Apple would have been higher off saving 10% on apps: Invoice Gurley
Benchmark’s Bill Gurley said Tuesday that Apple got itself in trouble years ago when it implemented its 30% in-app purchase rate, a number that has been under increasing scrutiny.
“I’d always rather see a company have a lower rake and a very long sustainable future, and I found the 30% figure so high and so outrageous that you would tune for the exact type difficulty you are “said Gurley, who led the company’s investments in companies like GrubHub and Zillow, in an interview with CNBC’s TechCheck.
For years, Apple has withdrawn 30% from the purchase of software or digital goods from apps sold through the App Store. However, developers have claimed that Apple’s App Store platform is unfair to smaller businesses, and last year Apple cut commission for apps with net annual sales of less than $ 1 million on its platform to 15%. Most recently, Epic Games sued Apple, arguing in court that the company’s app store was anti-competitive.
Apple has denied the allegations, stating that it “does not have a dominant market share in any category in which we do business”. In response to the lawsuit, Apple argues that it created the App Store and is allowed to set the rules to ensure that apps are high quality and safe.
“I think it was a bad decision back then and it was hard to recover from. I think the best thing you could do was probably pick something like 10 and write it down for everyone,” Gurley said.
Still, it’s a problem that could have been avoided, Gurley said.
“If you started on a lower rake and were fair across the board, you won’t end up in this mess,” Gurley said.
The tech investor has long said Apple took too much and criticized the company in a 2013 blog post entitled “A Rake Too Far: Optimal Platform Pricing Strategy.”
“Most venture capitalists encourage entrepreneurs to maximize price in order to get as much rent as possible from their ecosystem on each transaction. This is likely to be short-sighted. There is a huge difference between what you can extract and what you should be extracting. Water runs downhill, “Gurley wrote in 2013.
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