@stairjoke @reichenstein I don't understand the complaint. I understand that's how it works in the EU. I’m not a fan. I'm honest about that. I also try, always, to keep strong opinions loosely held.
@gruber I've been reading Daring Fireball for over 20 years. When something Apple happens, I look forward to your articles because they are informed, entertaining and articulate.
In this case you keep repeating the same polemic: that the EU and the DOJ do not understand Apple, IT, the market, antitrust, or even their own laws.
But you talk to devs, economists and you read the DMA and the DOJ case, and you must have you come across varied, valid views beyond that single, narrow narrative.
@gruber You must know that opposing views on Apple can be simultaneously real and valid. Apple can make great products and butterfly keyboards. Users can be happy with things that just work and slowly be locked in by its smooth eco system with expensive crappy cables. AirPods do just work, and Sony headphones don't get access to the same APIs and come with sloppy apps. Small devs can make a living, and their businesses can be held captive by the Apple tax. Security can be a reason and an excuse…
@gruber Apple itself is full of contradictions: it may have high standards when it comes to privacy in the US, but at the same time it can allow the Chinese government to decide which apps are okay and which are not and put the user data of Chinese citizens under government control in Guiyang. It claims absolute power on taxing developers but avoids state taxes with its off shore entities it pays its developers from. It dares to "think different" but wants us to follow its rules like state law.
@reichenstein There’s a lot to unpack in this one tweet! (1) “Taxes” are imposed by governments; Apple imposes fees. The DOJ gets this wrong too to their discredit.
(2) China: What would you say to to the Chinese citizen who can afford and wants an iPhone? Apple’s offering is by far the most private and secure available. The only alternative would be for Apple not to sell devices in China at all. That would make a statement, but I doubt Chinese Apple users would like it.
So, China "making a mess for businesses" is fine, but not EU because?
Strange how you only apply the logic in 2) to China, but "American companies have to at least consider the fact that doing business in the X isn’t worth the risk of fines" to EU
@dmitriid @reichenstein No, it’s all very cynical. First, Apple relies upon China for manufacturing and assembly at scale. iPhone hardware production would crater without China. Second, for sales, “Greater China” is about 16-17% of revenue, more than twice the EU and with far more room for future growth.
@gruber @dmitriid I've read your adventurous take on the size of the European market and how it could just be 7% based on a lot of speculation. It's not clear how big exactly it is because of the way Apple defines Europe (or Americas). But looking at at the SEC filing and the general market size, ditching Europe would be utter madness. If that's going to change in the near future only prophets would know.
@reichenstein @dmitriid See my piece yesterday. Apple's "Europe" includes not only non-EU countries like the UK, Norway, Turkey, etc., but the entire Middle East.
https://daringfireball.net/2024/03/eu_share_of_apples_revenue
@gruber @dmitriid I did follow that idiosyncratic logic. You're aware that "Americas" includes South and Middle America and Canada and that Greater China includes Taiwan. And you know that first world countries are where Apple makes money. No amount of polemic will conveniently turn one of the three biggest global markets into something neglectable so that Apple can keep its outdated AppStore rules that are globally put into question.
@gruber You write: "It’s unclear whether Maestri was saying that the EU accounts for 7 percent of Apple’s worldwide App Store revenue, or 7 percent of all revenue,"
But it *is* clear: Listening to the call, Luka Maestri says
“the EU market which represents roughly 7% of our Global App Store revenue”.
https://www.youtube.com/live/AR6Q7-CKGhE?si=VapYHhvgxFtOcagX&t=4625 (Six Colors transcript misquoted "absolute")
That you claim "AppStore Sales ≈ all sales" doesn't make it true. :)
@gruber China, which you expect to have a brighter future with Apple, comes with much higher risks of regulation and economic uncertainty. iPhone sales plunged 25% in 2024. Chinese Stock market collapsed. China restricts phone time for kids and reduces gaming licenses, and at the end of Match pretty much everyone will pull out of the Chinese AppStore because of China's latest stunt: https://www.reuters.com/technology/apple-enforces-new-check-apps-china-beijing-tightens-oversight-2023-10-03/
@gruber From what we understand, the Chinese AppStore will collapse for us in a few days. Next to Chinese devs, a few big corporations that can afford a Chinese operation or partnership will be the only choice. Millions of Apps will be suddenly silenced, and every true Apple Jedi will feel a great disturbance in the force. This involves close to zero speculation or prognostics. It's official, announced and days away. It for sure doesn't paint a bright future for any business dealing with China.
@reichenstein @gruber There was also an increasingly strong “buy Chinese“ feeling in the country. And Chinese phone manufacturers are making some of the best Android phones.
@reichenstein @gruber unsolicited feedback from a bystander. It is really hard to follow such a discussion here (torn into little pieces). Maybe a discussion on a podcast would be the better format?
@seiz @gruber In written form, to me, this back and forth feels like playing Chess against a great player, with the help of a chess computer, when he's two pawns down. But live... 
I'm not as quick-witted and eloquent as John, and in this case he's at the polar-opposite side from me, well prepared, on his turf, in his native language and channel... Sounds risky. It wouldn't be boring, though.
@reichenstein @seiz @gruber I prefer the written form where everyone has time to think about his answers and do research. A podcast debate is like a TV talkshow: skewed towards superficiality.
@reichenstein Oh, good catch, and good idea going to the actual recording of the call.
So, still: if EU = 7 percent of App Store revenue, it seems very likely to me that EU = around 7 percent of total revenue. What's the hypothetical scenario where the EU accounts for significantly more than 7 percent of overall revenue? If anything, given the relative low market share for the Mac in the EU (compared to, say, the US and UK), I suspect if 7 percent is wrong, it might be *lower* not higher.
@gruber It is very possible that certain regions have lower and higher adoption rates for the AppStore, buying apps and subscriptions. Whether or not Europe matters becomes clear from theSEC filing. And while they are still very vague, and the Americas are just as vague as Europe, you need to apply the same common sense there in assessing where Apple sells. It doesn't sell much in Honduras or Liechtenstein, Argentina or Turkey. We know exactly where and why. Maybe this is clearer to us because…
@gruber …we see from our AppStore and Android sales data mirrors SEC sales table, with clear weights in US+Canada, Western Europe+UK, and Japan. We can't judge China (no Android data, and AppStore is not proportional to SEC stats). The rest of the world is almost neglectable. That's just us. But on the Android side we see that it's not our app, but that Android really is as huge in India, Brazil, Africa, etc as other available data suggest, big in exactly those regions where Apple doesn't sell.
@reichenstein News to me that you guys have an Android version of Writer!
@gruber We're full of surprises. We learned a lot there, but mostly it taught us how different the audiences are. We have a very clear image of iPhone and Android users. Productivity apps might crystallize that impression even more than, say, games. Talking about surprises, we happen to also have a lot of statistical insight through our design clients (which are practically invisible on our site these days), and some of them run apps with Millions of users. The data we get there mirrors our own.
@reichenstein Just my Pixel 4, or is the default font size rather large? (I realize I'm taking this thread on a tangent!)
@gruber I know more about the American legal system than what happens with iA Writer on a certain Android version on an older phone. Our support would know exactly, but... My guess is that you use automatic font size on an older OS version and/or a smaller or lower density screen than today's standard.
Google Play Store shows how it looks on newer phones/OSes: https://play.google.com/store/apps/details?id=net.ia.iawriter.x&hl=en&gl=US
@reichenstein Oliver, can you say more about the difference between the audiences?
@omz13 Plenty of good and bad on both sides, but, in general, Apple users are ready to pay for good productivity software, Android users expect Google's free model. Apple users recognize and appreciate good design. Android users are used device/OS inconsistencies. Lots of hacking, cheating and pirating. There's a difference in culture between specific Android groups (the cheap, the clever, the geek, the contrarian, the open, the…) in Western countries and the more general Android users globally.
@reichenstein Thanks: that is what I had very much suspected, so good to have confirmation the two really are like that.
@omz13 The bad side for Apple customers: They almost never accept that any issues they have is on Apple's side. WebKit PDF-export has been buggy for years, iCloud has improved but can still occasionally be utterly terrible, and even when they encounter glitches in early betas they're absolutely not ready to accept that our hands are tied, or—behold—Apple has its flaws. A lot of the vocal Apple users blindly echo Apple talking points as their own insight, as if they were remote controlled.
@gruber Unless Apple really gives us the data, we can all only speculate, but when we do we need to be careful. We sell a nicht productivity app. This is a very special data set, representing a tiny spectrum of a fraction of mobile users. Most people spend money in the AppStore on games and entertainment. The cash that gets spent on e-commerce and ad targeting via iPhones doesn't go through AppStore it still owns it and profits from it (see 20B Google default search deal). And here we also know…
@gruber …we know that iOS users are valued 5x to 10x by publishers because Apple users are the ones with cash to spend. There are plenty of sources online that document that (airlines are a famous example), but through our work with publishers we know specifically that they use metrics for Android vs iPhone users value. At this point, you don't need to triangulate a number from an Apple spokes person with Statcounter macOS browser share to know who buys iPhones and why. Try GDP per Capita.
@reichenstein @gruber When you think about it, Oliver, that was also very cunning and insincere of Apple to tell on the phone call on the record that „EU is just 7%” when they know (and we know) it that it’s worth to them much more because of GDP per capita, the buying power of the Europeans...
Another by-product of this whole thing, that an Apple fan like me is now double-reading everything they say and no longer giving them a benefit of a doubt. They no longer deserve it. Sad.
@michael @gruber That 7% quote is a calculated PR tactic from Apple. Gruber knows that. Instead of questioning it he accelerates it into 'maybe Apple could stop operating on Europe altogether.'
Yes, Apple's 'Europe' (25% of its revenue) includes UK, Switzerland&Co, Africa and the Middle East. The EU share is likely between 15% and 20%. Even if it were 7%!
Pulling out of EU and betting on China to protect the obsolete, easy to change AppStore rules reminds me of Trump's NATO logic.
@michael @gruber If you want to triangulate the number of Apple users in the EU, you could operate with browser share and compare it to the population size. Then compare it to GDP and GDP per capita. Get as much triangulation data as you can. This is interesting, but this is not how you make a business decision. To assess the impact of such a move you need to look at the long term impact of moving out of one of the three biggest markets and the full spectrum of its repercussions.
@michael @gruber One may think Europe with its 746 Million citizens are not as important as the US with its 333 Million citizens. Europe is complicated and diverse. The EU "only" counts 448 Million people. 30-40% have iPhones. It's not irrelevant who these 30%-40% are, and where they live. They may not buy as many apps as US users, but they're mostly well earning, well educated customers, a lot of them are young. Who in his right mind drops them for a couple of rusty AppStore rules?
@reichenstein @michael The DMA compels a lot more than App Store changes.
@gruber Of course, now it's a bigger problem, and likely it will become bigger the more stubborn they are about these stupid rules. I thought that this is a point we'd likely agree, because you said something along the lines.
"To my knowledge no company in history has ever gotten into antitrust hot water over a side business so comparatively small to its overall business. Apple doesn’t need this."
@reichenstein I still believe that, and, on the whole, I still think Apple's on-the-table DMA compliance plan is going to fly, and that the EC, privately, wants it to fly.
@gruber Gut feelings and law... If I had to tell the future I'd say that in Europe Apple is in hot water because its executive are ideological about AppStore rules and misunderstand how the EU works.
I have no prophecies about the US case. The lobbying, the precedence business, the legal power that companies and people have that can afford top tier lawyers and escalation, the volatility of justice depending on the judge and who's on the SC or... president. I don't like it, get it, or trust it.
@reichenstein @gruber Had this thread pinned until we had a response from the EC, which seems (unsurprisingly, honestly) to not agree with Apple's DMA fixes. Not all responses are ready yet.
From day one of this I've thought Apple should've bitten the bullet, called it a good run and proactively set new global rules that clearly show a different direction, more aligned with what the current market, developers and governments ask. I'm saddened they're stubbornly digging their heels further.
@reichenstein @michael It wasn't calculated PR, because it wasn't part of Apple's prepared remarks on the call. It was in answer to an analyst's question about whether Apple expects DMA compliance to have “any significant impact financially to your services or the broader Apple P&L statement”. If they hadn't been asked that question they wouldn't have released that figure, and the figure really was about putting EU App Store revenue in context of Services overall.
@reichenstein OS market share from Statcounter has "Europe" at 8 percent for Mac, but 14–20 percent in the US, and 11 percent in the UK. In Germany, the richest EU country, it's only 7 percent.
@gruber @reichenstein but the EU is bigger. So 8 percent are only about 10 million fewer users than 14 percent of the US population
@gruber No one is talking about Mac market share. Statcounter is a lazy reference, but be it: According to Statcounter, iOS market share in Germany is 40%.
To assess the weight of the Western European market for Apple, I wouldn't focus on macOS market share, but on the relationship of GDP and GDP per capita.
With the exception of South and North Korea, you'd get a pretty clear picture of where Apple sells (or, at least, should sell) phones. Can you guess why?
