103 replies
14h14m
Unlike other social platforms, Roblox’s revenue is nearly all via user spending rather than advertising. As such, Roblox pays 25% of its revenue to Apple and Google (30% of transactions on those platforms) whereas Facebook, Snap, et al pay effectively 0. Note that Facebook, which has structurally lower costs to service users than Roblox and is far more mature, has an operating margin of roughly 40% — if the company had to pay out 25-30% first, it would never have “tech company” profit margins, let alone profit dollars.
Wow. I've never though about this before, but this is an awful second-order consequence of the high app store fees set by Apple and Google. It essentially incentivizes App makers to treat users as products not customers!
(Not too surprising for Google, but certainly goes against Apple's public stance).
I'm a full-time developer of Roblox games.
It's wild that Apple or Google make as much from my games as I do. Obviously it still works out well enough since I'm not abandoning the platform, but strange anyway.
why is it wild? Microsoft keeps 30% of xbox store sales. Apple, Google, MS, etc. play a massive part in attracting users to the platform.
Visa and Mastercard provide entire global payment platforms, yet only (generally?) take a small fee per transaction.
Apple seems to do a lot less, but wants ~1/3 of every transaction.
Steam also takes 30% despite all platforms it operates on being entirely open. So it doesn’t seem to be that unreasonable
Steam reportedly puts in a bunch of effort to earn it though.
Whereas Apple's relationship seems more predatory/antagonistic (at best).
You think Steam puts in more effort than providing graphics APIs, system frameworks for everything from networking to controller handling, UI libraries, educational sessions and security critical updates?
Like, one may argue that the 30% isn’t valid (and it’s 15% for the majority of devs) but to say Steam does more is absurd.
I’m curious if people who hold this opinion have actually been involved in the process of releasing apps on either platform.
And to be clear, I know valve does contribute to gaming on Linux but that’s single digit market share, so is definitely a far cry from the 30%.
Those APIs are paid for by the owner of the phone. Charging developers (and the consumer) 30% to allow someone to distribute an app is utterly ridiculous. Framing it like Apple built these things and you are only paying 30% is in deep sycophant territory.
1. You assume they’re paid for by the owner of the phone. That’s not necessarily reflective of a companies income stream. Microsoft also charge for commercial access to their SDKs for example, and every company has different business models.
2. Then what does steam offer for 30% that isn’t just distribution? The majority of steam games do not use Valves tooling for matchmaking or their engine.
3. Can you go without name calling? Or are you that childish that it’s the only way you can feel like you have the upper hand in a conversation?
4. I’m not defending a 30% cut and already mentioned that. I’m saying that saying steam offers more for the 30% is absurd.
:(
Is that a new thing, or just for specific products? Asking because I've previously used some of their Azure SDK stuff before and that didn't seem to have a charge for SDK access.
Microsoft have charged for non-individual use for longer than they’ve had the free version. I should have perhaps used commercial non-individual use rather than just commercial.
https://www.microsoft.com/en-ca/d/visual-studio-enterprise-s...
Meanwhile Xcode is free and has been since the Project Builder days on Next.
I’m not personally saying one is better value or not. Just that the companies have put different values on different parts of their developer flow for many decades now, and one can’t simply say that the money comes from a single source.
Did MS ever make any significant amounts of money from selling VS/MSDN compared to how much the availability f 3rd part software benefited Windows sales/increasing market share?
Also you didn’t actually necessarily need it to publish software on Windows.
While if you want to develop for iOS (and even macOS these days) you still need to pay the $100/300 yearly fee (which is there entirely for gatekeeping and not an actual income stream).
To your question, that’s exactly my point. Without access to a companies books, you don’t know how they fund things. Take this as my response to your other reply as well.
You don’t know if Microsoft chose to fund certain parts of their development with the profits from VS enterprise or not. None of us do.
Even, for arguments sake, if we say that they could make it all free and still afford it, it would still affect priorities of what gets developed.
Again, I’m not saying one is right or wrong. I’m just arguing that it’s a lot more nuanced than any of the comments here suggest. Nobody has enough facts outside the companies bookkeeping and leadership to make these hardline claims.
Xcode is free if you don't consider the platform cost of needing to have only apple hardware to use it, however (generally) the hardware is cheaper than what MS charges for MSDN/VSE.
In the politest way, that is exactly my point.
Different companies fund things differently and put up different barriers.
Again, for the umpteenth time, I am not making a VALUE judgement. I am just saying they all do things differently and without knowledge of their books, nobody here can say what funds what internally
That’s it.
It is. Anything MS or Apple ever charged for SDKs and development tools was just peanuts compared to their other income streams.
At the end of the day open consumer platforms benefit much, much more from maximizing the amount of 3rd party software that’s available on them than from anything else.
Discoverability, consumer protection, relatively very good UX etc. of course that is much more valuable to smaller/medium developers than to companies like Epic/EA/etc.
Even the App Store and the 30% cut was a great deal for developers and consumers when it came out initially compared to all the alternatives available at the time.
The issue is that at this point Valve/Steam has to actually provide real value to consumers/developers and innovate. Apple can just do nothing and collect free money (consequently the App Store itself sucks immensely as an app/platform) since they don’t have to compete with anyone anymore. What are you going to do? Buy an Android? : D
I mean, Steam did release the Steam Deck, so yes it provides everything you described.
I'm not sure why we are focusing on the 30%, the problem is that facebook, a very rich company, get charged 0.
Steam Deck is mostly standard Linux (although most stuff Valve does is gets merged into the kernel/free packages etc. so it’s hard to disentangle the these, but not exactly comparable to building a platform almost from scratch)
Just like every other company using the same business model (i.e. ads instead of IAP)?
Are you meaning iOS there?
Of so, please remember they pulled significant amounts of code from Open Source Software in order to lighten their development load. :)
But they also contribute significantly to that same open source so how do you balance that out?
Again, I’m not saying they’re above criticism but I am saying this feels like a very one sided presentation of facts.
Not sure what you're asking?
"Significantly" doesn't seem to be correct. At least, not for the (GPL licensed?) stuff that's been stuck on ancient versions for many years.
Though they have (from my rough memory) made some contributions back to FreeBSD where it seemed to make sense.
All that aside, the point is that they didn't build their platform "almost from scratch".
They assembled a lot of pre-existing pieces (many OSS), then built on top of that. It's a common way of doing things.
What I’m suggesting more than asking is, when you say that open source has lifted their development burden, it makes it sound like it’s a unidirectional taking.
And sure, some might be freeloading. But they also do contribute quite a bit to open source. https://opensource.apple.com/
I know your response was more to correct the “developed from scratch” but I still think it’s important to note that it’s not unidirectional. Even in the development of their own platforms, you can find old Usenet discussions of how they were feeding things back. I think they could have gone their own route but Unix compatibility was important.
The history of Next, Apple, and the open source community is very intertwined and unfortunately cannot be reduced so easily.
Literally the last section of my comment addressed that. It’s a single digit market share. How does that play into windows/mac sales then? And what about the decade+ of sales before the SteamDeck?
And in that case, no, Valve didn’t provide all of that. They provided some of it, but AMD did the graphics driver, arch did the OS. Valve still offer less for the 30%. I’m not trying to diminish the effort they put in, but just pointing out the totality of what each store offers behind it is very different.
To your last point, that’s not really relevant to my point. I’m just pushing back on the other person about whether Apple or valve offer more for the 30%. You’re interjecting a completely different argument.
They only do it because they are painfully aware their rent-seeking behavior is entirely at whims of ms/apple and they want to have some moat.
What do you mean by “only”? You can really expect companies to behave irrationally. Pretty much every company funding Linux development do it because they expect this to benefit them somehow.
"I think Windows 8 is a catastrophe for everyone in the PC space. I think we’ll lose some of the top-tier PC/OEMs, who will exit the market. I think margins will be destroyed for a bunch of people. If that’s true, then it will be good to have alternatives to hedge against that eventuality." - Gabe Newell
https://www.neowin.net/news/valve-co-founder-windows-8-is-a-...
Take a wild guess when they started pushing steam on linux, and which version of windows introduced a store.
Yeah, the existence of SteamOS, Steam Machines and eventually Proton were a hedge against Microsoft’s perceived shift into locked down distribution .
I think a lot of folk have a hard time reconciling that there may have been non-altruistic intentions behind something that is enjoyed today.
Similarly, Steam itself was a hedge against physical distribution to cut out the middleman. It wasn’t originally envisioned as a store for anyone but Valve.
But here we are today, and both have positive side effects that actually have outlived the original design.
Sure. But this has absolutely nothing to do with fairness.
They charge 30% because they can and because developers have no other options.
Anyway consumers paying for HW/OS are the ones that are funding the development of those tools/apis etc. Apple, MS, etc. provided all of that stuff for free (or a nominal fee) for decades because they always needed software developers more than the other way around. Any platform without third party apps would be mostly worthless.
Apple is in an interesting spot because when they released the app store initially 30% was a very good deal compared to how much it cost to publish apps on other phones.
Without an insight into how a company pays for its RnD internally, one cannot conclusively say that the consumers are the ones who pay for the HW/OS.
I’ll also reiterate that the majority of devs pay 15% now on the App Store. Not 30%.
And then this gets into every other market choice as well if we’re saying all the stuff is paid for up front by the consumer.
What does Steam offer for its 30%? The majority of games on steam don’t use any steam services unlike apps on the AppStore. Valve doesn’t do educational sessions for developers or provide support for system issues. So is Steam not a terrible deal at double the cost?
But then we get to consoles, where the consumer not only pays for the device but also pays a subscription for online play. If we say that Sony/Microsoft are funded up front by the consumer and then recurring for online fees, then what the value to developers for the 30% (in addition to devkit costs)?
I’m not defending apples cut here. That’s a subjective argument that goes nowhere, but I am saying: if we say Apple’s cut is unfair, why are we okay with the others that are arguably more? And why do people defend the other marketplaces ?
Effort has nothing to do with it. There's two things that matter, supply and demand.
There is competition in that space though. A PC game developer can self distribute, can use alternative storefronts (e.g.: GoG, Epic), etc.
Exactly, but paying 30% stills seems like a very good deal for most developers.
As shown in Roblox case, it obviously is not. Especially as Apple also wants to take a cut from in-app sales.
Well it is for most developers on Steam.
Small/medium developers of course benefit much more from the increased reach/discoverability and PC games have a very different business model than mobile ones of course.
But even for iAP, yes 30% is very step but as a consumer I’m significantly more likely to spend money on an app published by a non-major company if I can use Apple as an intermediary (refunds, subscription management, no cc hassle etc.) I don’t think I’m unique in that way so there is some values we’ll just never know what % it’s actually worth until Apple stop restricting third part stores.
Large companies with a “sticky” user-base of course gain absolutely nothing from it.
Not that I’m trying to defend Apple, on the whole they hardly offer anything useful in return for the 30% to the developers at least because they don’t need to. The App Store as an app/platform is a complete pile of worthless garbage compared to Steam..
Such an odd take.
I begrudgingly use a Macbook for work - that is the laptop my employer issued for me. I pay for IntelliJ, because I think it is an excellent IDE.
Following your logic, Apple should somehow bite 30% of that yearly subscription, when in truth, I am a customer of JetBrains, not of Apple.
Your logic would be fine if, and only if, there was the option to buy the game outside of the AppStore, and you still chose to buy it through the AppStore. That proves you prefer going through Apple's channel and are their customer after all.
In the Steam case, especially for small/medium developers, there are multiple options to buy their games - I generally prefer GoG.
No, that’s not even remotely close to what I said or implied.
Yes. The overwhelming majority still use Steam due to various rational reasons.
I never said that I think that Apple should have a monopoly on app distribution on their platform.
But doesn't that have way more to do with (EU) regulation? I thought that they take quite a significant chunk in the US
That a bit unclear. Are you meaning Visa/Mastercard charge less in the EU due to EU regulations?
If that's what you're meaning, then I simply don't know as I've not heard that before. :)
Someone in the food chain does take less in some EU countries. Not all.
The commissions are capped by law in some parts, but not others.
As a small sample, in RO i think a large store chain pays like 0.5%. The consequence is credit card reward programs are either non existent or something like 0.1% cashback. The other consequence is you can pay by card almost anywhere.
On the other hand I've been to NL and small stores simply did not take Visa/MC because it was too expensive for them. Guessing the visa/mc charges weren't capped there.
Not sure if you actually been to RO but every small shop has 3-4 payment terminals, each bank branded, and based on the card they use a different terminal thus ensuring minimal charge or even 0.
In DE or NL, you operate via an intermediary ( like payone, etc ) and a single terminal. Maybe here comes the difference.
PS. Larger shops/markets ( like kaufland, carrefour, etc ) have also just one, but I guess they negociate the fee.
No, I was born and live there.
My groceries kiosk has just the single terminal.
Where I shop, only Dedeman, Altex and the eMag showroom still ask me what bank is the card from, and they're nowhere near small...
Edit: Hmm. Cozy? Small world...
ha, Torp! Nice!
But yes, is a mix/jungle of options. But I find fascinating that paying with cards has a far more adoption than some places in western world.
They made it compulsory by law to accept cards for B2C if you sold more than like 15k eur/month. But I think you were already in DE.
I think that law also cames with caps on card charges. Or at least there was so much competition between banks for the new market that purchase charges dropped on their own.
They’re all covered by identical regulations.
Culturally, though, small retailers may still believe that credit card fees are higher than they actually are.
They may be concerned about refund and chargeback processes.
Or, their gateway either cannot offer credit cards on their POS terminals for technical or compliance reasons, or the retailer simply hasn’t enabled the payment methods.
It’s not regulation in NL that blocks small retailers from taking V or MC.
High fees is what they told me :) But then I was that weird tourist with a Visa and a MC...
Not really. They still take “only” up to 1-2% in the US
I would bet Apple has put more into R&D for iPhones, iPads and iOS than the entire enterprise value of visa and mastercard put together. If anything, they've worked for it more than visa/mastercard who are merely rails with distribution. Most of the heavy lifting, risk and work in the card ecosystem is done by the issuers (banks et. al.)
I think you underestimate the difficulty of competing against visa or mastercard.
Visa and mastercard are logistical masterpieces.
Think of how much legal work needs to be done in order to be compliant in every country in the world.
Since they're giants, I wonder how much of the compliance is the other way: countries being strong-armed to comply with their terms.
"countries being strong-armed to comply with their terms."
I suppose that is just another way of describing "legal work" in this context.
And you pay for that when you buy the device. That does not justify paying Apple huge percentage each time when you are paying for an app.
The high margins of iPhones and iPad gets already already justified with Apple's R&D costs.
And it would be morally wrong to put that costs on the app developers, without their apps the store is useless.
The lack of apps killed Windows Phone.
If desktop pc users saw Microsoft taking a third of every transaction from yourmoms.com to Amazon.com because they did the heavy lifting of popularizing the home pc and web browser usage, I think you’d realize how ridiculous that argument sounds.
They built it to sell something else, operating systems and then some ancillary stuff. They became one of the most valuable companies in the world off just that.
Just like the iOS was built to sell phones. They make plenty off phones. They’ve made Apple one of the most valuable companies in the world too. Access to an App Store has become a requirement of a modern phone, so they wouldn’t sell many without it. But it doesn’t mean they should be able to tax the entire economy so heavily. Just like how running a browser is a requirement of modern browsers for an operating system, but that doesn’t mean the operating system should be allowed to tax the entire economy of activity that takes place on said operating system.
Apples to oranges. Card networks have more than three stakeholders to work with per transaction, apply fees indiscriminately from milk to digital music subscriptions, and operate at truly staggering volumes.
You're right. Visa and Mastercard seem to do a lot more, yet charge a very small fraction of the amount.
Yet Canada has Interac and India has UPI which nationalize all digital transactions while charging even less. In Europe they’re much more heavily regulated and this charge even less than in the States.
So if within their own industry Visa and Mastercard overcharge like crazy, especially when they can, what makes you so sure that they’re a good counter example for a completely different industry? Especially when competitors seem to be charging a very similar rate for a similar service?
That being said, it is a fair point when you consider that retailers and other similar product middle men tend to charge 1-3%, but it’s important to also consider that Apple position’s itself as a luxury product and brand where 30% markup isn’t actually out of line.
Exactly right. I’m not against competitor analysis here. But let’s at least compare against a basket of structurally similar offerings instead of cherry picking companies whose rake happens to be an order of magnitude lower in percentage terms.
My point, which hasn’t really been addressed, is that “more” isn’t a meaningful term when comparing card networks and software app stores, because the markets are structurally different.
You mean they provide actual value to users unlike two parasites that hold whole world hostage?
Not suggesting that this warrants a 30% cut, but unlike payment gateways Apple also provides discoverability and distribution.
They lock their users in a walled garden where only they can provide discoverability and distribution.
Apple seems to be incredibly poor at discovery, so that's not a point in their favour.
Distribution could be done by any number of other CDNs, as will likely be done by the new EU based App stores.
What's the bet those won't be charging ~30% transaction fees to cover things? And they won't even have the same scale as Apple. ;)
Only 3% of the 30% go to payment processing. Hence why they still want 27% when developers choose their own payment system.
The 27% are seen similar to Sony and Nintendo as fees to be on a platform which has wide reach but also gives tools and does stuff to enable app distribution.
Is that too much? I don‘t know but it‘s what all appear to do. The platform politics didn‘t evolve as fast as the tech though. So what about apps like Patreon, Netflix, Spotify, that was never on the table in 2008.
The 3% payment charge is the transaction fee, but that doesn’t take into account the actual handling of the rest of the transaction lifecycle, like managing refunds, or chargebacks. A single chargeback will cost you $25 whether it’s successful or not (plus refunding the transaction if you lose), but on google play and co it’s just refunded.
They do, which is why credit cards take that much, cost of chargebacks is a part of the transaction fee.
Microsoft/Sony/Nintendo subsidize the development and cost of their dedicated gaming system from the 30% cut of the store sales.
It's very different on the mobile side: Apple sells iOS devices at full cost. With Android, it gets even more mucky as Samsung, the hardware vendor, gets 0% of the sales on their handset (unless the user, for some reason, uses the Samsung store), and Google gets the full 30% for only their software work. So the fact that Google gets 30% is wild.
So if you sell your hardware at a profit, you forfeit your right to profit off the platform post-sale? Nintendo never sells hardware at a loss either, by the way.
And your Samsung comment doesn’t make sense. Samsung gets the operating system for free and then sells hardware for whatever profit they can get for it. Plus all of the post-sale platform services profit they can manage, just like Google and Apple. What is wild?
I never meant to imply that once a company sell the hardware for profit, they forfeit the rights to profit off the platform. It's really about market power. The two dominant mobile leaders have enough market power to increase their take to 50%, for example, arguing that's how much traditional retailers take, if not for the risk of attracting government interventions.
The intention is to point out that simple arguments of 'Xbox is charging 30%, so it is fine that the mobile platforms do the same thing' failed to take into account of the nuances of the situation. Isn't it weird that these platforms are all charging 30% even through all these platforms have different business models, with different cost structure and provide different values? I hadn't even talked about how Microsoft has been getting no money off sales on Steam when it is their platform, because they hadn't (yet?) lock down the platform.
Finally, Nintendo did sell the Wii U at a loss. [0]
[0]: https://www.gamesindustry.biz/nintendo-still-selling-wii-u-a...
Not that I trust Google (my personal phones are Apple) but how do you think a phone with all software made by Samsung will work? Every time I lay my hands on one of their phones (and I have one on my desk for Android development) something annoys me. They somehow think they know how to do UI/UX but they still haven't learned after all these years of "customizing" Android.
So yes, Google deserves some money. Not 30% but some.
I never get this argument, but following its logic, is Apple and Microsoft being really charitable by not gatekeeping and taking a cut for every paid-for application installed on their respective desktop platforms? To answer my own question, it just seems that the status quo has inertia. In the way that we don't pay for online news, social media, or search, similarly, we've just accepted a large chunk of our purchase is feeding the app store.
Also, from memory, Xbox/Sony consoles are loss leaders to recoup profits from store sales. I'm not sure if that holds for Google and Apple phones, but I'd be more okay with app store fees if it did.
Is the "large chunk of our purchase ... feeding the app store" or is it going to shareholder profits? Appstores seem super inefficient if they cost so much to feed (ie run/maintain).
Sure. It's all just revenue growth. Sans some anti-competition regulation, it's the prerogative of a business to charge as much as the market will bear, as much as it can be sustained, by whatever legal means necessary.
Google gives you an App Store and maintain the OS that other hardware vendors (and sometimes themselves) implement hardware around. They take a 30% cut for distribution in their special app store and not much else.
Microsoft and Sony take similar cuts for access to their game consoles. In return they provide: - High quality, robust developer APIs. - High quality debuggers, graphics debuggers and CPU+GPU profiling tools with in-depth access to hardware counters - Networking libraries for matchmaking, and a network backend for tunneling network traffic via their online services - True development kit hardware with expanded resources for debugging tools - High quality documentation and direct support - GPU drivers that actually work - Payment processing - All for a hardware platform that is typically sold at or below BOM cost for the initial launch of the device
Google provides distribution via the Play Store, and only for about ~4GB of app before they force you to use your own CDN because they have a limit on the size of the app bundle they'll distribute. There's likely things I'm not aware of that Google provides for app developers rather than game developers, but if we're comparing to game consoles then I'm going to compare tool for tool.
Apple's tooling is better, largely because they have way more control over the target hardware and software environment, but they take an additional cost via their highly restrictive app guidelines.
For the difference between mobile and consoles, it depends on if you have publisher or port team backing or not. Many indie developers do not get devkits, do not get proper access to Nintendo Switch Online, PlayStation Network, or Xbox Live networking, do not get performance monitoring tools, and do not get any documentation or support. For them the most that happens is they export the necessary files in a reviewable archive format and send it in for approval, hoping that the game engine they chose to use properly functions on the given console and that there won't be any major problems that will cause them to go through the review process again. This also applies to any major updates or patches later on. The consoles treat these indie developers the same way Steam, Itch.io, and GOG treat their developers -- as vendors in a storefront, not as equal business partners vital to the operations of the platform. For these indie devs if you want the above features you have to hire somebody to do the porting for you or you have to go through a lengthy and expensive process to be approved to use them. Most console releases of well known indie games like Celeste, Shovel Knight, and Rimworld are handled by port teams for this very reason. On console, if you're below the AA tier you're paying for the cost of the privileges others get instead of you.
However with mobile storefronts at the start everybody gets treated equally since they all have access to the same limited number of features and get the same level of (some would say neglectful) automated support. For the most part Epic Games goes through the same process of uploading a game or program and waiting for approval that Jimbob does. It's only afterwards that the level of access changes. It's this way by design. Not only because early on there were no big names in the mobile space and so no real tier system was necessary, but also because quantity is valued over quality. There are about a thousand uploads to Google Play a week (I haven't found strict data on how many are only games, but the process is the same for games and apps so it doesn't really matter), versus between twenty to thirty on PlayStation and Xbox. Creating unique avenues and methods would bottleneck things horrifically for mobile. As a developer you get an informal discount for the relative lack of quality control and increased competition you'll be facing.
This cost is very evident in the prices of the games. You won't ever see games that aren't asset flips or shovelware below a non-sale price of $1.99 on Xbox Games Store, but you'll see plenty of $0.79 games on Google Play and Steam.
The contrast is stark compared to another of Google's own projects: Stadia.
Much of this comes second hand as I wasn't on this particular team when they were working on Stadia bring-up for proprietary AAA engine (I joined about 2 weeks before Stadia was officially canned).
But the quality of support from Stadia for developers was leagues above what you get from Android. Every few weeks I'll hear from other team members how good it was working with Google for Stadia. The tooling was great. We got developer kit hardware. We had documentation and direct support channels and Google was actively managing outreach and development on tooling to ease transitioning into their systems (Google was one of the biggest driving forces behind DXC's SPIR-V target).
Compare this against the same people commenting on the Android experience and it's the complete opposite. We're left out to dry with poor support while trying to target devices that barely work.
What's the difference? Google actually had to fight to get us to come to their store. They had competition and weren't acting as a toll collector to a captive market. Game developers had the choice to tell Google to kick rocks, Xbox and PlayStation aren't going anywhere. Google had no choice but to play ball with good support and fair pricing. No such pressure exists on Mobile, and they crank the toll as a result.
Ok why doesn’t Microsoft get 30% of revenue of Steam purchases or Adobe CC subs? Why doesn’t Apple get 30% of revenue from purchases through the Safari browser in MacOS?
After all they play a massive part in making those purchases possible.
FWIW, there are large publishers which successfully negotiate with the ilk of Microsoft[1] and Sony[2] to get a better revenue split, as consoles in fact have more functional competition than mobile phone app stores: people who own a gaming console might could reasonably own a second one if they were interested in some game that was only available on one console or the other; this simply doesn't happen with phones, as only a small handful of particularly-crazy power users would ever carry around a second cell phone. If you want to not release on Xbox unless Microsoft gives you a better deal, it doesn't sound anywhere near as ridiculous to tell your potential customers "you'll have to also own a Playstation" as if you tried to explain to people that to use your new social network they have to also own and carry around an Android phone (or, worse, whatever the third option might be... is there even a third option anymore that would make any sense? ;P). You can tell that Apple has some insane amount of fundamentally market-distorting power as they seriously charge large publishers -- the ones you would expect to have the most leverage -- more than smaller ones; and, with maybe a sole exception of WeChat, we have never heard of anyone getting a better deal out of them, ever.
[1]: https://x.com/tomwarren/status/1671981463040819200?s=46
[2]: https://x.com/twthereddragon/status/1672270407179665409?s=46
They do play a massive part because their platforms are designed to lock users in. You do not really have an many alternatives to using their stores on console or mobile platforms. In case of consoles or Apple there are none.
They don't attract people, they gatekeep solutions/entertainment. It is the exact other way around, the products on their store attract people into their environment.
Console user spend and user acquisition costs are not even remotely similar to the corresponding values in the mobile ecosystem.
Apple is not attracting. Saying Apple is attracting with their compute platform would be saying Intel is attracting with their compute platform. Apple is spending next to nothing to attract users to Roblox but is acting as an unwanted gatekeeper to users that paid Apple to use their products.
The games and apps play a massive part in attracting users.
That's why MS bought game studios to get more games and therefore users to the Xbox.
Wild meaning unfair, perhaps?
Absolutely, it's better to have a smaller slice of a bigger pie, which is why I'm OK with this.
What I meant by "wild" is that in this case, the dev of the game is the one receiving that ~30% slice. Apple+Google get about the same as the dev does.
Would you rather do the hardware/OS platform yourself as well?
I know, the big ones are always "evil", but...
How about being real?
You mean like most Linux distros?
Yeah it's great.
Well, the app stores could fix that by also demanding a cut from ad revenue.
Haha, I am imagining the Facebook response to this! :)
In any case I suspect that is too much overreach and would only attract more attention from regulators.
Two wrongs don't make a right, and this is fixing the wrong problem. (The problem being that once I purchase a portable pocket computer, I want it to be mine to use how I want with whatever software I want without asking the manufacturer for permission).
Apple is already collecting a 30% cut when you're buying ads on an iPhone: https://www.facebook.com/business/help/704141224249342/
Unreal. Apple’s gonna take a 30% off everything they possibly can.
Well, yeah. It’s probably the major reason Apple can afford to design and print their own chips. You don’t get rich unless you are greedy.
Well they did and Facebook refused. Hence the "do not track" feature.
Apple did have conversations about how to profit from Facebook’s apps.
But there’s no evidence that the App Tracking Transparency was a direct result of failure to come to terms with Facebook on some type of revenue share.
Even if a portion of the comprehensive set of protections included in ATT was specifically to target Facebook, Apple did not use it to punish Facebook.
Apple’s customers did.
Because when given a choice, 85-96% of all people across the entire planet did not want Facebook tracking them.
If one was to speculate on The decision-making behind platforms’ leadership, it follows to consider Google’s reluctance to follow in the footsteps of Apple with ATT due to google’s own direct reliance on ad revenue.
Apple is no saint, it’s made many compromises on user privacy in the face of business.
But there’s no doubt in my mind that the position of selling products and services, including the distribution of others’ software is by far more consumer friendly than the quiet identification, data collection and targeting of individuals.
I also hadn't thought about it before, but when you present it that way it's dazzlingly clear - thank you!
Get money from your users: 25% platform tax
Get money from advertisers: No platform tax
More like:
- Get money through the platforms' users and their payment methods, without having to worry about asking for users' credit card information, billing, chargebacks, or individual invoicing: 25% platform tax.
- Get money through your own means, similarly to what Amazon did with Kindle books: no platform tax.
You should definitely worry about cashbacks.
You refund 100% but Apple and Google keep their share.
Fair enough. So I guess if I don't mind worrying about all those things, I can simply reach my own agreement with a PCI-compliant payment service provider to charge customers through my app directly and therefore avoid that 25% platform tax, right?
...right?
Not sure what you’re talking about, you still can’t buy kindle books on iOS apps.
Plus the advertising network takes its own tax, right? Then it goes into the same or similar pockets again anyways.
The ad platform takes big fees.
I’m surprised that Roblox haven’t done what Amazon did with Kindle books. They just stopped book purchases through Kindle iOS app.
At this point it’s safe to assume Roblox is as popular as Apple so they don’t have the problem of discovery. Distribution yes for which they can pay the listing price.
They need 8-year-olds to be able to make unauthorized purchases on their parents' credit cards, so the IAP flow is important.
It also makes it almost impossible to compete if Apple/Google has a similar product. They get 100 % of their own earnings, you only get 70 %, so need a much much bigger operational margin. And they still make 30 % off you, so if you're equally big they in reality make 130 % and you 70 %, almost the double of you while having the same sales.
Makes me think of Spotify
Well, Tencent needs to pay the same Apple and Android tax as well for its gaming business, but guess what, Tencent's gaming business is very profitable. The real difference is that Tencent has a big market share in China(arguably the most profitable gaming market in the world) and Roblox has none.