Comment by tchalla
4 years ago
> It's similar to when Apple defended it's 30% store cut by claiming it's an "industry standard"... specifically, an industry standard that Apple established.
Apple established a standard for the Apple app store. There was a lot of complaint about "Apple Tax" and Apple merely pointed out that it wasn't a "Apple Tax". Sure, Apple started it but others which are not even connected to the Apple ecosystem simply followed. They could have not decided to but they did (Re:Table 1) [0]. Microsoft, Samsung, Google and Amazon all have the same 30% tax. Heck, even commission rates for Xbox, Playstation, Nintendo have the same rate (Re : Table 2). I am sure Apple is not forcing them to have those rates.
Somehow, this conversation turns into an "Apple" vs rest conversation. There's no conversation had upon the charges on a digital distribution store. I'd say - let's have that conversation and come up with a number. Currently, the number is decided in a "free market". I would be open to come up to an alternate number. Most arguments against the 30% is that it is too high. Well, every penny that goes out from the developer's pocket is too high. The cost of an iPhone might be too high. Something, being too high is not an argument to not have that rate.
[0] https://www.analysisgroup.com/globalassets/insights/publishi...
this is a classic example of how companies collude without direct communication. it's a type of game theoretic outcome that's actually taught in business school - how to read your competitor's intentions from public information (like pricing intentions) and legally act and counter-communicate publicly your own intentions to not compete (in many cases by not lowering price).
this can practically only happen in oligarchic markets (those controlled by a few large players) who can safely assume a smaller competitor won't undercut them. unfortunately, most major markets in the US are oligarchic, if not downright monopolized (e.g., cellular service).
This is a great comment. It drives me crazy how often people take concepts that apply to an idealized free market and apply them to an area that's controlled by a small number of entrenched behemoths. Very little of the tech industry these days operates like an Econ 101 free marketplace.
> this is a classic example of how companies collude without direct communication.
In that case, let's have that conversation as a society and as a government. "Are companies listed in Table 1 and 2 in collusion as defined by current law?".
In most of the Apple 30% conversations, the conversations seem to be about an instance (Apple) instead of an object (Digital Store Tax, Collusion etc). Lets set the frame and be clear about the conversation we want to have regardless of the business we talk. We can use Apple, Microsoft et al as examples to make the point. We shouldn't replace them with the overarching discussion.
as i understand it, by not communicating directly, companies avoid the most damning potential evidence that they are colluding. it's theoretically possible to still determine that their behavior is collusive, but quite difficult in practice.
i personally think anti-trust/anti-monopoly regulations should be tightened by an order of magnitude or so. any market that exhibits such extended, obviously inflated profit margins needs to be sliced up more finely. any market participant with more than ~10% market share should be scrutinized closely. piercing the corporate veil should be the norm with any anticompetitive infraction (as well as embezzlement, insider trading, and other such executive crimes).
in short, make markets fair (not just 'free').
and in turn, that should allocate capital more efficiently throughout the economy, rather than letting it accumulate inefficiently in fewer and fewer hands.
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> There's no conversation had upon the charges on a digital distribution store. I'd say - let's have that conversation and come up with a number. Currently, the number is decided in a "free market".
There is no competition in the mobile app distribution market. Apple and Google have a duopoly on mobile app distribution, and they behave like a cartel when it comes to price fixing.
For over a decade now, consumers and developers could have benefited from real competition in the mobile app distribution market. Real competition between companies means that consumers can benefit from increased efficiencies and reductions in cost when it comes to distributing mobile apps.
Instead, Apple and Google have kept a stranglehold on the mobile app distribution market, and it took over a decade and the threat of regulation before Apple chose to lower costs to developers somewhat.
How can anyone know what prices are "industry standard" or "too high" when it comes to mobile app distribution if there is no real competition in that market, just a cartel consisting of two trillion dollar companies controlling mobile app distribution for nearly 13 years?
I agree - there's no competition. What's your solution to change in the law that will create competition?
At minimum if you operate an app store on your own platform that takes a cut the platform should allow alternative 3rd party stores to be used. Android/Windows/web/MacOS are already there on that software front. iOS/Consoles/SmartTVs and many others are not. It's probably why you hear about the Apple App Store 30% but not the Play/Microsoft Store 30% - those aren't the only options to distribute an app on those platforms. Users are definitely steered and incentivized to use them but not forced.
That in itself isn't a fix all, for example the Amazon app store for Android based devices still takes a 30% cut at the moment, but it opens the floodgates to stores like this that could start to create natural competition. And even if not at least you have the choice to try not to do that, look at Fortnite. Not for the court case but because they took a 0% cut on Android by distributing the app via their own store when they got kicked off due to that battle. Obviously not an option for everyone but you can still load the app on Android devices and Epic Games Store actually only takes a 12% cut as it's trying to compete. Even if none of this ends up mattering - at least one can load what they want on their devices.
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At the more extreme end there is always antitrust action like the oft cited idea of splitting the likes of Apple or so on into "Apple Hardware" and "Apple Software" which would definitely blow away some anti-competition tendencies (How many use ios+safari+apple-hardware because that's what they would pick vs that's the only option to get any of the above? Probably less than 100%...) but at the same time are probably a bit extreme when we have tried tamer things like the above before.
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I have an android phone and there is one clear difference: I can go elsewhere to get apps other than the official channel. For Microsoft I can go as far as installing a whole different OS on the device. You can do neither with iPhones. Sure, you can buy a different phone but it isn't as simple as that
It even polluted into other markets, like Wolt.com taking a 30% (!!) cut of food delivered using their platform. On top of the actual delivery charges.
I remember thinking that Just-Eat.com were criminals for taking 10%.
Hungry.dk takes 1-2%.
You're comparing apples and oranges.
You're most likely not being fair with what services these platforms provide, or how they structure their fees.
Wolt and other companies like UberEats or Postmates are food discovery, delivery and PoS platforms (and more). They don't operate on any single commission model.
(Ofc one could argue this pricing complexity is intentional so that comparing is more difficult)