie successes happen to be built with Unreal Engine. But that doesn't change the underlying principle: they would be entitled to it if they had asked for it.)

[onelovetwo]

Exactly, it would force apple to lower the cut they take to make it worth it.

[stale2002]

Of course developers would allow people to purchase through the app.

They would do this by transparently showing the markup to the user, and allowing the user to choose if they want to pay 30% more or not.

That seems like a pretty reasonable solution to all of this. Give users the choice to buy on the app, and have them pay the full fee if that is actually what the user wants.

[Silhouette]

One-sided consumer protections are great if you're a consumer who actually is being wronged. They're not so great for merchants when consumers who haven't been wronged abuse them, though, and that has a chilling effect that hurts everyone. Merchants will either push their prices up to compensate for the abuse, so legitimate customers end up paying the price for abusive ones, or simply not offer their products or services for sale in that channel at all if it brings more trouble and risk than it's worth.

[narism]

Is there evidence of this chilling effect in action on the App Store? What’s the restock overhead for returning a digital game?

[Silhouette]

Yes, you're talking to it. My businesses operate web apps but do not offer native iOS apps despite the occasional request. The hostile developer environment, high fees and expectation of ridiculously low prices simply aren't worth it in our view.

[narism]

That sucks but what does it have to do with "consumers who haven't been wronged abuse them"? Especially in the context of "Apple support, that allows me to return in few clicks game I didn’t like, subscription that didn’t offer what it promised and other services I was dissatisfied with".

I guess my point is that App Store metrics (total revenue, subscription revenue, average revenue per user, etc) continues to grow and maintain their lead over Google Play so the chilling effect can't be too bad.

[Silhouette]

Exactly. The typical problem with these huge, two-sided online marketplaces is that they are the big guy in any "negotiation" of terms with both sides of the market, which means they can effectively dictate the terms. And yet, they are just an intermediary. The only value they contribute is connecting the other parties and facilitating the transaction. In other words, they are the least important player, yet often they are taking a huge cut that inevitably pushes prices up for buyers and profits down for sellers.

I suspect the best way to bust those marketplaces and reduce them to making profits commensurate with the true value they offer is to prohibit them from handling any financial transactions between the two parties at all. Instead, let them simply get paid by the sellers on some agreed terms. If they offer enough value to justify the rate they ask, the sellers will pay it. If they are too greedy, the sellers will go somewhere else. And if they have a monopoly or monopsony position, they are subject to the same competition law as any other business buying or selling anything else in an exclusive or dominant position.

[simondotau]

Whatever your stance is on Apple's control over apps on iOS, it's a little bit beyond the pale to claim that Apple does nothing other than connect parties and facilitate the transaction.

Apple literally made the town in which their marketplace resides. They attracted residents to their town from the goodwill of their brand name, through the creation of a desirable product, and through substantial investments of marketing. People are continually attracted to this town because the crime rate is low and the city council's ordinances are suitable for the vast majority.

Apple literally built all of the existing buildings, provided anyone who wanted to participate in the economy with a garage full of tools, provided free and near-free training to anyone who wants it, and supplied people (again, for free) many of the basic raw materials which people used to build products.

Apple literally built the marketplace itself. They did an imperfect but not terrible job at minimising the number of outright hucksters. They made it so financial transactions were perceived as secure transactions[0], and that merchants' customers felt confident opening their wallets more often than in the adjacent town.

[0] This is more important than you remember. Ten years ago the concept of trusting your credit card through an app on your phone was new. By making the system highly trustworthy from the get-go, people's trust was rapidly won and rarely shaken.

[Silhouette]

Even if that is all true, having built the town and then prohibiting anyone else from setting up a marketplace is exploiting one monopoly you hold to benefit another, which is a big no-no in terms of economics and competition law. In your analogy, why are the townspeople better off because the town bans anyone else from providing shopping facilities for them?

[simondotau]

You assert that the town and the marketplace are two separate monopolies. I disagree and assert that they're a single entity, because they are not separable. Neither could have been created without the other. And their cumulative success is (in many respects) dependent on them being intertwined.

But even if you do insist on separating them, you don't get to arbitrarily bisect them wherever you want to suit your argument. The "retail" App Store is only the surface layer of the iOS app ecosystem which Apple has developed, it's certainly not the totality of it. There's the toolchain, APIs, documentation, training resources and many other things besides, which are all necessary parts to that marketplace's existence.

You might argue that Apple chose to give away their developer tools rather than license their use with a revenue share arrangement (like Epic does with Unreal Engine). You might argue that Apple charges for their tools with the $99 annual developer fee. I disagree that these are relevant. How Apple chooses to monetise their own work is up to them. For example, Apple could have instead defined their 30% revenue share requirement as a license condition for the use of their tools and libraries. The outcome for consumers and developers would be largely identical, but the "store monopoly" argument would make a lot less sense.

Even Epic themselves understand that developer ecosystems are valuable and it's fair for a percentage of top-line profit to go to them regardless how the app is sold or how payments work.

More broadly I must admit some occasional frustration by people who insist Apple must change, as this insistence is all too often paired with a somewhat arrogant paternalism, that they know better than I do what I should want. "Free market" is certainly the simplest argument to side with and the easiest one to wax lyrical about, but that doesn't automatically make it the best one.

I'm not going to spend too much time explaining why I think the iOS ecosystem would be worse if "free markets" were forced upon it, because unfortunately Hacker News debates on this topic generally see more people throwing down-votes rather than engaging with the debate. But fundamentally I see the difference of opinion stemming from whether you see the smartphone as a computing platform or an appliance bundled with systems administration services from the vendor. I think of my smartphone as an appliance, despite being a software developer by trade. But I'm glad that the market includes many brands of Android phone so that everyone who cares can have a choice.

[Silhouette]

You are arguing that the platform and the app marketplace are inseparable, but many other platforms for personal computing have not had such a store yet have been popular with both users and developers. They provided tools and documentation for developers, often for free, too. Plenty more have had multiple marketplace-like sources for new software, not necessarily provided by the same organisation that built the platform itself. From Windows to Linux distros and from Steam to the plug-in marketplaces for many large applications, there is no shortage of counter-examples to your position here.

[sfifs]

Sure. That's also pretty much the definition of anti-trust. Using a dominant position in one market (distribution of apps on iOS) to gain an unfair advantage in others (payment processing) to make profits in a way that causes consumers to pay more - it's very easy to demonstrate in many apps you pay higher to buy exactly the same content in-app vs. on website.

Apple's in very deep shit in this lawsuit and losing this will open a can of worms.

[quackyodata]

>Apple's in very deep shit in this lawsuit and losing this will open a can of worms.

For example, is it okay to bundle a default web browser with an OS and forbid any other browsers from being installed? All iOS browsers are required to use Safari's WebKit under the hood, despite the appearance of choice in the app store. This cripples the features and performance of 3rd-party browsers like Firefox.

And unlike this spat with Epic, there might be some strong precedence on that question.

https://en.wikipedia.org/wiki/United_States_v._Microsoft_Cor....

[simondotau]

> For example, is it okay to bundle a default web browser with an OS and forbid any other browsers from being installed?

There are hundreds (or depending on how you count them, thousands) of products where exactly this is the case. Try installing an alternative web rendering engine on your LG smart TV, or your Toyota, or your Playstation.

> there might be some strong precedence on that question

This precedent isn't analogous. Microsoft had an initial marketplace monopoly over desktop computer operating systems, which was not ideal, but legally fine. They then illegally buttressed and extended their monopoly by arm-twisting the largest OEMs to lock competitive operating systems out of the open market. Finally they used this illegal monopoly to force their way into an existing competitive market of commercial[0] web browsers. Had alternative operating systems such as OS/2 and Linux not been illegally suppressed, or had the question been asked in the iOS/Android era, Microsoft's actions around Internet Explorer wouldn't have justified the same level of scrutiny.

For the analogy to hold, you'd have to show that Apple has used their market dominance to illegally suppress market access from its competitors.

[0] It's often hard for us to remember in 2021, but web browsers weren't always entirely free. Netscape was commercial software; initially free for evaluation purposes only, then later free for non-commercial purposes only. Netscape was set to be a very successful company through commercial web browser sales.

[anoncake]

> There are hundreds (or depending on how you count them, thousands) of products where exactly this is the case. Try installing an alternative web rendering engine on your LG smart TV, or your Toyota, or your Playstation.

Sure, and that's problematic, but let's focus on the bigger fish for now.

[simondotau]

It's not problematic. Just because Toyota happens to sell a product that contains a multi-purpose computer with a display, Toyota is not suddenly obligated to release free tools and libraries to allow third parties to port Firefox to their cars' head units. Having such a requirement would be insane, not to mention impossible given the existence of copyright laws[0]. Toyota's software is proprietary; if they don't want to release tools and libraries, that's their prerogative.

[0] And before you start arguing in opposition to intellectual property rights, remember that copyright law is necessary to enforce the GPL. Without the protection of copyright, GPL software cannot exist—everything becomes de-facto public domain, with none of the benefits of copyleft rules.

[anoncake]

> Toyota is not suddenly obligated to release free tools and libraries to allow third parties to port Firefox to their cars' head units.

Who argued for that? No one, it's a strawman.

> And before you start arguing in opposition to intellectual property rights, remember that copyright law is necessary to enforce the GPL.

Ordering companies not to lock down the customer's hardware does not require abolishing copyright.

[cblconfederate]

If Apple is not offering a rate that is competitive to whatever the developers use on their own site, then it means their policy is anti-competitive and costing users money. There's no law that says Apple and only apple must make the maximum amount of profit.

If apple continues by complaining that they need the extra money to operate their app store then well, they are free to allow alternative app stores.

[xvector]

It’s impossible to offer a competitive rate while still taking any cut whatsoever. The App Store is a storefront.

Obviously every developer would prefer to transact directly and bypass the cut, while relying on the App Store for advertising and visibility.

[cblconfederate]

> impossible to offer a competitive rate

Then they can charge apps for downloads that dont go through their own payments.

But more importantly that's assuming that Apple needs to have rates as high as e.g. stripe, but they can probably get better much better rates due to their size, hell they have the cash to create their own bank (as they should as they re becoming a services company).

[sk5t]

> impossible to offer a competitive rate while still taking any cut whatsoever

Huh, are you suggesting that there's no money to be made in the online payment processing industry? No differentiation in prices between processors that provide more or less service and ease-of-use?

[stock_toaster]

Agreed. Also no way for apple to enforce refunds for purchases are even _possible_ if they aren't involved in the payment pipeline.

[Silhouette]

Why should that be Apple's job in the first place? If I go to a big shopping centre, and I buy something from one of the shops there, and subsequently it turns out to be defective, that's between me and the shop who sold it to me. No-one would expect the shopping centre to have any control over that commercial relationship just because the shop happened to be under its roof.

[tomjen3]

I would if the shopping center widely advertised this feature.

[dkarras]

But then if the shop is a dick to you, or it scams you, otherwise does a dirty on you, it would affect the credibility of the shopping center (how are they allowing scammers to rent shops here), even the concept of doing business with shopping centers as a whole.

Also "shopping center" analogy somewhat breaks down because you buy something from a shop and use it somewhere else. When you buy an app, you use it in the device only (inside the shopping center) using the device's affordances. So they are somewhat more intimately tied.

In the end, this all boils down to ideological differences. One camp says "it is their store, take it or leave it, they already have competitors - if the value proposition wasn't there, it would fail - and if they screw up it will fail" and I'm in this camp. Apple as a company does not owe anything to anyone. Can they discontinue the app store tomorrow if they wanted? Sure they can, it is their store and platform. Can they decide to get 99% cut from all purchases? Yes, it is their business, their platform. Up to them. If the value proposition isn't there, it will fail on its own. If it is there, whining feels to me like entitlement.

The other camp thinks private companies should be bound to rules such that even if they provide immense value, there should be a "limit" to how much return they can get from it, mandated by governments etc. I don't agree, but I can see where they are coming from.

[Silhouette]

One camp says "it is their store, take it or leave it, they already have competitors - if the value proposition wasn't there, it would fail - and if they screw up it will fail" and I'm in this camp.

I would have more sympathy for that position if having one of two types of smartphone were not now assumed by so many organisations and if people buying those phones hadn't dramatically reduced the alternative devices those people might otherwise have bought.

Like an essential utility, a smartphone has become a practical necessity for many people to be able to live a normal life. When you have attracted so much influence, you are no longer just another business, and again like an essential utility, regulation is appropriate for the protection of the little guy.

Apple as a company does not owe anything to anyone. Can they discontinue the app store tomorrow if they wanted? Sure they can, it is their store and platform.

Sure, but if they did that, Apple's influence would rapidly diminish and the problem I described would solve itself as well.

If the value proposition isn't there, it will fail on its own.

Well, that's really the big question here, isn't it? Does Apple's App Store actually provide good value for what it costs, or is it being artificially supported through other means? One of those is just good business. The other is a potential violation of competition law in many places.

[yyyk]

>In the end, this all boils down to ideological differences. One camp says "it is their store, take it or leave it, they already have competitors

American law abandoned this outlook at the early 20th century. Also, what Apple is doing is making it harder for customers to switch from Apple if they want to. It's ridiculous to invoke competition as a defence when Apple is trying to prevent competition.

[Lazare]

I don't see a problem here.

Apple charges (and is able to charge) a lot for an iPhone in large part because the iPhone gives the purchaser access to the App Store. But they also bundle a payment service into the app store, force developers to use it whether they want to or not, then charge a very hefty premium for it as well.

Obviously Apple likes being able to charge a hefty premium to both sides - why wouldn't they? But there's no obvious moral reason why we, as a society, should let them, nor any obvious empirical reason why we wouldn't collectively be better off if we stopped them.

Nothing stops Apple from charging a competitive rate for payments, or for download bandwidth, or for app reviews, or for offering various plans or bundles of these services. Apple should be more than capable of making the best iOS app store! "$500 per submission and $1 per 10k app downloads, first 1m downloads free for new apps, download fees waived for apps from non-profits, charities, and students are registered educational institutions, ask us about our payment plans, starting at a 15% cut of all revenue, discounts for high volume apps available, all payment plans come with free submissions and downloads!" Sure, why not?

But the more they create a single bundle or services, and the more they use non-market power to force people into accepting the bundle, and prevent anyone from offering a competing bundle of services, the worse it looks for them.

> I don't agree with this but I think it would be a good argument by Apple.

The argument is basically "if you stop us from forcing developers to give us more money, then we'll have less money". And IF Apple is abusing their market dominance to extract money from developers, then that would be a terrible argument for them to make, because the entire point of all this is to stop them forcing developers to give them "unearned" money. Rather than a defence, this would just be admitting the court had stumbled across the correct target.

Now, personally, I'm not entirely sure I agree that Apple is abusing their market dominance and should be stopped. But if you do think that, then "this would cost them money" is an argument in favour of the policy. (Conversely if you don't think that, then it's all irrelevant, because Apple can do what they like.)

[2OEH8eoCRo0]

>If it was easy to advertise to the user other payment options, then what would stop developers from making free apps [0] that are unlocked in the developers website? Bypassing the Apple's cut.

Allow users to install app stores then.

"How dare you bypass the App Store!"

"Alright, can we make our own app store?"

"No!"

[zamalek]

I have the option to not use Google Pay but I use it whenever possible. It is far more convenient than having to enter in (and trust!) CC details.

Apple has subpoenaed the living daylights out of everyone in near orbit of operating a market. This argument wouldn't stand up to evidence acquired from Google Pay.

[eqtn]

The choice should be with the user. If an app has a redirect to their website for payment, there should be an option of Apple pay too(may be with 30% extra) just like how every app with "Login with Facebook/Google" has an option "Login with Apple"

[klmadfejno]

I mean Apple could. You can allow other payment options and still forbid apps that entirely don't function without them.