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by ProAm 1860 days ago
Its not that they are making a profit is that users have no choice, and no choice but to give them 15-30% for no value add (arguable). It's a racket.
2 comments

Their choice is to buy an android device. The phone market is not a monopoly unless you limit the market to only Iphones, and that's ludicrous.
How many users spend more than a tenner on paid apps? Not many... but Epic made 300 000 000 a year on iOS alone selling in game items. What value is epic selling there?

Epic is targeting kids with Fortnite and its their money that they're after. Impulse- and vanity purchases, much more than anything else.

Whereas, when buying a paid app, one usually gets real value. At least as I see it. But maybe this means i'm old :D

If you're going to argue "most users don't spend more than ten bucks", how do you explain Apple earning 20 billion USD per year off the app store? 20 billion USD divided by 10 dollars is 2 billion customers. But Apple only pockets 3 dollars of that 10, so it's actually 20 billion divided by 3 dollars - around 6.6 billion customers.

Do the math.

Law of skewed distributions. A few apps, like Fortnite, generate huge amounts of revenue for the App Store (and for Epic in this case). Most apps are actually free or ad-funded and don't generate any revenue for Apple apart from the 100 bucks dev fee.

So it's fortnite and a bunch of other apps that make those 20 bn. Again, Fortnite alone made 300 M a year for epic, and 150M a year for Apple.

Actually I'd bet that the largest part of the revenue is generated by in-game purchases. Too easy to trigger addictive gaming with simple tricks like intermittent reward.

Game IAPs definitely have skewed distributions, but I think the exact numbers have significant impact on arguments made about how much of a cut Apple deserves or how much total profit is reasonable. If you're making arguments about that I think you need at least basic numbers to support them, and those numbers aren't here.

Apple and Epic both have those distribution numbers, and I wish those showed up in the trial. The distribution is going to vary wildly from app to app, and games like Fortnite allow you to earn currency in-game. While I know they are skewed from personal industry experience, any claim from me about the actual average would be complete speculation.

Yes, since Apple wouldn't release the numbers required we cannot do a proper analysis.

Personally I don't know anyone who spends huge sums on paid apps, but I know of cases where kids spend huge sums on in-game stuff on iOS.

So yes, it's based on anecdotal evidence, but I have yet to hear an account of someone who regularly spends more than a tenner per month (or even per year) on paid Apps.

That's not true. There are repeat customers, so you probably mean app sales not customers. Even that isn't true, since there are in-app sales that go through Apple.
OK, so you're arguing customers spend <= 10 dollars per app on multiple apps. How many apps? These arguments are being used to make the case that Apple deserves to earn $20 billion USD per year, or even must. I think if you're going that far you should be able to at least support that with napkin math instead of hand-waving.
There are two facts you are not taking into consideration, instead you chose to attack something I didn't write. Those two facts are:

  1. A Customer is not the same as a Sale.  There can be muptiple Sales per Customer.
  2. App Sales * Avg App Cost is not the same as Total Sales.  There are also in-app sales.
> I think if you're going that far you should be able to at least support that with napkin math instead of hand-waving.

I think you are arguing for the sake of arguing.

If I find a game I enjoy, I will usually give them 5-10 and play until it gets ridiculous. I don’t want to play a game for a month, check up on it every day, etc.