I don’t even know what to say anymore at this point. A bugfix update for the WordPress iOS application – which allows you to manage your WordPress website but does not sell anything – was blocked by Apple because WordPress.com separately also sells domain names and hosting packags, and Apple wants its 30% extortion fee, forcing the developer of this open source app to add the ability to buy WordPress domains and hosting.
Is Apple seriously asking for WordPress owner Automattic to share a cut of all its domain name revenue? How would it even know which customers used the app? Was this all a mistake?
Apple didn’t respond to a request for comment, but Mullenweg tells The Verge he’s not going to fight it — he will add brand-new in-app purchases for WordPress.com’s paid tiers, which include domain names, within 30 days. Apple has agreed to allow Automattic to update the app while it waits. (The last update was issued yesterday.)
In other words, Apple won: the richest company in the world just successfully forced an app developer to monetize an app so it could make more money. It’s just the latest example of Apple’s fervent attempts to guard its cash cow resulting in a decision that doesn’t make much sense and doesn’t live up to Apple’s ethos (real or imagined) of putting the customer experience ahead of all else.
It’s like Apple is purposefully laying out a breadcrumb trail for antitrust investigators.
Okay, I think this might be too much.
Am I missing something, or are they asking an app which previously did not have any in app purchases to include some? And on top of domain names nevertheless?
Domains have pretty thin margins. Who is going to absorb the 30% cost?
sukru,
That’s what the article says, maybe someone will publish a followup with more info.
It’s rhetorical, but who always absorbs the cost, ultimately?
I would hope that they would just tack on the additional 30% for users making purchases through the app, rather than raising everyone’s prices slightly and forcing all customers to subsidize apple’s fees.
I agree this is idiotic.
I think they are being too over-zealous with their requirements on requiring their own payment processor. Automattic does allow people to purchase upgraded plans at WordPress.com (https://wordpress.com/pricing/), and I think that is what Apple keyed in on.
Thom Holwerda,
Just think, it’s somebody’s job at apple to find companies to bully into paying 30% fees. Apple became a $2 trillion dollar company this week, or 1/10th the US annual GDP. Mafia tactics work.
Nah, the US is corrupt enough they can just pay off the politicians & DOJ and be chums.
I think only reason Apple hasn’t been slapped with antitrust investigations by the EU is because they just don’t have enough market share.
Pretty much. Apple has a monopoly on their platform (iOS), but in the macro Android is the dominant platform. By a significant margin it appears.
https://gs.statcounter.com/os-market-share/mobile/europe/
Flatland_Spider,
It depends on the market, in the US they’re much closer than in europe. I’m not sure why.
But the other thing to keep in mind is that apple actually takes 65% of mobile app store sales, which means that IOS has a significantly greater influence on developer livelihoods.
https://www.cultofmac.com/716174/app-store-revenue-continues-to-dwarf-google-plays-in-2020/
The US wireless carriers subsidizing phones vs EU wireless carriers do not is one reason I’ve heard.
I’d forgotten about that. People who purchase Apple products have higher incomes, and it’s access to this market has kept devs from abandoning Apple.
That still doesn’t factor into the equation. In the PC market, Apple has 10% marketshare with a base of significantly higher household income, but no one is going to argue Apple is a monopoly in the PC realm.
I think this has always been the case too.
Flatland_Spider,
That’s possible.
It does factor in, but windows has a strong lead over macs in the PC realm. On mobile google and apple are both leading, but in different market segments. Apple has a larger share of the high end market whereas google has a larger share of the low end market.
Sure, it’s soon the US elections so they’ll support (aka give money to) the candidate that will promise to allow this to continue. More or less the Epic-scale scam actually occurring 🙂
Kochise,
There’s no doubt it’s going to continue. Both parties in the US are corrupt. The republican party is correct as hell, no need to say any more on that. But for better or worse the democrats have a bad history of getting too close to big tech. I recall the obama administration would regularly hire employees from tech giants as policy advisors. Obama utterly failed to provide representation for small businesses and big tech went largely unregulated.
https://theintercept.com/2016/04/22/googles-remarkably-close-relationship-with-the-obama-white-house-in-two-charts/
Now obviously, like most people, I want to get the dictator out of office, However realistically the democrats are unlikely to put limits on the power of the tech industry. It’s very doubtful Biden will lift a finger to reign in industry abuses, rather it will likely be a continuation of Obama’s policies letting the industry regulate itself. I believe that if elected, Warren and Sanders would have cracked down on corporate abuses, but it turns out that candidates that threaten corporate rule aren’t very electable 🙁
I don’t know if I typed this, or if it was autocorrected, but I certainly meant “corrupt” here rather than “correct”.
Check your machine, man. They might have gotten to it. Here, take some aluminum foil. It’ll keep the rays out, man. 🙂
Flatland_Spider,
That must be why they keep slapping more terrifs on aluminum.
I just finished reading the latest Firefly novel (The Ghost Machine) and in it (without spoilers) the Blue Sun corporation just uses blackmail and coercion to take a third of all profits. And it points out that they do it not because they need the money, or they want to expand. But simply because they can…
Kind of made me wonder if the author is an app developer.
Which came first, the Firefly novel or the Futurama’s MomCorp?
That’s a pretty basic critique of capitalism since the ’80s.
I guess Apple bubble was inflated as much as it could be, in the past decade, and cracks are now starting to show. The idea of all other business owning Apple a 30% cut, that just ain’t going to fly anymore. Thanks Apple, but no thanks.
The issue was that they were promoting the stuff they were selling in the app. The TOS says if you do that you have to sell it.
There is an apology from Apple on this and the matter has been amicably resolved by the developer removing the sales stuff.
Also this was never about 30% of all the revenue. That’s just fake news Thom made up. It was about giving the app users the option to buy from the app ( and Apple would take 30% of those purchases only ).
FWIW I believe I should be allowed to install apps from outside the App Store.
Or you can buy something else than Apple products…
Kochise,
This is always a lousy response for anti-competitive behavior because it doesn’t excuse the behavior. Moreover, when you’ve got a duopoly the notion that we have good choices is completely naive. It would be much better if hardware makers weren’t permitted to enforce deliberately anti-competitive restrictions on owners in the first place.
I don’t think you understand what anti-competitive behavior is.
In this case Apple is attaching stipulations and restrictions to the use of the product they sell – this is pretty much what every technology company on earth does including Apple, Google, Red Hat, SuSE, Samsung, Roku, heck, even tractor companies like John Deer and car companies like Tesla.
Apple is in no way restricting the ‘market’ or even the ‘market segment‘ unless you define the ‘market’ to be the products for Apple products which may work for bloggers but has no basis in the law of any sensible country.
If you don’t like the rules a company places on the license to its products don’t license those products. That’s the whole point of the free market and anti-competition laws, to give you that choice.
kristoph,
Of course I do.
You have to be more specific before we can say whether any of these are comparable or not. However the old adage that “two wrongs don’t make a right” applies here. If we allow all companies to be anti-competitive, we end up with everyone being beholden to the corporations at the very top with little competition left.
Some corporations are confident that their abuses will not get challenged in today’s political climate, and they may be right. However you and I still have a responsibility to call out anti-competitive behavior, including apple’s. If we fail, and we may, the concentration of wealth and control will get worse at an exponential rate.
Unfortunately this isn’t just fiction, it’s happened before with the robber-barons over a century ago, although this time the world is more globalized and there’s even more at stake. Newcomers will be completely locked out, consolidation will will further empower oligopolies, duopolies, and monopolies rendering competition a farce. Presently all the warnings are already on the wall, the real question is are we going to fight this now, or let our children inherit a world where the world’s richest corporations are in control.
And… the issue is over:
https://twitter.com/photomatt/status/1297324441890779136
It seems like this is more or less the limit that Apple could push the developers.
Thanks for the press support of this issue 🙂
This particular instance may be over, but the issues themselves remain: Huge companies increasing their profit margin by abusing their market size and the gate keeping powers of said companies,
Edit: typos
Except Android dominates the market. The US is the market where the margin between Android and iOS is the smallest.
https://gs.statcounter.com/os-market-share/mobile/united-states-of-america
Market share is irrelevant when the 2 biggest players are doing the same kind of scummy things
That’s collusion, which is different then antitrust stuff.
If we want to argue about collusion, sure. There’s a lot more evidence for that.
Not really, at least not in this case. I can install whatever I darn well please on my Android device regardless of what Google does with its own store. This is a very different situation than what Apple has done.
Even though it looks like Apple is setting itself up and there have been a few politicians calling out Apple for anti-trust, the key is that there are only a few politicians concerned about Apple’s and Google’s behavior. In the meantime, they can make 30% and will change only if they are forced to.
For the record, I think that it is abhorrent who much control of external factors these companies have created out of “their” technology. If the roles were reversed and they were being controlled, they’d be crying “bloody murder.”
So the whole thing was a misunderstanding rather than nefarious. And it’s been sorted.
I am not sure what the problem is with the app store model. Is it:
a) The principle of app stores acting as gatekeepers vetting apps for their platform
or
b) objections to the 30% charged by the app stores
If it’s (a) then frankly the objectors don’t have a leg to stand on. The App Store model liberated billions of people who can easily find, acquire and use software safe in the knowledge that it doesn’t contain any nasties and that the whole install and updating procedure is all taken care of invisibly. That has transformed the way billions of people use software and created a software market an order of magnitude larger than the old desktop free market. I can’t see any downside to that at all.
If it’s (b) then maybe there is a point about the rates charged but the 30% seems to be more or less standard across all app store platforms including all consoles. Seems as if it’s the rate that’s charged and I can’t see any justification for any state intervention to fix prices for software as opposed to any other sort of commodity.
Mainly A. Apple gatekeeps iOS/iPadOS via the App Store, and the only way to install apps which aren’t in the App Store is by buying a dev license.
The 30% is something Hey and Epic brought up. The vast majority of mobile apps are free, and they compliment other services.
Sort of. People are pretty adept in developing new ways to be malicious and generally finding ways to abuse systems. An org has to be pretty ruthless to keep the abuse at bay.
Strossen,
Apple may have gone through with it if the media hadn’t gotten involved, but let’s give them the benefit of doubt that apple’s enforcement officers made an innocent mistake. Fair enough?
There’s nothing wrong with the app store model, that’s a complete straw man to rebut points that nobody here is making. Apple wasn’t the first and won’t be the last to implement the app store model, that’s simply not what they’re being criticized for. However when you have huge corporations including apple who are blocking competitors from the app store market, that’s a huge red flag. Unfortunately many people are looking the other way because they’re fans of apple, yet if apple were the victim of the very same policies you’d have apple fans crying foul!
Please, let’s not be sheep. Companies like google, apple, and microsoft benefit when users are fighting each other rather than standing up together for consumer rights. We need to wise-up and recognize that this infighting between brands is a superficial distraction from the fact that they’re all ripping off consumers together. Companies that seek to profit off of control rather than meritocratic means deserves to be publicly admonished for it.
We’ll find out where it goes. Like many things in the anti-trust area, they are often more about abuse of power than global rules.
Apple has the goal of it’s app-store to provide users with a one stop shop for high quality apps. They can and do have a pretty strict vetting process to keep things updated and to a reasonably high standard.
Just as an example, Apple doesn’t want you to just take your website and package it as an app. That’s a waste of an app. Users should just go directly to the website or bookmark it in safari. They have boat loads of UI standards and others.
Is that worth 30% off the top of transactions? I don’t know. As I said it’s a matter of abuse of power. If Apple’s fee was 5%, would everyone be okay with their behavior?
Let’s take Apple’s legitimate position here. They want their apps to be of high quality and contains the functionality offered on other platforms (Web…). So you have this wordpress app that does not contain all the functionality word press offers on their website. Apple says, this is no good. Please add these features to the app.
I guess fair and legitimate.
Now the questions of abuse of power come in that are in the details.
1. Can an app charge more for a transaction in the app than on the website to account for apple’s ‘convenience’ fee?
2. Can you load an app bypassing the App Store?
3. Can the app give people notice that certain actions can be done on the website?: Advertise that it’s cheaper or they get more value if they go through the website?
4. Is the 30% fee excessive?
…
I’m not a lawyer, but those are the kinds of questions that I would ask from my basic understanding of anti-trust.