When IOS was launched, Apple's App Store took 30% royalty on all apps sold. App providers responded largely by switching to free apps that were charged in the app for annual subscriptions and other fees, and appeal (when the dominant smartphone seller and critical to many companies' businesses) prohibit the purchase of apps, except via Apple, who would charge a 30% commission on the lifetime income of each user.
Competition from Android and hybrid models where users sign up (and pay) online and then log in to their apps has driven Apple's in-app lifetime tax on 15%, but for Apple's top vendors, this still adds to hundreds of millions a year.
This has led to a slow but growing emigration from payments, from Amazon Video to Spotify, and now, Netfix.
Following an attempt to require users to pay via the web, Netflix has now terminated the use of payments for all new users; last year, Netflix Apple paid an estimated $ 256m in "Apple Tax" for users who paid through the app. Netflix can afford to lose millions of users from this switch and is still coming forward.
Netflix dropped purchases in the app from the Google Play store earlier in 201
For example, Amazon has historically limited movie and TV rentals and purchases to its own website or other "compatible" apps, rather than letting them take place through its Prime Video app. The same goes for Kindle e-books, which are also not offered in the Kindle mobile app. Spotify also ended the opportunity to pay for its Premium service using Apple's payment system for apps.
And this year's Epic Games bypassed Google's Play Store completely – in addition to 30 percent cut – when it launched Fortnite for Android as a sideloaded app. That decision resulted in Google's $ 50 million loss in marketplace fees.
Earlier this year, Netflix had dropped subscription enrollment into the app in its Android app on Google Play. It signaled its intentions to later take back the so-called "Apple tax" for itself as well.
Netflix stops paying "Apple tax" on its $ 853M in annual iOS revenue [Sarah Perez/Tech Crunch]
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Cory Doctorow
I write books. My last is: a YA graphic novel called In Real Life (with Jen Wang); a non-fiction book about the art and the internet called information will not be free: the laws of the Internet age (with introductions by Neil Gaiman and Amanda Palmer) and a YA science fiction novel called Homeland (that's the sequel to the little brother). I'm talking about everything, and I tweet and thumb too.
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