Press F for Fortnite - Apple AND GOOGLE remove Fortnite from the App Store - Epic Sues Apple

[mr moose]

1 minute ago, maartendc said:

 

 

But charging on an ongoing basis for all in-app purchases is going too far. Especially something as high as 30%. Apple didn't 'earn' that money. If the developer puts a lot of work into providing content in an app, be it gameplay, articles, video content, whatever, it seems pretty egregious to me to charge a percentage of all that revenue.

 

 

 

This is basically my whole argument.  in-app purchases are basically a transaction and cost apple no more than a CC transaction costs visa.  When visa do it for 1.6% (with profit) there is no justification for the in-app purchase fee to be 30%. 

[AnonymousGuy]

3 minutes ago, HenrySalayne said:

Costumers are harmed by Apple's practices. A developer isn't allowed to adjust their pricing for the cut Apple is taking. So basically there are three scenarios (which are all bad for costumers):

1. A certain service isn't availabe on Apple devices (bad for Apple users)

2. The developer has to subsidize the cut Apple takes with the income from other costumers on other platforms (bad for everyone, Apple users pay less, users on other platforms pay more)

3. The developer has to increase the price by 30% across all platforms (still bad for everyone, Apple users pay what they deserve, users on other platforms pay a flat 30% more for nothing)

 

Apple has to either allow developers to adjust the price of their service or allow alternative payment methods. Dictating the price and forcing the developer to use the Apple payment system, is just hurting the free market and thus costumers. If there would be a price disparity between services on Apple devices and on other platforms, (some) people might not buy an Apple product.

You forget option 4) where the developer accepts less revenue overall.  

 

Option 1) just doesn't happen.  "well I was going to make $1M dollars but because of Apple's 30% cut I choose to make $0 instead of $700k"

[maartendc]

I would add that I applaud Epic for taking on the Google and Apple monopolies on app stores. Not many companies are big enough and have enough clout to be able to fight them on this.

 

Sure, they are doing it for their own gain. But in the end, the consumer stands to win on this.

 

I feel the same way about them taking the fight to Steam. In the end, the consumer will benefit from more competition.

[HenrySalayne]

1 minute ago, AnonymousGuy said:

You forget option 4) where the developer accepts less revenue overall.  

 

Option 1) just doesn't happen.  "well I was going to make $1M dollars but because of Apple's 30% cut I choose to make $0 instead of $700k"

No, there is no 4th option, because revenue and profit are two completely different things. And even if the profit margin is above 30% it is still basically option 2 or 3, because it could be cheaper.

 

I agree option 1 is unlikely, because Apple makes up a large percentage of the market and you have to bring your service to Apple devices. Which sounds pretty much like a monopoly to me.

[AnonymousGuy]

18 minutes ago, mr moose said:

 

This is basically my whole argument.  in-app purchases are basically a transaction and cost apple no more than a CC transaction costs visa.  When visa do it for 1.6% (with profit) there is no justification for the in-app purchase fee to be 30%. 

Why does a CPU cost $10k when $50 ones exist: because the people paying it are buying access to technology that they can then profit themselves off of.  

 

The situation is no different here: you want access to a billion users who spend 2x more in in-app purchases than the competition?  Well...30% is the price of that ticket.

 

The court is not going to decide what a "fair" profit margin is, and there is no inherent entitlement for a business to have access to another business's ecosystem.  Imagine AMD suing Intel for Intel's customer list "because we're substantially harmed by not being able to market our own CPUs to them"

[mr moose]

5 minutes ago, AnonymousGuy said:

Why does a CPU cost $10k when $50 ones exist: because the people paying it are buying access to technology that they can then profit themselves off of.  

Apple do nothing but transfer the money from the consumer to the developer for an in-app purchase or subscription payment.  They literally do nothing else, it is exactly like a paypal transaction.  That move money from you to the seller.  Are you seriously trying to argue that apples funds transfer (which is probably just rebranded bank service anyway) is so much better it warrants a 1776% increase in price?

 

5 minutes ago, AnonymousGuy said:

The situation is no different here: you want access to a billion users who spend 2x more in in-app purchases than the competition?  Well...30% is the price of that ticket.

We call that holding the market for ransom.  you can have access to the other half of the market if you pay us 30%.  

 

5 minutes ago, AnonymousGuy said:

The court is not going to decide what a "fair" profit margin is, and there is no inherent entitlement for a business to have access to another business's ecosystem.  Imagine AMD suing Intel for Intel's customer list "because we're substantially harmed by not being able to market our own CPUs to them"

Never said the court should decide what a fair profit margin is, in fact I said quite the opposite, I said if defining the amount was the only problem then the judge would throw it out.

 

Your analogies just don't work, that are non analogous the issue.  Apple can prevent developers from accessing half the mobile market, that is enough to be considered a monopoly,  by saying to developers pay us 30% of your revenue for every in-app purchase or you can't have this market is called Anti trust.

 

I'm going to post this again because it is really important people understand it:

 

If we consumers aren't careful about what we defend and what we happily accept from companies then we will get the very service we deserve.  Everything will cost more than it has to, you will have no choice (a choice between google or apple is not a choice the way they do business). One of the reasons I am so active in threads like these is because I am personally sick and tired of having only two choices for phones.  I did have a third option once but between apple and google controlling the market and peoples love for either of them ,it became unpopular to support them. I now don't have that option.  If we don't support everything that has even the smallest positive effect for consumers then we get nothing.

 

This means if you defend apple for not only charging way than is reasonable for in-app purchases but for holding the entire ios market as ransom then you are part of the problem.  

 

It's really simple

 

Apple can fix this and dissolve all the case being bought against them by doing any one of the following:

 

1. Keeping the apple payment as compulsory but charging the same fee as any other comparable transaction.  Currently between 1 and 3 %.

2. Allow an alternative to the app store, then they can keep business as usual in their own app store

3. Allow apps to setup up their own payment systems for in app purchases.

 

No one is arguing the 30% or yearly listing fee is unfair. They are just arguing holding the market to ransom is anti trust when you have to pay 30% for in app or subscriptions.

 

All these things about API support and running costs etc, they are BS,  MS don't charge for dx, vulcan is free, opengl is an open standard. Nvidia spend millions giving developers all sorts of resources and software kits to make it easier for them to develop and make their product sell better.  Not one of them charge developers to provide support to make their product better, only apple do that. 

 

I am reminded of a line from skidrow,  "you keep telling me it's raining while your pissing down my back" this sums up apple treats it's devs at the moment.

[HenrySalayne]

15 minutes ago, mr moose said:

Apple can fix this and dissolve all the case being bought against them by doing any one of the following:

 

1. Keeping the apple payment as compulsory but charging the same fee as any other comparable transaction.  Currently between 1 and 3 %.

2. Allow an alternative to the app store, then they can keep business as usual in their own app store

3. Allow apps to setup up their own payment systems for in app purchases.

I would add:
4. Allow a higher price compared to other platforms to cover the 30% fees.

[maartendc]

2 hours ago, AnonymousGuy said:

you want access to a billion users who spend 2x more in in-app purchases than the competition?  Well...30% is the price of that ticket.

You really hit the nail on the head here. That is exactly what is happening.

 

And ask yourself: is that a good thing for consumers, healthy for the market? Is that even what Apple users want?

 

As a consumer, you are under the impression you are buying a phone that is yours to do with as you please. Except, in reality, whether they know it or not, this is not the case. You are only 'allowed' to use it with the Apple app store, not any other app store. And you are only 'allowed' to install apps from said app store.

 

That is the bigger issue here. The fact that they charge 30% for all purchases is a consequence of the bigger problem. The % of what is 'fair' is irrelevant.

 

As Tim Sweeney tweeted recently:

Obviously, Epic stands to gain from 'taking a stand' in this case. But what is good for Epic, is good for everyone in this case. Everyone but Apple.

[yolosnail]

14 minutes ago, maartendc said:

You really hit the nail on the head here. That is exactly what is happening.

 

And ask yourself: is that a good thing for consumers, healthy for the market? Is that even what Apple users want?

 

As a consumer, you are under the impression you are buying a phone that is yours to do with as you please. Except, in reality, whether they know it or not, this is not the case. You are only 'allowed' to use it with the Apple app store, not any other app store. And you are only 'allowed' to install apps from said app store.

 

That is the bigger issue here. The fact that they charge 30% for all purchases is a consequence of the bigger problem. The % of what is 'fair' is irrelevant.

 

As Tim Sweeney tweeted recently:

Obviously, Epic stands to gain from 'taking a stand' in this case. But what is good for Epic, is good for everyone in this case. Everyone but Apple.

 

Exactly, imagine you bought a Toyota, and you could only fill it up at a ToyotaFuel franchise, but you could only pay using ToyotaPay, so they take a 30% cut. That sounds a bit dodgy, but fine. Maybe it takes a special type of fuel.

 

But then, say you want to buy a sandwich at the station when you're filling up, something that Toyota have absolutely nothing to do with, but because you're forced to use ToyotaPay they take their 30%. 

Great, that just means you're paying 30% extra for that sandwich for the convenience, but actually, Toyota restrict them from charging more than anywhere else, and you can't just pay by cash because, although Toyota had no hand in making the sandwich, or even own the fuel station it's in, they want to take a 30% cut.

[spartaman64]

On 8/14/2020 at 5:58 PM, Lord Vile said:

It’s not a monopoly though because they’re not the only phone marketplace. It’s a duopoly really but still. iOS is a mobile phone OS with its own marketplace, android is that also and so is Huaweis thing which no one cares about.

 

YT is actually a monopoly with no major competitor.  

their phone isnt the monopoly. their app store on their phone is the monopoly. remember when microsoft got in trouble for antitrust just for having internet explorer bundled with their OS

[Lord Vile]

1 hour ago, spartaman64 said:

their phone isnt the monopoly. their app store on their phone is the monopoly. remember when microsoft got in trouble for antitrust just for having internet explorer bundled with their OS

It's their hardware, OS and software. I don't see how you can have a monopoly on your own devices. If that counts pretty much every company that has a storefront for its devices is a monopoly. 

[HenrySalayne]

6 minutes ago, Lord Vile said:

It's their hardware, OS and software. I don't see how you can have a monopoly on your own devices. If that counts pretty much every company that has a storefront for its devices is a monopoly. 

Imagine there would be a company owning 40% of the supermarkets in your country. They worked hard to get the there and now they are controlling 40% of the market. And now imagine this company would force its suppliers to sell their products for the same price as everywhere else, but they have to pay the supermarket company a 30% cut. The suppliers may say "No, thanks.", but then they wouldn't get access to 40% of the market.

The company owned store brand additonally doesn't have to pay a 30% cut.

And that's exactly what is happening with Apple devices. It doesn't matter if you call it a monopoly or just an abuse of market power.

[Lord Vile]

34 minutes ago, HenrySalayne said:

Imagine there would be a company owning 40% of the supermarkets in your country. They worked hard to get the there and now they are controlling 40% of the market. And now imagine this company would force its suppliers to sell their products for the same price as everywhere else, but they have to pay the supermarket company a 30% cut. The suppliers may say "No, thanks.", but then they wouldn't get access to 40% of the market.

The company owned store brand additonally doesn't have to pay a 30% cut.

And that's exactly what is happening with Apple devices. It doesn't matter if you call it a monopoly or just an abuse of market power.

That's not how supermarkets work. Supermarkets buy bulk from a supplier and then add their own margin to sell to customers, so they'll buy a tin of beans for like 20p from the supplier and sell it for 30p to the consumer making 10p profit. Now the supplier could sell the product directly to get more profit per unit but they wouldn't sell as many units because they lack the various infrastructures etc that the supermarket already has.

 

Company own brands for the most part are essentially all the same just with different packaging or with clothes a different label sewn in. They buy them the same as they would any other bran but slap their own label on it. 

 

It's not though because your analogy doesn't work. Well not in the way you meant it. If you want to sell software you have to let the platform take its cut. Google does it, Sony does it, Microsoft does it, Nintendo does it and pretty much everyone else that deals with licensing software for their hardware/OS.

 

 

[Blade of Grass]

38 minutes ago, HenrySalayne said:

Imagine there would be a company owning 40% of the supermarkets in your country. They worked hard to get the there and now they are controlling 40% of the market. And now imagine this company would force its suppliers to sell their products for the same price as everywhere else, but they have to pay the supermarket company a 30% cut. The suppliers may say "No, thanks.", but then they wouldn't get access to 40% of the market.

The company owned store brand additonally doesn't have to pay a 30% cut.

This is exactly how a supermarket works though? They markup the products they sell by double digit %, which gets passed directly on to the consumers, and the in-house brands are created because the supermarket can either sell them for cheaper (because they cut out the supplier) or they sell them for the same price and pocket the extra cash. 

[spartaman64]

6 hours ago, Lord Vile said:

It's their hardware, OS and software. I don't see how you can have a monopoly on your own devices. If that counts pretty much every company that has a storefront for its devices is a monopoly. 

except its a device sold to consumers not a storefront. and there is precedence for companies getting in trouble just bundling software with their OS like microsoft which i mentioned. let alone making it the only software you can use and charging people 30% for it

[HenrySalayne]

28 minutes ago, Lord Vile said:

That's not how supermarkets work.

 

27 minutes ago, Blade of Grass said:

This is exactly how a supermarket works though?

You are sending me mixed signals here.

I carefully chose the word "imagine". But after all the basic differences between the App Store and a supermarket are negligible. A lot of brands have been disappearing temporarely from supermarket shelves because either the brand (in this case Fortnite) or the supermarket (Apple) tried to enforce their conditions. At least here in Germany most products do cost almost the same across a wide variety of supermarkets (free market) and the profit margin for the supermarkets and for the brands is solely based on their contracts with each other. 

But in this particular case one party (Apple) is imposing the rule on everyone, that the prices need to be the same compared to competing markets. There lays the problem.

[Lord Vile]

7 minutes ago, HenrySalayne said:

 

You are sending me mixed signals here.

I carefully chose the word "imagine". But after all the basic differences between the App Store and a supermarket are negligible. A lot of brands have been disappearing temporarely from supermarket shelves because either the brand (in this case Fortnite) or the supermarket (Apple) tried to enforce their conditions. At least here in Germany most products do cost almost the same across a wide variety of supermarkets (free market) and the profit margin for the supermarkets and for the brands is solely based on their contracts with each other. 

But in this particular case one party (Apple) is imposing the rule on everyone, that the prices need to be the same compared to competing markets. There lays the problem.

No you're just not understanding. There is a fairly massive difference. The app store is like a market where someone can pitch a tent and sell their wares as long as they pay a fee for access to the market, a supermarket is a single independent shop that buys product from suppliers in bulk (so it's cheap) and sells that on for a profit. So for the app store to be like a supermarket, lets take fortnite as an example, they would be buying V Bucks in bulk from Epic at a discount and selling those on the app store in small chunks for a profit.

 

The app store is a platform for others to sell product on. A supermarket is somewhere for the supermarket to sell product. Think of the 30% as rent but it's taken from the sales of the dev rather than charged so much a week to have your software hosted on it. 

[Kisai]

7 hours ago, HenrySalayne said:

I would add:
4. Allow a higher price compared to other platforms to cover the 30% fees.

Nope. The credit card processors have always forbidden this, many states forbid this including Calfornia, which is why Apple forbids this.

You're not allowed to charge more to favor a payment method. You can offer a cash discount if you pay with cash, but that's about it. 

https://ehopper.com/articles/credit-card-surcharges-vs-cash-discounts/

Quote

Compliance Requirements

You’ll notice card associations DO NOT want you to discourage customers from using credit cards in favor of cash or debit options. That being said, most of the guidelines card associations provide are the same:

• There is 4% limit.
• Post appropriate notice in your store about credit options.
• Include surcharge as a separate line on your receipts. This means you need a POS that can handle this.
• Choose between applying brand-level surcharges or product-level surcharges – can’t do both.
• Notify card association and your ISO in writing at least 30 days in advance.

So you need express permission from the processor to add surcharges of any kind. That just will not fly.

 

And since Apple is a California company, they're not permitted to anyway.

 

Quote

Apple can fix this and dissolve all the case being bought against them by doing any one of the following:

 

1. Keeping the apple payment as compulsory but charging the same fee as any other comparable transaction.  Currently between 1 and 3 %.

2. Allow an alternative to the app store, then they can keep business as usual in their own app store

3. Allow apps to setup up their own payment systems for in app purchases.

1. Ain't happening without all the competition doing the same, Epic isn't going to charge 4% any more than Apple will.

2. Never happening, and Epic would love to put it's own store on mobile devices and this is probably the bigger target, because if they can force Apple to have their Epic store on their device, they can completely cut Apple 100% out.

3. This should just not be a thing. We tolerate this in the PC/web world but nowhere else primarily because these platforms predate Paypal and the idea that you shouldn't have to give your card info out to every website or application. If my phone has saved my card for use with Apple Pay, I want to use Apple Pay, and not hand over my payment info again. If it comes down to using the app with apple pay to buy something or using another app to buy the same thing without apple pay, the one without apple pay better be giving me a 30% discount, otherwise I'm not even going to consider it.

 

As I mentioned somewhere else in one of the two threads going on about this, the restaurant apps don't do this.

If you go to Subway itself, and order in person and the only thing you do with the app is scan the loyalty card QR code, Subway will use your stored card that they previously asked you for, or you can pay in person with Apple Pay or your physical cards.

If you go to KFC itself, you can go pay in person, and in fact the stupid thing is that I get more choice by using Apple Pay than I do with paying in person as neither restaurant will accept AMEX in person.

[HenrySalayne]

30 minutes ago, Lord Vile said:

No you're just not understanding. There is a fairly massive difference. The app store is like a market where someone can pitch a tent and sell their wares as long as they pay a fee for access to the market, a supermarket is a single independent shop that buys product from suppliers in bulk (so it's cheap) and sells that on for a profit.

You have supposedly no idea how larger retail chains operate. They have individual contracts with each brand (or conglomerates with dozens of brands like Unilever) and they don't buy their stuff from wholesale. Their supermarkets are not independent, but part of the retail chain with centralized logistics and management.

But it doesn't really matter. The App Store is not a market place, because you are not buying your apps from a developer but from Apple and you have to pay Apple directly. Bulk doesn't matter for digital goods. Most developers would be pretty happy, if the App Store would be just a market place and not like a supermarket.

Apple also specifies this excatly in the App Store's TOS: "Each Transaction is an electronic contract between you and Apple, and/or you and the entity providing the Content on our Services."

[HenrySalayne]

Spoiler

2 minutes ago, Kisai said:

Nope. The credit card processors have always forbidden this, many states forbid this including Calfornia, which is why Apple forbids this.

You're not allowed to charge more to favor a payment method. You can offer a cash discount if you pay with cash, but that's about it. 

https://ehopper.com/articles/credit-card-surcharges-vs-cash-discounts/

Quote

Compliance Requirements

You’ll notice card associations DO NOT want you to discourage customers from using credit cards in favor of cash or debit options. That being said, most of the guidelines card associations provide are the same:

• There is 4% limit.
• Post appropriate notice in your store about credit options.
• Include surcharge as a separate line on your receipts. This means you need a POS that can handle this.
• Choose between applying brand-level surcharges or product-level surcharges – can’t do both.
• Notify card association and your ISO in writing at least 30 days in advance.

So you need express permission from the processor to add surcharges of any kind. That just will not fly.

 

 If Apple would just follow these guidelines, they wouldn't be allowed to charge more than 4% which is only one eighth of their current cut. So, yeah. It's a nice addition, but I don't think this is relevant for the App Store.

[Lord Vile]

16 minutes ago, HenrySalayne said:

You have supposedly no idea how larger retail chains operate. They have individual contracts with each brand (or conglomerates with dozens of brands like Unilever) and they don't buy their stuff from wholesale. Their supermarkets are not independent, but part of the retail chain with centralized logistics and management.

But it doesn't really matter. The App Store is not a market place, because you are not buying your apps from a developer but from Apple and you have to pay Apple directly. Bulk doesn't matter for digital goods. Most developers would be pretty happy, if the App Store would be just a market place and not like a supermarket.

Apple also specifies this excatly in the App Store's TOS: "Each Transaction is an electronic contract between you and Apple, and/or you and the entity providing the Content on our Services."

You really have no clue. I'm out I can feel my brain cells committing suicide. 

 

[HenrySalayne]

23 minutes ago, Lord Vile said:

I'm out I can feel my brain cells committing suicide. 

What a relief, this explains a lot.

[Lord Vile]

36 minutes ago, HenrySalayne said:

What a relief, this explains a lot.

Nice of you to omit the important bit of the post

[Spindel]

6 minutes ago, gabrielcarvfer said:

Now Apple is going after all Epic accounts and will probably follow by revoking credentials, blocking Unreal from running in iOS/Mac.

 

Play stupid games win stupid prices. GG Epic.

 

My guess this is only until the lawsuit is setteled to not have any conflicts of interests.

[Spindel]

1 minute ago, gabrielcarvfer said:

As a developer: Fu** Apple. The really deserve shitty web apps.

No matter if you like Apple or not the fact stands: Epic broke the TOS for the developer account, Apple is in the right on this one.

 

If you agree to a set of rules, you follow them and should expect there to be consequences if you break them. 
 

If you don’t like the way apple handles buissiness on iOS stay away from it. But all the revenue from Apples appstore is to juicy to pass up so every developer still developes and then complains that their children are starving. Classical keep the cake and eat it at the same time mentality.