“Should Apple Take a Cut of the Whole Ecosystem?” MNTN CEO Mark Douglas Talks Tech With Bloomberg

Sep 14, 2021 2 Min Read

Why Does Apple Charge App Developers a 30% Fee?

Firstly, let’s take a look back at how important the App Store is to Apple’s business model overall, and how it’s shaped its ecosystem. Douglas explains that “people forget that with the first iPhone, you could only use software from Apple. When Apple opened that up and allowed anyone to create software for the iPhone, they created the App Store, which charges a 30% fee for developers for any revenue that is created on it. The [Epic Games versus Apple] ruling shapes the 30% fee, which is really excessive.”

However, is 30% really that excessive? The other side of the coin considers the value that developers are getting from promoting their software on the App Store, as they unlock access to Apple’s 2 Billion device users worldwide. Douglas still thinks that it’s not fair to developers as “Apple also has the Mac and has access to all Mac users for free…keep in mind there were 10 claims, Apple won nine claims…but this is not a complete loss for Apple or a complete win for developers. It starts to make a dent in its monopoly, and now developers can now make changes that potentially helps them retain their 30%. If I’m a user, I want the money for the app to go to the person who created it, not to Apple.”

A Story of the American Dream, Private Property and “What’s Mine is Mine.”

Douglas still thinks that Apple is a classic success story, however it’s also a classic example of a monopoly, which are generally anti-competitive and doesn’t always tip the scales in the user’s favor. “Apple sells an incredible device, which we pay over $1K to use, and then they charge a cut for anything that we use on it – even though they didn’t create what you’re using. The judge didn’t go so far to say it’s a monopoly, but this ruling will make a dent on its profit for investors. But the ruling is – should Apple take a cut of the whole ecosystem? Potentially not.”

Tune into the radio interview here

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