That's a gross characterization of what's going on. When I download Uber on App Store, the business relationship is between me and Uber (and Apple doesnt and shouldnt come into the picture).
Do you think Ford needs to get a cut if a user buys Michelin tyres of their Ford Car? Will you argue that Michelin needs to "pay into Ford for access to their market"?
In this case, the "ice cream" is a zero-margin utility. It can be reproduced infinitely without incurring extra costs beyond what Kroger deems sufficient. The act of installing an app on iOS can't even be compared to Kroger charging money for you to drink out of their hose in the back of the store. Software is simply not a physical commodity, apps like Safari are proof that data still flows freely.
In a fair universe people would stop going to this store and visit other places with lower margins. But Apple conveniently took steps to prevent you from leaving their shop, so they can charge whatever they consider a fair price. You cannot rationally defend this, jurisdictions worldwide are suing Apple for this, because it's a blatant racket. It is indefensible.
> But Apple conveniently took steps to prevent you from leaving their shop, so they can charge whatever they consider a fair price.
This is the part that is monopolistic.
Kroger collecting money when Bryer sells ice cream in their store is fine. Kroger prohibiting Bryer from selling ice cream else where is not.
This should honestly blanketly apply; as-in Bryer should not be allowed to enter a contract with Kroger where they'll only sell ice cream at Kroger. Bryer can choose not to sell at other grocery stores but it should never be a contractual requirement.
> You cannot rationally defend this, jurisdictions worldwide are suing Apple for this, because it's a blatant racket. It is indefensible.
Even if Bryer's ice cream was zero-margin, if you go into Kroger's store to buy it then Kroger is entitled to some compensation. The practice of collecting a commission from products you are an intermediary for is highly defensible. The practice of prohibiting others from selling their own goods to people not under your control is not (i.e Schools can ban an ice cream vendor from visiting a school).
Um, does a mall normally gets a cut in all the sales which happen in the stores on its ground? The mall surely keeps the stores running by providing services like security, parking, advertising to attract people, etc.
Apple incurs the ongoing cost of hosting the App Store, so yes, they're absolutely entitled to charge either or both vendors and consumers for access.
Giant and Safeway mark-up food they sell.
The shop that stocked and installed those Michelin tires charged a premium.
Etc.
If you're arguing the App Store shouldn't exists, or Apple shouldn't limit their users to a single App Store, that's an argument with some merit. But, it's not what you said.
Does Apple sell the app? Or are they only facilitating the transaction, but you're buying from the app author? Because grocery stores are selling you something, they are not middlemen who only connect you with the manufacturer. They've bought the products from the manufacturer and are now selling them to you.
It's more complicated than that. Nominally there's an ownership transfer, but the big players also charge the suppliers stocking fees [0], which seems to translate quite well to what Apple is doing. And if you're charging a fee to stock the product, it's clearly not being treated as a straightforward ownership transfer to the retailer like you say it is.
Plus, since when is a middleman connecting you to a party with the product or service you want not a party you have a business relationship with (as GP claims)? Brokers have been a thing since forever.
I think stocking fees are comparable to the ads you can buy in the app store. But Apple does not buy the apps and then resells them, which Walmart does.
Brokers are a thing, but would you consider Apple's "app store" a broker? A broker's value-add is making the connection, but Apple's app store's is "being the only app store available on Apple devices".
If you forced them to let users choose like Microsoft had to with browsers, that would be different, and I predict their perceived "value as a broker" would drop of a cliff because others could provide the same at a fraction of the cost.
> But Apple does not buy the apps and then resells them
In a sense they do. You can think of it as Apple buying a license and then selling the license to the end user.
I don't disagree that morally Apple is problematic in holding a monopoly on apps on their devices, but charging fees for their shop is not inherently problematic as a standalone issue.
Ok, you got me, the brick & mortar example doesn't translate perfectly.
My main point still stands... there is a real cost to hosting an App Store, and the entity doing that hosting should be compensated for doing so.
The "problem" is Apple (and now Google?) want to be the only App Store for their platforms. So, you can't pick between Safeway and Giant. But, that's not what the parent suggested - they only suggested the host of the App Store shouldn't be paid.
I don't think that necessarily follows from what they said. Apple might charge, much like grocery stores, for exposure (i.e. ads, which they also do), or they might charge the consumer a fee.
They shouldn't be a permanent middle man between consumer and manufacturer is what I took away from that comment. The app stores are only money printers because they are (largely) exclusive on their platforms. Would users and developers choose Apple's app store and its hefty fees if there was fair competition? Possibly, but likely not at the same conditions Apple can dictate today.
> Apple incurs the ongoing cost of hosting the App Store, so yes, they're absolutely entitled to charge either or both vendors and consumers for access.
You mean $99 per year that developers pay? Or $1000+ dollars per phone that customers pay? Or multiple devices that developers pay for?
So they do all that (and iPhone sales alone cover basically everything Apple does), and they are "entitled" to charging for a business transaction that happens between users and non-Apple businesses?
>So they do all that (and iPhone sales alone cover basically everything Apple does), and they are "entitled" to charging for a business transaction that happens between users and non-Apple businesses?
Yes, absolutely they are entitled to that. What they shouldn't be entitled to do (and we should pass laws to enforce) is not offer owners a choice as to whether to have Apple be the exclusive software/hardware source or not. By law, at purchase time anyone should be able to choose to have access to their device's software certificate root of trust, hardware rot, or both. Apple should have to compete on the merits of the App Store, on their service, curation, etc. And fwiw I think that for a large number (maybe even the majority) of regular people they'd perfectly well be able to do so. There's significant value there, particularly if the threat of straightforward alternatives kept Apple's incentives better aligned.
But within their own store, in a world with the choice to opt out, sure I don't see why there would be any problem with them charging for their role anymore then for any other store of any kind ever. The core issue is the required technical lock in.
When I buy stuff from an app, it's not happening "in apple's own store". It's happening between a person and a business. Why is Apple entitled to a cut of that transaction?
In-app purchase... Depends - is Apple hosting any of the infrastructure to make that happen? If so, yes, they get a cut. If the purchase happens outside of Apple's systems, they should not. And if they're forcing themselves into the middle, as they do with the App Store, that shouldn't be allowed.
I distinctly remember buying it. Not renting it, buying it.
The apple webpage says
> Why buy iPhone anywhere else?
> When it comes to purchasing a new iPhone, there’s no better place to buy than Apple. For all your questions about payment options and getting your new iPhone set up, we have the answers you need.
Routing push notifications, telemetry, marketing and promotions, sales analytics, they handle all the internationalization of sales such as currency exchange and local sales laws. They also provide cloud storage for core dumps and other crash logs, persistent iCloud storage for user data, and remote build pipelines. That’s just off the top of my head.
And of course the absolutely massive SDK that makes it easy to build all these apps natively without rolling your own computer vision framework or audio processing engine.
that's the issue! it should not be apple's phone! i paid for the hardware and current version of the software - anything more should be provided to me out of their goodwill, not because it is their device.
Do you think Ford needs to get a cut if a user buys Michelin tyres of their Ford Car? Will you argue that Michelin needs to "pay into Ford for access to their market"?