[HN Gopher] Apple buying Google ads for high-value subscription ...
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Apple buying Google ads for high-value subscription apps
Author : jitl
Score : 162 points
Date : 2021-11-14 14:16 UTC (8 hours ago)
(HTM) web link (www.forbes.com)
(TXT) w3m dump (www.forbes.com)
| indymike wrote:
| This is monopolistic behavior all the way. Let's leverage our
| cash to make it more expensive to get customers, and force app
| publishers to sell their product through our channel. This needs
| to be stopped. Now.
| ChildOfChaos wrote:
| How? Apple is spending it's money to help promote apps on it's
| service, i feel like people attack apple whatever they do.
|
| But doesn't this help defend a 30% app fee, when apple is also
| paying marketing costs to help the app get more customers
| through it's service?
| mthoms wrote:
| Apple are bidding on exact (trademarked) product name matches
| (eg "HBO Max" and "Tinder").
|
| You might have an argument if Apple was bidding on more
| general keywords like "online dating" to send traffic to the
| App Store's Tinder page.
|
| Apple are trying to intercept purchases and/or raise ad costs
| for the mentioned companies.
| DutchKevv wrote:
| Not if it doesn't add another 30% of customers.
|
| Not even taking in account the rise of advertising for the
| app creators self, the loses you have from not being able to
| redirect to your own website, giving specific incentives that
| Apple doesn't allow etc etc etc.
|
| So no, it's not just bashing, and that's the reason Apple
| does it secretly
| lordnacho wrote:
| I wonder if this is similar to Uber Eats or Deliveroo getting
| people to sign up with the help of some particular restaurant's
| menu, where that restaurant might have its own ordering site. If
| people get used to using the aggregator the restaurant loses out
| on the cut.
| haxal wrote:
| Could this be because the volume of searches and people that even
| open the App Store app daily is so low that now that ATT is in
| play advertisers aren't spending as much on marketing for iOS
| apps?
| tyingq wrote:
| The FTC generally cares more about screwing the end buyer than
| screwing the app developer. So this probably won't end well for
| Apple, since it sounds like steering buyers to a more expensive
| option.
| Brian_K_White wrote:
| It's actually an interesting question how nefarious or harmful
| this actually is.
|
| We obviously know why Apple is doing it and why the apps in
| question don't like it.
|
| But a couple things occurred to me:
|
| You could view this like Amazon giving away your book or android
| app in a promotion. As I understand it, they still pay the author
| as if it were a sale, so the author seemingly has nothong to
| complain about. Even that still seems wrong to me but that's the
| argument Amazon uses. That is essentially, no, litterally, Amazon
| advertizing your product for their own purposes.
|
| Another argument Apple and Apple devotees and general "invisible
| hand" worshippers may try to use is: Any sales generated by the
| ads would not have existed without the ad, and so it's not taking
| anything from the app developer.
|
| I don't really buy either theory, but it does take some thinking
| to describe a mechanism by which they cause harm and should be
| considered invalid.
|
| They hold enough water to convince a lot of people who want to be
| convinced, and the arguments against just sound kind of weak and
| whiny.
| lupire wrote:
| Apple would ban you from app store and therefore all of iOS if
| you did in the app store what they are doing on Google
| (advertise to sell subscription via a different channel).
|
| Its predatory monopolistic behavior.
| echelon wrote:
| This shows just how much a monopoly Apple has over brand <-->
| customer interaction.
|
| They say that their app store not allowing side loading is for
| user safety.
|
| In actuality, it forces the brand/company/startup into a place
| where they're completely shackled. They pay 30% taxes, have no
| customer relationship, and have to step through every hoop to
| satisfy apple.
|
| The handicap their browser so you can't get new runtimes or
| deploy software via alternate means. Good luck launching your
| media startup on iPhone without an app.
|
| Now this. They're clearly trying to gobble up any interest in
| other apps and force them into the payment shackles.
|
| This is a fucking monopoly! Please stop this, department of
| justice! Apple has undue power in computing! Every company has
| to go through them to reach 50% of consumers, and apple is
| extorting us!
|
| Apple says you're welcome to go to consumers another way, and
| then they do this. Look at their actions.
| RNCTX wrote:
| "nothing will fundamentally change"
|
| -- the person currently in charge of the DOJ, when running
| for office, speaking to donors.
| schwede wrote:
| To me it's an issue if Apple refuses to stop if a particular
| business asks them to. That seems like an easy measuring stick.
| offtotheraces wrote:
| I run a big portfolio of mobile apps, and the discussion around
| this is misguided. It's not about Apple taking 30% of the
| revenue generated from these ads.
|
| It's about Apple driving up the user acquisition costs for
| these companies so much so that it become entirely uneconomical
| for them to buy ads that direct users to their own websites,
| and instead the campaigns that target users to download the app
| - which results in 30%-to-Apple IAP subscriptions - become much
| more attractive again. So Apple is trying to make the cost of
| running these ads so prohibitive to the companies that they
| stop trying to drive web subscriptions and instead go back to
| driving app subscriptions only, where Apple gets 30% of
| everything.
|
| As you can see it's even more sinister than it first appears -
| it's not a short term land grab, it's a long term strategy to
| prevent developers from legitimately acquiring users outside of
| Apple's walled garden.
|
| (Looking at the economics make this even more clear. Let's say
| Tinder has a $100 subscriber LTV (lifetime value). If the user
| purchases the subscription in the app, Apple takes $30 of that,
| so if Tinder wants to run a marketing campaign on Google,
| Facebook, etc that drives an app install, they can't pay more
| than $70, otherwise their spend has a negative margin.
|
| On the other hand, if tinder can use these ads to get people to
| subscribe on the Tinder website, they have a ~$97 LTV ($100
| minus 3% payment processing fee via stripe/adyen/etc). So now
| they can run a campaign on Google where they can spend up to
| $97 to acquire a user, much more than the $70 before. And
| because Google and Facebook inventory availability scales non-
| linearly with your maximum bid, a 38% increase in acquisition
| cost allowable could mean a 100% increase in available
| inventory, and potentially higher quality inventory at that.
|
| But if Apple - with their unlimited cash pile and not caring
| about negative margins - comes in and soaks up all this
| inventory by bidding the same $97 for every user, all of a
| sudden the cost for Tinder to acquire these users goes way up
| and becomes negative margin. At that point, the rationale thing
| for tinder to do is stop running these campaigns. This means
| they stop getting web subscriptions, stop diversifying their
| business away from Apple, and Apple maintains its iron grip on
| Tinder.
|
| Remember, in this case Apple is paying $97 to acquire a user
| who will generate $30 for them (30% of the $100 LTV), so
| they're massively in the hole on this spend. But they don't
| care because their goal isn't to profitably acquire users;
| their goal is to make the costs for Tinder to create a more
| diversified business so high that Tinder stops trying to.
| That's some f-ed up sh*t.
| [deleted]
| renewiltord wrote:
| Unlike predatory pricing, you can't really price people out
| of this permanently.
|
| Tinder in this example is still getting the customer. Google
| is still getting paid.
|
| So the moment Apple stops buying the ads, they're both ready
| to participate again. So how is it a long term play?
| makeitdouble wrote:
| > how long
|
| I think we can assume Apple is getting enough out of it to
| run this scheme permanently.
|
| Unlike Tinder, they can get extra revenue from the user
| staying in the ecosystem (active credit card registered for
| IAP), getting used to Apple's service, and keep buying
| Apple devices. Their LTV of the user is not just the 30%
| cut.
| Joeri wrote:
| You do it while a service is growing, to capture most of
| the subscribers. Once growth dies down you stop buying and
| while the subscriber base will slowly bleed from app to
| web, you can ride the revenue stream from the growth fase's
| subscribers for a long time.
| offtotheraces wrote:
| You're right on two accounts: - Google gets paid no matter
| who pays, so they don't care - Tinder still gets the
| revenue (and at better margins bc they're not actually have
| to pay for that user anymore - Apple is paying)
|
| And even your last point is not wrong: at some point Apple
| may stop doing this. But that could be year's away, and in
| the meantime, they're throwing their big stack around to
| make it too costly for developers - who Apple supposedly
| partners with - to build businesses that are less dependent
| on Apple's whims. Plus, Apple uses the fact that most
| subscribers to app store products subscribe on the app
| store itself to bolster their case with regulators that no
| reform is needed bc consumers are overwhelmingly happy to
| use Apple's IAP systems. But if Apple is putting it's
| finger on the scales in order to actively drive users away
| from web subscriptions, then they heavily misleading these
| regulators about the true "choices" consumers are making.
| jefftk wrote:
| Sorry, where in the article do you see that Apple is running
| these ads in a way that loses them money?
| offtotheraces wrote:
| The article doesn't have to say it because it's just the
| way that google ads work. It's a bidding-based system, so
| at the most basic level the person who bids the most wins
| the auction and their ad is shown. If the LTV of a customer
| is $100, and there's a 3% processing fee for web
| transactions, then Tinder will bid up to $97 to acquire a
| customer. So Apple has to pay at least that much to acquire
| that same customer in order to win the ad auction. Once
| Applr has paid that $97, the user now downloads the app and
| subscribes via Apple's IAP system. Apple takes 30% of those
| revenue while Tinder gets 70%; so Apple gets 30%*$97 = $29.
| So they've spent $97 and received $29 ----> they have a
| negative $68 margin on that spend.
| jefftk wrote:
| I agree that that's one way it could work, but it seems
| really unlikely to me that Apple would be willing to lose
| so much money on a project like this. Some other
| possibilities that I think are more likely:
|
| * Apple has a higher LTV estimate than Tinder for this
| traffic.
|
| * Tinder has less available capital, so they are not able
| to outbid Apple even though they think that they would
| still earn lots of money at that price.
|
| * Perhaps someone who is looking to subscribe to Tinder
| is likely to succeed even without advertising, but
| without Apple's ads it won't be via Apple's IAP. The
| amount it's worth to Tinder for a subscriber to come to
| them directly instead of via Apple and the amount it's
| worth to Apple for a subscriber to come in via IAP are
| about the same.
|
| (Disclosure: I work on ads at Google, but not search ads.
| Speaking only for myself)
| offtotheraces wrote:
| Remember, it's not that much money for Apple especially
| considering their whole app store business model depends
| on taking their 30% tax. Maybe we're talking about
| $50m/yr vs app store revenues of $10b (?) a year (and
| 70%+ margins per docs in recent court cases). They would
| absolutely be willing to lose this money if it extended
| their stranglehold on app developers - it's the same
| reason they fight tooth and nail in every jurisdiction
| around the world to prevent regulation of their app store
| behaviors and fees (Japan, Korea, Netherlands, UK,
| Australia, Arizona, US federal, etc). These lawyers
| probably cost them about $500m/yr (without revealing my
| identity trust me that thats a very reasonable estimate).
|
| As to your bulletes points:
|
| - Tinder is owned by Match Group who - before Tinder -
| spent 20 years building a paid acqusition machine. In
| order to do paid acquisition you have to deeply
| understand the LTV of your users. That methodology,
| refined iver years at Match was ported to Tinder (just
| read Matchs earnings calls). While Apple has access to
| all ybe transaction data of apps on iOS, so do then
| defelopers, who are highly resourced and highly motivated
| to understand their LTV/CAC. So no, I dont believe for a
| second that Applr has an advantage here. And even if they
| did, applr only collects 30% of the revenues - how could
| they ever guy profitable when bidding for the same slots
| as the developers who Are getting 70%?
|
| - Capital - nope. Match produced close to a billion
| dollars a year in cash flow. HBO billions. Capital isn't
| an issue for either of them.
|
| - I disproves this hypothesis with the LTV illustration
| above. To be clear: Theres no scenario where apple can be
| profitable on this spend when they can only ever get 30%
| of what the consumer spends.
| jefftk wrote:
| Sorry, I don't understand how your response applies to my
| third point? Tinder would not be willing to spend
| $97/user because that is only worth it for users they
| would not otherwise acquire. In this case, I'm positing
| that these are users who already want to subscribe to
| Tinder, and are going to do it somewhere, the only
| question is whether Apple can get them to sign up through
| the IAP flow and take a 30% cut. If I'm thinking about
| this right, this means that it is worth just as much to
| Apple to get one of these users to sign up through IAP as
| it is worth to Tinder to get one of these users to sign
| up directly?
| treis wrote:
| Both ads are shown though with Apple in the 2nd slot. So
| HBO is bidding more and I doubt Apple is going into
| negative margins.
| offtotheraces wrote:
| Again, by definition theyre going into negative margins
| because they can only ever get 30% of the revenues; how
| could they compete with the developer who gets 70% of the
| revenues without going negative?
| treis wrote:
| They're not beating the developer. They're getting the #2
| slot.
| nicodjimenez wrote:
| Thanks for this insight! Very interesting.
| mcphage wrote:
| I don't entire understand the ad market, so sorry if this is
| a stupid question, but if Apple bids $97 per user and wins,
| then that's more than the $70 per user Tinder would get, that
| makes sense. But since that user didn't cost Tinder anything,
| aren't they +$70 since Apple ate the acquisition cost,
| instead of +$27 where Tinder only had to spend $70 (under the
| no-Apple bid price) to earn $97?
| makeitdouble wrote:
| On the Amazon part, the harm is caused by your book losing
| value during the Amazon give away and a while after.
|
| For instance any other seller of your book is affected, so you
| potentially lose distribution channels.
|
| Customers also get attracted to Amazon, but your book is only
| seen as a bait, and when it goes back at the regular price it
| will be less desirable (some will have negative feelings of
| having missed the sale, some will keep seeing your book as
| something only worth giving away).
|
| If your book has a short shelf life and you didn't expect much
| of it, or if it's a stepping stone into a series and you could
| have given it away anyway, Amazon footing the bill is a boon.
| Otherwise it probably shortens the life of your book.
| Aulig wrote:
| >Any sales generated by the ads would not have existed without
| the ad, and so it's not taking anything from the app developer.
|
| This argument is not very convincing in my opinion, as it looks
| like Apple is purchasing ads for brand keywords. If the ad
| wasn't there, the customer would go to the brands website,
| which would be ranked #1 without the ad.
| quitit wrote:
| The example shows the brand name being ranked 1st. For this
| to be a poor result for the brand it would require
| cannibalisation rates to be high enough to push the 15/30%
| fee higher than their margin - that's not realistic because
| the app store price would never be at a loss to begin with
| (with many alreadying increasing the app store fee to match
| the 15/30% cut.) In all likelihood the end result is a net
| profit for the developer at the expense of their competitors.
|
| Also neglected for consideration: the developer doesn't pay
| for these ads - and the scarcity isn't high enough to
| meaningfully affect bid pricing over regular competition.
| tmoravec wrote:
| Without the Apple's ad, wouldn't there be some _other_ ad
| instead? Presumably a competitor's, or the brand's own,
| paying the Google tax?
| GeneralTspoon wrote:
| Yes, but if their own ad converts the user to a paying
| customer, they don't pay 30% of their revenue to Apple.
| Hamuko wrote:
| It never ceases to amaze me how much Apple is willing to trash
| its reputation just for some pocket money. I can't imagine this
| or the App Store ads to actually make that much money, and both
| make Apple look terrible.
| FridayoLeary wrote:
| Most of Apples' worst excesses seem to be around the management
| of the app store. Even Tim Cook expressed frustration at the
| lack of leadership in that department. I don't think this is
| representative of Apple as a whole. Although the company must
| accept full responsibility for even their lowest common
| denominator.
| pfortuny wrote:
| > Apple is trying maximize the money they're making ...
|
| And that is the problem with our modern companies. The only
| morals is making money. What a pitiful excuse.
| bogwog wrote:
| That's capitalism, and it's not always bad.
|
| It only becomes a problem when there's no regulation, which is
| exactly what's happening here. Apple has too much market power,
| and the government is doing nothing to regulate them. The only
| way Apple will stop doing evil and harmful things like this is
| if A) government steps in or B) Apple decides to stop trying to
| grow. B will never happen (it's basically impossible for a
| publicly traded company)
|
| The same is true for the other tech giants.
|
| Either we need one big action (break them up), or a lot of
| small actions (force them to change specific business
| practices)
| FridayoLeary wrote:
| can you explain to me this attitude, which i see a lot?
| Obviously the entire reason for a companys' existence is to
| make money why should we expect anything else? Also this is
| true for every company in history. Of course we must demand
| companies meet minimum moral standards such as not using slaves
| (which would be unthinkable today in 2021 _cough_ ) but those
| must be imposed on them by law. This is a genuine question
| please feel free to enthusiastically disagree with me and
| explain why i'm wrong.
|
| [Edit: I should clarify that i meant that a company needs no
| other reason to exist, not that a ethical company is
| impossible]
| betterunix2 wrote:
| "Obviously the entire reason for a companys' existence is to
| make money"
|
| That is not actually true. Corporations are a tradeoff for
| society: a corporation fulfills some societal need in
| exchange for investors receiving limited liability and a
| chance to profit. We have every right to question whether or
| not this arrangement is beneficial or harmful to society, and
| every so often a corporation will be broken up when society's
| needs are not being met.
|
| Don't think that profit, limited liability, or anything about
| the current arrangement is a given or a natural right or
| anything like that. It is a system we use to accomplish
| certain shared goals, nothing more.
| reaperducer wrote:
| _the entire reason for a companys ' existence is to make
| money_
|
| This is incorrect. There are many reasons a company can exist
| other than to make money. The company I work for, for
| example, does not have making money as its primary goal.
|
| There's nothing wrong with a company making money. The
| problem is people who believe that companies should only make
| money, or make all the money they can at whatever cost.
|
| There are actually people on HN who think companies have some
| legal obligation (usually under the cliche of "shareholder
| maximization") to do anything to make money. This is false.
|
| Companies are created by and for humans. They should work for
| humans.
| bmitc wrote:
| In my view, it's bad because there's no end to the growth of
| a company's wealth, and thus power. Companies are treated as
| individuals when it's convenient for them, and not so when
| it's inconvenient. As companies gain more and more money, it
| becomes much easier to commit crimes and abuse their power to
| gain even more money and even more power, and yet, the
| likelihood of them being held accountable decreases.
| Comapnies can commit crimes that would land an individual in
| prison, and yet companies are usually at most fined in
| amounts much lower than the money they earned committing
| crimes. This creates serious problems in society, where
| companies are able and _enabled_ to essentially act as
| sociopaths with limitless power.
| rahoulb wrote:
| > Obviously the entire reason for a companys' existence is to
| make money why should we expect anything else? Also this is
| true for every company in history.
|
| In Elizabethan times, company charters (and the subsequent
| right to create and hoard profit) was granted by the queen as
| a reward for the company doing the work required by the
| state. Money was a secondary reason for a company's
| existence, their primary reason was to further the interests
| of the monarchy and by extension the country.
| AnthonyMouse wrote:
| > Obviously the entire reason for a companys' existence is to
| make money why should we expect anything else?
|
| The way this is supposed to work is that you make flour and I
| want flour so I give you money and you give me flour. Then
| you make more money by automating the production of flour so
| you can sell it to me for a lower price even though you now
| have higher margins. And try to take market share from
| competitors who are doing the same thing. The profit motive
| increases efficiency. This is growing the pie.
|
| The nefarious way to make money is to swipe somebody else's
| piece. This is rent seeking. It causes prices to increase
| with no increase in value. It is to be destroyed.
| howinteresting wrote:
| Companies are legal fictions of the state, with privileges
| like limited liability. Therefore the state can impose
| requirements on how the same companies behave as well.
|
| For example, a company could be made to serve the interests
| of employees rather than just shareholders. This can be done
| by, for example, requiring a certain percentage of the board
| of directors to be employee representatives.
| pokot0 wrote:
| This! I see so many people who seem to have forgotten that
| companies exist only to serve the people. When society is
| run to protect companies over the well being of the people,
| thay have lost their reason to exist in the first place.
|
| On the flip side, I see numerous posts and comments on HN
| that blame companies for not behaving more ethical. This is
| complete nonsense to me; you can't expect companies to
| autoregulate when they are designed to follow only 2
| things: laws and market. Since as we know now we have
| little control over what the market wants, the real control
| is through regulation.
|
| But the US has done a very poor job at selecting their
| politician leadership for a long time now.... that's where
| people who wants to do something needs to look at..
| foerbert wrote:
| I think it's both reasonable and important to criticize
| companies for behaving unethically even when it's not
| illegal. At the end of the day the "company" itself is
| incapable of doing anything. Humans are the ones actually
| making these decisions and then actually carrying them
| out.
|
| Unfortunately we don't and likely won't ever know who
| exactly did what. The best we can do is point at the
| company as a whole and say that some people over there
| decided to do bad things, nobody else in that group
| stopped them, and then some of those people went and did
| the bad thing. I don't see why that's not a reasonable
| critique when we cannot be more specific.
|
| I think that it is also important to do so. The more we
| perpetuate the idea that companies can't be blamed for
| bad-but-not-illegal behavior the more we help enable
| people to make those sorts of decisions as part of a
| company. They can't be blamed personally - it was the
| best decision for the company and that's what companies
| do, you know?
|
| We also help reduce negative feelings towards the
| companies when they do behave unethically. You can't
| actually blame them - they're a company after all, right?
| But this actually helps enable companies to get away with
| it. Negative public perceptions can impact the ability of
| a company to make money. I don't see why we should be
| trying to reduce this kind of influence.
| pokot0 wrote:
| I agree with you. I think it is perfectly healthy to
| criticize companies and even boycott their products if we
| don't share their values. This is what I referred to by
| "controlling the market". Unfortunately this has
| historically provided very little results imo.
|
| What I was referring to is the expectation that this
| criticism can make the difference; I don't think it can,
| for mostly one single reason: if you happen to make
| progress and magically turn 99% of the people running
| companies ethical, you have created a huge incentive for
| being evil. Someone acting unethical will reap the
| benefit without competitor.
|
| I tend to see these dynamics as balances and movement
| from balances when something changes. I think changing
| laws changes the balance point and after a shake, the
| system will settle somewhere else. Trying to persuade
| managers to be ethical it's just a fight against the
| balance that you will eventually lose.
| foerbert wrote:
| Public criticism does not change things only via boycott.
| I agree with you about boycotts and their at-best
| questionable usefulness.
|
| The more meaningful aspects are the fact it creates a
| negative reputation, and that reputation impacts all
| interactions with the company. A bad reputation adds an
| additional cost to interacting with you (be it customers,
| workers, or business partners), and that needs to be
| constantly paid for somehow.
|
| Additionally, there's some level of 'acceptableness' for
| the individuals of a company to do unethical things,
| which also plays a role. You addressed this in your 99%
| hypothetical, which I would agree with if it was done in
| a vacuum. However it's not. In practice if 1% of
| businesses were behaving in some way the rest refused on
| ethical grounds, lawmakers would be be falling over
| themselves to address it. Obviously such an example is
| unlikely to appear, but I hope you get my point. Moving
| the needle on acceptable behavior also moves the needle
| on what acceptable regulations of behavior.
|
| I also largely agree on many of these factors being a
| dynamic balance. It's just that public criticism is
| _already_ a factor in the current balance. Some level of
| criticism is required to maintain it, lest we move
| towards a balance that sees even more bad behavior.
| FridayoLeary wrote:
| > When society is run to protect companies over the well
| being of the people, thay have lost their reason to exist
| in the first place.
|
| According to you, seeing as almost every country in
| history was run exclusively for the benefit of the ruling
| class, none of them had a reason to exist?
|
| > But the US has done a very poor job at selecting their
| politician leadership for a long time now.
|
| Agreed. But i think it's a problem in the system itself.
| The us have a binary choice between hilary/biden and
| trump with no middle ground.
| pokot0 wrote:
| > According to you, seeing as almost every country in
| history was run exclusively for the benefit of the ruling
| class, none of them had a reason to exist?
|
| Hmm... with "reason to exist" I meant the reason why they
| were "created" in the first place. This is an interesting
| article that expands on how corporation "rights" have
| changed since foundation (take the historical data points
| more than the underlying political bias): https://www.ame
| ricanbar.org/groups/crsj/publications/human_r...
|
| > Agreed. But i think it's a problem in the system
| itself. The us have a binary choice between hilary/biden
| and trump with no middle ground.
|
| Indeed! I believe the problem in the system is even
| deeper. Regardless of your values or your preferred
| policies, I really feel hilary/biden/trump is a very poor
| display for the United States. The selection process that
| brought them there is not working. Smart people avoid
| going into politics in the first place because of this
| selection process. People don't want to spend their days
| arguing with a guy with bogus claim that is only trying
| to bring them down.
| pfortuny wrote:
| "Making money" is not a humane endeavour. Just that.
|
| Helping people, raising a family, being virtuous...
|
| "Making money" is just so void of content.
|
| Companies either exist for human beings or are just
| despicable.
|
| But this is just my opinion obviously.
| tauwauwau wrote:
| Money corrupts everything, it replaces the original
| motivation.
|
| If companies didn't have to maximize x% of the profit made on
| the investor's money per quarter/year, they will be able to
| focus on product/service, customer and employees more. It may
| result in less profit but it will be better for the society
| as a whole.
|
| We can see this happening when some company is acquired
| solely for sucking money out of it. Sometimes it leads to
| worsening of the service/product made by original company, y%
| of employees get fired because new owners don't care about
| the product or the employees. Money saved by using cheaper
| but worse raw material and firing employees shows up as
| profit.
|
| Because money is sole motivator, we end up over optimizing a
| company's operations around it. This could be seen everywhere
| when Covid started. Hospitals didn't have have back up PPEs.
| Auto makers didn't have parts/chips in inventory for
| emergencies. They're optimized to order the amount they need
| in immediate future, without any serious thought to
| contingency.
|
| When an Amazon worker is asked to self x products across the
| warehouse in y minutes, like a machine without a thought to
| the well being of the worker, its because Amazon has to show
| profit to the investors.
|
| We don't have product making companies anymore, we have stock
| making companies. They don't sell goods, services, they sell
| stocks.
| _hyn3 wrote:
| > Money corrupts everything, it replaces the original
| motivation.
|
| What do you believe the original motivation was, if it
| wasn't money?
| tauwauwau wrote:
| To me original motivation is solving a problem and
| innovation. If you come up with an idea to create a
| service/product, you may be invested in the innovation in
| the beginning. But, as soon as you start making it using
| other people's money, it starts being less about the
| product.
|
| [Edit] https://www.youtube.com/watch?v=f61KMw5zVhg&ab_cha
| nnel=batxg...
|
| Richard Feynman, explaining if "it" was worth the Nobel
| Prize.
|
| "...I already got the prize. Prize is the pleasure of
| finding the thing out, kick in the discovery, the
| observation other people use it. Those are the real
| things..."
| betterunix2 wrote:
| "Money corrupts everything"
|
| BS. One of the only things Ayn Rand got right was her view
| of money: it is one of the greatest forces for good humans
| have ever invented. Money allows us to settle our disputes
| without violence; money is what enables peaceful trade;
| money is how we moved beyond palace economies.
|
| Sure, money can corrupt some things, but on the whole money
| has likely saved many lives and in all likelihood the free
| societies we have today could never have existed without a
| monetary system.
| pfortuny wrote:
| Like lust, laziness, envy, pride, and wrath... Avarice is
| one of the primary wrong impulses. Yes.
|
| What have we done with love, mercy...
| spacedcowboy wrote:
| Money is nothing but a sophisticated barter system.
| Instead of "I will give you 3 apples from my tree for a
| dozen eggs from your hens", there is an indirection
| through a standardized property - money. Now we can say
| my apples are worth 4 shekels each and your eggs are
| worth 1 shekel each, and we can still agree on the same
| transaction.
|
| The difference (some would argue, improvement) is that
| shekels have a worth of their own, so can be stored
| against harder times, which may not have been possible
| with the goods they bought. Of course, that shekel value
| being variable over time, can equally lead to riches or
| ruin, and requires a more sophisticated treatment by
| perhaps insufficiently sophisticated participants; snakes
| _and_ ladders.
|
| In any event, societies existed well before this "money"
| thing came along, even free ones. High technology
| societies _do_ need a money system, I think; for
| automated transactions to take place, there needs to be a
| standardized good-exchange valuation, but not all high-
| tech societies are free, and not all free societies are
| high-tech. Freedom seems orthogonal to money.
| FridayoLeary wrote:
| >Money is nothing but a sophisticated barter system.
|
| I think we are all in agreement there. But it has such
| sophistication and is so amazingly efficient that it has
| an intrinsic value as a mere concept. This is because it
| enables activities that would otherwise be impossible. A
| good analogy would be a computer program. This i think is
| where we differ. But i think it's obvious that money is
| more than "nothing"- after all it sustains the entire
| banking industry.
|
| >The difference (some would argue, improvement) is that
| shekels have a worth of their own, so can be stored
| against harder times
|
| Again this isn't (and was never) the true reason for
| money. It was only a security against the money and
| helped people to visualise the concept better (i know i'm
| oversimplifying but i think that's the basic idea)
| robocat wrote:
| > Money is nothing but a sophisticated barter system.
|
| Money is the core of a distributed optimisation system.
| How does society decide whether to fix a pothole, eat
| some oranges, advertise a game? The hugely complex chain
| of suppliers is balanced via money - every actor in the
| chain is optimising locally using profit as the objective
| function. Legal agreements are the mechanism to ensure
| the money flows for the correct goods/services, and
| society sets constraints (laws/regulations) to enforce
| goals that are not monetary.
|
| The economics 101 narrative for how money was created is
| an extremely limited view.
| ClumsyPilot wrote:
| "Money allows us to settle our disputes without violence"
|
| What? Money is the cause of like70% of all violence
| noirbot wrote:
| Sure, but if it's 70% of the remaining smaller pie of
| violence, that's still an improvement. If money wasn't a
| thing, you wouldn't be like "Relationships cause 70% of
| violence. Relationships are the root of all evil"
| ClumsyPilot wrote:
| "70% of the remaining smaller pie of violence, that's
| still an improvement."
|
| What leads you to believe that the pie is smaller than it
| was without money? I have never seen any kind of
| statistics like "hunter gatherers had more wars". How you
| you even formulate the null hypothesis for this?
| noirbot wrote:
| I'm not claiming that I can back up that statistic, just
| pointing out that the state of something being an issue
| in the status quo doesn't mean it couldn't have been a
| net advantage over what it replaced.
| bmitc wrote:
| I fully agree that money is a serious problem, but I have
| come to the conclusion that the true source of violence
| in society is simply humans. Everything else is simply a
| medium or catalyst for violence.
| tauwauwau wrote:
| I agree with you to a certain extent, also I didn't mean
| to disregard the value that money provides by giving us a
| way to assign a quantifiable value to things. That's
| entirely different and in that way it can be counted as
| one of the greatest innovations in human history.
|
| I was talking about the human greed that is exploited by
| money.
|
| Also, if you're going to fight a war with another
| country, money doesn't mean much does it? Unless you have
| a global currency that both sides can agree on.
| Ultimately wars were fought for resources (Non
| ideological ones). Money is just paper/coins which you
| can print anytime you want if you control the resources.
| hownottowrite wrote:
| Steve Jobs certainly never did anything because of money.
| The iPhone is just his gift to the masses.
| nemothekid wrote:
| > _We don 't have product making companies anymore,_
|
| The problem with this sentiment is it's always presented as
| some new found discovery, and not as an inherent outcome of
| a capitalist economy. It was in 1973, 48 years ago now,
| that Ford did the infamous calculation on not to recall the
| Ford Pinto because the cost of recall was less than their
| calculated law suit risk - a move that would have killed
| their customers; and then further still Milton Friedman
| defended this decision.
|
| We haven't had "product making companies" as the norm for
| at least 50 years now. What era are you talking about?
| tauwauwau wrote:
| I was talking about the current era. But you're right, it
| has been like that for a long time, modern technology
| just has made it more efficient.
|
| My comment was hyperbolic, it should have been more
| moderate.
| varispeed wrote:
| I think the problem is that some big corporations are allowed
| to avoid paying tax, essentially getting huge competitive
| advantage over SMEs. The anomalous capital they were able to
| amass further enables them to corrupt governments to ensure
| regulatory capture and that any investigations in their tax
| affairs get dropped.
| _hyn3 wrote:
| That's one (gigantic) problem, but not necessarily _the_
| problem.
| londons_explore wrote:
| Who wins... Google...
| tinus_hn wrote:
| Is this different from a tv store buying ads for specific tvs
| that link to that store?
| ComodoHacker wrote:
| I think it's different because a store is competing with other
| stores, not with tv manufacturer.
| tinus_hn wrote:
| If you assume tv manufacturers are not themselves stores that
| sell tvs.
|
| Would you mind people putting up ads for buying an iPhone in
| their store?
| FridayoLeary wrote:
| This isn't terrible since it's possible that many apps providers
| can't afford the ads. But i think it's unacceptable unless the
| app owner is given a choice, and a clear cut choice with obvious
| opt in and opt out buttons. Also, it wouldn't hurt to make it
| clear to the consumer that Apple is paying for the ad.
| Hamuko wrote:
| How many of the ads Apple buys are for small developers who
| couldn't afford it and how many are for massive companies that
| could absolutely afford it?
| mdoms wrote:
| This is covered in the article. It's high value apps like
| Tinder and HBO Max.
| yunohn wrote:
| > that many apps providers can't afford the ads
|
| The impacted apps are "high value" - they make both sides a lot
| of money.
|
| > Impacted businesses include major brands such as dating apps
| like Tinder, Plenty of Fish, and Bumble, media giant HBO,
| education and learning publisher Masterclass, and language
| learning service Babbel.
| reaperducer wrote:
| _But i think it 's unacceptable unless the app owner is given a
| choice, and a clear cut choice with obvious opt in and opt out
| buttons_
|
| Didn't some other tech company do this recently? Something like
| eBay or Etsy, where the company was promoting the items for
| sale, and then taking a cut of that sale? I seem to remember it
| because the sellers were mad that it was opt-out, rather than
| opt-in.
| andrewstuart wrote:
| Dirty tricks.
|
| All the money in the world isn't enough for Apple.
|
| I wonder if Google can be said to be colluding with Apple on
| this.
| threeseed wrote:
| App developers have signed a contract giving permission for
| Apple to do this.
|
| There is nothing illegal or dirty about this and frankly I fail
| to see how it is that different to bidding on competitor's
| search terms.
| mymllnthaccount wrote:
| How's this different than googling for a Lenovo laptop and seeing
| ads for Lenovo's website versus Amazon?
| mdoms wrote:
| Does Amazon take a 30% cut of every transaction made on that
| laptop in perpetuity?
| treis wrote:
| Lenovo doesn't have to sell through Amazon while HBO, Netflix,
| et. al. are forced to sell through Apple.
| rkk3 wrote:
| > Lenovo doesn't have to sell through Amazon while HBO,
| Netflix, et. al. are forced to sell through Apple.
|
| Except they aren't forced to sell through Apple, Netflix
| doesn't allow in app-purchases for this very reason.
| mleo wrote:
| This more akin to Booking.com placing ads for hotels in an
| area. The hotel gets revenue and Booking.com gets commission,
| and sometime advertising recovery fees on top.
|
| Developers of apps should be allowed to opt out of this, or
| really should be an opt in feature.
| howinteresting wrote:
| Amazon doesn't get recurring revenue from selling Lenovo
| laptops.
| paulryanrogers wrote:
| There is a third party taking a large commission for the sale
| and any recurring service.
|
| It's like if Amazon put out ads for Lenovo but bundling a
| protection plan and taking a referer cut.
| cma wrote:
| Just outbid Apple by paying Google 24% of your gross income,
| likely >50% of your profit (assuming Apple has 6% payment
| processing/gift card and bandwidth costs; from the Epic trial we
| know Google has 6% costs).
|
| Apple's cost is probably significantly less here as it is a small
| app and most of the bandwidth is in the streaming, which Apple
| doesn't help with.
| donarb wrote:
| Doesn't look so secret to me. The ad shows the address as
| apple.com.
| bellyfullofbac wrote:
| Not secret, but still, they're taking the publisher's money,
| imagine if it was your service: if the users subscribe through
| your website, you get 100%, and if they subscribe through
| Apple, they pocket 30% and you get 70%.
|
| Apple is relying on the subscribers' not knowing of this money
| grab...
| pentae wrote:
| It would show the app store url, which most would assume to be
| the developer themselves pushing the app store link and not
| Apple itself
| syspec wrote:
| Speculation
| rkk3 wrote:
| Ruthless move by Apple - but brands like HBO should just take
| Netflix's queue and not allow in-app purchases.
|
| I was actually surprised to learn some of the app native brands
| mentioned (Tinder, Bumble) even had a way to sign-up for a
| subscription outside of the app. Seems like they would actually
| benefit from apple placing adds.
| TheJoeMan wrote:
| Which is why I see this will be a non-issue if on Dec 9th the
| anti-steering goes away. Then Apple places ad->user
| downloads->app says "hey it's cheaper on tinder's
| website"->user decides for themselves
| DutchKevv wrote:
| Unless the app itself cost money to download, then it's to
| late.
|
| You could create a bootstrap page after first install, bit
| that makes it feel like unfair cause the app was 'free' on
| the app store.
|
| So once again Apple got it all figured out how to make stuff
| difficult for creators and make money while doing it
| jpalomaki wrote:
| They key piece is that article claims Apple is doing this so that
| they can get their 30% transaction fees.
|
| If customer pays on the app developers website, Apple is not
| getting cut. If customer downloads the app and makes payment
| there, Apple gets their money.
| thrwn_frthr_awy wrote:
| I see. So to a end-user it may not make much difference whether
| they sign up via the web site or app, but if Apple can get in-
| between, they can cleave 30% of the user's lifetime revenue.
| Hiding email, credit card info already entered, subscription
| management,... there are reasons to want to run everything
| through Apple, but it's interesting to see this behind the
| scenes as it can really change Apple's incentives.
| sam0x17 wrote:
| Lovely corporate ethics. I posted this in our company slack room
| as an example of how not to act for bizdev
|
| Google benefits too much from this sort of arrangement to have
| any incentive to stop it, even though these are unauthorized
| advertisements that are specifically against Google's AdWords TOS
| (side note, I wonder if there is a legal avenue to follow when a
| vendor doesn't follow their own TOS? An interesting thought...).
|
| This is also a recurring issue with all of Google's advertising
| revenue -- malicious behavior such as fraudulent clicks,
| unauthorized ads, etc., are a decent portion of the revenue
| stream, and Google is financially incentivized to keep these
| sorts of abuse going until the ruse is up and the accuracy of
| their system is called into question publicly in a way that
| scares away advertisers, but with NDAs and corporate secrecy, it
| is far too easy to keep things unbalanced, and keep abuse like
| this in the dark.
|
| Business models like this demonstrate just how dire the need for
| regulation is in some areas of the tech world, particularly among
| FANG.
| threeseed wrote:
| a) It is not against AdWords TOS provided you have permission
| to use their trademarked terms. Which Apple has since in the
| Developer agreement [1] they have been assigned permissions to
| use logos, trademarked terms etc in marketing material.
|
| b) Google is incentivised to tackle abuse within their system.
| It's ridiculous and baseless to say otherwise. Lack of
| integrity in an ad marketplace very easily can translate to
| lost dollars. But unfortunately with spoofing being trivial
| it's simply hard to detect and manage abuse.
|
| c) There is no regulation that will prevent this. App
| developers have signed a legally binding contract.
|
| [1] https://developer.apple.com/support/downloads/terms/apple-
| de...
| [deleted]
| gpm wrote:
| a, b) yes
|
| c) regulations and laws trump contracts, not the other way
| around.
| kingcharles wrote:
| Not necessarily. You can waive your legal rights. e.g.
| agreeing to talk to the police waives your 5th Amendment
| right against self-incrimination.
| spzb wrote:
| Surely if 30% fee wipes out your profit margin, you don't offer
| in-app subscriptions. Netflix doesn't.
| Tronno wrote:
| Netflix has special agreements with Apple. Other apps have been
| rejected for doing the same thing:
|
| https://www.theverge.com/2020/6/25/21302931/hey-email-servic...
| threeseed wrote:
| Would add that it's 15% for App Developers earning < $1 million
| a year.
| fzil wrote:
| yes, but they aren't running these apps for small apps like
| that. The ads according to TFA, are for giants like Tinder,
| HBO Max etc. The little guy making < $1M would obviously
| appreciate the free publicity.
| globnomulous wrote:
| Sorry for the mildly off-topic comment, but does anyone else find
| the writing horrible, almost impenetrable? The first sentence
| alone seems to have four or five bizarre syntactic and semantic
| ambiguities. I really have no idea what it's supposed to mean.
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