Friday, March 7, 2008

iPhone SDK

Overall, I like what Apple announced. I don’t mean to take away anything from what looks like great work they’ve done. However, I do want to point out that the spin was a bit much:

As with the original sweet SDK, Apple has made entirely reasonable business and technical decisions, but they chose to spin them unnecessarily.

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I don't think I'd call the App Store a versiontracker listing. It's more like versiontracker + download hosting + credit card processing + automatic upgrade management.

Taken in that light, the 30% seems a bit less heinous.

First point is overstated. Version tracker does not provide hosting or transaction clearing. And it is not an obligate screen that all users will see. IANAD, but 30% seems like a pretty decent deal. Sure, 12-20 could be better, but it is not out of the line (eg a flat fee on everything).

Has anyone collected the comparative pricing for other phone platforms? I gave up on mobile development awhile back but at the time it was insane - $50K per app to get something signed with the "Don't nag the user about every network request" bit for J2ME/BREW/etc.

It's a bit annoying that we're still not where Palm was with the first Treo - being able to install code without paying danegeld to the carrier was one of the biggest selling points to that platform. At least free iPhone apps will be free.

Mac developers can currently pay in the neighborhood of 3% for credit card processing, one tenth of what Apple is charging. No doubt there's value in being in the listing that all users will see, though it will be a big list of apps (like VersionTracker). I'm not saying the App Store is a bad deal, but for 30% I think it will be a profit opportunity for Apple, contrary to what Jobs said.

Also, I think Apple gets 30% of music sales. On single tracks, that ends up being about a nickel of profit, what with minimum charges.

Plus, the developers who are making money are subsidizing those who choose to release free iP* applications. That further cuts down on the profit Apple's making.

30% seems fair to me. Obviously we'd be happier if it was 10%, or 20%, or even 29%... but 30% seems fair.

Erik: The free apps are still paying Apple $99 up front. That buys a lot of bandwidth these days.

But that $99 up front is getting you tech support from Apple too. Use that once or twice and Apple is losing money.

RLH: I don't think you get free tech support from Apple. It's probably like the Mac developer program. Your $99 probably allows you to buy technical support incidents for $195 each.

Like others, I have to disagree with the first point. Download hosting, credit card processing, automatic updates and let's not forget app digital signing, which will handle all the license authentication and prevent (or at least minimize) piracy. It seems like all those things would take up roughly 30% of the developers time, so 30% seems fair to me.

Patrick: I doubt you would find a developer who thinks those things would take up 30% of the time. They can be automated. If you're spending a lot of time on that stuff, you're doing something wrong. Anyway, I'm not saying it's a bad deal; I'm saying that Apple will do more than break even.

Michael wrote: " Your $99 probably allows you to buy technical support incidents for $195 each."

No, you get two incidents.

Deric Horn backs up the two incidents assertion:

That makes me wonder if the $99 fee is annual. I haven't seen an indication along those lines, but in the past Apple's only bundled tech support incidents (which expire after a year) with annual memberships.

Apple's 30% cut is an interesting deal to my thinking because it looks like the only way, short of a jailbreak, to put software on the device. If a developer sets a price, however low, they'll have something akin to the cryptographic muscle behind Apple's contracts with the music labels equating each distribution with a sale. The impact on software pricing, and developer revenue, could be far-reaching.

I agree that 30% seems big enough to show up on Apple's bottom line, but you can't equate the iPhone software ecosystem they're creating to VersionTracker's informational-on-a-good-day listings.

Yeah, I think the $99 fee is ANNUAL, which makes me mad. I wish it was just a one-time fee....

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