Apple Does Not Keep the 30% Commission On a Refund [Update] 60
When a customer gets refunded for an app they purchased, Apple doesn't refund the 30% cut they took from the developer, says developer Simeon Saens of Two Lives Left. While [online] payment processors generally don't refund fees on refunded payments, "the App Store doesn't position itself as a payments processor the way Stripe does, so it sounds really weird that they would act like one," writes HN user chadlavi. Epic Games CEO Tim Sweeney says in a tweet: This is a critical consideration in these 30% store fees. They come off the top, before funding any developer costs. As a result, Apple and Google make more profit from most developers' games than the developers themselves. That is terribly unfair and exploitative. "If the app store took a 3% chunk and never refunded it regardless of the ongoing status of the transaction, that would put them right in line with other payment processors," adds chadlavi. "It would also still net them billions of dollars, I think!"
UPDATE: In a follow-up tweet, Simeon says he "was mistaken in my original (now deleted) tweet." He adds: "Apple does not keep the 30% commission on a refund the refund happens as you'd expect. I don't know where I got the idea that it worked the way I thought it did."
Slashdot reader ravenscar did some digging in the Apple developer forums and found that "Apple has the right to keep its 30%... [but] rarely exercises this right and most developers see a 1 to 1 relationship on funds received vs funds refunded in these situations." They go on to say: "I can't find any cited examples of Apple keeping the commission."
UPDATE: In a follow-up tweet, Simeon says he "was mistaken in my original (now deleted) tweet." He adds: "Apple does not keep the 30% commission on a refund the refund happens as you'd expect. I don't know where I got the idea that it worked the way I thought it did."
Slashdot reader ravenscar did some digging in the Apple developer forums and found that "Apple has the right to keep its 30%... [but] rarely exercises this right and most developers see a 1 to 1 relationship on funds received vs funds refunded in these situations." They go on to say: "I can't find any cited examples of Apple keeping the commission."
The 30% cut goes back to the buyer obviously (Score:5, Informative)
If you pay a dollar and the developer gets $0.70, Apple keeps $0.30. If the user gets a refund, the full dollar goes back to the user. The developer doesnâ(TM)t get $0.30, obviously.
Re: (Score:2)
Re: (Score:2)
would like to hear an explanation of how Apple gets to keep that 30 cents.
Because they can.
Re: (Score:1)
C'mon, restocking fees. Uploading, downloading, uploading... Some poor kid has to find space on the hard drive that won't fragment the file.
Re: (Score:3)
They do not need justification. They do it because they can.
As for how they do it? They subtract the refunded amount (all of it, including the 30% they already pocketed) from the developer's future earnings.
This is not different from what some other big names do. There was a time Amazon would allow customers to return custom alloys wheels, no questions asked. The manufacturer would not get the wheels back, they would lose the whole sale amount, they would get charged penalties by Amazon, AND Amazon woul
Re: (Score:2)
interesting thing here is that you could, with enough accounts, force a developer into bankruptcy and in to debt with apple.
anyway apple could do it from the day they started appstore because they were taking only 30% and taking only 100 bucks a year to start, which was a bargain.
yeah, selling mobile software before was kinda crappy. so crappy in fact that a major mobile manufacturer of the day was paying money(per unit, on millions of units) to give out free licenses to some bundled software (they had a re
Re: The 30% cut goes back to the buyer obviously (Score:2)
But they donâ(TM)t. I just bought and refunded an app too see how much money I get back. Says the price I paid.
Re: (Score:1)
You misunderstand.
When you buy the app for $1
You pay $1.00 (perhaps more with taxes)
Apple gets $0.30
Developer gets $0.70
When you get a refund for that app.
You get $1.00 refund
Apple keeps $0.30
Developer pays the full $1.00
I'm not sure why this is news now. I recall this being brought up/discussed way back when Apple first permitted refunds (as initially, they didn't).
Re: (Score:1)
Re: (Score:3)
Read it again, especially that very last line: The *developer* is losing 30 cents by paying the full $1 refund, despite the fact that they only received $0.70 when the customer bought the software.
Apple takes their 30% at the time of sale, and never gives it back..
Re:The 30% cut goes back to the buyer obviously (Score:4, Informative)
No.
When you buy an app
You pay $1.00
Apple gets $0.30
Developer gets $0.70
When you refund an app
You get $1.00 refund
Apple refunds NO MONEY
Developer pays $1.00
So, the developer has effectively paid $0.30 to Apple, when a user gets a refund.
Re: (Score:2)
Re: (Score:2)
Re: (Score:1)
No apple keep the $0.30, and refund 0.7$ to the user.
That is what "Apple doesn't refund the 30% cut they took from the developer" mean. But I must admit I am not sure that this is true. But that is the claim.
Re: (Score:3)
That is wrong.
If you buy something for $1, and get a refund, you get $1 as refund.
Re: (Score:2)
Re: (Score:3, Informative)
No, what they're saying is if you refund then the full $1.00 comes from the developer even though they only got $.70 to begin with.
Re: (Score:2)
The other interpretation (which I know to be wrong on personal experience) would be users getting a refund less apples 30% cut.
What seems most plausible is that Apple eats the 30% along with the developer eating the remaining 70%.
Re: (Score:3, Informative)
No that's actually how it works. They are complaining because payment processors also do the same thing but their fees are much smaller (~3%). If you purchase something online with a credit card a small percentage is charged the vendor by the payment processor; if you refund the vendor loses that fee because the payment processor keeps it.
Re: The 30% cut goes back to the buyer obviously (Score:2)
Considering the timeline for refunding being short, seems to me often fees wouldn't need to be paid.
Re: (Score:2)
Re: (Score:2)
Re:The 30% cut goes back to the buyer obviously (Score:5, Informative)
From reading the Apple developer forums and looking at the agreements...
Apple has the right to keep its 30%, but can expect the developer to refund the full cost. So, if I purchase an app for $1 the developer gets $.70 and Apple gets $.30. If I request and am granted a refund Apple can charge the developer the full $1 and keep the $.30 they collected. In the end the developer could be out more money than they were ever paid in the transactions.
However, feedback I see from developers in the forum is that Apple rarely exercises this right and most developers see a 1 to 1 relationship on funds received vs funds refunded in these situations. I can't find any cited examples of Apple keeping the commission.
Re: (Score:2)
Selectively enforcing this policy is even worse from an anti-trust perspective. Very easy to target wrong-thinkers into bankruptcy with a minimal brigading effort.
Re: (Score:3)
Assuming what you say is true and they don't actually do this, that is good. But if they are not doing it, what would be the issue with changing the terms so that they can't do it? As it stand, devs have to count on their good will for it to not happen. If Apple has a bad quarter and wants to up their profits, they can just invoke the clause and use it. If there is no intent to ever use it, removing it should not be an issue at all. If they refuse to remove it, that means there are plans for future use of i
Re:The 30% cut goes back to the buyer obviously (Score:4, Insightful)
Chances are, the right is there if the developer is abusive in what they're doing - they create a deliberately misleading app that ends up billing people behind their backs without full consent. In this case, Apple would use the 30% as punishment.Or if say, the app promises you the full version if you pay some money, but merely extends the demo 30 days without telling you it's a subscription, etc.
But given the vast majority of refunds are where the developer is basically innocent (buyer bought an app, didn't do as wanted, etc) then there is no reason to hold back because it wasn't the developer's fault.
And changes to iOS make it hard for surreptitious purchases to happen. Quite likely, it's easier to make a scam app that rips off user data and feeds it to advertisers and give it for free than make a paid app do same. And I'm sure Apple reviews the in-app purchases to make sure you're not trying to scam people out of their money anyways, rendering most of the power moot because the review stage ensures in-app purchases work as advertised.
It's likely a power Apple has but not needed because of thorough reviews. I suspect if/when the government says Apple must allow all apps and turns the App Store in the malware mess that is Google Play, it would be more useful. Just like the ability to ban apps from using the location API - the ability to kill apps is still inside the location API, but since no app egregiously abuses that information, it's not been needed. But when the rules are a free for all, it's probably going to happen a lot.
Re: (Score:3)
Re: (Score:2)
In any case, the 3% argument is bogus. Most credit card services have a minimum fee, like 40 or 50 cents. This means on a $5 app, the developer would be paying closer to 10%, on a $.99 cent, that would be almost half the costs. If the developer had to sell each it individually through the customer. There there wou
How is this news? (Score:3)
Didn't we know this years ago?
This article from 2014 [sensortower.com]describes the same situation:
"This is much more developer friendly, but if Apple does issue a refund on your app, they still keep the 30% transaction cost, so that is something that you should be aware of."
Simply Untrue (Score:5, Informative)
Re:Simply Untrue (Score:4, Insightful)
Re: (Score:2)
Since you're a developer you should read the terms of service. Apple being nice and not exercising your agreement to being out of pocket is not withstanding.
You're right there's no evidence of it happening. But the fact that the ToS are written the way they are is douchebaggery enough.
Re: (Score:2)
Why? (Score:1)
"If the app store took a 3% chunk and never refunded it regardless of the ongoing status of the transaction, that would put them right in line with other payment processors," adds chadlavi. "It would also still net them billions of dollars, I think!"
Yes, but why would they want to do that when they can take a 30% chunk and never refund it? They have been getting away with it for years it seems and this will (or has?) net them tens of billions of dollars which is what they need to help pay their enormous tax bills [gizmodo.co.uk].
Fees!=profit (Score:2)
As a result, Apple and Google make more profit from most developers' games than the developers themselves. That is terribly unfair and exploitative.
How can Tim Sweeney know how much profit either Google or Apple makes off their stores? Both stores charge the 30% fee to run the stores and handle all the infrastructure. While I don’t doubt both stores make some profit, I hardly believe they make the kind of profit Sweeney alleges.
Retracted (Score:5, Informative)
https://twitter.com/twolivesle... [twitter.com]
From the quoted developer Simeon Saens:
"@twolivesleft
I think I’m mistaken and Apple does not refund the full amount from the dev
I always thought it worked this way, seeing days of negative revenue when there were a lot of refunds but I’m pretty sure I misinterpreted App Figures data
Deleting original tweet until I know for sure"
What I wanna know is how something so obviously wrong can spread so quickly? There are millions of people who should know first hand that this was false .. yet it spread. That's scary.
Re: (Score:2, Insightful)
"What I wanna know is how something so obviously wrong can spread so quickly? There are millions of people who should know first hand that this was false .. yet it spread. That's scary."
And then Slashdot posts it without checking or thinking.
Re: (Score:2)
"What I wanna know is how something so obviously wrong can spread so quickly? There are millions of people who should know first hand that this was false .. yet it spread. That's scary."
And then Slashdot posts it without checking or thinking
But that's the Open Source Way -- the Many Eyes solution will catch everything. Even if they have to keep ON catching it.
You just have to keep on releasing earlier and earlier; who has time to bother for old-fashioned things like "first-hand", "story checks", and "robust"?
Re: (Score:2)
Re: (Score:2)
Simple: Confirmation Bias.
Oh come on (Score:2)
Would you expect the Mob to refund your protection money when your business doesn’t burn down?
you purposefully misconstrued my comment (Score:1)
Re: (Score:2)
Slashdot is trash.
This is why Apple is a toy manufacturer. (Score:2)
They don't want widespread adoption of their platforms.
They don't have the breadth and depth of a talent pool for it.
So they're incapable of actually supporting such a thing in a proper manner.
And I'm not just talking customers. I'm talking a PARTNER NETWORK.
Hence the outrageous money-grubbing bullshit going on in the Apple ecosphere.
Hence the cultish ethos and the unswerving 45 year history of "Not Invented Here".
"refund" ... are you asked to "give back" the app (Score:1)
This imaginary property delusion becomes sillier by the day.
Look, you are providing a *service*, by coding an app! You can bill for that *service*! Not for the resulting information!
Because, newsflash, it is not a car! You cannot "sell" a car, by putting it in your parking lot, have people come there, press "download", and have the parking lot do the equivalent of Ctrl-C, Ctrl-V internallly, as it copies the cae onto the exit ramp, which itself then copies it onto the street another time, and just forgets w
Re: (Score:2)
You lost this argument about 30-40 years ago. It's never going to change.
You're not selling "the app". You're selling *legal access to* the app. The APK or equivalent isn't yours and doesn't belong to you.
The usual analogy here is a book. Do you own the physical book? Sure. It's yours. Can you scan the book and put it online, or start churning out copies of the book yourself and selling them? No, you can't. If you could, most authors would stop writing books (I know, I have an author in my family w
sounds like a good reason (Score:2)
Re: (Score:2)
Re: (Score:2)
There are not just paid apps (Score:2)
What this guy complains about has been the case for many many years. What he doesn't mention is a recent change - the App Store now allows developers to recognise customers who got a refund, and treat them accordingly.
Amazon (Score:2)
Right now, a competitor could place a bunch of orders from our listings, then request refunds immediately (after postage is created, but before the packages leave our warehouse), and we will be out the cost of the products * 0.03. It is pretty messed up that with a large enough network of fake customer accounts, you could drain money from our business.