21

As a German I am watching the reports of the hearing in Congress with interest (Google, Facebook, Amazon and Apple). But it is not clear to me why Apple was also summoned. The iPhones have a market share of about 50% in the USA and less than 20% world wide. The same seems to apply to Apple Music and Apple TV. Or is the reason that Apple has the potential to gain a dominant position in the future?

  • 4
    What is your source for the iPhone having less than 20% market share in the US? Apple have 40-50% share of shipments, and 50-60% share of usage... – jcaron Aug 2 at 12:31
  • 1
    @jcaron Your are right. I accidentally used the world wide market share. – marsh-wiggle Aug 2 at 13:13
  • Was Apple questioned about the artificial barriers it maintains around iMessage? – erickson Aug 3 at 19:07
  • The main reason is that Congress is full of luddites who don't understand the very simple points you brought up. – user91988 Aug 3 at 19:09
  • It might have to do with Apple not opening up their technology so third parties can produce computers that run on their architecture and software foundation. There are countless "PC" manufacturers, and they can build out with different processors and configurations, but only Apple can commercially make Apple computers that run their OS. They did allow for "clones" to be made in the 1990s, but pulled that back once they finally developed multi-tasking/threading OS with their first OSX version. Or maybe it's because they're really, really big and rich...... - Similar with Android phones vs iOS. – PoloHoleSet Aug 4 at 13:47
70

Apple has long positioned the iPhone as a luxury item and iPhone users are on average wealthier and more willing to spend money in apps. Despite Android devices having a 3:1 market share advantage over iOS, the Apple App Store generated about twice as much revenue as Google Play in 2019. This means that if you want to make money on apps, you're seriously hamstringing yourself by not releasing on iOS.

However, Apple controls the App Store very tightly to ensure the quality and cohesiveness of their entire platform; every app needs to be manually approved to make its way onto the store and the rules Apple uses to determine whether or not an app should be allowed have been criticized as arbitrary.

A major item that became big news in the last couple months is that if you put certain types of apps on the Apple App Store, Apple requires that in-app purchases of digital goods and services go through its own in-app payment system, where it takes a 30% cut. Generally available payment system fees are in the 2%-4% range and the developers obviously would like to avoid paying so much of their revenue, while Apple argues the fees are perfectly reasonable (Google takes the same 30% commission for payments on the Play Store and Valve takes 30% from game sales on their Steam platform, for example, so these percentages are far from unprecedented) and pay to keep the App Store a convenient and high quality source of apps.

A business email app called Hey which sells subscriptions outside of the App Store tried to release an update to their iOS app- said app included no option to buy a subscription in it. Apple decided to block the update from the App Store because if you only download the app it "doesn't work" as it has no functionality without a paid subscription, and that apps which do nothing but connect to an external service are only allowed for "business services" not "consumer products" when they don't include the ability to purchase access in the app via Apple's own system. This is when the app had been previously approved by Apple, and Bandcamp, the company behind Hey, said there's no guidance on what Apple considers a "business service" as opposed to a "consumer product".

As Apple also makes its own versions of certain kinds of apps (Apple music vs Spotify for example), there have also been complaints that some developers are competing against a company that has power over whether or not they can even make their product available, when it has both the ability and the incentive to simply try and force them out to capture all of their revenue for themselves.

| improve this answer | |
  • 29
    I think a concern is also that Apple Music doesn’t have to pay that 30%, whereas Spotify does... – Tim Aug 2 at 8:31
  • @ThisIsNoZaku, The current answer is slightly better, but I think it still conflates the two things. The cut taken by payment system (such as PayPal, Stripe) is different from taking commissions for sales performed through a distribution platform/marketplace (Google Play, App Store, Steam). The first is a service for people to have exchange of money based on a product/service done outside the service, while in the second one developers uses the platform to sell their products, which is unavailable otherwise. – justhalf Aug 4 at 6:38

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .