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App Developer Oppression?

Phil Harvey
2/28/2011

2:40 PM -- Ahead of this week's announcement about the iPad 2, the iPhone 5, the 30th Century Mac or whatever Steve Jobs has in store for us, I wonder: Is writing apps for Apple Inc. (Nasdaq: AAPL)'s iOS still the best deal going? Does developing apps for carrier networks directly have any more appeal now than it did a year ago?

Big Bob McGarvey summarized a wave of recent thoughts about Apple and its revenue-sharing arrangements with content producers and developers. In general, people think Apple's greedy for wanting a big cut of revenues generated via its App Store.

I replied that I think Apple is being fair. They invented a platform. They have a clear value proposition to consumers, and consumers continue to buy Apple products. Developers are presented with a clear cost of doing business, and it either turns them off or helps their business grow.

But I wonder: What can AT&T and other carriers who are courting developers do to appeal to the handful of publishers and content producers that are angry at Apple for, well, acting like a for-profit, publicly held company?



— Phil Harvey, Editor-in-Chief, Light Reading



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sarahthomas1011
sarahthomas1011
12/5/2012 | 5:11:42 PM
re: App Developer Oppression?


Apple's ad service was another point of developer frustration, and Apple recently said it'd cut the minimum buy required by half. So at least it's listening in some respects, but - you're right - that perhaps it doesn't have to in most.

paolo.franzoi
paolo.franzoi
12/5/2012 | 5:11:41 PM
re: App Developer Oppression?


<to the tune of Fiddler on the Roof's - If I were a Rich Man>


Okay from what I am reading this only applies to app subscriptions that are done via the app store.  If you do them via a web interface (for example), then they are free.


Is the 30% fair?  No idea, but it does seem that it would save you a lot in collecting and building a billing structure.  If you wanted to build a multi-platform subscription service, you will need an external mechanism anyway.


seven


 


 

DCITDave
DCITDave
12/5/2012 | 5:11:40 PM
re: App Developer Oppression?


brooks,


I agree. Perhaps the carrier opportunity in this space has more to do with selling services like hosted billing infrastructure to app developers. In that way they'd be less like Apple and more like Amazon.com.

burn0050
burn0050
12/5/2012 | 5:11:32 PM
re: App Developer Oppression?


The frustration here is that apps that could originally purchase content outside the app, and then download the content to the app (ie. their marketplace was already built) - they now have to offer that capability inside the app. And this means that Apple is forcing them to give them a 30% cut of any content bought inside their app.


So, this is fair - how? Just because I have written an app that runs on an Apple device, they now are entitled to a 30% cut of the content I am selling? Now, this is clearly aimed at their competitors who are selling the same type of content Apple is selling - namely books, at this point - but where does it end? Since it is sold through Apple, does that mean they also have the right to "review" the content as acceptable?


It's a frustration that Apple continues to exert itself as the provider of all good things, but hidden behind the beautiful exterior is the money-grubbing control freak. Bill Gates screwed over Steve Jobs back in the day, but the Windows platform was infinitely more open than Apple's.


In my opinion, it just doesn't seem fair to take a 30% cut of something you had absolutely nothing to do with. Why not something more on the order of the 2% that Visa charges for using its services?

paolo.franzoi
paolo.franzoi
12/5/2012 | 5:11:31 PM
re: App Developer Oppression?


burn,


I have read in no place that it is REQUIRED that an app offer content through the App Store.  All I have seen is that IF you do, then you owe 30%.


 


seven


 

burn0050
burn0050
12/5/2012 | 5:11:30 PM
re: App Developer Oppression?


From the Apple rulebook:



11.2 Apps utilizing a system other than the In App Purchase API (IAP) to purchase content, functionality, or services in an app will be rejected



Correct. You don't have to use in-app purchase, unless you sell something for the app outside the app.


For a company that wants to use HTML5 and not Flash because it's an "open standard" and not proprietary, seems they use this argument only when it suits their needs. I would say that iTunes and the "App Purchase API (IAP)" are completely proprietary.

burn0050
burn0050
12/5/2012 | 5:11:30 PM
re: App Developer Oppression?


Seven,


I don't believe I ever said that purchasable content was required in an app. It's that if you sell content for your app outside your app, you are now required to have in-app purchase for the content as well. Which essentially means that if most of my content purchases came from people hitting the "buy" button in my app, which took them to my purchase portal, I now instead have to route the purchase through Apple and give them a 30% cut.


 

paolo.franzoi
paolo.franzoi
12/5/2012 | 5:11:30 PM
re: App Developer Oppression?


 


I have not read you are required to have an app buy button only that it was available.


Will have to read more.


seven


 

burn0050
burn0050
12/5/2012 | 5:11:29 PM
re: App Developer Oppression?


But LionsGate is actually doing something - distributing your film. They have the relationships and so on.


Apple is horning in where it is doing nothing. It wasn't costing them anything when people purchased content outside of their API, other than opportunity. They see someone making money from their device outside of their reach, and they just want a cut.


Theatres don't get money from ticket sales - they get it from concession sales. In this case, they are providing something... food, beverage, the place to watch the movie, etc.


One could argue that Apple is the "theater", but they are already charging for the app AND the device (admission, in this case). I know that reader apps and such are free, but I would argue that apps are what make the phones/tablets cool, not the other way around.

DCITDave
DCITDave
12/5/2012 | 5:11:29 PM
re: App Developer Oppression?


burn0050,


If Lionsgate, let's say, distributes your film they get a BIG cut of every ticket sold in every theater AND DVD sales AND online ad sales, and so on. They didn't write, direct, produce, act in, or fund your film. They're just providing a marketplace and taking a chunk of your hide in the process.


Is it fair? In some cases, yes. In others, not at all. It depends on the filmmaker's personal market power and their ability to find the audience on their own.


Apple's playing the same game with the tightly controlled App Store. I wouldn't be surprised if Pixar studios helped influence Jobs' thinking here.

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