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Microsoft To Apple: Don't Take Your Normal 30% Cut of Office For iOS

Soulskill posted about 2 years ago | from the gotta-pay-the-toll-to-cross-the-bridge dept.

Businesses 724

An anonymous reader writes "Sources tell All Things D that Apple and Microsoft are at loggerheads over the cut Apple is expected to take of Office 365 subscriptions sold through Microsoft Office for iOS, which is expected to launch sometime next year. An update to Microsoft's SkyDrive app has been rejected after the company was 'pushing Apple to adjust the 70/30 revenue split in its developer license agreement. Predictably, Apple has refused to comply. It’s not yet clear what sort of concession Microsoft is seeking, but whatever it is, Apple’s evidently not willing to consider it.'"

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We are the 30% (5, Insightful)

Quakeulf (2650167) | about 2 years ago | (#42258999)

It's Apple's platform. I agree that a 30% cut is a bit too much, and there could be tiers introduced based on company size, revenue, etc., but to manage this would probably be a bit too much for them, although it would be beneficial for small startups.

But then again, what would the Microsoft do if they were in their position, suddenly play fair?

Re:We are the 30% (0)

peragrin (659227) | about 2 years ago | (#42259045)

That's a good idea.

The bigger the company the bigger the cut. MSFT should get the 30%. Smaller developers and less popular apps should 85%

Re:We are the 30% (4, Insightful)

AliasMarlowe (1042386) | about 2 years ago | (#42259153)

So... just reduce the price. Zero sounds about right, and then it does not really matter who gets what percentage of it.

Re:We are the 30% (-1)

Anonymous Coward | about 2 years ago | (#42259055)

It's Apple's platform. I agree that a 30% cut is a bit too much, and there could be tiers introduced based on company size, revenue, etc., but to manage this would probably be a bit too much for them, although it would be beneficial for small startups.

But then again, what would the Microsoft do if they were in their position, suddenly play fair?

Microsoft takes 30% from apps sold through the Microsoft app store. Surely they had to see this coming.

Re:We are the 30% (4, Informative)

guises (2423402) | about 2 years ago | (#42259261)

Microsoft only takes 30% for the first $25,000 of a given app. After that it's 20%.

Re:We are the 30% (5, Interesting)

Anonymous Coward | about 2 years ago | (#42259409)

Microsoft only takes 30% for the first $25,000 of a given app. After that it's 20%.

More importantly, they allow third party in-app subscription transactions and do not take a cut of that. That is a very major difference to Apple.

Re:We are the 30% (5, Insightful)

recoiledsnake (879048) | about 2 years ago | (#42259443)

This is about in-app subscriptions. Microsoft, unlike Apple does not mandate that you need to use their in-app purchasing model. The Kindle app on Windows 8/WP8 would be allowed to sell books in app or link to the Kindle's site. On iOS, Kindle was forced to remove even a link to the Kindle site.

From http://blogs.msdn.com/b/windowsstore/archive/2012/07/20/making-money-with-your-apps-through-the-windows-store.aspx [msdn.com]

Using your own billing system

Your app and service may already depend on a particular transaction provider or benefit from ties to other lines of business. Your customers want the trust and efficiency of a familiar, trusted transaction experience. You can use your own transaction provider within your app to provide the experience your customers expect.

If you are not using the Windows Store as your transaction provider, you will want to make sure that your app meets all of the certification requirements such as: Identifying the transaction provider to the user during purchase confirmation Prompt the user for authentication before processing the transaction Your payment processor must meet the current PCI Data Security Standard

So, Microsoft is not being a hypocrite here while Apple is trying to install a toll on every bought on an iOS device, even if you stop using the iDevice after a month and use the service on other devices, Apple wants 30% of the entire subscription. Guess which company gets a free pass on HN while criticism is piled on which company even while developer freedom is compromised before our very eyes. Everyone raised hell when MS proposed Palladium but when Apple implemented the Palladium spec to the letter the same journalists were stepping over each other to praise the iDevices. Same here, misinformation is being spread about the 30% cut by Apple afficionados to blame Microsoft while another facet of developer freedom is lost.

Re:We are the 30% (1)

Anonymous Coward | about 2 years ago | (#42259063)

fine they can have shitty maps and crappy office

Re:We are the 30% (1, Troll)

mumblestheclown (569987) | about 2 years ago | (#42259103)

suh-praz suh-praz, suh-praz. suddenly when microsoft's the one in the position of supplication, slashdotters become capitalists.

Re:We are the 30% (1)

Anonymous Coward | about 2 years ago | (#42259193)

suh-praz suh-praz, a snide comment on Slashdot

Platform == racketeering (-1, Flamebait)

mschaffer (97223) | about 2 years ago | (#42259149)

Can you imagine if a similar system was in place on desktops?
the iOS platform is a MONOPOLY.

Re:Platform == racketeering (2)

Quakeulf (2650167) | about 2 years ago | (#42259167)

Android is an alternative to iOS, and is shaping up nicely to become a worthy competitor. I will be awaiting the price fixing scandals.

Re:Platform == racketeering (1, Insightful)

SuperDre (982372) | about 2 years ago | (#42259245)

Well, if that's your defense, than MS doesn't have to adher to any monopoly rules regarding windows, as there are numerous other desktop OSses...

Re:Platform == racketeering (4, Insightful)

Desler (1608317) | about 2 years ago | (#42259341)

If the complaints are about Apple taking a 30% cut of in-app purchases how exactly is Android an alternative? Google takes a 30% cut for both app purchases and in-app purchases as well. Yet somehow only Apple is "evil" for doing this.

Transaction fees for app purchases: [google.com]

For applications that you choose to sell in Google Play, the transaction fee is equivalent to 30% of the application price.

In app purchases: [google.com]

The standard 30% transaction fee applies to in-app transactions on Google Play.

Re:Platform == racketeering (5, Informative)

Nerdfest (867930) | about 2 years ago | (#42259401)

Well, you aren't forced to use Google's Plat store, there are others, and side loading is allowed as well. You are also not forced to go through Google for in-app purchases I believe. Both of these services are set up so that it is convenient, and you *want* to use it. You are not forced to.

Re:Platform == racketeering (1)

Jesus_666 (702802) | about 2 years ago | (#42259353)

Actually, as far as I know the Google Play Store also takes a 30% cut. The main difference is that it costs more to get into the store with Apple (99 USD/a)than with Google (25 USD once). Things might be different for vendor-specific stores like Samsung Apps but then again those have a limited reach and are unlikely to be as attractive as Google's store.

Re:Platform == racketeering (0)

Anonymous Coward | about 2 years ago | (#42259181)

You don't know what a monopoly is. STFU.

BTW : Cydia? Remember?

Re:Platform == racketeering (1)

elashish14 (1302231) | about 2 years ago | (#42259217)

It's not a monopoly, so much as it is vertically integrated, which is good for no one. A lot of companies are fairly tied into Apple's platform which only benefits the vendor in the end. If they wanted to put a hurt on their customers, they could raise the rates even higher, though 30% is absurd as it is. Yes, this would encourage adoption of alternative platforms, but it would still harm the industries that have adopted iOS enormously.

I think the fairest solution is to force Apple to open their platform to alternative software sources in the same way as Android. Look at how that has benefited Amazon - they've been pretty successful with the Kindle Fire and their own app store, and it would be great to see this opportunity for innovation on other platforms as well. Apple can do whatever they want with their market, and it's not like people are gonna completely stop using it as there are still going to be plenty of users who see value in Apple's app store. But it would definitely support more indie development which is one of the greatest things money just can't buy.

Re:Platform == racketeering (5, Informative)

BonzaiThePenguin (2528980) | about 2 years ago | (#42259221)

You mean like Windows 8? You can't release Metro apps outside of the Windows Store.

Re:Platform == racketeering (2)

Nerdfest (867930) | about 2 years ago | (#42259405)

... and Microsoft takes a cut.

Re:Platform == racketeering (3, Informative)

Anonymous Coward | about 2 years ago | (#42259457)

... and Microsoft takes a cut.

Actually, Microsoft allow you to do your own subscription transactions in the app, and do not take a cut of that, unlike Apple. To say that this is pretty major for everything related to subscription revenue is an understatement.

Re:Platform == racketeering (0)

Anonymous Coward | about 2 years ago | (#42259435)

Where are my mod points when I need them? +1 Insightful

Re:Platform == racketeering (0)

whisper_jeff (680366) | about 2 years ago | (#42259259)

Ever heard of Android?

You might want to look into it.

ios =/= monopoly

Re:Platform == racketeering (1)

paiute (550198) | about 2 years ago | (#42259319)

Can you imagine if a similar system was in place on desktops? the iOS platform is a MONOPOLY.

http://bgr.com/2012/11/27/iphone-5-market-share-october-2012/ [bgr.com]

"Following the successful launch of the iPhone 5, sales of iOS devices have overtaken Android in the U.S., according to Kantar Worldpanel. The research firm found that in the past 12 weeks, sales of Apple (AAPL) smartphones accounted for 48.1% of the market compared to Android’s 46.7% share."

Re:Platform == racketeering (4, Funny)

Tridus (79566) | about 2 years ago | (#42259385)

It's a curious world where the #2 selling product is a monopoly.

Re:We are the 30% (-1)

Anonymous Coward | about 2 years ago | (#42259263)

I agree that a 30% cut is a bit too much

And yet both Google and Microsoft also take 30% cuts from revenue of things sold in their app stores. But the Fandroids and Slashturds (mostly the same people) only whine about Apple.

Re:We are the 30% (0)

Anonymous Coward | about 2 years ago | (#42259367)

Oh, and you're one of those that complains about the users of a website in general terms while also being a user.

Re:We are the 30% (2)

bhagwad (1426855) | about 2 years ago | (#42259389)

The difference with Android is that regular users can get their apps from elsewhere and developers can offer an alternative sales channel. I'll agree with your assertion the day Apple provides a "install from unknown sources" checkbox (off by default if you wish).

Re:We are the 30% (2)

paiute (550198) | about 2 years ago | (#42259287)

But then again, what would the Microsoft do if they were in their position....

40%

Re:We are the 30% (5, Insightful)

whisper_jeff (680366) | about 2 years ago | (#42259315)

I agree that a 30% cut is a bit too much...

No. It isn't. The only people who think that are those that have an axe to grind with Apple.

a) Pretty much every other app store out there has the same deal and, more importantly

b) When a company sells digital software themselves, they don't get to keep 100% of the sale price. They have to pay for hosting, bandwidth, marketing, sales processing, manhours involved in all of this, etc., etc., etc. Those numbers start to add up very quickly and anyone who's been even vaguely involved in producing and selling a product knows that they can quickly add up to near or above 30%. And doing it yourself doesn't give you the same marketing potential that Apple has when they do it and that marketing potential is not easily ignored.

Seriously, the only people who still bring this up (and mod it "Insightful" on /.) are those who are utterly ignorant of reality and just want to gripe about Apple (while ignoring all the other app stores operating under the same terms).

Re:We are the 30% (5, Insightful)

bhagwad (1426855) | about 2 years ago | (#42259395)

Umm...Apple already charges developers for merely listing their apps - $99 a year. That's HUGE and more than covers all the stuff you talked about - hosting, bandwidth etc.

They don't need to do this. They're just being greedy dicks.

Re:We are the 30% (2)

wisty (1335733) | about 2 years ago | (#42259411)

> They have to pay for hosting, bandwidth, marketing, sales processing, manhours involved in all of this, etc., etc., etc.

The one thing Apple does which is really valuable is payment processing. They have the customer's CC number, so there's a lot less steps to purchase. There's also a lot more trust, as you know Apple isn't likely to sell your CC.

That's it. Everything else is a bonus.

But having the customer's CC in the system is worth at least 30%.

Re:We are the 30% (1)

Nerdfest (867930) | about 2 years ago | (#42259419)

The disagreement over the high fixed percentage despite the cost of the products sounds startlingly similar to Apple's complaints about fees on FRAND patents though.

Re:We are the 30% (1)

wpiman (739077) | about 2 years ago | (#42259421)

Microsoft has an ulterior motive to cell their OS powered phones now. I haven't used on but apparently they are quite good. This might be a teaser to companies-- "hey, you can't use Blackberry anymore. Iphones are nice-- but you can't do work on them. Look at our new Windows phones!"

Re:We are the 30% (1)

PsychoSlashDot (207849) | about 2 years ago | (#42259447)

It's Apple's platform. I agree that a 30% cut is a bit too much, and there could be tiers introduced based on company size, revenue, etc., but to manage this would probably be a bit too much for them, although it would be beneficial for small startups.

Devil's advocate here. If I manufacture a brick, I set the price that I am willing to sell that brick to a brick store. That brick store can then apply whatever margin they wish to my brick before they sell it to the public. While I can recommend a retail price (MSRP) I cannot enforce that price without simply not selling my bricks to the brick store. I set the price of my brick at the amount I need to cover cost of manufacturing plus some profit. If the brick store's retail price is so high that it discourages people from buying my bricks, I have no recourse. I can certainly request a price drop but have no real influence other than ceasing my supply.

Why would the digital distribution model be any different?

Re:We are the 30% (1)

Lumpy (12016) | about 2 years ago | (#42259459)

I dont. I think they need to take a 40% cut from Office. Microsoft makes obscene money from office on the PC, so they can suck it.

Lets bargain (2)

Sulphur (1548251) | about 2 years ago | (#42259007)

Is 100% too much?

Re:Lets bargain (1)

oztiks (921504) | about 2 years ago | (#42259143)

Apple needs to cut the arrogance crap! If Apple wants to stay in the BYOD game they should be seeking means to accommodate services as such by being as plugin friendly as possible. Blackberry, Nokia and anything Android would not put down such limitations.

This also means companies (not BYOD) seeking devices which plugin to their already pre existing services only serves to strike Apple off the buying list.

What's next? expecting people to drop Exchange for MobileMe? not likely. Not to say I use either Office 365 or Exchange, Zimbra for me all the way. What move has done is affect legacy and hurt Apple. A card that needed to be played much later in the collapse of MS as doing it now only serves to promote it and help Windows 8, stupid.

Re:Lets bargain (0)

Anonymous Coward | about 2 years ago | (#42259209)

Clueless idiot.

Enterprise customers are able to install their own iOS software without the Appstore. No cut, no restrictions.

http://www.apple.com/iphone/business/it-center/deployment.html
http://help.apple.com/iosdeployment-apps/mac/1.1/

The article failed to mention (5, Funny)

skipkent (1510) | about 2 years ago | (#42259017)

A threatening note was tied to a chair and flung through a window at Apple headquarters.

Re:The article failed to mention (1)

ipquickly (1562169) | about 2 years ago | (#42259065)

A threatening note was tied to a chair and flung through a window at Apple headquarters.

Was the window open or closed?

Re:The article failed to mention (0)

Anonymous Coward | about 2 years ago | (#42259213)

Curved or flat?

Re:The article failed to mention (0)

Anonymous Coward | about 2 years ago | (#42259307)

Flat, rectangular, with rounded corners.

Re:The article failed to mention (3, Funny)

azalin (67640) | about 2 years ago | (#42259391)

Was the window open or closed?

I can't say, there's this blue screen that won't let me see the window.

As much as I hate Microsoft... (2, Insightful)

pointyhat (2649443) | about 2 years ago | (#42259019)

As much as I hate Microsoft, I'm behind them here. Perhaps they should just drop all their apps suddenly and promote the Android and Windows Phone versions?

Re:As much as I hate Microsoft... (1)

Vanderhoth (1582661) | about 2 years ago | (#42259085)

Isn't MS planning on doing the same thing apple is through the windows store? and isn't the windows store the only way to get things on Windows RT?

Re:As much as I hate Microsoft... (0)

Anonymous Coward | about 2 years ago | (#42259111)

The only difference is that apple has no software of value to sale through another app store.

Re:As much as I hate Microsoft... (0)

Anonymous Coward | about 2 years ago | (#42259113)

srsly. i agree.

only reason apple exists today:
1- bill gates hooked up his buddy (steve jobs) because of sentimental reasons by buying enough shares to keep apple from bankruptcy and supportrd jobs' return to apple kingship
2- microsoft needed apple to survive becauseof all the heat it was recieving over antitrust issues. fall of apple would have literally made microsoft a global monopoly on the desktopso they started supporting their core products on apple and played nice with all of bill gates' moves

if the 2 above things didnt happen, apple would not exist. that 30 percent was a number microsoft came up with out of generosity. i dont think it was right, and i wish apple had failed and microsoft would have to be split into multiple companies and the industryt would have learned a valuable lesson. it would have set precident for case law that would protect consumers. instead we had to have apples greeed and crap lawsuits to set that precident over 10 years later. that said, microsoft is asking not for apples help in dealing with the death spiral they are in, but for apple to stop gouging them over an issue where microsoft was being generous to apple.

i am so happy to see microsoft going down the tubes, but apple is officially on my shitlist for having no sense of humanity at all. before i thought they were of the same ilk as most corporations, but now they are approaching enron status.

Re:As much as I hate Microsoft... (0)

Anonymous Coward | about 2 years ago | (#42259249)

Boy, you desperately cling to an urban myth. MS has NOT saved Apple. Apple was saved by Steve Jobs and his radical product shake up, not those measly 150 millions (Apple had even then some billions in it's bank account).

http://www.roughlydrafted.com/RD/RDM.Tech.Q1.07/592FE887-5CA1-4F30-BD62-407362B533B9.html

Re:As much as I hate Microsoft... (0)

Anonymous Coward | about 2 years ago | (#42259345)

Boy, you desperately cling to an urban myth. MS has NOT saved Apple. Apple was saved by Steve Jobs and his radical product shake up, not those measly 150 millions (Apple had even then some billions in it's bank account).

http://www.roughlydrafted.com/RD/RDM.Tech.Q1.07/592FE887-5CA1-4F30-BD62-407362B533B9.html

Jobs finally got around to "marketing" relevant stuff 13 years after being kicked out for trying to market useless stuff. Had he been prepared to listen to John Scully this situation may never have arisen.

Re:As much as I hate Microsoft... (0)

Anonymous Coward | about 2 years ago | (#42259273)

"Humanity"?
Microsoft putting Office on iOS out of the goodness of their hearts?
Apple to blame for measures Microsoft took to avoid being broken up?

Enron status? ...

Really? Is the crack that good?

Re:As much as I hate Microsoft... (0)

Anonymous Coward | about 2 years ago | (#42259337)

Thank you for your post. Reading it dropped my IQ 20 points. Now I can get my attention back on my mindless drudgery.

Re:As much as I hate Microsoft... (4, Interesting)

SerpentMage (13390) | about 2 years ago | (#42259125)

No Apple has a point here. The reason why Apple charges 30%, even if that may seem high, is that its FAIR! How many times do bigger companies have an unfair advantage over smaller companies? Apple is saying, "hey big or small you pay the same fee!" Of course Microsoft is irked because they play by a different set of rules. Rules that they like to make up. Oh wait, this is the company that has been charged with monopolistic practices.

My answer to Microsoft, "tough shit live with it!"

Re:As much as I hate Microsoft... (2)

K. S. Kyosuke (729550) | about 2 years ago | (#42259187)

The reason why Apple charges 30%, even if that may seem high, is that its FAIR!

I can hardly think of any reasonable definition of "fair" in this context that would be *that* simplistic. It's the same with taxes. You can only keep saying "if everyone pays 20% income tax it's FAIR" until you realize that poorer people are more taxed by consumption/excise taxes already. Different app costs, differtent app complexity...BTW, what are the actual costs to Apple anyway?

Re:As much as I hate Microsoft... (1)

T-Bone-T (1048702) | about 2 years ago | (#42259283)

Actual costs never matter to the costomer. You, as a simple customer, have no say in how much a company can charge above actual costs except by not buying if you object to the profit margin.

Re:As much as I hate Microsoft... (1)

msauve (701917) | about 2 years ago | (#42259303)

"if everyone pays 20% income tax it's FAIR"

You're right, that's completely NOT fair, because someone who makes more pays more, but receives nothing more from government. What would be fair is everyone gets sent a bill for $X, which is the same for everyone.

Re:As much as I hate Microsoft... (1)

MurukeshM (1901690) | about 2 years ago | (#42259327)

There was a nice bit in one of the Foundation prequels where Seldon tricked the junta into using poll tax. Read that to understand what's "fair".

Re:As much as I hate Microsoft... (1)

Xest (935314) | about 2 years ago | (#42259371)

There's nothing fair about skimming 30% off the profits of small companies.

Re:As much as I hate Microsoft... (1)

Anonymous Coward | about 2 years ago | (#42259177)

Considering MS Office on a tablet _can_ be a dealbreaker for an enterprise, I find it strange that Apple's so unwilling to give in.

I'd think they would prefer to begrudgingly prop up each other than go and help boost Android's sales.

Re:As much as I hate Microsoft... (1)

smash (1351) | about 2 years ago | (#42259233)

You can already open office docs on a tablet. If you need to edit them, BYOD peeps are already pushing stuff like VMware view, anyhow.

Sell subscription outside of App Store ... (1)

perpenso (1613749) | about 2 years ago | (#42259185)

As much as I hate Microsoft, I'm behind them here. Perhaps they should just drop all their apps suddenly and promote the Android and Windows Phone versions?

I don't think too many users are going to be using MS Office only on their iOS devices, rather they will have MS Office on their computer and devices. So don't sell/manage the subscriptions from the App Store apps. Only sell/manage the subscriptions from the web or from computer based apps sold outside of the Apple App Store. Unlike iOS, the Apple App Store is not required under Mac OS X and developers may sell directly to users. If you are an established and well known brand and have the infrastructure to do your own digital sales to Windows and Mac OS X users then there is little need for the Apple App Store.

Re:As much as I hate Microsoft... (1)

smash (1351) | about 2 years ago | (#42259219)

No one will care.

Not actually 70/30 (3, Informative)

gnasher719 (869701) | about 2 years ago | (#42259023)

One thing to remember: It is not actually the case that Apple gets 30% of the money, and the developer gets 70%. Each app has an "official" price, lets say $9.99 or $10 to make the maths easier. If you purchase it, the developer gets $7. However, Apple doesn't always get $10. There have been student offers where you could buy a Mac and get $100 for store purchases, which means Apple gets nothing and pays $70 to developers. Plenty of people give gift cards for Christmas, and if you buy a $50 gift card from some store, that store is taking its (generous) cut and Apple doesn't get $50, but still pays $35 to developers. I always manage to stock up with gift cards purchased with 20% rebate, so for £50 official price software, music or books that I buy, the developers get £35, I paid only £40, so I don't think that Apple keeps 30% of that.

Now Apple's plan is not to make money from the stores (thought is just a welcome side effect), but to have good app stores to make you buy Macs and iPhones and iPads. Still, if Microsoft got say 80% of the "official" price, Apple might actually lose money on that.

Re:Not actually 70/30 (1)

Robadob (1800074) | about 2 years ago | (#42259043)

Why can't these app sales be handled like brick and mortar stores. Microsoft sets a price which they sell licenses to apple, then apple can do what they like with said licenses as purchased.

Re:Not actually 70/30 (2)

pointyhat (2649443) | about 2 years ago | (#42259071)

Because it's harder to retrospectively fuck you over then as a license holder.

Re:Not actually 70/30 (0)

Anonymous Coward | about 2 years ago | (#42259067)

It's cute that you believe it works like this.

Re:Not actually 70/30 (1)

gmhowell (26755) | about 2 years ago | (#42259159)

It's cute that you believe it works like this.

Who can possibly refute the reams of evidence you have linked to to support your implied claim.

Re:Not actually 70/30 (0)

Anonymous Coward | about 2 years ago | (#42259229)

Because offers like this doesn't happen unless a company is stuck with surplus stock.
Not many companies have surplus stock these days because they sit with as little stock as they possibly can and if they do agree to take on stock they demand you rebuy if it does not sell according to some plan.

Now this is the software business, with no stock at all, offers only happen if the "manufacturer" agree to lower their price for the offer.
I may be wrong and Apple may be truly altruistic about this, but altruism isn't something I associate with Apple.

Re:Not actually 70/30 (0)

Anonymous Coward | about 2 years ago | (#42259117)

If they couldn't afford that model, then it wouldn't happen in the first place. Besides, they might lose at that particular deal, but with 30% of everything else, it still translates into loads of money.

Apple's bussiness model isn't "make money", it's "make lots and lots of money".

Re:Not actually 70/30 (4, Interesting)

Anonymous Coward | about 2 years ago | (#42259139)

You claim that if you buy a gift card in a store, the store takes a "generous" cut. This is not the case. I am in a position where I order these gift cards for a large retail chain in the US. The margins on gift cards are 1 to 2 percent. So for that $50 gift card, the store profits 50 cents to a dollar. I wouldn't call that generous at all. The only reason we sell them is because people tend to not come in and only buy gift cards, they tend to also pick up greeting cards (a HUGE profit center, percentage wise) and other gift-related items at the same time.

Re:Not actually 70/30 (1)

gnasher719 (869701) | about 2 years ago | (#42259325)

You claim that if you buy a gift card in a store, the store takes a "generous" cut. This is not the case. I am in a position where I order these gift cards for a large retail chain in the US. The margins on gift cards are 1 to 2 percent. So for that $50 gift card, the store profits 50 cents to a dollar. I wouldn't call that generous at all. The only reason we sell them is because people tend to not come in and only buy gift cards, they tend to also pick up greeting cards (a HUGE profit center, percentage wise) and other gift-related items at the same time.

So how can Boots sell a £25 gift card for £20?

Re:Not actually 70/30 (1)

ByOhTek (1181381) | about 2 years ago | (#42259375)

I've never seen a gift card sold for less than face value, but it does work with the GPs post...

I'll take another example, a very profitable company you might have heard of... Newegg?

Yep. They actually at one time (and maybe still) took a loss on memory sales, because people would just stick on that site and buy other stuff as well, even if it was normal price.

As the GP said, they aren't there for the profit, they are there to help get people into the store and move other items (greetings cards in particular, but there's plenty of impulse aisle stuff, as well as normal purchases that might have been made elsewhere)

Re:Not actually 70/30 (1)

Tridus (79566) | about 2 years ago | (#42259417)

I bought a bunch of iTunes gift cards at Walmart a few months ago at a significant discount off the face value. Something like 25%. It was a pretty good deal.

Re:Not actually 70/30 (1)

Xest (935314) | about 2 years ago | (#42259413)

Because they've milked money off you elsewhere to subsidise it, or have milked enough money off others through methods related to the the promotion on average to subsidise it.

Either way they're not getting a discount on the gift card, they're subsidising it themselves either through a calculation that to get that gift card you had to spend enough on something else to make up for it, or through a careful calculated estimation that by drawing you into the store to buy their discounted cards, you'll spend enough on other things to make up for it.

Re:Not actually 70/30 (4, Insightful)

Entropy98 (1340659) | about 2 years ago | (#42259179)

Who modded this informative?? A significant percentage of gift cards are never redeemed, more than enough to cover the retailers cut and then some.

You think apple might lose money on 20% transaction fees????? Paypal and other payment processors charge ~$.30 + 2-3% percent transaction fees and they aren't losing money.

Apple is making 25%+ pure profit on every transaction.

Re:Not actually 70/30 (0)

Anonymous Coward | about 2 years ago | (#42259279)

Wait, so we should really be feeling sorry for Apple because in some circumstances they might not actually get that 30% and somehow 'lose money' on it?
( They're marvellous bookkeepers, aren't they - if you think the App Store really isn't bringing in any money directly and only through secondary effects such as people buying Apple hardware, I've got a bridge to sell you, you look like a buyer. )

Look, it's their store, their rules - I get that. They're also not a monopoly and even if they were, it wouldn't be abuse.

But it's still dickish moves left and right with them, isn't it?

Take the Skydrive story. Forget the 30% for a moment. It could be 50%, it could be 1%, it really doesn't matter because the more important issue is this:
If you use the Skydrive app, or any other app that integrates Skydrive, and that lands you on a Skydrive page where you can get a subscription - Microsoft must pay Apple a portion of that subscription fee because 'it happened through an app store app'.
So I get a Skydrive subscription, unrelatedly grow bored with my iPhone a week later, and get an Android or Windows Phone instead. I pay for my Skydrive subscription come next year. Guess who still wants a piece of that subscription fee because it was set up a year before through a platform that I'm not even using anymore?

Okay, so Microsoft should have known that from Apple's terms, right? No problem, just remove the the option to get a Skydrive subscription - same thing Dropbox did, and all should be well, yeah?
Well, no. Apple refused that offer. Hey, maybe they had other reasons, but unless they change their PR machine being mum on such issues and clarify, I'm inclined to think that they'll accept Skydrive if it offers the membership - and they give Apple a cut - or not at all.

Their store, their rules, but that 'one thing to remember' where they might not get a 30% cut? May they cry me a river. Hey, did I mention I have a bridge for sale?

That's a nice business you have there (0)

Anonymous Coward | about 2 years ago | (#42259035)

Would be a shame if something happened to your office software.

Who to root for... (5, Funny)

jtownatpunk.net (245670) | about 2 years ago | (#42259041)

Who should I root for when I want both sides to lose?

Go, banana!

Re:Who to root for... (0)

Anonymous Coward | about 2 years ago | (#42259087)

Who should I root for when I want both sides to lose?

The consumers, but you should also throw in a cheer for 2013: Year of the Linux Desktop.

Go, banana!

Yay Ralphie!

Didn't MSFT want $40,000 to certify a patch? (5, Interesting)

Anonymous Coward | about 2 years ago | (#42259047)

Funny, when it was their OWN store, for the XBox, they wanted $40k to certify a patch on a game:

http://arstechnica.com/gaming/2012/07/microsoft-comes-under-fire-for-five-figure-xbox-360-patch-fee/

Suddenly when other companies want *their* cut to sell in *their* store, it's suddenly objectionable?

Hasn't the tables really turned here, Apple doesn't need MS Office for the iPad to be a success. Indeed Microsoft needs certification for it's Office 365 to succeed. Oh how the mighty have fallen.

If Microsoft didn't release it for iPad, so what Polaris office or similar would work just fine.

Re:Didn't MSFT want $40,000 to certify a patch? (1)

Stewie241 (1035724) | about 2 years ago | (#42259265)

Fallen? I'm not sure about that. MS Office is still the platform of choice. I doubt that Microsoft is really considering 'fair' on this. Not that they are trying to be unfair. They are likely simply trying to negotiate a better deal on the basis that they believe having MS Office on iOS is important for Apple.

The question to ask is who stands to lose more of MS doesn't release Office for iOS? Short term is definitely MS, but as Android's share continues to increase this will become more and more of a deciding factor if the implementation is good.

Re:Didn't MSFT want $40,000 to certify a patch? (2)

Tridus (79566) | about 2 years ago | (#42259433)

The point here is that people are complaining about fairness in this thread and how it's unfair to Microsoft, when MIcrosoft itself is quite happy to dictate far worse terms to other people.

MS is acting like a privileged person who suddenly is no longer in a privileged position: by wanting special treatment anyway and not knowing how to react when they get told to pound sand.

Re:Didn't MSFT want $40,000 to certify a patch? (1)

Xest (935314) | about 2 years ago | (#42259397)

Yes, except for games like Minecraft Microsoft have offered to wave that fee so that it can continue to provide updates meaning Microsoft does make concessions based on the business case which unfortunately runs a steamroller over your argument that there's somehow some kind of double standards going on here.

yea naw (0)

Anonymous Coward | about 2 years ago | (#42259081)

The subscription isn't even going to be sold through the MS Office apps, those are to be bought separately on the Office 365 website. And MS adding serious functionality to Apple's shitty fart app tablet. So frankly they ought to be getting paid for it, not the other way around.

Same could be said for all devs on all OSs at this point. Without them iOS is garbage. Without any dev on any platform really. This whole "pay me to increase my OS's value" attitude has got to go. They're doing you a favor, without third party software your OS is shit unless you want to spend all that money developing it yourself and see less returns.

Yeah...no. (2)

danaris (525051) | about 2 years ago | (#42259151)

The subscription isn't even going to be sold through the MS Office apps, those are to be bought separately on the Office 365 website.

Apple's position is, and always has been, that subscriptions bought through in-app purchase pay Apple the 30% cut—because they're going through Apple's payment process and paying through their iTunes account—while subscriptions bought elsewhere, Apple doesn't care about. (They used to care enough to demand that they be priced the same as subscriptions through in-app purchase, but now, IIRC, they no longer even do that.)

So you're as full of BS as the next irrational Apple-hater.

Dan Aris

iOS apps can only sell using in-app purchases ... (2)

perpenso (1613749) | about 2 years ago | (#42259305)

Apple's position is, and always has been, that subscriptions bought through in-app purchase pay Apple the 30% cut—because they're going through Apple's payment process and paying through their iTunes account—while subscriptions bought elsewhere, Apple doesn't care about.

I think all sales done by an app have to go through Apple's in-app purchase system. You can offer subscriptions and services elsewhere but the purchase has to be done outside of the app. I don't think the app can even send you to the web for such purchases to avoid in-app.

Now for MS Office this seems like a minor issue. I expect people will have Office on their computer and mobile device. So do the subscription purchases from the computer.

Re:iOS apps can only sell using in-app purchases . (1)

danaris (525051) | about 2 years ago | (#42259339)

Apple's position is, and always has been, that subscriptions bought through in-app purchase pay Apple the 30% cut—because they're going through Apple's payment process and paying through their iTunes account—while subscriptions bought elsewhere, Apple doesn't care about.

I think all sales done by an app have to go through Apple's in-app purchase system. You can offer subscriptions and services elsewhere but the purchase has to be done outside of the app. I don't think the app can even send you to the web for such purchases to avoid in-app.

Yes, that's correct. I didn't intend to imply otherwise; sorry if I wasn't clear.

Now for MS Office this seems like a minor issue. I expect people will have Office on their computer and mobile device. So do the subscription purchases from the computer.

Exactly. I really don't see why Microsoft is making such a huge stink over this, if the in-app purchase of a subscription is the real issue for them. Makes me suspect that all they really want is to try to make Apple look bad. (But then, I've been anti-Microsoft for decades now, so I'm hardly impartial.)

Dan Aris

Re:iOS apps can only sell using in-app purchases . (1)

perpenso (1613749) | about 2 years ago | (#42259399)

I expect people will have Office on their computer and mobile device. So do the subscription purchases from the computer.

Exactly. I really don't see why Microsoft is making such a huge stink over this, if the in-app purchase of a subscription is the real issue for them.

Perhaps MS was thinking of offering the Mac version of Office through Apple's Mac App Store. That might trigger the same restrictions as the iOS App Store.

Re:yea naw (0)

Anonymous Coward | about 2 years ago | (#42259383)

There are more fart apps for Android than there have ever been for iOS.
Reality check.

BTW : No platform, no developer, no money for developers. But developers could spend their own money to develop their own hardware platform. Right?

uh... no (1, Insightful)

smash (1351) | about 2 years ago | (#42259201)

What the fuck do microsoft think makes them so special?

If indie developers working out of their bedroom can take the 30% so can they.

IT'S CALLED, THE LEVER !! (0)

Anonymous Coward | about 2 years ago | (#42259269)

WIth a long enough one, you can move mountains !!

If you have an even bigger lever, you can move even bigger moutains !!

If you have a wee-man thing, you can move your chair around and that's about it !!

But Office ### on a little screen is crap so why do you care ??

Re:uh... no (2)

Stewie241 (1035724) | about 2 years ago | (#42259285)

Sure... unless they can negotiate a better deal on the basis that they can convince Apple that they need Office enough that they are willing to cut the rates for it.

Re:uh... no (1)

Anonymous Coward | about 2 years ago | (#42259441)

Because indie developers arent bringing MICROSOFT OFFICE to the IoS platform. Office is an app guaranteed to sell bajillions of copies worldwide and will no doubt be more feature rich than indie apps are. Given the alternative for Apple is to create their OWN productivity software, making it up in volume seems like an obvious choice to me.

iOS and Ofice (0)

Anonymous Coward | about 2 years ago | (#42259225)

Let's see...

Obviously, MS is in a very strong position. Because not having had Office on iOS so far was a big obstacle for Apple's iOS sales, so... oh wait...

On the horizon... (1)

MrKaos (858439) | about 2 years ago | (#42259335)

I see a perfect storm, brewing.

Appstore. (0)

Anonymous Coward | about 2 years ago | (#42259343)

If only I would have the option to open my own store for the iPhone.

This is not about app purchases... (5, Interesting)

HumanEmulator (1062440) | about 2 years ago | (#42259357)

As a small developer, I would love if Apple took a smaller percentage of app purchases (which as others have pointed out isn't really 30% when you factor in referral fees, retail markups on iTunes gift cards and the credit card processing fees they pay out), but it's great that by enforcing rules they are effectively taking a step toward leveling the playing field for the small guys. (Instead of giving sweetheart deals to fellow big guys.)

But in this case, we're not talking about app purchases-- we're talking about transactions that occur in an app, and this has always been a questionable rule. It a straight tax on transactions. It's in the same vein as Verizon demanding Google pay them because Verizon customers are accessing Google "through their pipes."

And it's more inconsistent than people realize... I routinely place orders for food in the Delivery.com and the SeamlessWeb apps and because I have no credit card on file with either, I enter my credit card info for payment instead of using an iTunes account. So no 30% goes to Apple for my burrito, but DropBox leaves a link to their website in their SDK and suddenly all hell breaks loose. But Apple has a DropBox competitor and doesn't currently offer burritos I guess...

Awww, poor widdle Microsoft... (4, Insightful)

sootman (158191) | about 2 years ago | (#42259379)

Is that big mean company not being nice?

If they don't want to pay to play in Apple's playground, there's a simple, two step solution (with apologies to Larry Wall, I believe):

1) Make your own mobile platform

2) Make it popular

And this is why HTML5 apps will make it big. (1)

boylinux (775361) | about 2 years ago | (#42259423)

You avoid having to pay for different developper licenses and losing a cut of the costs. As browsers and javascript engines get better and developpers get smarter then we won't have to be tied into walled gardens. Then we will just have to work at getting pricing down for wireless plans.
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