Apple paid App Store devs $260B — and leeched over $100B from their labor
There’s a parable for capitalism here somewhere
Quick maths: Apple App Store edition
At this point, we should work out how much cash Apple is skimming off the top.
In itsJanuary 2021 release, Apple said it paid out$200 billionafterits 30% cut. Working backwards, this means total revenue was around$285.71 billion. In other words, Apple pocketed around$85.71 billionby the end of 2020.
We saw earlier that Apple shelled out$60 billionto developers across 2021. Because we don’t have access to what split of this falls under 15% or 30% commission, we can say that Apple earned between$10.59 billion and $25.71 billionin 2021 alone.
This means that, since 2008, Apple has made somewhere between$96.3 billion and $112.42 billionfrom the App Store.
Why earning so much from the App Store is a problem
I’m not going to sit here and say Apple doesn’t deserve to earn a substantial amount of cash from the App Store. It has to provide server space,teams working on the service (in development, moderation, marketing, and editorially), security, and various types of infrastructure.
None of this is cheap. But it’s hard to emphasise justhow much $110 billionis.
That’s the equivalent of the nominal GDP of Morocco (roughly $109 billion). That’s an entire country. It has a population of 37 million. It’s 274,460 square miles. With that money it pays for education, roads, hospitals, military,everything.
Apple has outgoings, but let’s not kid ourselves that the majority of what we use from the App Store is created by external devs.
It doesn’t end there though.
After App Store devs are given their 70%, they have to pay tax on it. If they were based in the Netherlands (where I live),that’d amount to 25%.
Want to guess how much tax Apple pays in Europe? Well, thanks to some loopholes (and the Irish government),it gets away with 12.5%. Devs on the other hand are effectively taxed twice: once by the government and once by Apple.
End the monopoly
There are cracks in Apple’s armor. In the Epic court case,the judge ruledthat Apple had to allow devs to provide customers with alternative in-app payment options. Of course, Apple is still fighting this.
The 30% cut is incredibly lucrative, especially when it comes to subscriptions. Don’t expect Apple to let it go without a fight.
News releaseslike this oneposition Apple as a benevolent figure, beaming down with joy at how well its app-making subjects are doing. The reality is more akin to a feudal lord squeezing every last drop of coin it can from those working the land.
Yes, Apple has done an amazing job at building its App Store platform, but it needs to become an enabler, rather than a leech. Don’t hold your breath though.
Story byCallum Booth
Callum Booth is a freelance journalist with over a decade of experience. Previously, he was the Managing Editor of TNW, where his reporting(show all)Callum Booth is a freelance journalist with over a decade of experience. Previously, he was the Managing Editor of TNW, where his reporting was cited widely, including in VICE, the FT, and the BBC.
Callum’s writing has appeared in The Verge, The Daily Telegraph, Time Out, and many more. He covers the full spectrum of technology, with a particular focus on how it shapes our daily lives. And a lot of regulation stuff too.
Outside of work, Callum’s an avid bookworm, a Fisherman’s Friends addict, and resolutely unshaven. Follow him on Twitter @CallumBooth or visit www.callumbooth.net.
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