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App Culture vs. Free Culture

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steeladept:

Isn't this where I supply the same argument that was raised in the Kindle vs Nook pricing thread? 

-wraith808 (July 08, 2010, 11:07 AM)
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Yep.  Pretty much.  Right on target and more or less the implication that the TheQuerty had.

tomos:
Is 30% that bad when you consider it means you don't have to set up a store, actually handle credit card fees, or pay for the bandwidth? I'm seriously asking as it doesn't seem that bad to me. I dislike Apple's policies and the corporate attitude they project, but I'm not sure I see this 70-30 split being so outrageous.-TheQwerty (July 07, 2010, 06:13 AM)
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It's outrageously high, I think. You do 100% of the work and they take 30%! Why not 5%?
-zridling (July 07, 2010, 05:45 PM)
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if you sell a product directly to a [real] shop, in my experience they usually put minimum 100% on top of your price i.e. a 50-50 split of the retail price.
70-30 is actually 42% on top of your selling price FWIW   [edit] I've no idea how this would normally work with online retailers [/edit]
 
I'm not trying to defend the system (or Apple :p) just throwing it out there.
Also, of course, what's quoted in the last two posts...

mouser:
btw for the record i think that 30% is way way too high, and is the kind of mark up that you could only get away with by having a near-monopoly control over access by consumers.

wraith808:
btw for the record i think that 30% is way way too high, and is the kind of mark up that you could only get away with by having a near-monopoly control over access by consumers.
-mouser (July 08, 2010, 02:49 PM)
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Isn't that the usual retail model though?  I worked in retail during my college years, and got to know way more than I ever wanted to know about the channel, and tomos hit it close to the mark... the retail markup I've always seen is between 35% and 45% in general.  We're looking at it as if internet sales and marketing is a special case, but really, when you look at it, it isn't.  We pay the same markup for Windows, Office, and all the other software.  It's just that we don't know the details of those deals as well as the details of the App store because those contracts are pretty sacrosanct.

JavaJones:
Markup in retail was set based on "what the market will bear" vs. their costs of course. Retail sales models have higher costs overall, when you take into account shelf and building space costs, employees, not to mention the intermediaries like the shipper from the factory, etc. Once you have the Apple store system developed and working smoothly, adding 100 or 1000 more products doesn't notably increase costs, try that in a brick and mortar store.

So the rules have changed and stores in the digital world are lower cost *and* can support vastly more product, which benefits Apple as well, but the pricing hasn't necessarily changed. Maybe it just hasn't caught up yet, but I think it's a mistake regardless to justify the price with traditional retail models that no longer apply.

- Oshyan

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