Apple: iPhone App and iTunes stores don't make money
How to hook a fanboi
Apple's App Store and iTunes Store aren't moneymakers. They're lures for prospective handset customers.
Although Apple's online content and app marts have long been suspected of being more marketing arms than profit centers, CFO Peter Oppenheimer made that belief a certainty on Monday afternoon when speaking with analysts and reporters after announcing Apple's first-quarter financial results for its 2010 fiscal year.
"Regarding the App Store and the iTunes Store, we're running those a bit over break-even, and that hasn't changed," Oppenheimer said. "We're very excited to be providing our developers with just a fabulous opportunity, and we think that's helping us a lot with the iPhone and the iPod touch platforms."
But as a marketing effort, the App Store's long-running, well, "challenges" may have tarnished Apple's rep as much as enticed millions of folks to send their money Cupertino's way.
Examples of the App Store's clunky approvals process are legion: disallowing then allowing Apple-supplied images not once but twice, approving some pointless apps but not others, banning then unbanning streaming 3G TV,
rejecting studying but not approving Google Voice and Google Lattitude, refusing then approving then pulling then reapproving a Commadore 64 emulator, and more. Much more.
It hasn't been pretty. But during today's conference call, Apple COO Tim Cook - standing in for Steve Jobs, who was a no-show - defended the App Store approval process.
"I think it's important to keep this in some perspective," he said. "That we have over 100,000 apps on the store, and that over 90 per cent of the apps that we've had have been approved within 14 days of the submission. We created the approval process to really make sure that it protected consumer privacy, to safeguard children from inappropriate content, and to avoid apps that degrade the core experience of the phone."
He also outlined the App Store police guidelines: "Some types of content, such as pornography, are rejected outright. Some things like graphic combat scenes in action games might be approved, but with appropriate age ratings.
"Most of the rejections, however," he continued, "are actually bugs in the code itself. And this is protecting the customer - and the developer to a great extent, because they don't want customers that are unhappy with the apps."
Cook is also of the opinion that reports of the App Store's problems are overstated. "I think what you have here is something that the noise on it occasionally may be much higher than the reality." ®
More than one analyst asked both Oppenheimer and Cook whether Apple's projections for the next quarter's revenue took into account the launch of the long-rumored iPad, but both execs dodged all such questions. To one questioner, Cook replied: "I wouldn't want to take away your joy and surprise on Wednesday when you see our latest creations."
Apple has nothing close to a monopoly.
Just a correction for you and everyone that somehow thinks Apple has some kind of "monopoly".
There can't be antitrust or monopoly issues when you only control 4% of the cell phone market. Customers are happy to go elsewhere if they don't like the consistency and ease of use of Apple products. Even with the iPod at around 70% share of "mp3 players", it's nowhere close to a monopoly since there are plenty of other ways to obtain and listen to "music" in that "market"...
Apple is vertically integrated... and that's perfectly legal since you can't have a "monopoly" on your own products.
So will people please pass on the fact that Apple is nowhere close to any monopoly position. If you don't like the iPhone, then you have 100's of other choices. ONLY if Apple had around 80% of ALL cell phones would antitrust become an issue. But with 4% or (technically less) they are far, far, far away from any "monopoly" position.
Now you know!
Re: Just One Question
First up, you don't need to actually run out of memory to know that you are going to run out. If you know that you have a ten megabyte requirement and you can only see five, then that's plenty to show a message box.
Second up, any sane GUI will have some reserved space, accessible to the message box API, precisely for this situation. Even DOS-based Windows managed this one.
Disclaimer: I've no idea what the app in question was wanting to do (reasonably or otherwise) or what it actually was doing (ditto). I'm merely pointing out that there are perfectly reasonable answers to those questions. Running out of memory is not some new problem to which computer scientists and OS designers have not yet given any thought.
I'm sold too!
This is reassuring since Android has been hit with Malware already, I don't need to worry as much with the Apple iPhone or suspected the iSlate.
Some people (developers and geeks) might get annoyed by it, but in the long run it will pay off. Checks will become faster, apps should become slicker and security for the end-user tightened.
I'm getting tired of small hiccups and GUI issues in Windows 7 too, starting to piss me off, no debating a MacPro Desktop, I'll miss gaming slightly though. :(
That's not how it works. How much money you make is irrelevant. In fact one could argue that the price of entry to the market is fixed at such a low level that profit cannot be made by anyone else. It's also unlawful to use one market to achieve dominance in another, however this is much harded to prove (unless you blatantly go out of your way to put the only other competitor out of business, for instance like what happened to Netscape) Therefore the dominant firm are stifling competition by 'price-fixing'. Besides, you cannot punish a business for having the lions share of a niche (approximately 1 in 4 sales of music is digital. Source: IFPI), the market must be viewed as a whole. Apple may have a dominant position in downloads, but when applied to the whole it's much smaller. This is the very reason Apple couldn't be sued for their perceived monopoly over Macintosh computers and why ultimately Psystar were on a hiding to nothing.
funny, but in my dictionary, "a little above breaking even" isn't in the definition of "loss leader"