Notes

App Store Chief Says Apple is Aiming to Level the Playing the Field for Developers

By Stephen Nellis



July 28, 2008 (Reuters) - Apple Inc Chief Executive Tim Cook will be questioned by U.S. lawmakers on Wednesday about whether Apple's App Store practices give it unfair control over independent software developers.
Before you point your finger at me


Apple has a tight grip on the App Store, which forms the core of its $46.3 billion annual service business. Apple's commissions vary between 15% and 30% on a lot of App Store orders and its ban on attracting customers through outside sign-ups, as well as the inexplicably opaque and unpredictable App-vetting process has been criticized by developers.



However, when the App Store was launched in 2008 with 500 apps Apple executives viewed it as a test of offering a compellingly low commission rate to attract developers, Philip W. Schiller the Apple's senior vice-president of worldwide marketing and chief executive for the App Store spoke to Reuters in an interview.



"One of our goals was to treat all apps on the App Store the same. One set of rules apply to everyone, no special conditions or deals and all code is applicable to all developers. This wasn't the case for PC software. Nobody could have imagined that. It was a complete reverse of the way the whole system was to function," Schiller stated.



Software sold in physical stores meant that the software had to be paid for shelf space and prominence. These costs could consume up to 50% of the retail cost. Small-scale developers could not get in.



Bajarin said that the App Store's predecessor was Handango. Handango allowed developers to deliver applications over cellular networks, to the Palms of users in exchange for 40% commission.



With the App Store, "Apple took that to another level. At 30 percent, they were better value," Bajarin said.



The App Store had rules. Apple reviewed each app and demanded that its billing system be used. Schiller said that Apple executives believed that users are more confident in purchasing apps if their payment details were secured.



"We believe that our customers privacy should be protected that way. Imagine having to enter credit card numbers and payments to every app you've ever used," he said.



Apple's rules began as an internal list, but they were published in 2010.



Over the years, developers complained to Apple about the commissions. Apple has since reduced the areas where developers can apply. In 2018, they allowed gaming companies such as Microsoft Corp , maker of Minecraft and Minecraft, to let players access their accounts as they provided Apple's in-app payment as an alternative.



"As we were talking to some of the biggest game developers, such as, Minecraft, they said"I totally understand why you want the user to be able to pay for it through their device. We have many users who purchased their subscriptions and accounts elsewhere - on an Xbox or PC or even the internet. Schiller has stated that it's an obstacle to accessing your store. "So we made this exception to our own rule."



Schiller said that Apple's cut will help fund an extensive system for developers The thousands of Apple engineers manage secure servers to distribute apps and create the tools to create and test the apps.



Marc Fischer, the chief executive of mobile technology firm Dogtown Studios, said Apple's 30% commission was justified in the beginning of the App Store, when it was the price of global distribution for a small company like Dogtown Studios. But now that Apple and Alphabet Inc's Google have an "duopoly" on mobile app stores, Fischer said, fees are likely to be lower, possibly the same as the single-digit fees payment processors charge.



Fischer stated, "As a developer, you have no choice but accept the cost." (Reporting by Stephen Nellis in San Francisco Editing by Greg Mithcell and Steve Orlofsky)


Homepage: https://wickedfrise.com/