App Store rent-seeking

Excellent article today from Ben Thompson. After laying out in detail why Apple has a strong argument in yesterday’s Supreme Court hearing, Ben moves to the larger question of the App Store monopoly:

To put it another way, Apple profits handsomely from having a monopoly on iOS: if you want the Apple software experience, you have no choice but to buy Apple hardware. That is perfectly legitimate. The company, though, is leveraging that monopoly into an adjacent market — the digital content market — and rent-seeking. Apple does nothing to increase the value of Netlix shows or Spotify music or Amazon books or any number of digital services from any number of app providers; they simply skim off 30% because they can.

I’ve been saying for years that the 30% cut is completely out of line with the value that Apple provides to developers. Developers should be calling for a more fair 15% rate across the board for all apps, and more flexibility to sell subscriptions outside the App Store. As I wrote earlier this summer, it shouldn’t sit well with developers when Apple talks about billions in services revenue, at our expense.

Manton Reece @manton
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