In a major ruling this week, Apple has been forced to stop taxing app developers a huge fee just for the privilege of making apps on its platform. After years of delay tactics and stonewalling (and, the judge says, “outright lies” in court), Apple has to allow app developers to offer in-app purchases through stores outside the App Store, here in the U.S. Apple will appeal the decision, but is required to comply with it in the meantime.
It’s not the sweeping rules instituted by the European Union, which found the platform to be a “gatekeeper” and therefore has to allow third-party app stores, app sideloading, alternate tap-and-pay processors, and so on. Those regulations, which Apple fought against tooth and nail (and has been found to be partially violating even now), have resulted in a version of iOS that many feel is better than the one we have in the U.S.
These aren’t isolated instances. Apple has consistently fought every possible effort to allow users to get apps on iPhone or iPad, or to pay for them, using anything other than Apple’s own store and payment processing. Apple tells us the main reason is security and simplicity, but it also happens to take a big cut off the top (30 percent, but Apple has been backed into various programs and policies to lower that somewhat for some developers). As a result, Apple is currently being sued by the federal government over antitrust violations.
Out of control over control
Back in the 80s, Apple started as a scrappy upstart, emphasizing lower costs and more freedom for users and developers, in stark contrast to IBM, which wanted to control and limit you. Now Apple seems to view itself as a holistic ecosystem, a growing network of devices and services made by and for the benefit of Apple. To the extent that it allows other developers access to “their” platform, it is being magnanimous to do so. Access to the iPhone is a gift from Apple…or at least, that’s the attitude it seems to convey.
Apple uses more persuasive language than that, of course. It talks about how much it “invests” in developer tools and the App Store and how the fees developers are forced to pay are a necessary cost.
The fact is, Apple isn’t a tiny company going up against the big IBMs and Microsofts of the world anymore. It’s one of the world’s most valuable companies and the most influential in tech. It has several billion customers. Apple now is the IBM of the 80s, the Microsoft of the ’90s… and it doesn’t seem to recognize it.
Consider all the ways Apple still prevents anyone else from making a smartwatch that can do what the Apple Watch does on the iPhone. Apple gives its own watch special privileges, and even its own apps and services on the watch are exclusive. Earlier this year, the original creator of the Pebble smartwatch announced a new modernized version and highlighted all the ways Apple prevents any other smartwatch from working as well with the iPhone as the Apple Watch. It’s not a short list.
The new Pebble watch won’t play nice with the iPhone because of Apple’s restrictions.
Pebble
Most of Apple’s problems could be avoided if it weren’t so greedy about owning and controlling all access to the iPhone and iPad for every developer. Apple sees app distribution as a critical revenue source, on top of its industry-leading margins on hardware. Instead, it should view app development and distribution as a cost center. It should be a money-losing endeavor, like advertising, because it builds demand for Apple’s products.
Apple’s claim for its obsession with controlling all app distribution and payment always comes down to security and privacy, but that rings hollow when the company will gladly sell you a Mac—an open platform that allows direct web download of apps, alternate app stores like Steam, and open payments. And yet Mac users are not suffering some existential privacy or security risk, and for that matter, neither are Android users (which far outnumber iPhone users, globally).
What’s more, the EU’s forcing of relaxed rules over app distribution, payments, browsers, and default apps has not resulted in headline after headline of EU iPhone users being hacked, swindled, and cyber-stalked. It’s just fine. It’s all fine. We could all have it this way, globally, and all it would do is cause a nominal drop in Apple’s revenue—again, this is the most valuable company in the world that just made a profit of more than $27B per quarter off mostly hardware sales and services.
There are two ways to make the best product or service, whether it’s earbuds, apps, app stores, or whatever else: One is to provide a better experience at a better price so customers choose you, the other is to prevent others from being able to produce an experience or price that can beat yours. Apple does both, but seems to favor the latter as much as the former.
Does Apple know what people want anymore?
I’m starting to think that Apple leadership doesn’t know what people want anymore. Too many hardware lines are stuck in an endless cycle of “the same as last year but just a little better.” The big iPhone push this year is going to be a super-thin model (call it “iPhone 17 Air” if you will), which of course will limit space for advanced cameras and bigger batteries. When you ask people what they want out of an iPhone, nearly everyone says a cheaper price, longer battery life, and a better camera (with less photo processing). That’s basically the opposite of where Apple is headed.
How did Apple Intelligence end up so bad? Which leaders within Apple said, “Yeah, this is great, people will love this. Let’s build our entire marketing campaign around it?” How is Siri only now getting the attention it needs, when it has been a public joke for years? Why does Apple keep trying to court gamers to the Mac when it so very clearly doesn’t understand what gamers want or need, and isn’t willing to invest in delivering it? Why can’t Apple make a decent mouse? Why are there six different iPads? Why is the company making devices to wear on your head (Vision Pro and AirPods Max) that weigh twice what they should? Didn’t anyone try these things out? Is it just an absolute obsession with making everything out of metal?
Apple made Vision Pro with little regard for the user’s comfort.
David Price / Foundry
I mean, look at this new Snapshot website Apple just launched a few days ago. Who is this for? Why is it so bad? You can’t search it, you can’t control the scrolling, you can’t find any actual interesting info about any of these celebrities… why does this even exist and why does it have it’s own subdomain on apple.com?
I want to be able to download apps and app stores on my iPhone like I do on my Mac. I want to be able to pay for things using Apple’s payment methods if I choose, or some other method if I prefer. I want developers who use Apple’s payment processing to pay fees of around 5 percent, comparable to Stripe or Square (around 3-4 percent), plus a percent or two to pay for Apple’s upkeep of the App Store. That would excite developers about making iPhone/iPad their first choice, like it used to be back in the early years of iPhone. I want hardware makers to be able to make devices that do all the things Apple’s own devices do, from quick-pairing and instant switching to sending iMessages, so that they can compete on quality, price, and innovative new capabilities.
I would benefit from all these things. You would benefit from all these things. App developers and hardware makers of all kinds would benefit from these things. Apple is surely aware of all these concepts…none of this is new or novel, much of it exists on the Mac and competing platforms. But Apple would make nominally less money, and it’s starting to feel like that’s all Apple really cares about these days.
Apple needs to change its corporate culture from the top down. There’s a pervasive vibe that “we know what’s best, you’re lucky to be here,” and it needs to start taking a more customer-first, user-centric approach. It feels like the company acts as though we (the users and developers) need them, when it should act as though it needs us.
