The problem is, this isn’t a small fee. It not 5% or 10%. It’s 30%, almost a third of all revenue. Not profit, revenue. And this isn’t an independent store that needs to make a lot on each transaction. With an economy of scale like the App Store, Apple could make significant profit with a fee of only a few percent.
On the other hand, many of the apps in the App Store are from small independent companies, which can’t afford 30% with every single transaction. The problem is that it’s 30% across-the-board, regardless of the type of app, the type of subscription, etc. 30% may make sense for some apps, but certainly not for all, like those that distribute others’ content and therefore don’t have as much control over the pricing. Otherwise, the kind of apps that can afford to be on the App Store will continue to be restricted, with eBook sellers, music subscriptions services, and others being excluded unless they can cut a deal with Apple.
I really am having trouble making up mind on this issue — which is back in the news after iFlowReader-gate.
One on hand, developers are all aware of the thirty percent cut Apple takes when they are forming their business plans. It’s a known, fixed cost. If they don’t build in a buffer, then part of me thinks “too bad.”
The other part of me just wants to give Surat a high five for standing up for the little guy.