I’ve been meaning to write about Apple’s solution to the whole South Korea Appstore problem lately but I’ve been so busy with home remodeling on the weekends that it’s taken me a while to respond. In short, I’ve been absolutely delighted with how Apple solved their problem.
If you remember, I wrote recently that Apple and Google should just ignore South Korea’s new law which stipulated that they had to provide access for developers to bypass the official Appstore payment systems. Governments can only enforce what is sold in their countries. They can’t actually make Apple or Google do anything.
Right from the start, I was amused with how Apple handled this problem. They started by stating that they had “a great deal of respect for Korea’s laws”. But this statement of respect was almost like a veiled threat. Apple was actually saying that the South Korean law was toothless but they’d comply voluntarily anyway. They were implying that they had the option of ignoring it.
Apple stating that they were going to obey the law out of respect and not due to force made it very clear that they didn’t have to do anything. If South Korean lawmakers were dumb enough to say that local businesses couldn’t sell iPhones, which make up around 25% of national sales, there would have been hell to pay by those politicians. And if Google joined the fray and Samsung phones were outlawed, these government officials would’ve been promptly out of a job at the next election.
So how did Apple solve the problem? They simply shifted the fees from commissions to fees. Nothing is really changing. Apple kind of did ignore the law. But they did it in a way that allowed the politicians to save face.
I’m still shocked that various writers like Jason Snell or Ben Thompson are so biased towards the developers that they would try to apply a different set of rules on Apple. What part of business do they not understand?
iOS developers are vendors, not customers. There will always be an unspoken tension between purchasing companies and vendors. This is nothing unique to Apple. Apple built their “store” and they need to cover their costs plus make a profit.
The fact that Apple sells hardware is irrelevant. The business of selling iPhones and Apps are two different industries. It’s kind of like Tesla and their Supercharger network. Tesla charges customers who use their supercharger network because they need to cover their costs. The business of maintaining a charging network is very different from the business of selling cars. Tesla used to provide free supercharger use to those who purchased cars. That was unsustainable long-term.
The call by writers for Apple to completely support the Appstore by selling iPhones is bad business. Subsidizing anything always leads to stagnation. In fact, the very reason that companies “spin off” divisions is to help increase innovation by allowing a business to stand on it’s own two feet.
Jason claims to understand capitalism and yet he thinks that Apple should just provide free Appstore use to developers because it would “help the customer experience”. What world is Jason living in? Because opening up the Appstore to developers is entirely antagonistic to the consumer.
If the Appstore is free to developers it disallows consumers from “voting” for the good apps. Meaning that the more popular an app is, the more Apple receives in commissions from that app. This gives Apple an incentive to pave the way for good apps and ignore bad ones. In the Apple v Epic court case, it came out that Apple had assigned developers to work on projects related to the game Fortnite. Why did they do that? Because Fortnite was bringing in huge amounts of cash for them. This is the customer vote at work.
Jason also constantly makes the accusation that Apple is making the customer experience worse by their Appstore rules. He’s gaslighting the public because Apple is no different from any other retailer. If something isn’t available for sale in the Appstore, the onus is on the supplying vendor, not Apple. Do people say that eBay or Walmart is making the customer experience worse by charging a markup? I covered this in a little more detail in this post a couple of years ago.
The Real Reason Amazon Won’t Sell Books in iOS
It’s unfortunate that Jason persists in his misinformation on this subject.
Right from the start, I was amused with how Apple handled this problem. They started by stating that they had “a great deal of respect for Korea’s laws”. But this statement of respect was almost like a veiled threat. Apple was actually saying that the South Korean law was toothless but they’d comply voluntarily anyway. They were implying that they had the option of ignoring it.
Apple stating that they were going to obey the law out of respect and not due to force made it very clear that they didn’t have to do anything. If South Korean lawmakers were dumb enough to say that local businesses couldn’t sell iPhones, which make up around 25% of national sales, there would have been hell to pay by those politicians. And if Google joined the fray and Samsung phones were outlawed, these government officials would’ve been promptly out of a job at the next election.
So how did Apple solve the problem? They simply shifted the fees from commissions to fees. Nothing is really changing. Apple kind of did ignore the law. But they did it in a way that allowed the politicians to save face.
I’m still shocked that various writers like Jason Snell or Ben Thompson are so biased towards the developers that they would try to apply a different set of rules on Apple. What part of business do they not understand?
iOS developers are vendors, not customers. There will always be an unspoken tension between purchasing companies and vendors. This is nothing unique to Apple. Apple built their “store” and they need to cover their costs plus make a profit.
The fact that Apple sells hardware is irrelevant. The business of selling iPhones and Apps are two different industries. It’s kind of like Tesla and their Supercharger network. Tesla charges customers who use their supercharger network because they need to cover their costs. The business of maintaining a charging network is very different from the business of selling cars. Tesla used to provide free supercharger use to those who purchased cars. That was unsustainable long-term.
The call by writers for Apple to completely support the Appstore by selling iPhones is bad business. Subsidizing anything always leads to stagnation. In fact, the very reason that companies “spin off” divisions is to help increase innovation by allowing a business to stand on it’s own two feet.
Jason claims to understand capitalism and yet he thinks that Apple should just provide free Appstore use to developers because it would “help the customer experience”. What world is Jason living in? Because opening up the Appstore to developers is entirely antagonistic to the consumer.
If the Appstore is free to developers it disallows consumers from “voting” for the good apps. Meaning that the more popular an app is, the more Apple receives in commissions from that app. This gives Apple an incentive to pave the way for good apps and ignore bad ones. In the Apple v Epic court case, it came out that Apple had assigned developers to work on projects related to the game Fortnite. Why did they do that? Because Fortnite was bringing in huge amounts of cash for them. This is the customer vote at work.
Jason also constantly makes the accusation that Apple is making the customer experience worse by their Appstore rules. He’s gaslighting the public because Apple is no different from any other retailer. If something isn’t available for sale in the Appstore, the onus is on the supplying vendor, not Apple. Do people say that eBay or Walmart is making the customer experience worse by charging a markup? I covered this in a little more detail in this post a couple of years ago.
The Real Reason Amazon Won’t Sell Books in iOS
It’s unfortunate that Jason persists in his misinformation on this subject.
RSS Feed