Does Apple get a cut of In-App revenue also?

  • Posted: 12 November 2009 09:28 AM

    I can’t remember reading that Apple gets its standard 30% cut on in-app generated revenue also. Do any AFBers have information on this? This would seem to be an important issue given the rising volume of such revenue.

         
  • Posted: 12 November 2009 09:36 AM #1

    Hannibal - 12 November 2009 01:28 PM

    I can’t remember reading that Apple gets its standard 30% cut on in-app generated revenue also. Do any AFBers have information on this? This would seem to be an important issue given the rising volume of such revenue.

    I have not seen specifics but you can bet they do. The purchase of in apps still goes thru the iTunes account be it credit card or iTunes gift card. Apple holds ALL the cards. It would be interesting to know what percentage Apple gets though… i am sure some developer would know.

         
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    Posted: 12 November 2009 09:37 AM #2

    Hannibal - 12 November 2009 01:28 PM

    I can’t remember reading that Apple gets its standard 30% cut on in-app generated revenue also. Do any AFBers have information on this? This would seem to be an important issue given the rising volume of such revenue.

    Same terms 70/30

    http://developer.apple.com/iphone/program/sdk/inapppurchase.html

         
  • Posted: 12 November 2009 09:48 AM #3

    pats - 12 November 2009 01:37 PM
    Hannibal - 12 November 2009 01:28 PM

    I can’t remember reading that Apple gets its standard 30% cut on in-app generated revenue also. Do any AFBers have information on this? This would seem to be an important issue given the rising volume of such revenue.

    Same terms 70/30

    http://developer.apple.com/iphone/program/sdk/inapppurchase.html

    Merci Pats

         
  • Posted: 12 November 2009 11:19 AM #4

    pats - 12 November 2009 01:37 PM
    Hannibal - 12 November 2009 01:28 PM

    I can’t remember reading that Apple gets its standard 30% cut on in-app generated revenue also. Do any AFBers have information on this? This would seem to be an important issue given the rising volume of such revenue.

    Same terms 70/30

    http://developer.apple.com/iphone/program/sdk/inapppurchase.html

    This was mentioned by Apple awhile ago. Absent the same terms as the original app purchase there would be no incentive for Apple to build in the feature and developers would be seeking to pilfer customers from Apple. The bigger news I believe I believe is allowing in app purchases (new game levels, etc.) on apps originally distributed as free.

         
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    Posted: 12 November 2009 11:51 AM #5

    DawnTreader - 12 November 2009 03:19 PM
    pats - 12 November 2009 01:37 PM
    Hannibal - 12 November 2009 01:28 PM

    I can’t remember reading that Apple gets its standard 30% cut on in-app generated revenue also. Do any AFBers have information on this? This would seem to be an important issue given the rising volume of such revenue.

    Same terms 70/30

    http://developer.apple.com/iphone/program/sdk/inapppurchase.html

    This was mentioned by Apple awhile ago. Absent the same terms as the original app purchase there would be no incentive for Apple to build in the feature and developers would be seeking to pilfer customers from Apple. The bigger news I believe I believe is allowing in app purchases (new game levels, etc.) on apps originally distributed as free.

    I agree on the in app being huge

    Here is a recent article on a Ngmoco game

    Ngmoco’s freemium iPhone FPS Eliminate is the #1 Free game on the App Store right now. Perhaps more significant is that it’s climbed as high as the #20 spot on the Top Grossing chart despite being available for only two days. Since the game itself is free, all revenue generated by Eliminate is generated by in-app purchases of virtual items made by players.

         
  • Posted: 12 November 2009 02:51 PM #6

    I’m waiting for the first latte to be sold this way; bought as you walk towards the store; ready for you as you enter (they know how many minutes walk before you arrive, and you get turn by turn directions if you want!). No turning back then.

         
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    Posted: 12 November 2009 03:28 PM #7

    We are getting close.

    Imagine taking all of the cool functionality you love about your iPhone and using it to order your favorite Pizza Hut pizza, pasta and wings. Welcome to a mobile-ordering revolution that makes ordering from Pizza Hut EASY, FAST and FUN!

    You can tap it, tilt it, drag it, drop it, shake it, pinch it, stretch it and order it. There’s even a game to play while your Pizza Hut order is being delivered.

    Save 20% on every order made through the Pizza Hut iPhone app.

    If we link it with the next generation
    NFC

    Had to share this news. A highly reliable source has informed me that Apple has built some prototypes of the next gen iPhone with an RFID reader built in and they have seen it in action. So its not full NFC but its a start for real service discovery and I’m told that the reaction was very positive that we can expect this in the next gen iPhone.

         
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    Posted: 12 November 2009 05:32 PM #8

    sleepygeek - 12 November 2009 06:51 PM

    I’m waiting for the first latte to be sold this way; bought as you walk towards the store; ready for you as you enter (they know how many minutes walk before you arrive, and you get turn by turn directions if you want!). No turning back then.

    I bought a Chipotle burrito with my iPod Touch the other day.  The Chipotel app found the closest store to my location, I created a profile, saved my credit card information, built my burrito, and clicked “Order.”  The app told me what time it would be ready (about 20 minutes).  I showed up, skipped in front of the 20 people waiting in line, told the cashier my name, and they handed me a bag with my burrito already in it.  No ID verification, no credit card check, they just handed me the bag and I was out the door in under a minute.

    Kind of scary, really.  tongue laugh

         
  • Posted: 12 November 2009 10:31 PM #9

    sleepygeek - 12 November 2009 06:51 PM

    I’m waiting for the first latte to be sold this way; bought as you walk towards the store; ready for you as you enter (they know how many minutes walk before you arrive, and you get turn by turn directions if you want!). No turning back then.

    You are a genius! This would make my day…

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    -alex

         
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    Posted: 12 November 2009 11:49 PM #10

    Hannibal - 12 November 2009 01:28 PM

    I can’t remember reading that Apple gets its standard 30% cut on in-app generated revenue also. Do any AFBers have information on this? This would seem to be an important issue given the rising volume of such revenue.

    As I recall 30% is correct less operating expenses.

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  • Posted: 13 November 2009 02:02 AM #11

    Eric Landstrom - 13 November 2009 03:49 AM
    Hannibal - 12 November 2009 01:28 PM

    I can’t remember reading that Apple gets its standard 30% cut on in-app generated revenue also. Do any AFBers have information on this? This would seem to be an important issue given the rising volume of such revenue.

    As I recall 30% is correct less operating expenses.

    Actually, I understood Apple picked up the transaction fees so the 70% is exactly that.

         
  • Posted: 13 November 2009 07:46 AM #12

    From Apple Site

    Familiar business terms.
    In app purchase uses the same business terms used for apps sold on the App Store. You receive 70% of the purchase price of each item you sell within your app, paid to you on a monthly basis?no credit card fees apply.

    30% may be fine for software where incremental sales accrue more directly to the bottom line. But for that burrito there remains a food cost, labor number as well as the facility cost. 30 % seems steep. But hey it is the leading, bleeding edge.

         
  • Posted: 13 November 2009 07:46 AM #13

    dc930 - 12 November 2009 09:32 PM

    I bought a Chipotle burrito with my iPod Touch the other day.  The Chipotel app found the closest store to my location, I created a profile, saved my credit card information, built my burrito, and clicked “Order.”  The app told me what time it would be ready (about 20 minutes).  I showed up, skipped in front of the 20 people waiting in line, told the cashier my name, and they handed me a bag with my burrito already in it.  No ID verification, no credit card check, they just handed me the bag and I was out the door in under a minute.

    Does Apple get 30% of what you paid for the burrito?

         
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    Posted: 13 November 2009 08:03 AM #14

    I believe they also get 30% of the burrito itself too! Pretty sweet deal they got huh! :-D

         
  • Posted: 13 November 2009 08:21 AM #15

    It’s when the payment for the burrito goes through Apple that the revolution really hits its stride. Actually, I think 30% for Apple is doable for fast food; ingredients cost is typically 30% (less for a latte),  it would be about half of the received payment with 30% to Apple. But you’ve saved on staff costs for order and cash processing, and premises space for waiting customers. The same site can process more orders, further reducing the contribution of fixed overheads to each burrito.

    [ Edited: 13 November 2009 08:26 AM by sleepygeek ]