Addressing Spotify’s Claims - Apple

RoninChaos

Member
Oct 26, 2017
2,713
"Like every other app developer"
Except Apple itself, obviously.
Warren is right on this. Platform holders should be designated as utilities and should not be able to compete on said platform.
What? So if a platform holder, like valve with steam, shouldn’t be able to sell games? Apple setup iTunes to sell music. Now everybody streams music. Apple is changing with the times and you think they shouldn’t also go into streaming music because they control the App Store and the App Store has other streaming options?

They aren’t the only option out there, man.
 

Aureon

Member
Oct 27, 2017
826
They're not entitled to be on the platform.
Said fucking who?

We're just giving up to monopolies now?
Regulate this shit already.

What? So if a platform holder, like valve with steam, shouldn’t be able to sell games? Apple setup iTunes to sell music. Because they’re changing with the times they shouldn’t also go into streaming music because they control the App Store?
No, they shouldn't. Because it's heavily anticompetitive.
Digital platforms, especially app delivery systems in closed systems, should be treated like public utilities at this point. Everybody needs one.

Let's say Apple&Google team up and decide to lifetime ban you for a forum comment against them. Would you think that kind of thing should be allowed to happen?

Let's say Apple decides to ban all music streaming services from the app store. Should Apple be allowed to do that?

Tech giants hold tremendous power, and it's time to bring them to heel. There's a reason they skirt the line - there's political pressure to do something about them, and any abuse could tip the line - but let's not pretend they do not abuse their market position.
 

Fliesen

Member
Oct 25, 2017
4,071
Can you download the watch app without going through the app store and bypassing the 30% cut? If not then apple has an issue on their hands.
The Watch app is free. The Spotify app is free.

If you subscribe to spotify from within the App, Apple takes a cut.
They don't take a cut if you already are a premium subscriber, they don't take a cut from the ad revenue the free spotify tier generates.
 

Klotera

Member
Oct 27, 2017
624
The argument that the 30% is just the "cost of doing business" or that Spotify wants the benefits of the app store without contributing are ridiculous.

First of all, Apple is not subject to its own fee, so it puts its own service at an advantage.

Second, Spotify is not just an iOS service. So, people sign up through the app, but may end up using on their pc. So, they're paying 30% to Apple for a service that someone could only be using half time on their iOS device.

Third, the idea that Spotify only benefits from Apple and not the other way round is not true either. People expect all the major apps to be on iOS. Apple is always bragging about how many apps are available. If a large chunk of popular apps weren't on iOS, you'd see people move to other platforms. The app ecosystem benefits Apple as much as it benefits app devs.

And arguing that Apple needs their cut is ridiculous. Google can afford to not take this cut and Apple is sitting on a bigger pile of cash than Google is.
 

snacknuts

The Fallen
Nov 1, 2017
2,013
How is this that different than any other walled garden? Sony, Microsoft, and Nintendo all compete with 3rd parties who must pay a cut that 1st parties don't. This goes for both games and on-platform media sales.
The first parties you listed are selling different content than other developers on those platforms. Streaming a Nirvana song from Spotify is not functionally different than streaming a Nirvana song from Apple Music, but Apple gives themselves in advantage in their marketplace.
 

Border

Member
Oct 25, 2017
7,052
The first parties you listed are selling different content than other developers on those platforms. Streaming a Nirvana song from Spotify is not functionally different than streaming a Nirvana song from Apple Music, but Apple gives themselves in advantage in their marketplace.
What exactly does this distinction prove? If Apple had a library of exclusive content, would their service be appreciably different then? Why does "same product" matter?

And of course, Sony and Microsoft DO sell the exact same products as potential competitors. A film downloaded from Sony is no different than one you might buy on Amazon or Vudu.
 

Fliesen

Member
Oct 25, 2017
4,071
Second, Spotify is not just an iOS service. So, people sign up through the app, but may end up using on their pc. So, they're paying 30% to Apple for a service that someone could only be using half time on their iOS device.
But similarly, they could be making literally zero cents on users that had signed up for Spotify premium outside the app, but are still using it 99% on their iPhone. So that would kinda balance things out, don't you think?

Also, the share is 15% after the 2nd year.

Spotify is in a super weird situation, because like 60-70% of their users are free tier users,

Meanwhile, the premium users are what generate the lion's share of their revenue.


Spotify's business model is rather unsustainable, in so far as premium users are subsidizing a huge share of "freeloaders", yet they still pay out incredibly little to artists.

Apple is simply the first real - and most importantly - international(!)* competitor and every premium user that Apple steals from them hurts Spotify doubly so.
(Google Music doesn't really seem to be a thing outside the US, so is Amazon ... neither is Pandora ... or Tidal)

I feel like - some of Spotify's points are very valid - namely the fact that Apple plays by different rules on their own platform (access to more APIs, for example).
But even if Apple were to give Spotfiy the same access to HomePod or Siri - i don't think that'd solve any of Spotify's actual probems; namely - profitability.
 
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Klotera

Member
Oct 27, 2017
624
But similarly, they could be making literally zero cents on users that had signed up for Spotify premium outside the app, but are still using it 99% on their iPhone. So that would kinda balance things out, don't you think?

Also, the share is 15% after the 2nd year.
I don't see the problem with them making zero cents on users that sign up outside. They're not processing the payments or using their bandwidth to stream the songs. It would put Apple Music and Spotify on an even playing field.

Google makes zero money on users who subscribe to Apple music and use the Android app. Seems Apple is more than happy to take advantage of that on another platform.

Not asking Apple to give them free payment processing, but let them link out to their own sign up page. Simple, fair request.
 

justin haines

Member
Nov 27, 2018
742
I switched to Apple Music recently when I left android.

Apple seems kind of annoyed. Spotify comes off entitled a bit.

That’s as far as I can care right now. Hopefully this results in better music services for everybody.
 
Oct 27, 2017
12,046
But similarly, they could be making literally zero cents on users that had signed up for Spotify premium outside the app, but are still using it 99% on their iPhone. So that would kinda balance things out, don't you think?
No. Why should Apple make money from that? People keep making this out to be a one way beneficial relationship, but as other posters have mentioned, Apple benefits from having Spotify in their store too outside of just monetary compensation.

Also people realize to upload an app to the Apple store devs pay yearly for a Developer account, right? Just because the act of uploading doesn't cost them doesn't mean the entire process is free. Even for "free" apps without IAP, Apple makes money
 

Fisty

Member
Oct 25, 2017
3,774
What exactly does this distinction prove? If Apple had a library of exclusive content, would their service be appreciably different then? Why does "same product" matter?

And of course, Sony and Microsoft DO sell the exact same products as potential competitors. A film downloaded from Sony is no different than one you might buy on Amazon or Vudu.
Does Sony demand a 30% cut of movies purchased/rented on the Amazon streaming PS4 app?
 

31GhostsIV

Member
Oct 26, 2017
1,613
Lots of Apple hate here. Won't somebody think of the small startup streaming service owned and operated by billionaire Daniel Ek, who doesn't seem to believe the artists on his platform deserve a fair cut?

Interested to see the percentage of people such as myself that use Spotify on Apple devices but set up the account/sub via browser, compared to those who pay via app.
 

MajesticSoup

Member
Feb 22, 2019
340
The Watch app is free. The Spotify app is free.

If you subscribe to spotify from within the App, Apple takes a cut.
They don't take a cut if you already are a premium subscriber, they don't take a cut from the ad revenue the free spotify tier generates.
I see. So does apple prevent developers from having the option to launch a browser from within the app to subscribe?
 

Selbran

Member
Oct 25, 2017
652
I see. So does apple prevent developers from having the option to launch a browser from within the app to subscribe?
Yes since that would be circumventing the app store. It's the same reason the Steam Link app got shut-down because people had the ability to buy Steam Games through the streaming and Apple didn't like that.
 

Klotera

Member
Oct 27, 2017
624
Lots of Apple hate here. Won't somebody think of the small startup streaming service owned and operated by billionaire Daniel Ek, who doesn't seem to believe the artists on his platform deserve a fair cut?

Interested to see the percentage of people such as myself that use Spotify on Apple devices but set up the account/sub via browser, compared to those who pay via app.
As opposed to the small startup phone maker, Apple. The second biggest company in the world.

Thing is, Google, Amazon, and Facebook are getting (rightfully) called out on their BS business practices these days. But, Apple is supposed to be untouchable because they've created this false image of being a pure, honest, moral company. They're just as much a business as any others, who will do what they can to get a leg up on competitors. Apple should be just as accountable for their business practices as other tech companies. That probably why you're seeing "Apple hate"
 

borghe

Member
Oct 27, 2017
3,112
Your idea of clear and direct is Apple not directly responding to Spotify's claims? OK then.
Spotify's claims amount to Proctor & Gamble saying "Why does Target get to sell generic laundry detergent with higher margin at the same price as our Tide product? That's unfair."

The answer is easy... don't sell your product (i.e. subscription) at that store then (App Store).

This shit has been around for decades in retail.. but we get to digital services and everyone throws common sense out the fucking window. Apple didn't respond to it because it literally merits no response. What DOES warrant a response is Spotify's entire business model revolving around "how can we pay as little as absolutely possible to ALL of the companies and creator's who allow us to exist?"
 

Kalamour

Member
Oct 25, 2017
118
Apple is clearly preventing Apps from being natively integrated into Siri. You just need to compare Google assistant/Alexa vs Siri on integration of third party apps to understand that Apple is not trying to play a fair game...
On the other hand, the 30% cut taken on transaction taken from their store seems to be standard practice.
 

Kthulhu

Member
Oct 25, 2017
8,590
Lots of Apple hate here. Won't somebody think of the small startup streaming service owned and operated by billionaire Daniel Ek, who doesn't seem to believe the artists on his platform deserve a fair cut?

Interested to see the percentage of people such as myself that use Spotify on Apple devices but set up the account/sub via browser, compared to those who pay via app.
Company size is irrelevant. This is about competition and consumer welfare.
 

NinjaGarden

Member
Oct 25, 2017
1,452
A one-time surcharge on subscriptions would be acceptable to most services. Giving 15-30% forever when they bear no burdens beyond that initial download seems abusive to me.
 

Pargon

Member
Oct 27, 2017
3,030
The Watch app is free. The Spotify app is free.
If you subscribe to spotify from within the App, Apple takes a cut.
They don't take a cut if you already are a premium subscriber, they don't take a cut from the ad revenue the free spotify tier generates.
Just to make it clear: Spotify have removed the option to buy a subscription in their app.
The only way to purchase a premium subscription is now through their website.
Apple is getting $0 from their subscriptions, while paying for the distribution costs of their app.

No. Why should Apple make money from that? People keep making this out to be a one way beneficial relationship, but as other posters have mentioned, Apple benefits from having Spotify in their store too outside of just monetary compensation.
Both companies benefit from Spotify being on the App Store, but it would hurt Spotify more than Apple if they were blacklisted.
I don't know why there is an expectation that they should be able to benefit from being on the App Store for free.
Maybe there should be another tier of payments on the App Store for cross-platform streaming services, where Apple's cut drops to 5% or 10% rather than 30% and bans issued for bypassing it, but I don't see why it should be $0.
Also people realize to upload an app to the Apple store devs pay yearly for a Developer account, right? Just because the act of uploading doesn't cost them doesn't mean the entire process is free. Even for "free" apps without IAP, Apple makes money
Yeah, I'm sure that $99 Spotify pays Apple to be on the service is really covering their bills.

Said fucking who?

We're just giving up to monopolies now?
Regulate this shit already.
Should stores be required to carry every product that someone wants to sell, or should they be able to decide what products they want to offer?
While it is far from perfect, the App Store's stricter rules and tighter regulation has overall been a great thing.
I do agree that there is a lack of transparency and potential for abuse, with a prominent example being their blocking of the Steam Link app.
But I don't think that anyone should be allowed to ignore the rules or run their platform on top of the service without paying anything.

No, they shouldn't. Because it's heavily anticompetitive.
Digital platforms, especially app delivery systems in closed systems, should be treated like public utilities at this point. Everybody needs one.
So you're saying that the App Store should be taken over and publicly owned/funded/regulated rather than controlled by Apple?
That's an interesting proposition, but the actual execution of such a thing seems like it would be a nightmare. And why should Apple be forced to hand over control of their platform?

As I've said a few times now, I think what is most likely to happen in this situation, is Apple Music splitting off into its own entity and having to follow the same rules as everyone else.

I see. So does apple prevent developers from having the option to launch a browser from within the app to subscribe?
Yes. You're not allowed to link to external stores from an app to bypass the in-app purchase system.
There was a big deal about it a few years ago with Amazon selling books via the Kindle app in an in-app browser window, since that bypassed the IAP system.
Now you can access your Kindle library via the app, but have to navigate to the Amazon website in a browser yourself to buy books.
 

Selbran

Member
Oct 25, 2017
652
Spotify's claims amount to Proctor & Gamble saying "Why does Target get to sell generic laundry detergent with higher margin at the same price as our Tide product? That's unfair."

The answer is easy... don't sell your product (i.e. subscription) at that store then (App Store).

This shit has been around for decades in retail.. but we get to digital services and everyone throws common sense out the fucking window. Apple didn't respond to it because it literally merits no response. What DOES warrant a response is Spotify's entire business model revolving around "how can we pay as little as absolutely possible to ALL of the companies and creator's who allow us to exist?"
I think there's a massive difference between stocking an item on a store shelf (Which takes up physical space, let alone the costs of shipping said product) and a digital storefront where Apple isn't going through hoops to have Spotify's product on there. You're kind of splitting hairs with this argument if you just want to say "Oh well these stores have no problem so too bad so sad Spotify!"
 

Tron1

Member
Dec 23, 2017
3,953
Interesting. When I try and buy amazon music from the app I have to go to the website. So there is a workaround for those that don’t want to pay the tax? Business is business. We will see how this plays out.
 

Fisty

Member
Oct 25, 2017
3,774
Last I checked you can’t even purchase movies in the Vudu/Amazon apps — either Sony doesn’t allow it or they want to avoid Sony’s tax.
I thought I remember seeing the option to rent in the Amazon app, never done it though so I'm not sure. I think Sony has a sweetheart deal with Amazon and Spotify though so they may have different rules for them
 

Kthulhu

Member
Oct 25, 2017
8,590
Spotify's claims amount to Proctor & Gamble saying "Why does Target get to sell generic laundry detergent with higher margin at the same price as our Tide product? That's unfair."

The answer is easy... don't sell your product (i.e. subscription) at that store then (App Store).

This shit has been around for decades in retail.. but we get to digital services and everyone throws common sense out the fucking window. Apple didn't respond to it because it literally merits no response. What DOES warrant a response is Spotify's entire business model revolving around "how can we pay as little as absolutely possible to ALL of the companies and creator's who allow us to exist?"
A locked down digital ecosystem isn't really comparable to a physical store.
 

borghe

Member
Oct 27, 2017
3,112
Apple is clearly preventing Apps from being natively integrated into Siri. You just need to compare Google assistant/Alexa vs Siri on integration of third party apps to understand that Apple is not trying to play a fair game...
On the other hand, the 30% cut taken on transaction taken from their store seems to be standard practice.
So now THIS I will say needs to be looked into. Right now it's very "he said she said". But yes I agree. The Siri rules SHOULD be the same for all developers. and if not Apple needs to be taken to task.. That being said.. We've seen in the past claims that apple is being obstructive when clearly THEY were not the ones obstructing (Amazon). So EU or such may be the best place to figure the Siri thing out. For all we know Spotify is full of shit.. or Apple is being asses.

A locked down digital ecosystem isn't really comparable to a physical store.
yes, it is. And this is literally what I JUST said!

"This shit has been going on at retail for decades or longer.. but we get to digital services and everyone throws that common sense right out the window."

yes, it is the same. App Store is Apple's store.
 

borghe

Member
Oct 27, 2017
3,112
I think there's a massive difference between stocking an item on a store shelf (Which takes up physical space, let alone the costs of shipping said product) and a digital storefront where Apple isn't going through hoops to have Spotify's product on there. You're kind of splitting hairs with this argument if you just want to say "Oh well these stores have no problem so too bad so sad Spotify!"
Storage is relatively minor, sure.. but no way do I believe Apple's bandwidth bills are trivial. Probably a good chunk of operational costs. Plus maintenance, development, etc of the platform. Those things may even rival dollar per square footage at retail locations when we're talking about downloads (billions)
 

Klotera

Member
Oct 27, 2017
624
Apple is getting $0 from their subscriptions, while paying for the distribution costs of their app.
Devs pay for a license. Besides, the cost to serve an app is minuscule in relation to Apple's ecosystem, and they're not asking for a one-time fee. They want a monthly fee. So, Spotify uses their bandwidth to serve up the music every month, all Apple does is process a payment, and they should owe 30 or 15% monthly?

Also, people saying that it's easy enough to sign up on the website, so it's not stopping someone. Apple must think it will stop people, otherwise they wouldn't ban the practice of putting a lot of no out to a subscription page.
 

KHarvey16

Member
Oct 27, 2017
6,348
The arguments against Apple taking a cut are bizarre. Their platform is bringing millions of customers to your app. It’s like arguing all websites should charge the same for ads regardless of views or clicks per month. You’re paying for the privilege to leverage that audience.
 

31GhostsIV

Member
Oct 26, 2017
1,613
Company size is irrelevant. This is about competition and consumer welfare.
How is it irrelevant? Spotify is the largest music streaming company on the planet and has been for a while. Ek is a billionaire from Spotify, yet they constantly post annual losses, whine about paying store front cuts and oppose artist royalty pay rulings in court?

One percenter problems personified. Not sure where consumer welfare comes into it, unless Spotify charge higher sub prices via the App Store sign ups?
 

Klotera

Member
Oct 27, 2017
624
The arguments against Apple taking a cut are bizarre. Their platform is bringing millions of customers to your app. It’s like arguing all websites should charge the same for ads regardless of views or clicks per month. You’re paying for the privilege to leverage that audience.
It's a two way relationship. If all the major apps left the app store, or even just a few key ones, lots of people would jump ship to another platform. Apple needs apps as much as app devs need Apple.
 

Selbran

Member
Oct 25, 2017
652
Storage is relatively minor, sure.. but no way do I believe Apple's bandwidth bills are trivial. Probably a good chunk of operational costs. Plus maintenance, development, etc of the platform. Those things may even rival dollar per square footage at retail locations when we're talking about downloads (billions)
You're not being fair, all that infrastructure isn't in place for Spotify's benefit and I sincerely doubt it is anywhere near as expensive as retail stores (Especially when you recognize the amount of B&M stores shutting down). Not only that, but the profit margins are going to be a lot higher in Apple's favor compared to B&M stores. Just look at the Netflix situation, Apple made over 200 Million dollars off of the Netflix app and it isn't even their content. They aren't hosting Netflix's servers, or advertising them and yet they made 200+ million just for the "privilege" of being on their store.

The big problem is there are only two notable app stores in a sea of billions of mobile devices so you saying "Oh they don't have to be on the app store if they don't want" isn't fair because that kills a lot of businesses due to less mind-share.
 

whatsinaname

Member
Oct 25, 2017
4,137
The only contribution that Apple requires is for digital goods and services that are purchased inside the app using our secure in-app purchase system. As Spotify points out, that revenue share is 30 percent for the first year of an annual subscription — but they left out that it drops to 15 percent in the years after.
The whole article seems built around getting people to talk around or past this point. Such bullshit. Continuing to charge 15% on outside content is nonsense when they are not processing the payment.

" purchased inside the app using our secure in-app purchase system."

This is nonsense because you can't not use their in-app purchase system. You can't direct to another payment method. You can't charge more to offset Apple's cut.

1) Cost for hosting/downloading the app - Sure, they deserve money. But there are thousands of apps that are free (85% in their own numbers) and they charge no money for that. If hosting is getting expensive, start charging app devs who have maybe say more than 500k downloads or for patches/updates like xbox/sony/nintendo do.

2) They might deserve a cut for "discoverability" but I think this should be treated as a sales lead generation. Giving commission to a lead generator for a subscriber is a precedent in many industries but 15% for the lifetime of the subscription is unheard of.
 

KHarvey16

Member
Oct 27, 2017
6,348
It's a two way relationship. If all the major apps left the app store, or even just a few key ones, lots of people would jump ship to another platform. Apple needs apps as much as app devs need Apple.
That’s nonsense. The iPhone sold millions of devices with a tiny, minuscule fraction of the apps it has now. They can’t take it away but the idea the apps drove the size of the App Store is wrong.

Apple is providing the platform and the users. Arguing againt charging for that is really, really silly.
 

Selbran

Member
Oct 25, 2017
652
That’s nonsense. The iPhone sold millions of devices with a tiny, minuscule fraction of the apps it has now. They can’t take it away but the idea the apps drove the size of the App Store is wrong.

Apple is providing the platform and the users. Arguing againt charging for that is really, really silly.
I'm curious what you think would happen if overnight apps like Facebook, Netflix, YouTube, Kindle and the like all vanished from Apple's platform.
 

itchi

Member
Oct 27, 2017
993
The arguments against Apple taking a cut are bizarre. Their platform is bringing millions of customers to your app. It’s like arguing all websites should charge the same for ads regardless of views or clicks per month. You’re paying for the privilege to leverage that audience.
Which I guess is fine but becomes an issue when Apple has competing services that don't have to play by the same rules, or they have access to special APIs that they don't allow other developers to use to give their service an unfair advantage.
 

KHarvey16

Member
Oct 27, 2017
6,348
The platform grew because of the support of apps, it may have sold decently but it wasn't flying off the shelves like it is nowadays.
It sold million and millions without a Spotify app. The idea that if all apps left it would be bad for Apple therefore no app should pay to make money from the Apple user base is completely crazy.