Comment by nabla9
10 hours ago
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.
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.
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.
> 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.
> 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.
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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.
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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
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Next up, Apple starts taking a cut of every money transfer you do with your banking app.
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> You could make the argument that Patreon isn't much more than a banking app.
Don't give them any ideas.
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.
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No kidding. Imagine if Apple took 30% of your Venmo transfers.
Next up, 2% cut whenever you use any banking or payment app. Only 1.5% when you use Apple Pay!
They currently do charge 0.15% on Apple Pay actually.
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).
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?
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> 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.
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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.
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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.
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.
Should Ford get a 30% cut every time you fill your gas tank ?
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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.
Or you could argue the App Store wouldn’t exist without the hardware, so the relevant reporting is both combined - lower margins.
> ...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".