Apple blocking SkyDrive from iOS store, wants cut of revenue(microsoft-news.com)
microsoft-news.com
Apple blocking SkyDrive from iOS store, wants cut of revenue
http://microsoft-news.com/apple-blocking-skydrive-from-ios-store-wants-cut-of-revenue/
29 comments
I think the problem is in how the question is framed. The App Store has always been revenue neutral [1]. It's not a profit center for Apple. It's not about "getting their cut". It's about having one billing statement to look at. It's about eliminating shady billing tactics a la gym memberships. It's about keeping your address out of some developer's mailing list.
You'd be surprised about the extent of this problem. I get e-mails all the time from people who are worried that they have a monthly payment for my app, for example. There are just an awful lot of people who don't "get" software at all and derive real value from simplified one-party billing.
So if you start from the premise that billing for iOS apps has to be brain-dead simple, we arrive at the present rule: any payment that looks like it happens on an iPhone must [2] run through IAP at whatever rate Apple can break even. If your payment collection process consists of people using their fingers on the screen of an iPhone, then it is potentially confusable with IAP by Grandpa and he might get mad at Apple; this is unacceptable. But monetizing your pizza ordering app by handing money to a pizza delivery guy who shows up at your house is not confusable, so it's A-OK.
Now, it's perfectly debatable whether or not consumer confusion is really that big of a problem, or a problem big enough to justify the negative externalities of solving it. But if it is, then the result follows: the solution is to run all the billing through a break-even single party. If you accept the premise, then the rule that is fairest and best and also solves the problem is the rule that we already have.
It's unfortunate that we live in a world where the economics of Dropbox, Skydrive, Amazon et al seemingly don't allow enough profit margin to pay Apple's overhead to process payments. But I'm not really sure who is to blame for that: the consumers, for being confused about billing; Apple, for trying to fix it for them; Skydrive etc. for not creating a two-tiered pricing structure to charge IAP customers at 30% more; or consumers again for being unwilling to pay an extra 30% for single-party billing.
[1] http://www.macobserver.com/tmo/article/apple_app_store_runs_... [2] there are some exceptions, I'm speaking broadly to make a point
You'd be surprised about the extent of this problem. I get e-mails all the time from people who are worried that they have a monthly payment for my app, for example. There are just an awful lot of people who don't "get" software at all and derive real value from simplified one-party billing.
So if you start from the premise that billing for iOS apps has to be brain-dead simple, we arrive at the present rule: any payment that looks like it happens on an iPhone must [2] run through IAP at whatever rate Apple can break even. If your payment collection process consists of people using their fingers on the screen of an iPhone, then it is potentially confusable with IAP by Grandpa and he might get mad at Apple; this is unacceptable. But monetizing your pizza ordering app by handing money to a pizza delivery guy who shows up at your house is not confusable, so it's A-OK.
Now, it's perfectly debatable whether or not consumer confusion is really that big of a problem, or a problem big enough to justify the negative externalities of solving it. But if it is, then the result follows: the solution is to run all the billing through a break-even single party. If you accept the premise, then the rule that is fairest and best and also solves the problem is the rule that we already have.
It's unfortunate that we live in a world where the economics of Dropbox, Skydrive, Amazon et al seemingly don't allow enough profit margin to pay Apple's overhead to process payments. But I'm not really sure who is to blame for that: the consumers, for being confused about billing; Apple, for trying to fix it for them; Skydrive etc. for not creating a two-tiered pricing structure to charge IAP customers at 30% more; or consumers again for being unwilling to pay an extra 30% for single-party billing.
[1] http://www.macobserver.com/tmo/article/apple_app_store_runs_... [2] there are some exceptions, I'm speaking broadly to make a point
Potential consumer confusion has nothing to do with the size of Apple's cut or how it is structured.
Clearly, a 30% cut is fair for the average $1.5 purchase because it includes fees for payment processing and fixed cost per app.
But Apple will have to decide whether or not they want people to sell more expensive stuff on their platform. Taking a 30% cut on a $100 purchase is not economically viable and it is unnecessary if the goal is to avoid consumer confusion.
They could just charge 50 cents + 5%
Clearly, a 30% cut is fair for the average $1.5 purchase because it includes fees for payment processing and fixed cost per app.
But Apple will have to decide whether or not they want people to sell more expensive stuff on their platform. Taking a 30% cut on a $100 purchase is not economically viable and it is unnecessary if the goal is to avoid consumer confusion.
They could just charge 50 cents + 5%
> Taking a 30% cut on a $100 purchase is not economically viable
The market for a $100 app isn't very large, and that price point is also a target for fraud / scams / accidental purchase complaints. This risk is offset by additional review scrutiny, but the cost for that additional scrutiny is amortized over a small number of potential customers.
The result of all this is that $100 purchases are expensive for Apple to run, and Apple as a rational actor should discourage them. I wouldn't be surprised to learn that the whole $50+ market runs at a loss that is covered by the cheaper apps.
The market for a $100 app isn't very large, and that price point is also a target for fraud / scams / accidental purchase complaints. This risk is offset by additional review scrutiny, but the cost for that additional scrutiny is amortized over a small number of potential customers.
The result of all this is that $100 purchases are expensive for Apple to run, and Apple as a rational actor should discourage them. I wouldn't be surprised to learn that the whole $50+ market runs at a loss that is covered by the cheaper apps.
Even for a $20 item 30% cut is not acceptable either, considering what Apple actually did is simply app hosting + payment processing. App Store did a really bad job on app discovery and promotion, so I don't think they deserve anything on marketing. However, they can charge developers for being featured on the front page.
> App Store did a really bad job on app discovery and promotion
You think most app buyers found their apps outside the app store? Unlike folks reading HN or tech sites and trying new apps thanks to app launch news, the normals I know find their apps only within the app store (other than the occasional app roundup in a mainstream printed magazine).
If you look at the CC processing industry, ranging from 5% fees for the most basic service (transaction + cc + merchant + bank) to 15% fees for an end to end service that cuts you a check, the 30% to also manage the user authentication and customer service is a reasonable deal, completely aside from marketing.
Finally, as a user, I don't want featured apps to be the ones paying to be featured. Not cool.
You think most app buyers found their apps outside the app store? Unlike folks reading HN or tech sites and trying new apps thanks to app launch news, the normals I know find their apps only within the app store (other than the occasional app roundup in a mainstream printed magazine).
If you look at the CC processing industry, ranging from 5% fees for the most basic service (transaction + cc + merchant + bank) to 15% fees for an end to end service that cuts you a check, the 30% to also manage the user authentication and customer service is a reasonable deal, completely aside from marketing.
Finally, as a user, I don't want featured apps to be the ones paying to be featured. Not cool.
15% for an end to end service? Citation Please! Paypal, Stripe, Braintree and those guys don't even come close to that. If you are getting charged 5% in fees in this day and age then you are doing something wrong... at least here in the USA.
Apple has a cost of no more than 2.5% for credit card fees, and its probably even a few tenths lower than that. That I will guarantee (seeing as how I have seen companies in the $5million/year range get that percentage from an end-to-end provider, and Apple is quite a bit more than that in volume).
What I think is really ridiculous is that they want to charge 30% for subscription type services. One time app purchases... ok, maybe I can see that. But for a $5/month or more subscription being bought through there its absurd and making it more of a pain for the user because the app developer is forced to break with the single-billing system due to costs. So, simplicity actually hinders the experience here.
Apple has a cost of no more than 2.5% for credit card fees, and its probably even a few tenths lower than that. That I will guarantee (seeing as how I have seen companies in the $5million/year range get that percentage from an end-to-end provider, and Apple is quite a bit more than that in volume).
What I think is really ridiculous is that they want to charge 30% for subscription type services. One time app purchases... ok, maybe I can see that. But for a $5/month or more subscription being bought through there its absurd and making it more of a pain for the user because the app developer is forced to break with the single-billing system due to costs. So, simplicity actually hinders the experience here.
> Citation Please!
My company has developed a CC gateway server, and has processed as much as $80M a year in transactions for a single client. This is a business I've spent a lot of time in.
Also note that digital goods and physical goods are different categories. A full service provider of "digital goods only" processing for clients without merchant accounts charges much more than a company like Paypal, Braintree, or Stripe, which process for physical goods as well.
My company has developed a CC gateway server, and has processed as much as $80M a year in transactions for a single client. This is a business I've spent a lot of time in.
Also note that digital goods and physical goods are different categories. A full service provider of "digital goods only" processing for clients without merchant accounts charges much more than a company like Paypal, Braintree, or Stripe, which process for physical goods as well.
From my own experience and friends I know, users rarely go the app store and search for a term. What they do there is check out the high ranked apps. The most effective way of discovering an app is still recommendation by mouth or websites. There are a lot of app review blogs out there for a good reason.
We are talking about different business. apps/ebooks generally don't have a high margin.
We are talking about different business. apps/ebooks generally don't have a high margin.
> App Store did a really bad job on app discovery and promotion, so I don't think they deserve anything on marketing
I have never understood this argument. It's a bit like saying "WalMart does a bad job promoting milk discovery, so I think they should sell it at cost."
I have never understood this argument. It's a bit like saying "WalMart does a bad job promoting milk discovery, so I think they should sell it at cost."
Apple also provided a large amount of eye balls for services that is available through the Apple app hosting system.
This post is not about the price for an app, but the price for a service (SkyDrive) provided through an app. The market for services is huge. If you deliver a service paid through an iOS device, Apple wants a 30% cut.
That's a great solution, actually. Think of it more like a credit card processing fee.
How have you been brainwashed into that being acceptable?
I don't understand... elaborate?
That taking a percentage of a transaction and giving it to a credit card company is OK.
They are providing the service of making your money available for payment without you having to think about the logistics of moving the money (plus credit facilities, chargebacks, fraud protection (If I have a wallet full of money and someone spends it I'm down that cash. If I have a wallet full of cards and someone spends with them, I'm covered.)). It only seems fair that they get paid for their work.
Whether the amount they charge is worth the services they provide is another question entirely.
Whether the amount they charge is worth the services they provide is another question entirely.
You are completely missing the point.... I at no point suggested that they shouldn't charge.
That it is a percentage of the transaction amount is what I have a problem with. If their business was truly about "credit" they shouldn't need extra charges as they claim back more value from bigger loans/transactions.
Debit cards provide the same service without a percentage charge but without the payment protection. Its a rigged game.
That it is a percentage of the transaction amount is what I have a problem with. If their business was truly about "credit" they shouldn't need extra charges as they claim back more value from bigger loans/transactions.
Debit cards provide the same service without a percentage charge but without the payment protection. Its a rigged game.
I thought the percentage charge is used to cover the cost of fraudulent transactions?
That's 10 times the normal fees.
Remember that you can put money onto your iTunes account using gift cards bought at retailers. Those retailers will get a cut (someone here probably knows but lets guess 10-15%).
That doesn't reduce it to a zero profit operation but at least on that portion of the revenue it looks like a lot than 30%.
That doesn't reduce it to a zero profit operation but at least on that portion of the revenue it looks like a lot than 30%.
It would be interesting to see what percentage of gift card dollars never get redeemed and how long they take to get redeemed.
Too late to edit but the end should read: "it looks like a lot less than 30%."
They have decided.
This makes sense.
If it's merely a break-even proposition for Apple, then perhaps a flat fee per purchase (or at least a maximum) would make more sense and allow services like Dropbox, Skydrive, and Amazon to participate.
Okay, let's do some math. Apple has paid $6.5b to developers [1], which would make the App Store gross $9.3b. This means their operating budget is $2.8b.
About 49% of app revenue comes from IAP [3] rather than paid downloads, so let's assume that's still the case in our flat-fee world. We still need to come up with 51% ($1.4b) of our budget from paid downloads.
Users have downloaded 35 billion apps [1], but the free-paid ratio is somewhere between 11:1 to 15:1 [2]. This would put the number of paid downloads between 2.3b and 3b.
Result: Apple charges a flat fee between $.47-$.61 per paid app to maintain their current operating budget. A developer who is trying to stay below the $1 magical price point (most developers) is now making 50c or so, whereas they were making 70c before. Does this still sound like a good idea to you?
Just thinking it through logically, a flat fee is effectively a decrease on expensive purchases, and (if the books are to be balanced) must be matched by an increase on cheap purchases.
[1] http://thenextweb.com/apple/2012/10/23/apple-announces-35-bi...
[2] http://www.insidemobileapps.com/2012/09/18/distimo-u-s-consu...
[3] http://gigaom.com/2011/01/07/iphone-in-app-purchases-almost-...
About 49% of app revenue comes from IAP [3] rather than paid downloads, so let's assume that's still the case in our flat-fee world. We still need to come up with 51% ($1.4b) of our budget from paid downloads.
Users have downloaded 35 billion apps [1], but the free-paid ratio is somewhere between 11:1 to 15:1 [2]. This would put the number of paid downloads between 2.3b and 3b.
Result: Apple charges a flat fee between $.47-$.61 per paid app to maintain their current operating budget. A developer who is trying to stay below the $1 magical price point (most developers) is now making 50c or so, whereas they were making 70c before. Does this still sound like a good idea to you?
Just thinking it through logically, a flat fee is effectively a decrease on expensive purchases, and (if the books are to be balanced) must be matched by an increase on cheap purchases.
[1] http://thenextweb.com/apple/2012/10/23/apple-announces-35-bi...
[2] http://www.insidemobileapps.com/2012/09/18/distimo-u-s-consu...
[3] http://gigaom.com/2011/01/07/iphone-in-app-purchases-almost-...
That reasoning assumes that the number of subscriptions is going to be the same regardless of the change in their policies. If including a more reasonable plan for higher priced purchases allowed a greater volume into the store, then that could help make up the difference.
I also question the assumption that they continue to need this level of revenue. If the app store was a little more than breaking even two years ago, they should be able to take advantage of growth and better efficiencies since then.
I also question the assumption that they continue to need this level of revenue. If the app store was a little more than breaking even two years ago, they should be able to take advantage of growth and better efficiencies since then.
> If including a more reasonable plan for higher priced purchases allowed a greater volume into the store, then that could help make up the difference.
As the old saying goes, if you lose money on each sale, you can't make it up in volume. If it is indeed true that Apple makes no or very little money from the App Store, it would require a huge, order-of-magnitude-shift, 10x, 100x, in purchase behavior to translate into raising $2b.
> I also question the assumption that they continue to need this level of revenue.
You and I can sit in our comfy chairs and question it, but unfortunately neither of us are in a position to run app stores, and the people who do don't provide a lot of transparency about how much it really costs. I do think if it was possible to do it for less, that Amazon or Google would undercut Apple (Amazon, in particular, has an incentive to run their store below cost). Seeing as how they don't, I'm inclined to believe 30% is very close to the actual cost.
I also think that solving the multinational billing/legal problem is much more difficult than many developers realize. The iOS app store recently opened in Chad, which is consistently ranked as one of the most difficult countries to do business with according to several international organizations [1]. Forget "formalities" like it taking 63 days to start a business or an effective tax rate of 65% that takes 732 hours per year to calculate [2], and worry about "informalities" like the government officials openly soliciting bribes to get electricity turned on to your office. Or try operating in India, where it takes 1,420 days to enforce contracts [3] or in the Congo where it costs 7x what it does in a Western country to import a shipping container [4]. I have customers in all of these countries through the iOS app store.
I bring up the cost of doing business in foreign countries, not only because it's expensive, but also because it's the factor to which Apple attributes its 2011 App Store growth. In a SEC-audited filing, the line item including the app store went up "primarily [due] to increased net sales from the iTunes Store, which was largely driven by App Store expansion into new countries that contributed to strong growth in all of the Company’s geographic segments." Basically, Apple's growth in the App Store is driven mostly by selling the product of first-world payment transactions to second and third-world countries. For this reason, the legal and accounting infrastructure behind Apple's various stores are probably among the most complex business processes that exist anywhere in the world.
[1] http://rru.worldbank.org/BESnapshots/Chad/default.aspx [2] http://www.doingbusiness.org/Custom-Query/chad [3] http://www.doingbusiness.org/data/exploreeconomies/india/#en... [4] http://www.doingbusiness.org/data/exploreeconomies/congo-rep... [5] http://files.shareholder.com/downloads/AAPL/2215124066x0x610...
As the old saying goes, if you lose money on each sale, you can't make it up in volume. If it is indeed true that Apple makes no or very little money from the App Store, it would require a huge, order-of-magnitude-shift, 10x, 100x, in purchase behavior to translate into raising $2b.
> I also question the assumption that they continue to need this level of revenue.
You and I can sit in our comfy chairs and question it, but unfortunately neither of us are in a position to run app stores, and the people who do don't provide a lot of transparency about how much it really costs. I do think if it was possible to do it for less, that Amazon or Google would undercut Apple (Amazon, in particular, has an incentive to run their store below cost). Seeing as how they don't, I'm inclined to believe 30% is very close to the actual cost.
I also think that solving the multinational billing/legal problem is much more difficult than many developers realize. The iOS app store recently opened in Chad, which is consistently ranked as one of the most difficult countries to do business with according to several international organizations [1]. Forget "formalities" like it taking 63 days to start a business or an effective tax rate of 65% that takes 732 hours per year to calculate [2], and worry about "informalities" like the government officials openly soliciting bribes to get electricity turned on to your office. Or try operating in India, where it takes 1,420 days to enforce contracts [3] or in the Congo where it costs 7x what it does in a Western country to import a shipping container [4]. I have customers in all of these countries through the iOS app store.
I bring up the cost of doing business in foreign countries, not only because it's expensive, but also because it's the factor to which Apple attributes its 2011 App Store growth. In a SEC-audited filing, the line item including the app store went up "primarily [due] to increased net sales from the iTunes Store, which was largely driven by App Store expansion into new countries that contributed to strong growth in all of the Company’s geographic segments." Basically, Apple's growth in the App Store is driven mostly by selling the product of first-world payment transactions to second and third-world countries. For this reason, the legal and accounting infrastructure behind Apple's various stores are probably among the most complex business processes that exist anywhere in the world.
[1] http://rru.worldbank.org/BESnapshots/Chad/default.aspx [2] http://www.doingbusiness.org/Custom-Query/chad [3] http://www.doingbusiness.org/data/exploreeconomies/india/#en... [4] http://www.doingbusiness.org/data/exploreeconomies/congo-rep... [5] http://files.shareholder.com/downloads/AAPL/2215124066x0x610...
>Just thinking it through logically, a flat fee is effectively a decrease on expensive purchases, and (if the books are to be balanced) must be matched by an increase on cheap purchases.
I think that sounds fair in terms of where the value is coming from. For a $1 app, Apple probably did provide 50% of the value. For a $20 app/book/etc., Apple's contribution is likely minimal.
I think that sounds fair in terms of where the value is coming from. For a $1 app, Apple probably did provide 50% of the value. For a $20 app/book/etc., Apple's contribution is likely minimal.
I'm pretty sure Apple's policies prevent developers from charging a different rate on iOS than they do on other platforms (specifically for subscriptions, but maybe also for one-time IAPs). This definitely protects their platform, but I'm sure there's a shady billing trick that this prevents as well.
There was once talk about this, but it's not the case now.
As someone who's an Apple user and will soon be an iOS developer, I'm all for a curated App Store (I actually think Apple should reject more apps! Some apps have been rejected unfairly, and I think they should change their policies slightly to include them), and I'm 100% for this 1-party payment. My only gripe is the 30% cut. Why not make that 15%, or 10%? It would make things sooooo easier for everyone. That %20 is so negligible (for Apple) that I'm sure it falls within error margin...
30% is just too much for a lot of developers/companies.
30% is just too much for a lot of developers/companies.
I'm recalling this from memory, but if I remember correctly, Apple's argument for the 30% charge when they first launched the app store is that traditionally you'd have to publish through a telco, and telcos used to charge way more than 50% of the revenue in order to place your application through their portal. Not sure how true that is but now, because of Apple, 30% seems to be the new standard.
> " Apple's argument for the 30% charge when they first launched the app store is that traditionally you'd have to publish through a telco, and telcos used to charge way more than 50% of the revenue in order to place your application through their portal."
That logic doesn't work though because phone and PDA apps have been available to download from 3rd party websites since even before 3G. You could set up a download portal for Windows Mobile or whatever OS the "dumb phones" from Sony Erricson's K-series featured using free hosting if you really wanted to. Granted it wouldn't be a centralised repository like Linux distro's feature (which are also free), but it certainly wouldn't have cost you >50% of your budget.
Apple do this sort crap all the time, they deliberately merge vaguely related statistics to promote whatever prejudice they're trying to peddle at that time (eg classing their notebooks as tablets when talking about their dominance on the mobile space. Or including iPod figures when talking about the dominance of the iPhones).
Smart phones, feature phones and PDAs have been around a long time before the iPhone; central software repositories have also been around a long time before the Apple App Store; and there's never been a precedence to take >50% (nor even a 30%) cut from transactions and nor has setting up independent 3rd party portals cost that much either.
Plus lets not forget that Apple also charge developers for the privilege of developing software (even just for your own personal iOS device) via their developers subscription (note I said subscription; not a one off payment) and (if I'm not mistaken) again for just adding your application to the App Store.
That logic doesn't work though because phone and PDA apps have been available to download from 3rd party websites since even before 3G. You could set up a download portal for Windows Mobile or whatever OS the "dumb phones" from Sony Erricson's K-series featured using free hosting if you really wanted to. Granted it wouldn't be a centralised repository like Linux distro's feature (which are also free), but it certainly wouldn't have cost you >50% of your budget.
Apple do this sort crap all the time, they deliberately merge vaguely related statistics to promote whatever prejudice they're trying to peddle at that time (eg classing their notebooks as tablets when talking about their dominance on the mobile space. Or including iPod figures when talking about the dominance of the iPhones).
Smart phones, feature phones and PDAs have been around a long time before the iPhone; central software repositories have also been around a long time before the Apple App Store; and there's never been a precedence to take >50% (nor even a 30%) cut from transactions and nor has setting up independent 3rd party portals cost that much either.
Plus lets not forget that Apple also charge developers for the privilege of developing software (even just for your own personal iOS device) via their developers subscription (note I said subscription; not a one off payment) and (if I'm not mistaken) again for just adding your application to the App Store.
> That logic doesn't work though because phone and PDA apps have been available to download from 3rd party websites since even before 3G. You could set up a download portal for Windows Mobile or whatever OS the "dumb phones" from Sony Erricson's K-series featured using free hosting if you really wanted to. Granted it wouldn't be a centralised repository like Linux distro's feature (which are also free), but it certainly wouldn't have cost you >50% of your budget.
Using a 3rd party website (or your own), you are unlikely to get the exposure of an app store or a telco portal.
Using a 3rd party website (or your own), you are unlikely to get the exposure of an app store or a telco portal.
"Using a 3rd party website (or your own), you are unlikely to get the exposure of an app store or a telco portal."
I don't agree with that either as most app store-published applications get next to no exposure anyway. That privilege is reserved for a very few that either pay for promotion or go viral. So you're back to the old model of users either searching for a specific application to suit their needs (search engines existed before app stores) or "word of mouth" (which these days include forums / blogs and all of those existed prior to app stores as well).
There is this misconception among some (and I'm by no means saying that you're under the same illusion) that developers only need to upload to Apples App Store or Google Play and they'll see thousands of downloads and "PROFIT" (to quote a meme). The reality is the vast majority of apps do not make any money and uploading to central repositories does not mean people will stumble across your application or game. And what's more, anything you do upload is not only subject to the same limitations of users stumbling upon your product as before, but with the influx of new developers sold on this rose-tinted vision, you're now competing with significantly more software than ever before. So just the additional signal-to-noise ratio alone makes it harder than ever to make your application visible.
So I really don't believe the notion that app stores increase exposure for the average developer.
Where app stores excel is making content easier to find and install for the average user; one search interface with inbuilt download and install functions. That's a huge step up from Googling from your PC, downloading then either manually copying the .jar to your phone or installing an EXE locally on your PC with your handset connected via activesync. However I wouldn't say that user convenience guarantees developer visibility.
I don't agree with that either as most app store-published applications get next to no exposure anyway. That privilege is reserved for a very few that either pay for promotion or go viral. So you're back to the old model of users either searching for a specific application to suit their needs (search engines existed before app stores) or "word of mouth" (which these days include forums / blogs and all of those existed prior to app stores as well).
There is this misconception among some (and I'm by no means saying that you're under the same illusion) that developers only need to upload to Apples App Store or Google Play and they'll see thousands of downloads and "PROFIT" (to quote a meme). The reality is the vast majority of apps do not make any money and uploading to central repositories does not mean people will stumble across your application or game. And what's more, anything you do upload is not only subject to the same limitations of users stumbling upon your product as before, but with the influx of new developers sold on this rose-tinted vision, you're now competing with significantly more software than ever before. So just the additional signal-to-noise ratio alone makes it harder than ever to make your application visible.
So I really don't believe the notion that app stores increase exposure for the average developer.
Where app stores excel is making content easier to find and install for the average user; one search interface with inbuilt download and install functions. That's a huge step up from Googling from your PC, downloading then either manually copying the .jar to your phone or installing an EXE locally on your PC with your handset connected via activesync. However I wouldn't say that user convenience guarantees developer visibility.
If your apps are not featured on the front page, the so called exposure is close to zero. There used to be a new released category which lists new apps, and honestly that is a VERY good channel for exposure, although the window is just about 3 days. Now, even that is gone.
So what apple does is basically hosting + payment. No way that is worth a flat 30%.
So what apple does is basically hosting + payment. No way that is worth a flat 30%.
> No way that is worth a flat 30%.
Certainly there's a way. I left a comment above that a number of cc payment providers, those who cut you a check instead of making you bring your own merchant account, take 15%, without any of the other things Apple is doing. Rep'ing someone's product should naturally cost more than that.
More to the point, the general idea of retail in the United States is not "flat markup", but what the market will bear. Costco claims to have a flat markup, but go into a jewelry store and you'll find they're taking a lot more than 30% over what the wholesaler charged them.
As an app seller, you're the wholesaler and you get to set "suggested retail price". You have the bonus of knowing the spread there.
Let's look at a console game: $7 console fee (call that 10%) and 25% retail markup, so you're paying 35%, which is more than the app store.[1] Before you feel bad about that, look at what the shelf space guys (aka "retailers") get as markup on a few other items.[2]
1. http://www.joystiq.com/2006/12/20/where-the-60-for-new-games...
2. http://www.wisebread.com/cheat-sheet-retail-markup-on-common...
Certainly there's a way. I left a comment above that a number of cc payment providers, those who cut you a check instead of making you bring your own merchant account, take 15%, without any of the other things Apple is doing. Rep'ing someone's product should naturally cost more than that.
More to the point, the general idea of retail in the United States is not "flat markup", but what the market will bear. Costco claims to have a flat markup, but go into a jewelry store and you'll find they're taking a lot more than 30% over what the wholesaler charged them.
As an app seller, you're the wholesaler and you get to set "suggested retail price". You have the bonus of knowing the spread there.
Let's look at a console game: $7 console fee (call that 10%) and 25% retail markup, so you're paying 35%, which is more than the app store.[1] Before you feel bad about that, look at what the shelf space guys (aka "retailers") get as markup on a few other items.[2]
1. http://www.joystiq.com/2006/12/20/where-the-60-for-new-games...
2. http://www.wisebread.com/cheat-sheet-retail-markup-on-common...
"Certainly there's a way. I left a comment above that a number of cc payment providers, those who cut you a check instead of making you bring your own merchant account, take 15%, without any of the other things Apple is doing. Rep'ing someone's product should naturally cost more than that."
Sure there are. There are also plenty that will do exactly the same thing for 3%, give or take.
Sure there are. There are also plenty that will do exactly the same thing for 3%, give or take.
Way to ignore every other part of my comment.
Disclosure: My company has developed a CC gateway server, and has processed as much as $80M a year in transactions for a single client.
Disclosure: My company has developed a CC gateway server, and has processed as much as $80M a year in transactions for a single client.
We've had low margin businesses forever, that's not going to change. I agree with what you said, single party billing is great, except Apple also sells software on their platform, and is exempt from the cut.
So that means that Apple is the only one able to sell ebooks on their platform, because who would go to Amazon if they had to pay 30% than in Apple's bookstore both on the platform and off of it (note that Apple explicitly forbids charging more on the app store than elsewhere). Do you think that this is reasonable, considering that Apple has owned a major part of mobile devices over the past 5 years?
If this was just Visa, it would be fine - the playing field would be level. But it's not, and Apple uses this to give themselves a massive competitive advantage. If Toyota bought a bunch of gas station chains and said that non-Toyota cars had to pay 30% more for gas, but made the billing system really straightforward, would you be okay with that?
So that means that Apple is the only one able to sell ebooks on their platform, because who would go to Amazon if they had to pay 30% than in Apple's bookstore both on the platform and off of it (note that Apple explicitly forbids charging more on the app store than elsewhere). Do you think that this is reasonable, considering that Apple has owned a major part of mobile devices over the past 5 years?
If this was just Visa, it would be fine - the playing field would be level. But it's not, and Apple uses this to give themselves a massive competitive advantage. If Toyota bought a bunch of gas station chains and said that non-Toyota cars had to pay 30% more for gas, but made the billing system really straightforward, would you be okay with that?
Let's dispel the myth that the App Store is not a profit center, that Apple are reluctantly taking a cut from developers in order to cover costs.
If the App Store is a cost center than it should be treated like other cost centers. Would it make sense if Human Resources started charging job applicants a fee of 30% to handle resumes, interviews and contracts?
If the App Store is treated as a business unit in its own right, then the profit'n'loss should take into account hardware sales (the App Store is touted as a selling point), perhaps by internal billing of other departments.
Sure, developers benefit from the App Store, but they also benefit from other departments like Marketing and R&D, who grow the potential market for apps. Should developers help cover their costs too?
The truth is Apple are taking a cut of 30% simply because they can.
If the App Store is a cost center than it should be treated like other cost centers. Would it make sense if Human Resources started charging job applicants a fee of 30% to handle resumes, interviews and contracts?
If the App Store is treated as a business unit in its own right, then the profit'n'loss should take into account hardware sales (the App Store is touted as a selling point), perhaps by internal billing of other departments.
Sure, developers benefit from the App Store, but they also benefit from other departments like Marketing and R&D, who grow the potential market for apps. Should developers help cover their costs too?
The truth is Apple are taking a cut of 30% simply because they can.
I'm not sure that the App Store is still revenue neutral, the source you cited was over a year old so things may have changed.
I agree on your point about billing having to be simple for the customer. I wonder about the reverse. If Apple were to release an iCloud app on android, would Google's Rules for Android Store mean that they have to take a cut on all iCloud purchases?
I agree on your point about billing having to be simple for the customer. I wonder about the reverse. If Apple were to release an iCloud app on android, would Google's Rules for Android Store mean that they have to take a cut on all iCloud purchases?
The fact that revenue for the App Store in Feb 2011 was "break-even" doesn't mean that Apple never wants it to be a source of profits.
You have missed the core issue.
The problem is this. There is online content. The app is one way of accessing that content. Apple wants a 30% cut of everything you make on that online content EVEN THOUGH the user may be primarily accessing that content on another device.
My suggested compromise is this. Any purchase made through the app, Apple should take its 30% cut on. If you've gone through the effort of accessing that content and purchasing it another way, Apple should not be taking a 30% cut.
The problem is this. There is online content. The app is one way of accessing that content. Apple wants a 30% cut of everything you make on that online content EVEN THOUGH the user may be primarily accessing that content on another device.
My suggested compromise is this. Any purchase made through the app, Apple should take its 30% cut on. If you've gone through the effort of accessing that content and purchasing it another way, Apple should not be taking a 30% cut.
That is precisely the case. In fact, if you go to the effort of using the browser on your iOS device, Apple considers that an "alternative means of purchasing." Indeed, if you past a link to the webapp onto your springboard, and launch it from there, Apple _still_ considers that an alternative means of purchasing.
You really have to be purchasing through an native application before apple asks for a cut.
You really have to be purchasing through an native application before apple asks for a cut.
I believe your suggestion is already the case.
It isn't, because apparently you cannot advertise payment options in any way ... so a link to a web page where you can buy storage or where you can purchase features and so on is not allowed. Even though the app itself is just a gateway to an online service that exists outside the iTunes Store. And even though you make it impossible for the user to purchase anything by using said device, telling them something like "go to a desktop to make purchases".
I have Google Drive installed on my iPad. In my profile it does say how much storage I have left, but provides absolutely no link or hint on if I can or how I could increase that storage.
I have Google Drive installed on my iPad. In my profile it does say how much storage I have left, but provides absolutely no link or hint on if I can or how I could increase that storage.
Right - the line between "Advertising" and "Purchasing" is pretty gray, particularly with in situ web browsing - what would happen if I clicked on a link and it brought me to an in-app web-kit interface?
Apple just makes it clear that if you want to purchase, advertise purchasing, or in any way try and extra hard $$$ from users through a native-client, then Apple gets 30%.
This is the only way their store will continue to work - any other approach will result in people gaming the system, and, instead of selling a $50 copy of Omnifocus, Omni will sell it for $5, but then have a "link" to Omnifocus's sync service for $45 for a three-year membership.
I agree with the OP up top - I can think of no way Apple can continue to run a store without toeing a hard-line on this.
Apple just makes it clear that if you want to purchase, advertise purchasing, or in any way try and extra hard $$$ from users through a native-client, then Apple gets 30%.
This is the only way their store will continue to work - any other approach will result in people gaming the system, and, instead of selling a $50 copy of Omnifocus, Omni will sell it for $5, but then have a "link" to Omnifocus's sync service for $45 for a three-year membership.
I agree with the OP up top - I can think of no way Apple can continue to run a store without toeing a hard-line on this.
Such arguments make sense only if the iTunes Store wasn't the only way to distribute apps on iOS.
I do hope they continue doing whatever they do, because such measures are really indefensible no matter how you try to rationalize it and this way developers and consumers alike are waking up to the fact that walled gardens are really a bad idea that will hurt us in the long term much more than anything Apple ever brought to the table and that the open web, for all its warts, is a much better platform.
I do hope they continue doing whatever they do, because such measures are really indefensible no matter how you try to rationalize it and this way developers and consumers alike are waking up to the fact that walled gardens are really a bad idea that will hurt us in the long term much more than anything Apple ever brought to the table and that the open web, for all its warts, is a much better platform.
You cannot have your cake and eat it too.
All pricing introduces inefficiency without perfect price discrimination. If you charge a fixed rate for a product or service you exclude the users where the wealth created is less than the rate charged, aka the marginal consumer. You can improve this by charge lower prices for the marginal buyers. You can then do a similar thing for very high value consumers. This is why Microsoft sells so many versions of Windows.
In the real world price discrimination is very crude. Consider that Microsoft only has ~6 versions of windows, that is only 6 discrete steps to covers the several magnitudes of value created for users.
The reality is there is no algorithmic way to determine the marginal apps. Thus if Apple wants to charge 30% for all apps except those for which this is excessive they are best off doing things on a case-by-case basis.
All pricing introduces inefficiency without perfect price discrimination. If you charge a fixed rate for a product or service you exclude the users where the wealth created is less than the rate charged, aka the marginal consumer. You can improve this by charge lower prices for the marginal buyers. You can then do a similar thing for very high value consumers. This is why Microsoft sells so many versions of Windows.
In the real world price discrimination is very crude. Consider that Microsoft only has ~6 versions of windows, that is only 6 discrete steps to covers the several magnitudes of value created for users.
The reality is there is no algorithmic way to determine the marginal apps. Thus if Apple wants to charge 30% for all apps except those for which this is excessive they are best off doing things on a case-by-case basis.
>Can anyone think of a clear, unambiguous rule that would allow things like Dropbox, Skydrive, Amazon, etc. to get around the 30% fee, but without allowing loopholes that would allow everyone to skirt it?
Simple: alternative stores should be enforced by law. Apple alone deciding what goes onto iDevices is wrong. (Ditto Microsoft with WP). Let the market decide.
Simple: alternative stores should be enforced by law. Apple alone deciding what goes onto iDevices is wrong. (Ditto Microsoft with WP). Let the market decide.
And hasn't the market decided? Users are buying both Android and iPhone devices, and to a far lesser extent WinFones. Since Android has far higher market share than Apple, it seems like this should be perfect. Yet for people who are actually buying apps online, Apple seems to be doing quite well.
Perhaps you're idea of letting the market decide isn't really focused on the market so much as developers...
Perhaps you're idea of letting the market decide isn't really focused on the market so much as developers...
Exactly. But some may say this is a free market, Apple can do whatever it wants in its own garden.
I agree. Perhaps a nice way to solve it is to tell Google and Apple:
Of course, this will never happen, but if it did (either because they thought it was morally right, or because of regulation), then it seems like a way to solve this issue.
"Let people do in-app purchasing however they want, if they use yours, you can take a cut."
Of course, this will never happen, but if it did (either because they thought it was morally right, or because of regulation), then it seems like a way to solve this issue.
> By all means, you make it as easy as possible to integrate with your solution by providing tools and support, and then you take a cut if they choose to make it.
The problem here is two-fold:
1) 30% is a lot, and many large scale developers will choose the homebrew/third party library solution 2) It begets a bad user experience when users have to be cautious about IAP, remember another set (or sets) of credentials, chase yet another company for refunds - and Apple are likely to cop the blame even if it's not their IAP solution the dev is using.
The problem here is two-fold:
1) 30% is a lot, and many large scale developers will choose the homebrew/third party library solution 2) It begets a bad user experience when users have to be cautious about IAP, remember another set (or sets) of credentials, chase yet another company for refunds - and Apple are likely to cop the blame even if it's not their IAP solution the dev is using.
Points 1 & 2 are somewhat in conflict: it's almost certain that 30% is artificially high but since there is a significant value for a well-supported, widely trusted payment system it's likely that they'd still see significant revenues. Most of the competition would be Amazon or Square, not app developers setting up their own credit card processor.
Competition would simply force them to actually deliver value to developers & users as well as allowing for business models with Apple's service isn't structured allow.
Competition would simply force them to actually deliver value to developers & users as well as allowing for business models with Apple's service isn't structured allow.
And that's all ignoring the negative security implications of having every developer reimplementing secure credit card payments.
Perhaps a similar situation would be online payment gateways for dealing with credit card transactions.
There are strict guidelines about what you need to do in order to be considered secure [0]. As a result, we don't end up with every man and his dog doing it, but there is sufficient competition compared with the single-player in-store app purchase situation.
[0] - http://en.wikipedia.org/wiki/PCI_DSS
There are strict guidelines about what you need to do in order to be considered secure [0]. As a result, we don't end up with every man and his dog doing it, but there is sufficient competition compared with the single-player in-store app purchase situation.
[0] - http://en.wikipedia.org/wiki/PCI_DSS
To be sure, they can split the functionality. 30% for payments for the app itself, some other % for in-app purchases using their e-commerce API.
I think the unfair part is the rule that you can't link to your website if users can buy things on your website. If apple wants to maintain a monopoly on in-app purchases that's their prerogative, but not allowing you to link out to an external purchase is just a huge dick move that seems unnecessarily desperate.
If you allow people to get around the in-app purchase they will and the whole platform will suffer.
How so?
Almost all top-grossing apps nowadays are IAP games. I'd say these are the natural successors of subscription scams on J2ME dumbphones. If you'd allow these companies to bill you through their website, you could probably forget about ever cancelling that subscription again.
Not necessarily so. Other payment systems like Paypal can come in and be the gatekeeper.
PayPal, there's the company we should hand the keys to the kingdom to.
Allow apps to charge users the extra 43% if they are buying from the app compared to the price they would pay direct, without the markup.
This is a good point.
Also wondering what's stopping MS from doing down the DropBox path and not allowing purchases on iOS.
Also wondering what's stopping MS from doing down the DropBox path and not allowing purchases on iOS.
Microsoft offered to remove all paid subscription option, but the compromise was rejected.
Well who really knows how two IT giants communicate.
There is little to stop MS from expecting the DropBox model to be accepted - it depends what else they are asking.
We simply don't know the details of all this, beyond the MS focused blog item.
MS want Skydrive and their own mobile/tablet App prowess recognised..
.. and here they are David compromising with Goliath!
There is little to stop MS from expecting the DropBox model to be accepted - it depends what else they are asking.
We simply don't know the details of all this, beyond the MS focused blog item.
MS want Skydrive and their own mobile/tablet App prowess recognised..
.. and here they are David compromising with Goliath!
I just checked Dropbox and Google Drive apps, both offer in-app upgrade of disk storage, giving Apple 30% cut. Appears that you can not simply just remove the upgrade option from the app. So I don't see how MS could be any different.
You can't, because apple rejects your app, if it is in any way connected with a website that offers payment. In other words, apple doesn't allow you to circumvent this "30% tax" by accepting only website payments. If you accept payments, you have to accept them also on iOS. At least that was the case with our relatively new app.
Was this for content that can live outside of the app? As can the storage or perhaps the books mentioned elsewhere in the discussion. If it was something tied with app I can see why apple doesn't want you to sell it anywhere else.
>Was this for content that can live outside of the app?
I don't fully understand your question. We have a voip app that among other things allows users to call landline or mobile numbers. These calls are not free, so a user must pay. We started with web site+flash and added paypal and stripe payment options. Then we've created iOS app and as anyone else found out about 30% tax. Long story short, nothing worked until we added in app purchases. Before that, the app was continuously rejected on the grounds that if it's possible to pay on website and then use that credit on iOS app, then we must provide also in app purchases.
> I can see why apple doesn't want you to sell it anywhere else.
It's not that apple don't want you to sell it anywhere else, but that if you do sell it anywhere else, you have to sell it also on iOS.
I don't fully understand your question. We have a voip app that among other things allows users to call landline or mobile numbers. These calls are not free, so a user must pay. We started with web site+flash and added paypal and stripe payment options. Then we've created iOS app and as anyone else found out about 30% tax. Long story short, nothing worked until we added in app purchases. Before that, the app was continuously rejected on the grounds that if it's possible to pay on website and then use that credit on iOS app, then we must provide also in app purchases.
> I can see why apple doesn't want you to sell it anywhere else.
It's not that apple don't want you to sell it anywhere else, but that if you do sell it anywhere else, you have to sell it also on iOS.
I think the question was content vs service.
Your app, like Dropbox and Skydrive, is providing a consumable service.
Your app, like Dropbox and Skydrive, is providing a consumable service.
If you're only an app.
If you're app-independent website that also has an app, that's not true.
If you're app-independent website that also has an app, that's not true.
It would make more sense if apple did anything to help attach content delivered via the store to specific individuals.
Recently there was a story about a game that was 'killed' by piracy because apple didn't provide a way of connecting players to iTunes accounts, in order to ban pirates.
There's very little intrinsic value with the app store.
How about if you use the app store to deliver your content, you are given a unique id to tie to specific devices?
Or maybe if you could host content tied to in app purchases on iTunes?
To me it seems fair to say 'if you use their resources to conduct a transaction and deliver content, you should pay them'
Recently there was a story about a game that was 'killed' by piracy because apple didn't provide a way of connecting players to iTunes accounts, in order to ban pirates.
There's very little intrinsic value with the app store.
How about if you use the app store to deliver your content, you are given a unique id to tie to specific devices?
Or maybe if you could host content tied to in app purchases on iTunes?
To me it seems fair to say 'if you use their resources to conduct a transaction and deliver content, you should pay them'
Do Apple-based in-app subscriptions until you hit critical mass.
Cancel all Apple subscriptions but maintain 30-60 free trial / continuous open use to existing customers.
Introduce new direct subscription with 30% discount (below previous rate i.e. minus Apple's cut) if signed up within 30-60 days.
Cancel all Apple subscriptions but maintain 30-60 free trial / continuous open use to existing customers.
Introduce new direct subscription with 30% discount (below previous rate i.e. minus Apple's cut) if signed up within 30-60 days.
I think the problem is, flat 30% on in-app purchase is just too much when you're working on a margin.
One solution would be for Apple to introduce plans.
eg:
classic - flat 30% - no monthly fee
pro - flat 15% - $500 monthly fee
irock - flat 7.5% - $2,000 monthly fee
That's just an example, but I think the main issue is that a flat 30% just doesn't work for some types of business.
[edit: fixed confusing typos]
One solution would be for Apple to introduce plans.
eg:
classic - flat 30% - no monthly fee
pro - flat 15% - $500 monthly fee
irock - flat 7.5% - $2,000 monthly fee
That's just an example, but I think the main issue is that a flat 30% just doesn't work for some types of business.
[edit: fixed confusing typos]
Those businesses are mostly middle-men businesses that are already offered by Apple (disk space, books, music, movies, apps, etc).
Sure, but do you really want a world where Apple is the only possible provider of storage, books, etc. on their devices?
No, but Apple might.
Why is it "financially impossible"?
10%-15% cut if you use your own payment processing? You lose the one click convenience customers have to add all this extra data etc.
> [These guys] should be able to sell space, etc., without paying 30% -- otherwise it's financially impossible.
The difficulty in finding that "fair line" might be that using government's implicit threat of violence to force Apple to capitulate to these guys demands to be in their store without playing by their rules is inconsistent with a belief in property rights.
The difficulty in finding that "fair line" might be that using government's implicit threat of violence to force Apple to capitulate to these guys demands to be in their store without playing by their rules is inconsistent with a belief in property rights.
Apple is NOT acting in the best interest of its customers. The main reason I got an iPod touch was the ease of updating, combined with the presence of Microsoft software I like and use elsewhere - OneNote, Skype, SkyDrive, Photosynth.
From the article (emphasis mine): "Microsoft has a new version of the application ready, INCLUDING A KEY FIX THAT RECTIFIES A CRASHING BUG, but cannot get it through."
From the article (emphasis mine): "Microsoft has a new version of the application ready, INCLUDING A KEY FIX THAT RECTIFIES A CRASHING BUG, but cannot get it through."
Yep, that's the reality of app store. Want to push a serious bug fix? Be prepared to wait 2 weeks or more. Could be up to a month, if reviewer decides that your app violates some rule that previous reviewer didn't notice or didn't care about.
If it's a serious bug, you can request an "Expedited App Review"[1] that can take between hours or a couple days.
If you abuse it though, I think they'll ignore you from that point on :)
[1]: https://developer.apple.com/appstore/contact/appreviewteam/i...
If you abuse it though, I think they'll ignore you from that point on :)
[1]: https://developer.apple.com/appstore/contact/appreviewteam/i...
The fact that Apple even refused when Microsoft offered to simply remove the subscription option from the app, is well.. fucking retarded.
Shame on you, Apple.
Shame on you, Apple.
Here is the linked TNW article that goes into more details of the problem: http://thenextweb.com/insider/2012/12/11/as-skydrive-balks-a...
I am not associated with TNW, I just think that everyone should read it as it seems like there are quite a lot of questions regarding things that has been covered in the article.
I am not associated with TNW, I just think that everyone should read it as it seems like there are quite a lot of questions regarding things that has been covered in the article.
Seems only fair, everybody else has to pay 30% on purchases made in-app, Microsoft should too.
The only thing worse than a stupid rule is a stupid rule that some people get excluded from.
The only thing worse than a stupid rule is a stupid rule that some people get excluded from.
The fact that everyone has to pay 30% for putting a link to their subscription sign up itself is not fair. The TNW article goes more into more detail on this.
It kind of is/kind of isn't.
Without this rule, it makes it easy to circumvent Apples payment altogether.
And of course, there are some things that Apple should be be getting 30% for.
It is not black and white. I wonder how Microsoft will handle this in their store? I would be surprised if they did not copy Apples model, as they already have.
Without this rule, it makes it easy to circumvent Apples payment altogether.
And of course, there are some things that Apple should be be getting 30% for.
It is not black and white. I wonder how Microsoft will handle this in their store? I would be surprised if they did not copy Apples model, as they already have.
From the original article:
ah, btw, Windows Store allows 3rd party transaction processor. http://msdn.microsoft.com/en-us/library/windows/apps/jj19359...
Our iOS app “Files Pro” [Link] includes support for SkyDrive using the official Live SDK.
A few days ago our last update was rejected by the Apple review team because of the presence of the “Sign Up” button in the Live login authorisation page. According to Apple the presence of this button violates their guideline that[quote from Apple guideline]:
My iOS app “CloudMusic for SkyDrive” utilizes LiveConnect SDK for iOS to stream user’s audio content to iDevice. I have a “Sign In” button that invokes LiveConnectClient “login” method which shows Windows Live sign-in page in UIWebView. The app was rejected by Apple review team saying that “the log in interface must be native and not a link or a web view.” Is there any other way to login to SkyDrive?
ah, btw, Windows Store allows 3rd party transaction processor. http://msdn.microsoft.com/en-us/library/windows/apps/jj19359...
Very frustrating for developers who get caught in the middle. Same thing happened with Dropbox a while ago, where developers had to wait for a new SDK which was safe for the App Store, before being able to update their apps.
I think the main problem they point out is if I get x gigs of space for 2 years, for which I pay monthly, and then switch to Android after 6 months, Apple still gets paid 30% for each the remaining 18 months. Which sort of makes sense, and sort of doesn't...
Are there other in-app purchases that can leave the iDevice? I'm wondering about precedent.
Dropbox.
Thank god for jailbreaking. Apple's devices get a lot more useful when you don't have to play by their idiotic rules.
Just buy a different device. Jailbreaking isn't the best option as one day, they might just find a way of making it impossible.
It is kinda impossible today (compared to golden days of iPhone OS 3.1 - I must've freed a good 50 iPod touches back then (for my friends)!). You have to wait a few months after any major or even point release, and jailbreaking new devices might take up to 7 months (I think that was the case for iPad 3)!
Not only that, but by buying from Apple you are subsidizing the practice anyway, so that next time they can develop an even harder to crack version. Aside from that it's a boondoggle, an economic waste to build protections just to crack them. Better to buy hardware from vendors that allow (or tolerates, such as Samsung) rooting and installing custom firmwares.
I buy stuff from Amazon on the desktop computer and read it on iPad and iPhone Kindle apps. So far works great for me. Dropbox is even easier, you really need to worry about paying for premium once a year, if that, more like once in five years when your credit card expires, so this is a non-issue.
In both cases I downloaded apps because I used desktop versions extensively not vice versa. I wonder if Apple's cut is a big deterrent for mobile-first strategy that was recently discussed in Fred Wilson's post that appeared on HN.
In both cases I downloaded apps because I used desktop versions extensively not vice versa. I wonder if Apple's cut is a big deterrent for mobile-first strategy that was recently discussed in Fred Wilson's post that appeared on HN.
This kind of garbage is eventually going to attract legislative scrutiny. The iPhone is the single most popular mobile device in at least the USA, and Apple has a complete monopoly on applications for that device.
Indeed it will certainly attract needed scrutiny. Both by the lawmakers and by the courts.
The presumption by all of these vendors who operate their own app store is that they are legally protected in tying their hardware product (their smartphone, for example) to their online store.
But there is a history in both the written law and from the courts that makes these 'company store' policies illegal.
There is no technical reason whatsoever that prevents a smartphone/tablet vendor from allowing their smartphone/tablet from accessing anybody's online store. An Amazon tablet should be able to visit the Apple online store (if they sold Android apps) just as easily as an iPhone should be able to visit the Android marketplace (if they sold iOS apps.)
Imagine the outcry if Chevy could force you to only buy tires or gas for your Malibu from their store. Or if Mattel could force you to only buy outfits for your kid's Barbie doll from their store. Or if Dell could force you to only buy software for your laptop from their store.
The law has long been clear that this type of market coercion is illegal.
The only reason that today's device vendors are still getting away with this is because the threshold for an outcry hasn't yet been passed. But the more stories we read like this, the louder the volume is from the everyday consumer.
The presumption by all of these vendors who operate their own app store is that they are legally protected in tying their hardware product (their smartphone, for example) to their online store.
But there is a history in both the written law and from the courts that makes these 'company store' policies illegal.
There is no technical reason whatsoever that prevents a smartphone/tablet vendor from allowing their smartphone/tablet from accessing anybody's online store. An Amazon tablet should be able to visit the Apple online store (if they sold Android apps) just as easily as an iPhone should be able to visit the Android marketplace (if they sold iOS apps.)
Imagine the outcry if Chevy could force you to only buy tires or gas for your Malibu from their store. Or if Mattel could force you to only buy outfits for your kid's Barbie doll from their store. Or if Dell could force you to only buy software for your laptop from their store.
The law has long been clear that this type of market coercion is illegal.
The only reason that today's device vendors are still getting away with this is because the threshold for an outcry hasn't yet been passed. But the more stories we read like this, the louder the volume is from the everyday consumer.
Aren't you supposed to buy the tires for a Bugatti Vayron directly from Bugatti? If a country buys an F-16, they are also committing to buy all the weapons and ammunition from Lockheed.
And besides, as it stands now, you can buy from other stores, for example, Cydia. Of course, you have to jailbreak your phone, but that is legal in the US, so there is no argument any more.
If you want to keep your warranty, you have to use the App Store.
And besides, as it stands now, you can buy from other stores, for example, Cydia. Of course, you have to jailbreak your phone, but that is legal in the US, so there is no argument any more.
If you want to keep your warranty, you have to use the App Store.
> And besides, as it stands now, you can buy from other stores, for example, Cydia. Of course, you have to jailbreak your phone, but that is legal in the US, so there is no argument any more.
> If you want to keep your warranty, you have to use the App Store.
You just pointed out one argument.
> If you want to keep your warranty, you have to use the App Store.
You just pointed out one argument.
> Imagine the outcry if Chevy could force you to only buy tires or gas for your Malibu from their store. Or if Mattel could force you to only buy outfits for your kid's Barbie doll from their store. Or if Dell could force you to only buy software for your laptop from their store.
Or if Apple could "force" you to only upgrade/fix your laptop at their store? Or if they could "force" you to develop iPhone apps on a Mac? Or if Tesla could "force" you to only buy a replacement battery from them?
I can't imagine any of these companies "forcing" these things, however, unless they're colluding with the government to make alternatives illegal, and then regulations aren't going to help anyway. They can make things inconvenient, which is quite different, and the market has a history of customers going to the competition when the inconvenience factor is high enough. Why invoke legislation at all, especially when the market under consideration is already competitive, which it is with smartphones? (If competition is stagnant and it's a difficult market to enter, then perhaps you have an argument to use government power to remove barriers to entry (often caused by the government) or to level the playing field or to provide incentives to make the market easier to enter.)
Or if Apple could "force" you to only upgrade/fix your laptop at their store? Or if they could "force" you to develop iPhone apps on a Mac? Or if Tesla could "force" you to only buy a replacement battery from them?
I can't imagine any of these companies "forcing" these things, however, unless they're colluding with the government to make alternatives illegal, and then regulations aren't going to help anyway. They can make things inconvenient, which is quite different, and the market has a history of customers going to the competition when the inconvenience factor is high enough. Why invoke legislation at all, especially when the market under consideration is already competitive, which it is with smartphones? (If competition is stagnant and it's a difficult market to enter, then perhaps you have an argument to use government power to remove barriers to entry (often caused by the government) or to level the playing field or to provide incentives to make the market easier to enter.)
The expectation that customers should act in a way to basically create the conditions for a perfectly free market is misguided. Not invoking legislation just makes things painful for everyone. Sure, I can switch to Android - but the cost of buying everything again is rather high. Tomorrow I might have to switch back for similar political reasons.
Apple doesn't have anything close to a monopoly in the smartphone market.
MS can get around this the way Amazon has and redirect users to the web site. Or, I'm sure they can work something special out with Apple - they are Microsoft, after all.
BTW, Microsoft has done a real bang-up job with SkyDrive. The free versions of Word and Excel are fantastic, and even scroll with native app like speed in the browser. SO much better than the horrible code base they use for the Word/Excel viewers in Outlook Web Access and Sharepoint.
BTW, Microsoft has done a real bang-up job with SkyDrive. The free versions of Word and Excel are fantastic, and even scroll with native app like speed in the browser. SO much better than the horrible code base they use for the Word/Excel viewers in Outlook Web Access and Sharepoint.
Original article: http://thenextweb.com/insider/2012/12/11/as-skydrive-balks-a...
In most of these discussions there's a question about the fairness of Apple's 30% cut. Are they charging too much?
Most might just look at the cost of a credit card transaction (~3%) and think that 30% is just crazy. That, of course, is the wrong way to look at it. The act of selling a product costs far more than the credit card processing fees. This is particularly true for physical products that you have to store and ship.
The best comparison I can make is to take a look at having Amazon sell your product. Here are the fees:
http://www.amazonservices.com/selling/pricing.htm
In very rough strokes, fees range from about 5% to 50% of the transaction total, depending on the cost and nature of the items sold.
Clearly Apple could charge a lot less for higher valued items. Right? The flat 30% cut starts to become excessive at some point. If I understand Amazon's pricing for selling your software product the two services compare as follows (assuming no shipping, only downloads):
Can you do better if you handle your own transactions, fulfillment, hosting, customer service, fraud/loss prevention, etc. Possibly. It certainly doesn't get down to the raw ~3% you pay for CC transactions. My guess is that a highly optimized operation might be able to achieve 5% to 25% depending on the nature of the product and sale price. Clearly selling items below about $10 requires a highly optimized operation with huge volume or your are going to loose your shirt --and more-- no matter how you approach it (keep that in mind when selling something for a buck on eBay).
Most might just look at the cost of a credit card transaction (~3%) and think that 30% is just crazy. That, of course, is the wrong way to look at it. The act of selling a product costs far more than the credit card processing fees. This is particularly true for physical products that you have to store and ship.
The best comparison I can make is to take a look at having Amazon sell your product. Here are the fees:
http://www.amazonservices.com/selling/pricing.htm
In very rough strokes, fees range from about 5% to 50% of the transaction total, depending on the cost and nature of the items sold.
Clearly Apple could charge a lot less for higher valued items. Right? The flat 30% cut starts to become excessive at some point. If I understand Amazon's pricing for selling your software product the two services compare as follows (assuming no shipping, only downloads):
price Apple Amazon % of Amazon take
1.00 0.30 2.49 249%
5.00 1.50 3.09 62%
10.00 3.00 3.84 38%
15.00 4.50 4.59 31%
20.00 6.00 5.34 27%
25.00 7.50 6.09 24%
30.00 9.00 6.84 23%
35.00 10.50 7.59 22%
40.00 12.00 8.34 21%
45.00 13.50 9.09 20%
50.00 15.00 9.84 20%
75.00 22.50 13.59 18%
100.00 30.00 17.34 17%
Can you do better if you handle your own transactions, fulfillment, hosting, customer service, fraud/loss prevention, etc. Possibly. It certainly doesn't get down to the raw ~3% you pay for CC transactions. My guess is that a highly optimized operation might be able to achieve 5% to 25% depending on the nature of the product and sale price. Clearly selling items below about $10 requires a highly optimized operation with huge volume or your are going to loose your shirt --and more-- no matter how you approach it (keep that in mind when selling something for a buck on eBay).
This isn't anything new.
Apple has enforced this same restriction on numerous app developers and companies before. The only reason for this being "bigger news" is the pre-existing rivalry between Apple and Microsoft, or more likely because of Microsoft's PR team.
Apple has enforced this same restriction on numerous app developers and companies before. The only reason for this being "bigger news" is the pre-existing rivalry between Apple and Microsoft, or more likely because of Microsoft's PR team.
It's also something that most people don't agree with, so every time it happens, it gets a lot of discussion. Maybe eventually Apple will have some solution that doesn't involve getting 30% for doing nothing.
You already can't buy books for the Kindle or Nook app via in-app purchase, nor can you pay Dropbox for space. Why is this news when SkyDrive has the same rule?
And why doesn't SkyDrive just go "oh", and like everyone else, remove the in-app purchase option?
And why doesn't SkyDrive just go "oh", and like everyone else, remove the in-app purchase option?
From the (much better) Next Web article which I wish had been linked instead:
Microsoft has persisted in trying to work out a compromise with Apple, but has thus far failed to come to an agreement. The company offered to remove all subscription options from its application, leaving it a non-revenue generating experience on iOS. The offer was rebuffed.
If a service has a subscription option, it seems, and it is not listed in the iOS store, the application cannot, and will not be allowed. That is, unless you are small enough that Apple doesn’t bothers to check. I assume that smaller companies could slip under the radar.
(note for transparency: I worked on the SkyDrive team until a few months ago, but don't know the latest details of this situation.)
Microsoft has persisted in trying to work out a compromise with Apple, but has thus far failed to come to an agreement. The company offered to remove all subscription options from its application, leaving it a non-revenue generating experience on iOS. The offer was rebuffed.
If a service has a subscription option, it seems, and it is not listed in the iOS store, the application cannot, and will not be allowed. That is, unless you are small enough that Apple doesn’t bothers to check. I assume that smaller companies could slip under the radar.
(note for transparency: I worked on the SkyDrive team until a few months ago, but don't know the latest details of this situation.)
I did not know that. (My only experience here is that the Dropbox SDK's login screen used to link to the website, which linked to the subscription page, and our app was rejected until the Dropbox SDK removed that link.) Thanks!
Something that needs a bit of clarification, what do they mean by "offered to remove all subscription options", and "the offer was rebuffed"? Do they mean that they created a new build with the subscription options removed, resubmitted, and had that build rejected? Or do they mean they sent an email to someone at apple and didn't get a response in a timely fashion?
I'm pretty sure that if you have an iOS application with signups and you have a subscription on your website, you have to have subscriptions available in the iOS app. Microsoft could just do what Dropbox did and allow subscriptions from their app and also allow the same from their website. Dropbox has more flexible options on their website than on their iOS app.
Dropbox on my iPhone 5 has a place for purchasing 100GB for $99 in settings. I think they had to decide to give in or not allow signups in their app. They chose to give in to Apple and allow subscriptions in their app.
The Dropbox app only has a single subscription in comparison to several options on their website including paying monthly. I guess Apple is OK with that.
The Dropbox app only has a single subscription in comparison to several options on their website including paying monthly. I guess Apple is OK with that.
Perhaps Microsoft should start charging Apple 30% for every song sold on iTunes for Windows.
"Rebuffed"? I suspect it was more like "ignored." Because Apple won't negotiate on the rules. It's their playground, and the rules are posted plainly.
So you submitted an app (or an update to one) with a feature not allowed by Apple and got rejected. Now, you remove the offending functionality and resubmit ... and they'll get to you when they're good-n-ready. And they'll take their dear sweet time because we can't have you overlooking the rules again (or trying to pull the wool over the eyes of the reviewer...)
So why doesn't Microsoft just market the hell out of SkyDrive?
"Use it. Love it. Sign up at skydrive.live.com. And now, access your SkyDrive subscription on your favorite mobile devices: Windows, Android and iOS."
Don't try to sell SkyDrive on Apple's App Store, just provide "free access" to the subscription. Plenty other services do exactly this.
So you submitted an app (or an update to one) with a feature not allowed by Apple and got rejected. Now, you remove the offending functionality and resubmit ... and they'll get to you when they're good-n-ready. And they'll take their dear sweet time because we can't have you overlooking the rules again (or trying to pull the wool over the eyes of the reviewer...)
So why doesn't Microsoft just market the hell out of SkyDrive?
"Use it. Love it. Sign up at skydrive.live.com. And now, access your SkyDrive subscription on your favorite mobile devices: Windows, Android and iOS."
Don't try to sell SkyDrive on Apple's App Store, just provide "free access" to the subscription. Plenty other services do exactly this.
It's the "poor kid that won the lottery" syndrome: doing things just because they can, hoarding cash, making up stupid rules to see how far people will comply, testing developer's patience at each turn, fearing that the miracle machine might eventually run out of steam if they stop sacrificing expansion slots to the almighty gods of dumbed down design.
It is mildly amusing if your livelihood does not depend 100% on them and you still have interesting platforms to work on (not necessarily mobile).
Apple will hopefully grow out of it and become an adult company: less bullshit, less "geniuses" at the bar, less patronizing.
Google, which is supposed to be a competitor, still takes 30% and you still don't even get a search box in the in-app purchases list...
It is mildly amusing if your livelihood does not depend 100% on them and you still have interesting platforms to work on (not necessarily mobile).
Apple will hopefully grow out of it and become an adult company: less bullshit, less "geniuses" at the bar, less patronizing.
Google, which is supposed to be a competitor, still takes 30% and you still don't even get a search box in the in-app purchases list...
at least Google doesn't force you to distribute apps on their store.
In all honesty I don't get these arguments. Why does it matter when Apple is fucking Dropbox/Microsoft? Am I supposed to be angry at Apple?
I hate Apple for a lot of reasons, but the idea they should be lenient to other large corporations is hilarious. Why on earth should I extend my empathy like that?
I hate Apple for a lot of reasons, but the idea they should be lenient to other large corporations is hilarious. Why on earth should I extend my empathy like that?
>the idea they should be lenient to other large corporations is hilarious.
The rules apply to developers of all sizes--not just Microsoft. This is Apple being greedy--which is fine in principle. But as a heavily-invested Apple customer, I "cheer" for the Apple ecosystem (and the company's fair dealings with developers) because I'd like continued priority and investment given to this platform. That's my angle, and Apple seems to be working against it. I find it offensive (as I'm sure many developers do) that Apple claims the right to revenue made from outside of its App ecosystem.
The rules apply to developers of all sizes--not just Microsoft. This is Apple being greedy--which is fine in principle. But as a heavily-invested Apple customer, I "cheer" for the Apple ecosystem (and the company's fair dealings with developers) because I'd like continued priority and investment given to this platform. That's my angle, and Apple seems to be working against it. I find it offensive (as I'm sure many developers do) that Apple claims the right to revenue made from outside of its App ecosystem.
In general I think that Apple should be saying to developers, 'we want our 30%' because it's their store, their revenue stream and it's pretty transparent, but when this kicked off with Dropbox I said it then, it's really stupid. If it's a case that they're selling the subscription through the device then fine, take the 30% charge, however if it's a case that the subscription is setup outside of the iOS store, off the device then Apple needs to go "oh well".
EDIT: mea culpa, mea maxima culpa. It sounds like Microsoft has removed the subs options from their app and resubmitted it to Apple who have yet to approve it, not denied it. It sounds like Microsoft have leaked that they were waiting in some attempt to look like Apple is picking on them.
EDIT: mea culpa, mea maxima culpa. It sounds like Microsoft has removed the subs options from their app and resubmitted it to Apple who have yet to approve it, not denied it. It sounds like Microsoft have leaked that they were waiting in some attempt to look like Apple is picking on them.
That's the way it works though - I have a subscription to DropBox that I setup outside the iOS store, and I'm pretty certain that Apple didn't get 30% of that subscription fee.
Except, Apple set up an agreement with Dropbox to do that, but apparently they're refusing to let Microsoft do it with Skydrive.
Apple blocked Dropbox from the App Store until they removed a link to IAP from their native client. Dropbox finally relented and removed IAP from their native client and the application was allowed in the App Store. I'm (reasonably) confident that as soon as Microsoft removes IAP options from their Skydrive native client, that, they too will have their app approved for the App store (presuming they pass the other conditions).
Do you have a reference for an agreement between Apple and Dropbox? My take on the whole thing is that Dropbox is operating exactly by the rules by not offering an IAP option nor link to outside subscription purchase from within the app.
Poof, approved.
Poof, approved.
Remember we're getting one side of the story here leaked by Microsoft.
True, it could be Microsoft spinning it to make Apple look bad, they might be trying to push against the rules, so if I turn out to be off the mark I'll mea culpa.
Well, it may be a sucky rule, but it's been there for a long time. They can't say they're surprised.
If Apple allows in-app purchases freely, what may happen is that every app is a free app, and the first screen is a screen asking you to buy the paid app. I have already experience a similar experience in some apps like NYT where basically you need in-app subscription. As a user, I felt that I was faked into thinking that it is a free app. On the other hand, it is also crazy for Apple to prevent any sort of in-app upgrades.
This will have big implications on Microsoft's plans to release Office for iOS in the new year. It has been reported that to use the apps you'll need an Office 365 subscription, obviously purchased from outside the app store. Apple have probably seen this coming and are drawing a line in the sand now.
Which probably means Apple is not scared of its competition at all. Otherwise they'd be happy to have Office on their tablets...
Hate it, but can see why its happening.
What if Apple offered the purchasing of services THROUGH their app store? Then there is this clear understanding that Apple made the sale and they actually had to play a part in the transaction. I still would think 30% would be too much, maybe 15-20.
What if Apple offered the purchasing of services THROUGH their app store? Then there is this clear understanding that Apple made the sale and they actually had to play a part in the transaction. I still would think 30% would be too much, maybe 15-20.
Nothing is stopping Microsoft from having a web presence that people use to purchase things at. Apple might be going a bit overboard to force their payment system as the "one true payment system", but it's also a lot better for the average user in most cases, which is what Apple builds for. They don't support many corner cases. Android does. Nobody is forcing you to have an app on iOS right?
Also, the process for setting up a dev account on Apple is far more pleasant than for the Windows 8 store. Also, Microsoft won't even let you publish Metro apps outside of the MSFT store, so who are they to complain about vendor lock in or requiring a cut of purchases and such?
Also, the process for setting up a dev account on Apple is far more pleasant than for the Windows 8 store. Also, Microsoft won't even let you publish Metro apps outside of the MSFT store, so who are they to complain about vendor lock in or requiring a cut of purchases and such?
Allow users to run unsigned code if they so desire. What is the problem. if you want curated store - use it. If you don't want this obtain your software however you desire.
And when Uncle Bob downloads malware, has his bank account drained by unscrupulous developers, takes his phone to a "Genius" to fix the problem, he's going to blame Apple for his trouble.
Let's do the old car analogy: if Mercedes tells you the car requires high octane fuel, but you insist on putting in cheaper fuel, is Mercedes going to repair the resulting damage under warranty? Certainly not.
So Apple decides to create/craft/curate a certain user experience for their customers. And they create rules to enforce it because they don't want to be responsible for their screw-ups (like jailbreaking and installing malware) - if you don't like it, why are you buying Apple's products?
Let's do the old car analogy: if Mercedes tells you the car requires high octane fuel, but you insist on putting in cheaper fuel, is Mercedes going to repair the resulting damage under warranty? Certainly not.
So Apple decides to create/craft/curate a certain user experience for their customers. And they create rules to enforce it because they don't want to be responsible for their screw-ups (like jailbreaking and installing malware) - if you don't like it, why are you buying Apple's products?
The title is incorrect. Apple isn't blocking SkyDrive from the App Store. Microsoft has decided that they didn't want Apple taking a 30% cut of revenue generated from iOS devices. This is a fine distinction. Like it or not, Apple controls their ecosystem, and your choices are to either play by their rules or not play at all. Microsoft decided that they didn't want to play by those rules, so they took their ball and went home.
I can't say that I blame them, but don't make it out like Microsoft is getting any kind of special scrutiny. It is worth noting though that both Dropbox and Box.net have found ways to live within the iOS ecosystem.
I can't say that I blame them, but don't make it out like Microsoft is getting any kind of special scrutiny. It is worth noting though that both Dropbox and Box.net have found ways to live within the iOS ecosystem.
How is the title incorrect? Microsoft have the app waiting for approval, which Apple has blocked.
There is a set of rules that Apple is applying to all developers. Why they don't apply to MS ?
Next you'll tell me Microsoft will complain about not being able to put IE10 on iOS. Wouldn't that be ironic?
amazon + MS + dropbox should just bring the case to justice department.
Why? Because there's no competition from the "leading mobile phone OS?" Because you can't get access to these companies' services on other devices? Because Apple has a de facto monopoly?
One way to look at: as amazon customer, you can't buy ebook from kindle iOS app. Amazon has a simpler one-click payment system, why should they give 30% (which is almost all they are making) to apple for a inferior service?
Apple is not blocking you from purchasing an ebook via Kindle's app. Amazon has chosen not to include this functionality in their app because they don't want to lose money on sales through their app.
So do you really think Amazon has a choice?
Amazon is choosing to sell via iOS devices. They did fine before the iPhone was released, and I doubt having to forgo the sales via IAP is making a dent in their non-existent profits...
Here's a game. Go to Amazon, tell them you want to become one of their merchants. See how far they'll negotiate with you regarding their cut of your sales...
iOS is Apple's platform, just as much as Amazon is a platform for sales. Apple has just as much right to control it via rules and fees as Amazon does.
Here's a game. Go to Amazon, tell them you want to become one of their merchants. See how far they'll negotiate with you regarding their cut of your sales...
iOS is Apple's platform, just as much as Amazon is a platform for sales. Apple has just as much right to control it via rules and fees as Amazon does.
I work on the Ubuntu One iOS team. Our apps have this same issue. I think it really affects user experience, because you can't allow sign up for premium features, but you also can't even mention those premium features (say, with a link to where you can find out more). If you don't already know about them, you're not going to find out in the app.
You can't link to anything, but I believe you can verbally describe them and that's fine.
I think you can even point out the url in plain text, like
"Subscribe by visiting www.myapp.com/iphone/subscribe"
(i.e., no link - user has to type that in Safari herself)
"Subscribe by visiting www.myapp.com/iphone/subscribe"
(i.e., no link - user has to type that in Safari herself)
You could, you just choose not to pay Apple.
How is this a surprise, it's right there in the app store documents.
This is Microsoft complaining they should be except from the rules just because they're big. This is the beauty of the App Store, doesn't matter how big you are you still get treated the same as the little guy
This is Microsoft complaining they should be except from the rules just because they're big. This is the beauty of the App Store, doesn't matter how big you are you still get treated the same as the little guy
On the one hand, it makes perfect sense Apple wants 30% on apps. They run the store.
On the other hand, it seems like Amazon should be able to sell books, Dropbox should be able to sell space, etc., without paying 30% -- otherwise it's financially impossible.
But if you allow apps to sell content within without paying 30%, then all of a sudden all apps become free, selling "upgrading functionality" within, and the app store is no longer viable for Apple.
You can't even make a rule like "reselling 3rd party content is exempt from the fee", because apps will claim additional functionality as 3rd-party. You can't make a rule that "content accessible on other devices is exempt from the fee", because gamemakers will just make their in-game purchases accessible on the Android version too, or something.
Can anyone think of a clear, unambiguous rule that would allow things like Dropbox, Skydrive, Amazon, etc. to get around the 30% fee, but without allowing loopholes that would allow everyone to skirt it? I swear my brain thinks there's a distinction, but I can't figure out what it is.