Which makes sense, when you read the technical details published earlier today here on HN: http://clover-developers.blogspot.de/2014/09/apple-pay.html
The article you're linking to is not definitive. The source is anonymous and not confirmed:
"Under deals reached with banks individually, Cupertino, California-based Apple will collect a fee for each transaction, said one of the people, who requested anonymity because terms aren’t public."
* charging a % from each transaction
* late fees
* interest on balances
This assumes banks make less money on transaction fees than they do on the other two when coupled with the potential for fraud... An interesting assumption...
"It is important to understand the difference between Apple Pay and In-App Purchase. Use Apple Pay to sell physical goods such as groceries, clothing, and appliances. Also use Apple Pay for services such as club memberships, hotel reservations, and tickets for events. On the other hand, use In-App Purchase to sell virtual goods such as premium content for your app, and subscriptions for digital content." Source: https://developer.apple.com/apple-pay/Getting-Started-with-A...
HOWEVER! It also means that these companies will need to integrate their new payment system deeper and make it compete with IAP on their own ecosystem. Since this system disrupts credit cards for real world purchases, it can't take a 30% cut. So you end up with two systems of payment, one which takes 30% and one which doesn't. You can bet your buttocks that publishers of online content will try to find ways to use the CREDIT CARD PROCESSING system instead of IAP, even if it means no fancy things like recurring subscriptions - things which ApplePay will have to add later. In short, Apple will have to bend over backwards to justify preserving the 30% cut on IAP. That 30% incidentally is also what keeps all apps from being free in the store - once IAP is cheap, why charge people 30% upfront for the app?
In short, I'm interested to see how Apple is able to keep ApplePay from cannibalizing its revenue from the App Store, by disrupting its own IAP service.
Apple certainly doesn't NEED the 30%, but it's very doubtful they'd reduce it.
How much does it cost to maintain the servers and infrastructure associated with IAP vs. the cost of building hardware?
[1] http://www.wikinvest.com/stock/Apple_(AAPL)/Data/Gross_Profi...
Implementation issues aside, I am not too hopeful on that front. Which is really a pity, because it would be so much more useful in a browser context.
For one-time purchases I am not downloading an app, and even for shops I use regularly I overwhelmingly prefer the web, because most apps are markedly inferior to their browser cousins.
See: Amazons Windowshop apps' lack of filtering.
World wide, you can buy those prepaid iTunes cards to fill up your account. I do that regularly. I do this, because at least here in Germany from time to time the merchants have discounts of 25% to 30% on those cards. Thats no shady merchant, but the big brick and mortar chains.
That let me assume, that Apple is selling those cards to those merchants with about this discount.
scroll down.
It says clearly: Apple does not charge users, merchants or developers to use Apple Pay for payments. Your credit and debit transactions will continue to be handled by the payment networks.
Apple is charging the banks and the banks are charging the merchants – so it is not free … and of the Apple _and_ bank fees are of course part of the customer price.
It is 2014 and I'm still unable to publish [any] apps on Apple app store and paid apps on Google Play... I'm based in Georgia, Europe.
[1] - http://www.cnet.com/uk/news/as-iflow-reader-app-closes-harsh...
Credit cards have always been a usable payment method, Apple Pay just makes them easier to use in an app. No one used them for IAP of digital goods because Apple forbade that on a policy level, which is likely to continue. Likewise, apps already allow credit card purchases for real-world items like Uber rides, Amazon physical items, etc.
I would say it is entirely in Apple's DNA. Apple has aggressively tried to inject themselves between sellers and buyers in multiple markets, even where their value add is unwanted and unnecessary.
And I don't fault them at all for that. They're a business and they're doing what businesses do, growing revenue. Trying to get a pound of flesh from the payment industry process is something many players are aggressively trying to do right now, and Apple is no exception.
And of course in the end all fees end up being borne by consumers.
One fallacy that many make in such discussions is the argument that Apple makes so much from hardware they really don't care about the smaller parts of their business, yet they have shown that they care very much about it. Don't think of Apple (or Google, or Microsoft, or any other growth company) as a $N billion dollar company -- every day they are, to the people fighting for more market, a $0 company, because all that matters to the tiers and people involved is $(M-N) tomorrow.
Nonetheless, the iTunes empire is currently doing almost $20B of business a year, with a $6B cut. The NFL, in contrast -- for all its seeming enormity and influence -- is about a $8B business, gross.
I don't think we've had anyone actually analyze that yet. It's only Apple that's been telling us that they barely cover the running costs. Also that was years ago. I imagine at least some profit grows faster than the costs with more apps in the App Store, more streamlined review policies, and increased profit/app from IAP business models.
Citation? Anything? That point isn't well explored but it is a "truth" apparently.
Another reason that 30% is BS is that it leaves no room for low margin sales. If I make an app that helps you find and buy the right computer monitor or TV, I'd have to mark it up 25% in order to break even after Apple takes it's cut.
