[ChrisLTD]

Apple is pushing people to the App Store to create a better user experience, but they also have made decisions that protect their 30% cut at the expense of that same experience (for recent examples, see the Dropbox API rejection and the inability to buy a book through the Kindle app). If the money wasn't at all important to them, they'd drop their cut down to a level closer to a payment processor.

[saurik]

No: these examples are much better explained by control over their competition (or even "user experience", which is arguable in both fact and morality), something which is much more easily evident when you stop using the irritatingly misleading term "their 30% cut".

Remember: Apple has costs in terms of payment processing, handles all of your complex accounting burden, takes care of district-specific sales taxes, manages currency normalization for worldwide distribution, and deals with any and all payment-related support requests (in numerous languages): they are left with a fraction of "their 30% cut", which is quite clear from their public financial reports.

So, to Apple, the amount of money they can make off of companies like Dropbox is effectively zero. Even their entire App Store ecosystem (representing tens of billions of dollars in revenue) nets them a profit but a few percent what they make off their hardware sales.

(Also, btw, as much as I disagree with Apple's decisions with respect to their platform, you are wrong about the experience issue: normal users would much rather have a single billing and support channel for all of their payments, and they get horribly confused when some of their purchases are direct to a developer and some aren't. It does not harm the experience of using an iPhone to have Dropbox bill through their App Store; it may harm Dropbox's experience, but that is irrelevant to Apple, as to them Dropbox's insistence to support multiple platforms is itself a mistake that will lead to poor customer experience of Dropbox.)

[mikeash]

Does Apple deal with substantially more than other payment processors do, who charge far, far less than 30% for their services?

[saurik]

I will copy/paste the paragraph from my comment that you seem to have ignored :( where I already explicitly listed the things that Apple does which, for example, PayPal does not:

"handles all of your complex accounting burden, takes care of district-specific sales taxes, manages currency normalization for worldwide distribution, and deals with any and all payment-related support requests (in numerous languages)"

The App Store is a retail store: you hand them product and give them a general price point, and they handle the rest. All you need to do is develop your product and (hopefully) handle support directly related to the product itself. Otherwise, your abstraction is you are just sent a check every month.

If you choose to sell a product yourself, I hope you have a good grounding in sales tax law. For an example, did you realize that you cannot legally sell digital products to the EU, no matter what country you are a resident of, without registering for and collecting VAT?

You also will be dealing with a drastically different kind of support request, as there will be people claiming that you stole money from their credit card, that they didn't intend to make purchases, that they thought the price was different, that they made a payment to you with one credit card but now wish they had used a different one... some of these people are lying, some of them had their credit card number stolen, some of them don't realize that a member of their family uses their PayPal account to make purchases online, and all of them are much angrier than your normal support request. You can build systems that make these issues come up less often, but honestly then you end up spending much more of your time on payment processing than your application, so you should just pay someone else to take care of it for you.

[nikster]

+1

Awesome explanation. Can we stop with the outrage over the "30% cut" now?

[st3fan]

You think they are just a payment processor? How about all the services that you have access to when you put your app on the store? Distribution, in-app purchases, notifications, game center, iCloud sync and storage.

[ChrisLTD]

If the argument is that they need the 30% to recoup costs, then fine, I can agree with that. But that means the 30% isn't just about protecting the user experience, which is my point.

[deelowe]

For Apple, UX includes standardizing things such as payment processing, distribution, and icloud as well as the standard UI bits. It's about the whole package. I agree with everyone else here. This is about Apple keeping control of the ecosystem to provide a well polished and consistent user experience so that their products stand out in comparison.

Apple has always considered itself an appliance company. They push physical products. That is where they want to generate revenue. Everything else is a means to that end. Debating over how much they make off the app store or iTunes is kinda missing the point.

[pgeorgi]

It seems like Apple doesn't trust its ecosystem to let it stand freely.

Otherwise "auto updates, in-app purchases, and iCloud" (etc.) should be a compelling package to keep developers in line. Not to mention visibility in the store (if they'd bother to provide a useful UI and search, that is).

Apple's antics are well-known, otherwise the situation could be interpreted as some lack of confidence in their own services.

[Someone]

I doubt it. Apple's stance is that _all_ developers must stay in line, not most. What they think would happen is that _some_ developers will supply their own store, cloud implementation and slightly different UI, separate update method, because they think they can improve upon Apple's offering (maybe rightly so), it is cheaper for them, easier to integrate, more inline with their ideals, or whatever. End result would be that users will go from "I know how to update my stuff/control who see my data/manage hi-score/etc" to "you have to be a nerd to do that" mode.

I think they are right; some developers wouuse noose to be different. For example, Adobe would try and use something AIR-based and there would probalby be more than one Linux package-manager-like thing that allows you to get a 'special-for-you compiled executable with exactly the features you want')

[deelowe]

Just like how your microwave maker doesn't support running different software on it. Apple is an appliance company hell bent on putting the user experience above all else. If this means 100% complete and total control over every instruction ran on the device, so be it.

That said, the motivation isn't malevolence, it's obsession.

[klez]

A more apt microwave analogy would be if microwave manufacturer didn't want you to heat water in your microwave oven, because you could use that water to boil eggs outside the oven.

[batista]

>If the argument is that they need the 30% to recoup costs, then fine, I can agree with that. But that means the 30% isn't just about protecting the user experience, which is my point.

All of those costs are related to the user experience. It's not like their store is some webpage with a Paypal link.

[throwaway64]

they are happy to provide this without your app supporting in app purchases, and they get no extra money at all.

[st3fan]

Yes it is a very socialist setup. The free apps are subsidized with the non-free ones. Pretty awesome, no?

[taligent]

Know any payment processors that will also make your app available (and in some cases promote) to 300+ million people ?

[ChrisLTD]

I didn't say they were just a payment processor. I understand the value they provide.