[nabla9]

The operating cost is the maximum Apple can come up with when their accountants attribute everything they possibly can to digital sales for the sake of legal argument. R&D shouldn't really be included, and Apple uses those same tools and APIs themselves. I think the actual profit margin is closer to 90%, and Apple could maintain a 20% margin with just a 3–4% fee.

[rob74]

I'd say that in the case of Patreon, any fee for Apple is unjustified. Apple can justify their fee on app purchases/subscriptions in the app store, but Patreon is not an app subscription, the money goes mostly from the patrons to the people they support. Ok, Patreon takes a cut to cover their operating costs, and also make a profit (not sure how profitable they are currently), but I really can't see how Apple, who don't have anything to do with this process except for listing the Patreon app on the app store, can justify taking a cut.

[silvestrov]

You could make the argument that Patreon isn't much more than a banking app.

It just focuses on the receiver of the money than the sender.

I think Apple is slowly killing apps with this policy. Everybody will slowly move to "web only" as 30% would kill their ability to compete with anybody else. This will likely be much stronger in countries where iPhones do not have the same market share as in the US.

[josephcsible]

> Everybody will slowly move to "web only" as 30% would kill their ability to compete with anybody else.

This is why Apple makes PWAs so miserable in Safari and disallows other browsers unless they're just Safari with lipstick.

[direwolf20]

Apple users seem to be fine with everything being much more expensive. Not only the 30% apple tax itself, developers know Apple users pay more and specify higher prices on Apple.

[jama211]

30% is also the cut google takes on the google play store. This is not an apple only issue. This is a regulatory one.

[direwolf20]

Google allows out–of–store installation (for now...) so it's much easier to argue there's competition. Apps installed through F–Droid don't have this tax.

[jama211]

And in the EU alternative app stores are allowed on iphone as well. In both cases, it’s a near negligible amount of people that use them. Your exceptions prove the rule, if anything.

[Spoom]

> Everybody will slowly move to "web only" as 30% would kill their ability to compete with anybody else.

Frankly, yes, please. I mean, I'm biased as my whole career is in web app development, but there are so many things these days that do not need a whole native app. They're just communicating with a server backend somewhere, using none of the unique native functionality of the phone (much of which is available in browser APIs these days anyway). I can block ads in a web app much more easily. It's much harder to do customer-hostile things like block screenshots in a web app.

Native apps definitely have a place, but I think they're very overused, mostly for reasons that benefit the business at the expense of the customer.

[BiteCode_dev]

Apple makes sure it's not practical.

You still can't have a "share to" target that is a web app on iOS. And the data your can store in local storage on safari is a joke.

Of course, forget about background tasks and integrated notifications.

In fact, even on Android you miss features with web apps, like widgets for quick actions, mapping actions to buttons and so on.

And no matter how good you cache things, the mobile browser will unload the app, and you will always get this friction when you load the web app on the new render you don't have on regular apps.

[mircerlancerous]

Service workers solve the cache issue; web apps can run permanently offline after initial load. You may be a bit out of date on the state of the web.

[BiteCode_dev]

No, I use them but loading and unloading the app in the tab still happens when the browser flushes the app from memory because the OS killed it or the browser eviction policy hits.

This loading is not nearly as seamless as a regular app starting back up.

For a regular app, you have the app loading, and the os cache helping with it. If you do your job half correctly, it loads as a block almost instantly.

For a web app you have the web browser loading, the the display of the white viewport in a flash, then the app loading in the browser (with zero os cache to help with so it's slower). It needs then to render. Then restoring the scroll (which is a mess with a browser) and the state as much as you can but you are limited with persistence size so most content must be reloaded which means the layout is moving around. Not to mention JS in a browser is not nearly as performant as a regular app, so as your app grows, it gets worse.

[xnyan]

> I think they're very overused

I disagree, native apps on iOS have important abilities that no web application can match. The inability to control cache long-term is alone a dealbreaker if trying to create an experience with minimal friction.

[mircerlancerous]

Service workers allow you to control cache in web apps; you may be a bit out of date.

There are hardware APIs for some stuff that only works in native (cors, raw tcp), but 99% of apps don't need those.

[benkaiser]

I think the parent may be referring to the fact that safari/webkit will evict all localstorage/indexeddb/caches etc after 7 days of not visiting a site. And apparently this now extends to PWAs making it a pretty big blog to building any infrequently accessed PWA that needs to persist user data locally.

[pphysch]

Those same elevated controls are used to steal PII and sell to data brokers. Again, it's the companies that are trying to force apps on their users. If it were genuinely a much better UX, they wouldn't have to do that.

[xnyan]

I don’t think you are correct, but I could be wrong. For example, can you replicate the functionality of TikTok - autoplay unmuted videos as the user scroll down to new videos? It’s the experience that the user expects.

[jama211]

As a user please for the love of god to not make me use a stupid mobile browser for everything. Native apps are so much better.

[Almondsetat]

You couldn't make that argument because Patreon is also a platform to host content, not just send money. If it was something like a twitch donation app the argument would make more sense

[dboreham]

The hosting aspect is only necessary because a) piracy and b) Google would eat their lunch if they were the gate keeper to content. Bit like how Ticketmaster takes all the money from artists because they get to say who sits in a seat.

[Already__Taken]

You could if they built a donation & support trading app separate from the content app?

[rkagerer]

Next up, Apple starts taking a cut of every money transfer you do with your banking app.

[hermanzegerman]

They do with Apple Pay, and don't allow Banks to roll with their own system like on Android

[H1Supreme]

Isn't that exactly what this is? Except they're targeting a single app.

[barnas2]

> You could make the argument that Patreon isn't much more than a banking app.

Don't give them any ideas.

[wlesieutre]

Honestly I wouldn't be that shocked if Apple tried demanding a 30% royalty on bank deposits and bills paid using iPhone apps. They've decided the future of their company depends on being huge assholes about it.

[mcintyre1994]

I would be surprised by that because iPhone users would notice that. I think the App Store model relies on their fee being invisible to consumers, and the increased price you’re paying not being linked to them. AFAIK apps aren’t allowed to explain that they charge more if you subscribe on iPhone to users either, or why they do so.

[wlesieutre]

True, hard for bank deposits where the user sees both ends of the transaction.

For bill payments though, they'd just insist on taking 30% of your electric bill payment and if the electric company's margins aren't high enough to absorb that then "Haha that sounds like a you problem" - Tim Cook, probably

[odo1242]

Apps are allowed to link to web services to offer payment as an alternative to IAPs and offer a discount for doing so, thanks to Apple v Epic.

[dlubarov]

While you're correct, it's worth noting that this only happened because the judge in the Epic lawsuit ordered an injunction forcing Apple to allow it.

Apple then "maliciously complied", allowing it while demanding a 27% fee on any web-based payments, which was found to be a violation of the injunction.

https://technologylaw.fkks.com/post/102ka4o/apple-violated-u...

[direwolf20]

Can they, or will they be delisted if they do that?

[burgreblast]

When you use Apple Pay, Apple collects ~0.15% (15 bps) from the issuing banks for credit. $1B in transaction volume = $1.5M

In 2022 the total volume was estimated at $6T * .15% = $9B. Real number would be maybe half due to lower fees on debit, but it's hugely profitable for Apple, and carries zero risk.

[mox1]

I think this is a very strong and simple argument to use with regulators, politicians etc.

When I put my credit card into Apples ecosystem they take a 0.15% cut of the transaction and appear to be very happy with the results. When I put my application into the ecosystem they take 30%..

You can then break down why this is, but boy is that an interesting contrast.

[direwolf20]

They'd much rather have 30%.

[jorvi]

Something interesting is that Apple and Google Pay charge a tiny commission (don't have the number at hand). Which banks didn't like, so at least on Android they created their own NFC payment stacks for a while. Only to then discover that maintaining such a stack cost them more per year than the commission.

[hermanzegerman]

My German Bank still maintains their own pay stack. It's also nice that I don't have to share my payment information or commission with another parasite

[fauigerzigerk]

I think Google Pay does not charge a fee.

[vel0city]

Ah yes, back in the Isis days. What terrible luck in the naming department on that one.

https://en.wikipedia.org/wiki/Softcard

[crabmusket]

Imagine seeing a popup banner in an app each time you open it that interrupts whatever you're trying to do to say "open on our website!"

(Apple's censorship notwithstanding)

[yibg]

No kidding. Imagine if Apple took 30% of your Venmo transfers.

[akerl_]

Why are you ok with Patreon taking a cut but not Apple?

[MadameMinty]

Next up, 2% cut whenever you use any banking or payment app. Only 1.5% when you use Apple Pay!

[odo1242]

They currently do charge 0.15% on Apple Pay actually.

[saimiam]

If a user almost exclusively uses the Patreon ios app to consume the artist’s content and likes to live inside the ios ecosystem for frictionless payments using the card on file/privacy/UX/whatever, then I feel apple should get to set the terms of engagement.

If you were a chain store in a high end mall where customers cars were all parked for free by valets, mall staff knew their names, and generally made them feel special, you’d not balk at a higher commission to be paid to mall for access to their customers, right? Airports come to mind for this.

I believe apple lets you set whatever price you want on their store, just not tell customers that they could get a lower price elsewhere/on the vendor’s website (I don’t follow App Store policies very closely so my info is probably out of date).

[TheDong]

Presumably you also would agree that it's fair if Chrome, Windows, and Lenovo all charged me 30% each for using Patreon via Chrome+Windows on a thinkpad, right?

They're doing about as much to facilitate my use of Patreon as Apple is.

This isn't like a mall at all. This is like a web browser, where apps are webpages, and Apple is insisting that the contents of that webpage are something they can dictate all payment terms on.

For the airport analogy to work, it would have to be that you go to the Airport, go into the electronics store, buy a Kindle, and then the Airport insists it can take 30% not just on the purchase of the kindle, but 30% on every single book you buy on the kindle forever.

Apple taking a cut on the purchase price of an app that a user found via the app store does make some sense. Apple taking a cut of an in-app interaction with a creator that the user almost certainly found elsewhere is nonsense.

What next, should apple take a 30% cut of my rent because I found my apartment on the Craigslist app? Should they take a 30% of my train ticket that I purchased using the Safari app? Why does Patreon have to add a 30% cut on in-app content, when Safari lets me pay for in-app content with my credit card without taking any cut?

[saimiam]

> certainly found elsewhere

I agree that if someone discovered the artist elsewhere, Apple has weaker standing in claiming a huge commission. But if they found an artist elsewhere, they would also know that they can support that artist elsewhere and not through the iOS app. If the patron found them through the patreon iOS app and use the app to consume the artist's content, then clearly the patron has indicated that they prefer the iOS experience.

[anigbrowl]

That's not worth 30%. Imagine if Youtube charged 30% for anyone who clicked a link under a video in a web browser.

Even if people do enjoy browsing through the PAtreon app and choosing creators they want to subscribe to, that's not worth 30%. Rent-seeking is a cognitive disease.

[TheDong]

And if I access Patreon via Chrome on Windows, and use Chrome on Windows to consume the artist's content, clearly I prefer the Chrome and Windows experience, so Microsoft and Google should be getting their 30% cut, right?

... and of course the user found the artist elsewhere than the iOS app store. They found them on youtube, or reddit, or _possibly_ on the webview inside the patreon iOS app, which is also _not_ apple's App Store content, it's content provided by Patreon.

Again, should accessing my bank via the Safari or Chrome iOS app mean apple gets 30% of all my bank transactions, just because they were displayed on a webview inside an iOS app?

[tapoxi]

The logical conclusion is that if you buy an Apple device from www.apple.com on your Windows PC, Microsoft should get a 30% cut of that sale.

[dwaite]

Sure, if Google wants to start a business model where your websites only load if you sign a business agreement and agree to commissions.

However, regulators would probably take note that Google has been aggressively pushing their browser for free for over a decade to gain market share, and have a field day.

The difference is that Apple's business model hasn't changed - you've always been restricted to distributing apps under a business agreement, and the conditions on commissions have been pretty consistent since inception, or at least since IAP was added in 2009.

"What ifs" about Apple charging 30% for bank transactions would run afoul of regulators. This is about consuming member-exclusive goods and services in-app, which again has been in the contract terms since 2009.

Goods and services consumed outside of the app (such as purchases of physical items on Amazon, or plane tickets or the like) are actually forbidden from using in-app purchase and do not have a commission rate.

[Talanes]

>If the patron found them through the patreon iOS app and use the app to consume the artist's content, then clearly the patron has indicated that they prefer the iOS experience.

I hate IOS enough that I'm running at least a full numbered version behind with updates turned off and never plan to buy another IOS device, and I'm subscribed to multiple Patreons started through the IOS app merely because it was the device in my hand and they automatically funnel Patreon links to it.

[browningstreet]

Chrome, Windows and Lenovo don't have the payment system baked in, with all the consumer protections that come with it.

I'm not entirely pro-Apple percentage in this argument, but I think people often dismiss the magical thing that Apple created with the app store and their payment/subscription system. The rest of the world keeps ripping users off, and Apple's walled garden is as protected a thing as it gets.

I've gone directly to my bank for subscription charges billed directly to my credit card and they wouldn't reverse or stop them. Cancelling and reversing on the App Store is basic, easy, and friction-free.

Plus, the Android environment doesn't yield nearly the same sales volume even with significantly more installed units.

People spend on iOS and they don't spend on other platforms.

30% hurts and it sucks, but.. Patreon will probably take it because they'll do the math and it won't come out in favor of the alternative. That's what really sucks, beyond Apple max-max-maxing this.

[fauigerzigerk]

>The rest of the world keeps ripping users off, and Apple's walled garden is as protected a thing as it gets.

This keeps getting repeated but it's not actually my experience. Not even Apple believes it, otherwise they could avoid a lot of legal and regulatory trouble by giving users a choice: Pay through Apple for an extra 30% protection fee.

[mrguyorama]

Apple's walled garden couldn't even protect it's users from a literal LastPass scam app. It was reviewed by Apple. It passed. It was in the store.

The screenshots for the app had "Documets" and "Lasspass" prominently visible

Nothing about this is for your sake.

[anigbrowl]

I had a Patreon subscription I forgot about. I went to Patreon and ended it. It took about a minute, including filling out the feedback form about why I was quitting.

[realusername]

They can offer to cancel or reverse subscriptions because you paid 5x that subscription amount just in fees.

[Matl]

> Chrome, Windows and Lenovo don't have the payment system baked in, with all the consumer protections that come with it.

Chrome definitely does, at least to a degree.

But you have the option to not use it, because guess what? You're supposed to own the device.

[browningstreet]

Chrome doesn't do this, Chrome has a wallet and you're still stuck talking to your credit card company.

It looks like you may have edited your comment, but the issues of Apple's app store payment percentage, the open/closed nature of their appstore, and the ability to sideload apps are 3 separate issues.

[sroussey]

The cost side of that protection is < 0.1% not 30%.

[vel0city]

Chrome and Windows definitely do have payment systems baked in. Google Pay, the Microsoft Store, etc.

[hermanzegerman]

I can cancel easily my subscriptions ik PayPal with ohne click, without them taking 30%

[seemaze]

>What next, should apple take a 30% cut of my rent because I found my apartment on the Craigslist app? Should they take a 30% of my train ticket that I purchased using the Safari app?

Sure they could, and usage of those products to purchase goods would nominally drop to 0%. People do not care about a lot of things, but they do care about losing money.

[odo1242]

Apple would then force the with-IAP price to be the same as the without-IAP price so that they get a 30% cut of your rent regardless. You may be underestimating their willingness to tax all economic activity

[seemaze]

While this would obviously be harmful to the consumer, I don't see this as plausible.

Amazon was able to achieve this by positioning themselves as the primary distributor of the goods in question. Apple is in no position to leverage a monopoly over fiat transer or housing supply.

With regard to municipal transportation, perhaps they are edging closer with Apple Pay, NFC, Wallet, etc.. but I can't imagine municipalities supporting, or constituents accepting, a tax on their existing taxes.

Of course, maybe Apple.gov is the long game. Hard to say whether that would be better or worse that the status quo..

[hshdhdhj4444]

> If a user almost exclusively uses the Patreon ios app to consume the artist’s content and likes to live inside the ios ecosystem for frictionless payments using the card on file/privacy/UX/whatever, then I feel apple should get to set the terms of engagement.

When I paid over $1000 to buy an iPhone I thought I was buying a technological product that I could use to improve my life.

I didn’t realize I was buying a ticket to Disneyland where the seller of the product decided how I interacted with everything the device enabled.

I don’t think this should be disallowed. I certainly think it’s incredibly false marketing for Apple to claim I bought an iphone, when in reality I paid upfront for essentially AOL.

[Zak]

> I didn’t realize I was buying a ticket to Disneyland where the seller of the product decided how I interacted with everything the device enabled.

If you're the sort of person who posts on HN and you bought an iPhone after they hit the $1000 price point, you probably did know that.

It surprises me a little that so many people who do know still make that choice.

[Matl]

I think the point OP is making is not that they actually didn't know, but that they shouldn't have to know for that price.

[gyulai]

> I certainly think it’s incredibly false marketing for Apple to claim I bought an iphone, when in reality I paid upfront for essentially AOL.

I wonder if that has ever been tried against Apple or a similar company in a court of law, because I think there might be real merit there. One would have to get a bunch of people together claiming a refund on the purchase price on the grounds that ownership hasn't been transferred and therefore Apple is in breach of contract in relation to the contract for sale of an iPhone. Then those people would have to bring a class action, and the case would revolve around the concept of "ownership". Because "ownership", to a first approximation, means the legal right to do with some piece of property essentially as you please, and Apple is clearly basing much of their business on the assumption that users do not have those rights and is taking positive action to prevent users from exercising such rights.

I don't know much about the law in the rest of the world, except Germany, but in Germany that would certainly be the case, and there is a surprising amount of case law revolving around such things as horses or other animals being sold, and the former owner then trying to restrict the new owner in exercising their ownership rights, which generally end with ownership rights being upheld by courts.

[Teever]

I’ve been thinking for a while now that a really effective way to deal with problem companies would be coordinate a mass action on small claims closets around the world all on the same day.

Often in small claims court you win by default if the other person doesn’t show up and I’m sure judges know average will sympathize with the kinds of arguments that you raised above.

[gyulai]

I don't know. We don't have any such thing as small claims court in Germany, but my expectation would be that judges in low-level courts will try their very best not to get noticed for setting any kind of precedent whatsoever. The only thing that's going to happen if you rule against Apple in a low-level court is that they will go into revision, and carrying a high probability that the higher-level judge will overturn the decision and make the lower-level judge look bad in the process.

Also, any kind of effort to annoy someone by bringing coordinated actions in lots of venues all at the same time is probably abuse of process.

[direwolf20]

You have the legal right to do anything to your iPhone that you please, except for DMCA circumvention. Apple, cleverly, designs it so you can't do very much without DMCA circumvention. But it is the government's fault for this loophole, not Apple's.

[xmcp123]

It is the governments fault that it exists, and apples fault for exploiting it to the extent they do.

It’s a choice, and you can tell it’s a choice because many, many other companies choose not to.

[hermanzegerman]

DMCA is only a thing in the US.

[patja]

Is this sarcasm? Apple pretty much invented the walled garden of personal computing.

[pc86]

I subscribe to a half dozen creators and I have exclusively used the web interface to subscribe and consume this content. You cannot tell me with a straight face that if the only difference was I subscribed on my phone to someone who charges me $10/mo, Apple is entitled to $36 for the first year and $18/yr in perpetuity thereafter.

[rubyfan]

I don’t think anyone suggests Apple should get nothing for their app store services, just that it shouldn’t be 30% of every transaction processed through every iOS app.

[londons_explore]

The EU has the right approach. Don't try to legislate exactly what is a fair/unfair amount of profit to make - change the rules of the game by requiring third party marketplaces and payment platforms so apple has to lower rates or lose every app into a third party store.

Apple can easily say "Use our store exclusively and you get our security/privacy guarantees. Go outside our store and you're in the wild west". App developers can then decide how much fee they are willing to pay for access to the user base who refuse to venture into the wild west. Other stores might try to persuade users that they are more secure and more private too via stricter review policies or more locked down permissions etc.

[fauigerzigerk]

From a consumer point of view, the best approach would be if devlopers had to sell their app in Apple's App Store (if Apple approves) and could optionally provide other purchasing options on top of that.

It would prevent fragmentation and give people a choice to pay up if they actually value Apple's extra protections (if any).

[dwaite]

Several years in, I don't believe Apple has lowered rates at all.

If the EU has the right approach, then they still do not have the right implementation.

[hermanzegerman]

They did lower them to 15% due to regulatory pressure for smaller vendors. And for compliance with EU DSA, they've tried countless malicious compliance efforts, that have been struck down again and again.

The only reason they haven't been smacked with a billion dollar fine for their Bullshit (Core Technology Fee)yet, is because of Trump.

[thfuran]

What they should get is customers for their phones and computers.

[idiotsecant]

I think that is in fact exactly what GP is suggesting.

[rubyfan]

I don’t read it that way. I think the point is it doesn’t make sense that apple is taking a cut of a transaction that is not in their payment rails*. Apple can still be compensated for their App store service without using a model that takes 30% of all transactions, e.g. a listing fee, an app review fee, etc.

*And anything on their payment rails should have a normal transaction fee, e.g. Stripe’s retail rate is 2.9% + $0.30.

[dwaite]

This is the model they have moved to in the EU - an annual per user-app core technology fee for apps enabled to be listed outside the store, and relaxed in-store rules (and reduced commissions) if you choose to still list in Apple's App Store. Effectively, they are acting as if commissions are paying the core technology fee, and subsidizing it for apps which aren't profitable.

The per-user model means that apps which have adopted freemium and advertising-driven models wind up having quite different financials, and could be more expensive.

[wolvoleo]

Yes it's fine but the 30% should be charged to the customer who wants to stay within that ecosystem of course. If they want that white glove treatment they can pay for it. Of course once the users see how much that fluffy ecosystem actually costs them I bet most of them will just pay patreon directly :)

If the platform like patreon is supposed to absorb that fee they will increase prices for everyone even people who won't touch Apple like me. That's not fair. Or more likely, they will just give less to the content creators.

In the EU it's already forbidden to force payments through Apple or to forbid the platforms to charge the fee back to the customer.

[mrighele]

Should Ford get a 30% cut every time you fill your gas tank ?

[mrguyorama]

Don't worry, we are well into "car branded fuel only" territory with electric vehicles.

"Buy our electricity at a huge markup to power your vehicle. Oh, you don't have one of our vehicles? Sorry, that's an extra 10% on top"

This was dystopic scifi like 20 years ago and Americans are so clueless they just sleepwalked into it because they'd rather not have a government at all.

[seemaze]

Certainly not defending Apple's behavior in this instance, but isn't the success of the larger product ecosystem a direct driver of their App Store profitability? To strictly evaluate the App Store finances in isolation seems to be the sort of accusation you've levied against Apple in the opposite direction..

I like Apple less and less these days for various reasons, but I haven't purchased an app on the App Store in more than a decade. It's strictly a vehicle for local utilities when, for whatever reason, a browser will not suffice. Nearly all purchasing is done on the 'open' web.

[jbs789]

Or you could argue the App Store wouldn’t exist without the hardware, so the relevant reporting is both combined - lower margins.

[parineum]

> ...for the sake of legal argument. R&D shouldn't really be included

That's an incredibly ridiculous take. R&D is an operating cost and it's an ongoing expense related to the app store existing.

> I think the actual profit margin is closer to ...

You can replace "think" there with "feel".