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Businesses Apple

Apple Discussed 'Punitive Measures' Against Netflix for Dropping In-App Purchases (macrumors.com) 130

As the Epic Games v. Apple trial progresses into its third day, Apple's internal documents and communications with various companies are continuing to surface, giving us some insight into the dealings that Apple has had around the App Store. From a report: Back in December 2018, Netflix stopped offering in-app subscription options for new or resubscribing members and instead began requiring them to sign up for Netflix outside of the App Store in order to avoid paying Apple's 30 percent cut. As it turns out, Apple executives were unhappy with Netflix's decision, and made attempts to persuade Netflix to keep in-app purchases available. The subject hasn't yet been broached in the live in-person trial that's going on right now, but news outlet 9to5Mac highlighted emails between Apple executives discussing Netflix's decision. When Apple learned that Netflix was A/B testing the removal of in-app purchases in certain countries, Apple started scrambling to put a stop to it. Apple's App Store Business Management Director Carson Oliver sent out an email in February 2018 outlining Netflix's testing plans and asked his fellow App Store executives whether Apple should take "punitive measures" against Netflix. "Do we want to take any punitive measures in response to the test (for examples, pulling all global featuring during the test period)? If so, how should those punitive measures be communicated to Netflix? (sic)," asked Oliver.
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Apple Discussed 'Punitive Measures' Against Netflix for Dropping In-App Purchases

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  • by NoMoreACs ( 6161580 ) on Wednesday May 05, 2021 @04:16PM (#61352234)

    Isn't it amazing that this two year old story surfaces again just as the Epic v. Apple lawsuit gets rolling in Court?

    • Re:Isn't it amazing? (Score:5, Informative)

      by saloomy ( 2817221 ) on Wednesday May 05, 2021 @04:24PM (#61352276)
      It is because that lawsuit has effective subpoenas that open up emails to public record.
    • by Anonymous Coward

      No, it's not amazing at all, it's simply an inevitable consequence of companies taking each other to court and internal documents ending up on the public record.

    • Isn't it amazing that this two year old story surfaces again just as the Epic v. Apple lawsuit gets rolling in Court?

      No.

      Apple's internal documents and communications with various companies are continuing to surface, giving us some insight into the dealings that Apple has had around the App Store

      Funny thing. When you read a book that you've already read but mostly forgotten, you begin to remember some of the parts that you forgot. Kind of the same deal here.

  • by Alain Williams ( 2972 ) <addw@phcomp.co.uk> on Wednesday May 05, 2021 @04:21PM (#61352256) Homepage

    in all sorts of ways, via an Apple 'phone is only one of them. So why should Apple have a cut of viewings done via: a PC; a tablet; an Android 'phone; ... ?

    • Comment removed (Score:4, Informative)

      by account_deleted ( 4530225 ) on Wednesday May 05, 2021 @04:27PM (#61352284)
      Comment removed based on user account deletion
    • Apple wants all things like Netflix to have a subscription option through the iOS store. It doesn't have to be exclusively available through Apple, but it has to be an option.

      They get zero cut through where it's viewed and a 15%* cut (or not) based on where it is subscribed from.

      * More for sub-year subscriptions.

      • If it were not for independent apps I suspect that fewer people would buy iphones.

        Maybe netflix could implement it but make it long winded, slow, buggy, ... That is not playing nice, but neither is Apple.

        • How is that "not playing nice" by Apple? First, it's the same deal that Google puts forward. And most customers sign up through their website.

          But what you're suggesting will get people to uninstall Netflix and blame them (after all, the Hulu app works well, etc.) Netflix already does something more clever. The advanced options are only accessible via the web (the app links to the web) and that tries to get you to move your subscription over to the web version.

          Besides, I imagine the conversion/retention

      • Apple wants all things like Netflix to have a subscription option through the iOS store. It doesn't have to be exclusively available through Apple, but it has to be an option.

        Netflix should allow in-app purchase, but twice the price, and with a big advertisement about the cheaper price when done through the web site. But Apple will surely make sure this is not allowed.

         

    • by idji ( 984038 )
      Apple only wanted a cut of subscriptions that were paid for on an iPhone, and they saw they were losing that.
    • in all sorts of ways, via an Apple 'phone is only one of them. So why should Apple have a cut of viewings done via: a PC; a tablet; an Android 'phone; ... ?

      Apple doesn't care how much you view. Their rule is that if you pay for viewing in the Netflix app on an iPhone or iPad, then they want their 30% cut. And if you pay for viewing on Android, on a website, or on your TV, then they don't take a cut. And Netflix did the right thing, not offering you to pay on their iOS app.

      I worked at a company where one payment let you use our software on up to six devices, Mac, Windows, iOS and Android, and if you paid through the iOS app we made less money. We tried to ma

  • by sdinfoserv ( 1793266 ) on Wednesday May 05, 2021 @04:32PM (#61352306)
    The Sherman Antitrust Act was enacted in 1890 to curtail combinations of power that interfere with trade and reduce economic competition. It outlaws both formal cartels and attempts to monopolize any part of commerce in the United States. https://www.britannica.com/eve... [britannica.com]
    If our electeds were not owned pawns of the oligarchy, we might actually experience competive prices and more choices Unfortunetly, the majority of SCOTUS's, those appointed by Trump, are also law hating, rule oversight dismantling corporate cronies. Judge Amy Barrett sided with corporations over people 76% of the time while on the appellate court.
    • by mysidia ( 191772 ) on Wednesday May 05, 2021 @05:21PM (#61352602)

      clear violation of the Sherman Act

      No.. not actually clear at all. Some internal discussion between managers within Apple that doesn't show the outcome of whether Apple actually did so much as threaten Netflix, let alone anything abusive / anticompetitive w.r.t. them.

      True it might be questionable under Sherman if Apple helped or hindered a dev's access to app distribution through the store based on their usage of Apple's payment processing, but then again, It is still unclear because Apple can make the argument that there's reasonable basis for it which is not anti-competitive -- the App store is Not free to run, and yet developers get free development tools or low-cost dev tools and are allowed to provide apps like Netflix for $Free - All the free stuff subsidized by apps using In-App purchases.

      Also, If Apple actually clearly violated anything, there would also likely be cases against Apple pursuing them on that point, and they would be in settlement and not trial on the issue, if it was clear... there would be no point in wasting hundreds of millions on the trial. The fact that they are in trial over this issue basically means it's not clear, at least not at this point.

      • Maybe not, but a lot of this boils down to the purpose for Apple's many actions regarding the app store - and this points away from Apple's contentions about business necessity and toward Epic's contentions that it is all intended to illegally hinder competition.
      • What this email does is show a clear intent to abuse their monopoly position over the market for apps for iOS devices. The only question is whether they will abuse that position in any individual case.

        • by mysidia ( 191772 )

          does is show a clear intent to abuse their monopoly position over the market for apps for iOS devices

          All it does is show a business manager asking their superiors if/what consequences should be for their business partner, Netflix, over Netflix's choice to basically start a move to stop doing probably 99% of their business with Apple.

          Maybe; it's not clearly abuse anyway... they're talking about a "Featured Apps" section of the app store. It is not clearly abuse of a monopoly position for Apple to advertis

    • by tlhIngan ( 30335 )

      All you have are memos between executives. Ones that say "Oh no! Netflix is dropping in app payments!" "What can we do" "Let's punish them!"

      Perfectly normal discussions among top executives. It happens all the time. You can bet Microsoft has the same discussion when a city moves their PCs from Windows to Linux.

      What matters is what Apple did about it - which appears to be... nothing. So what if some executives talked smack about it? I'm sure you talk smack about stuff too. Heck, I'm sure you probably really

  • Seems to me that Netflix could have let the consumers vote with their dollars:

    $13.99/mo if purchased from Netflix's web site
    $19.98/mo if purchased in-app

    Some customers are willing to pay for convenience, others prefer to work for savings. Netflix makes the same money either way.

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