Earlier this month, potentially the most disruptive thing happened in the mobile industry since Apple launched the iPhone: Fortnite (Free), the biggest game in the world, announced that they would be distributing the game themselves instead of using Google Play. I really don’t think many people appreciated what a huge deal this was, as both Apple and Google have more or less had a complete stranglehold on the mobile app market since … forever. Epic’s Tim Sweeney threw down the gauntlet by saying, “The 30% store tax is a high cost in a world where game developers’ 70% must cover all the cost of developing, operating, and supporting their games." It would seem that Facebook and Netflix agree.
This news comes from two separate reports: The first is from GamesIndustry.biz who are reporting that Facebook will no longer take any revenue from developers who release Instant Games on their Android platform, instead of the 70/30 split they used to have and this is applying retroactively. Additionally, per Market Watch, Netflix is poking around in a few test markets trying out a version of the app where you aren’t able to register for the streaming service at all.
Currently, the way the new user flow works is you download the Netflix app, and if you don’t have an account you can just begin subscribing right through iTunes subscriptions… Where Apple takes their 30% cut. In these test markets, that’s no longer an option, and users need to find their way to Netflix.com to sign up and pay for the service outside of Apple’s ecosystem. Spotify has been doing this forever, and arguably more vocal than most companies when it comes to what a raw deal the platforms are serving up.
It puts Apple (and Google) in an interesting position, as much like Spotify, it’s not like they can boot Netflix off of the App Store. iOS users wouldn’t put up with that, and it would turn into a major deciding factor on what their next mobile device would be. I play a ton of my games on my iPad, but iOS exclusives are so rare now that if it came down to am I going to buy the new iPad which doesn’t have Netflix or the next Samsung tablet that does have Netflix, it’s a fairly easy decision.
I have no idea what’s going to happen next, but these are very interesting times we’re living in. The App Store and Google Play had been seen as these untouchable behemoths that you have no choice but to play ball with and pay 30% for years now… But, in the words of Bob Dylan, the times they are a-changin’.
I prefer to pay via apple. I see all my subscriptions in one place and can cancel at any time.
You wouldn’t buy an iPad because of no Netflix, lol, no wonder this site is in the shape it’s in with people like this around.
Im suprised more folks didnt join amazon kindle's business practices sooner.
No kidding.
Just because you are miffed over the referral program (which I agree with you) doesn’t mean you should slant your editorial against Apple. Netflix is becoming very anti-consumer these days, putting ads into shows and now this. Guess that’s what happens when you become a dominant player in a space, eh?
I've thought Apple's platform fees are BS for ... ages now. You're reading between the lines a little too much.
Why? Apple is not a charity. I would expect to try and place a item in a store for sale without paying a shelving fee. It’s a mutually beneficial arrangement. Apple gives app developers access to their customers and a place to showcase their app. They in return expect a cut. If a developer doesn’t like it they should go develop their own smartphones and OS. I hear Windows Phone and Blackberry is looking for developers...
In the words of Tim Sweeney, "30% is disproportionate to the cost of the services these stores perform, such as payment processing, download bandwidth, and customer service."
Tim Sweeney is a bullshitter par excellence. Epic should be paying 30% to PUBG for stealing their game.
That certainly is a take.
On the contrary, because Apple thumbed the eyes of TouchArcade and other early and ongoing best supporters, I would welcome any schadenfreude TouchArcade can muster, especially in this case, which is nearly identical. Apple says to TouchArcade, "Your fees are no longer necessary", and Netflix/Facebook say to Apple, "You're right".
Didn't Netflix start like this? Where you could only sign up somewhere else because they didn't want to give Apple their fees. Then Apple changed their pay structure with Netflix and added subscriptions. Now Apple takes 30% for the first <x> amount of time and then the percent drops - I forget the exact numbers / details. But Netflix is trying to cut them out completely again is still a big deal - I guess even then it's not worth it for Netflix / FB. I'd like to see where this goes.
Yeah, I think that's the most surprising thing about all this to me. Netflix and a lot of other large companies don't really need advertising help from Apple & Google, so I'm sort of surprised they've given up that much revenue when there was a clear model to get around it.
I understood one of the benefits of purchasing things through the App Store was that they did the payment processing?
This had advantages, small shops could focus on the product and leave the payment processing to Apple. Apple then handled the security details if that processing. Another advantage as the consumer was that Apple shares less info than than a typical processor, providing additional peace of mind.
That is definitely one of the advantages of Apple Pay, they do not give the merchant all data they have on you, unlike when you swipe a card at Walgreens and they get your life history.
I would also argue the "advertising" savings of having your service one click away on BILLIONS of devices thanks to Apples App Store has a monetary value. Not sure people are buying phones based upon Netflix, but would Netflix have as many subs if they weren't featured prominently in Apple (And others) app stores? Their content selection has gotten worse IMO over the last several years. They may be making some good original content, but they are looking less compelling to me everyday. I could understand wanting to negotiate your own percentage, but complaining that it exists, seems rather disingenuous to me. The rise of mobile devices and set-top connected devices from Apple and Google has a lot to do with their success IMO.
Epic : Hi Apple, we don’t want to be on your App Store that is on 1.35 billion devices any more, it costs too much
Apple : um.. ok.. bye (goes back to counting the trillion it made before fornite even existed)
Epic : can we use another method to be on your devices
Apple : (still counting) no, and if you try we will block it
Epic : people will stop using Apple if our less than a year old game can’t be played on your device anymore
Apple : (still counting) we will take the risk
Oh and Netflix, I think Apple won’t bother too much, or will start a service that wIll stream their ENTIRE iTunes Store in competition (no likely). But too be honest Netflix on devices is much older than paying the sub.. plus Netflix is on everything anyway, not being on an IOS device if it comes to that is negligible