For a full view of not just what an executive says, but Microsoft's actions here:
The Windows app store gives a 95/5 cut to developers, as long as the download happened from an external link to the page. If the discovery happened via an app store search or marketing within the app store, that cut changes to 85/15 [1]
I would also like to find some revenue split data for the Xbox store, though I imagine that's far more nuanced, with many different contracts for different third parties. If I'm an indie developer with no negotiating power, is that a 70/30?
Thank you for saying "app store" instead of "App Store". If you dictate this sentence on an iPhone it comes out as "The windows App Store".
In other words, the people that work for Apple are so petty that they won't capitalize the word "windows" even if it was preceded by the word "Microsoft" but they always capitalize the words "App Store" because they insist that they have a trademark on this very generic term even though they really don't [0].
According to them, the generic phrase for app store is "online store" [1], which is hilarious because nobody ever says that.
Yeah sure. I suppose you’d also say that it’s simply incompetence that Apple refuses to open Google Maps, the most widely used map app, when I click on a link to somebody’s address in my contacts app. Oh and it just so happens that I can’t replace the Contacts app either.
Yup, iOS I believe learns your typings over time and chooses what you use the most. So if you talk about Windows a lot and capitalize it, it will start suggesting it, but if you talk about your house windows more, it'll lowercase it.
What was the earliest prior art resembling the Apple App Store? (Eg curation, 3rd party publishing with royalty cuts, one-click install.)
Was it Steam? Which first launched in 2003?
Did Apple debut objectively novel behavior that made the App Store a thing? Perhaps the install flow, or maybe the developer submission flow? (Which was admittedly awful for a number of years)
App Store was obvious as Linux user. In Windows and Symbian users has to search for installer. Out of commercial looks like Valve was first. I've never seen Windows Marketplace. Nokia took so long to make obvious thing - you have to review and sign application by Nokia (Symbian 9.1, 2005 [0]), but host by yourself.
Valve Steam - announced on March 22, 2002, released for beta testing the same day. [1]
Windows Marketplace - announced on July 12, 2004, launched on October 12, 2004 [2].
Nokia Ovi - announced on 29 August 2007, public beta on 28 August 2008 [3].
"an application development platform created by Qualcomm, originally for code division multiple access (CDMA) mobile phones, featuring third-party applications such as mobile games. It is offered in some feature phones (mostly with the similar specifications of a mid to high-end mobile phones) but not in smartphones. Developed in 1999, as a platform for wireless applications on CDMA-based mobile phones, it debuted in September 2001."
Wow, I completely forgot about this one. I remember this on my flip phone. While a nice bit of nostalgia, IIRC the fees and royalties were very high and the administration to get something submitted was not in the same ballpark of the earliest Apple App Store.
Symbian had mandatory signature checks and Nokia Signed/Symbian Signed program for privileged APIs, i-mode phones had “carrier official sites” program and Java app players to use with...
That said, the idea of iOS and App Store that you don’t ever sideload, browse from PC or web browser, or handle .ipa directly, as an integrated whole, do feel novel to me.
Something similar but for music existed in pre-Vivendi MP3.com (whose founder later started Lindows which had an app store for Linux PCs in 2002), and a real world analog might be something like a consignment store.
Remember though that until BUILD 2018, the revenue split on the Windows Store (even though it had long been a failure at that point) was 70/30. At BUILD 2018, they changed it to the 85/15 and 95/5 as a last-ditch effort, although it took until December 2018/January 2019 to finally roll out that change.
Chances are pretty good since the Xbox Games Store remains at 30%. And 5% is very, very low even for low-cut stores: apparently Itch is whatever the dev chooses, Epic is 12, Humble Store is 15% + 10% to charity or as store credit and Steam is 30 sliding down to 20 (above 50m sales). Short of individual agreements I think everything else is 30% flat.
I believe it is a lot more complicated than that. Non-game Apps on the Xbox see the same splits as on Windows (the 85/15 and 95/5 based on "marketing"). The 70/30 is offered to game developers that want to do only the bare minimum Xbox integration possible to get on the platform, almost every other scale and publisher agreement is presumably covered under NDA of one sort or another. Some rumors are that the sliding scale is today competitive to Steam's (and better than Sony's, maybe? Sony's seems even more NDA encumbered), with a lot of complicated other factors such as Xbox Play Anywhere titles and allowing Xbox Game Pass rotations are rumored to get substantial cut discounts based on the shifting whims of Microsoft's marketing teams.
The Windows app store also isn't very popular. I'd attribute that less to a sense of fairness and more to a way to drive adoption.
Microsoft has deployed all sorts of carrots and sticks to try to drive more adoption. In the early Windows 10 days, you could secure $500k-$2.5M in services investment even for internal apps at a not so huge scale.
It seems every thread there is a comment on console. They are not the same.
Console is a loss leader, or sold at cost. No one on planet Earth could make an exact replica of Playstation 5 or Xbox 5 for discount. And that is excluding all the IP, R&D and Software / OS Development involved. The 30% is where they make the money. And personally that is a fair share.
Microsoft also make their profits via selling OS to OEM and Business. The current App Store model are there to help distribution of Software. And the 5% are essentially zero considering you will have to paid ~3% for credit processing any way. i.e Linking to the App Store frees you the burden and duty of hosting yourself for free.
Edit: And if you dont mind share why you downvote.
I'm also not sure that the "but consoles are closed" argument would be a slam dunk anyway, even if they were exactly the same, because I would absolutely support either requiring Microsoft to open up the XBox or allowing game developers to bypass Microsoft's controls.
It's not clear to me why loss-leading consoles are a good thing for consumers. It just means that:
A) games will be more expensive, because Microsoft needs to make more money on them, and
B) a smaller number of games will be made, because the barrier of entry to profitability on any single game will be increased by forcing developers to subsidize Microsoft's costs.
Microsoft is still going to make the same amount of money regardless. They'll either charge upfront, or that cost will be passed on to consumers in the form of more expensive, less experimental games.
So, I dunno. People who make the comparison between Apple and XBox should maybe be careful what they wish for, because I'm more than happy to go after XBox, Playstation, and Switch with the exact same criticisms. I am skeptical that there are many indie game developers who are happy that they need to jump through hoops to get development consoles, or sign NDAs just to target a platform.
The game development communities are exactly the opposite of HN culture, there no one cares about FOSS ideals and stuff, it is all about IP and getting their ideas into the gamer's hands no matter how.
In fact, nowadays I see as a mistake having spent so much time around FOSS during the university back in the 90's, which caused a bit of schizophrenic considerations when going across communities.
The subsidized console increases the total user base by lowering the up front price hurdle. So you’re comparing a world with a small TAM, expensive consoles, cheaper games, vs a world with a large a TAM, artificially cheap consoles, and more expensive games.
I think both game devs and console makers prefer the big-TAM world.
Not loss leaders. Maybe close to "cost" but not loss leaders.
The reason is the length of the lifecycle. Say you spend $100M developing a video game console. That seems outrageous. You ship 100 000 units to stores for the early adopters, and some goof says $100M/ 100 000 = $1000 per console just for the R&D costs. These must be a loss leader!
But by the end of the cycle you've sold over 100 million units, so the R&D cost was under $1 per unit. You also get to do relentless cost engineering. When you spot a way to reduce the BOM by 4¢ on a product you're going to sell another hundred million of, that is Four million dollars you just added to the company's profits. Moore's law is on your side over that period of time too.
I was going to say something similar to you, but then I read https://www.investopedia.com/articles/investing/080515/econo... and found that consoles are loss leaders. With the plan of making it up in subscriptions, licensing, and games produced by the manufacturer.
In other words it is a "sell the razors at a loss and make it up on razor blades" strategy.
> In 2006, at the time of PS3’s launch, each console was sold at a loss of around US $240 per console
That would be a loss leader if the plan was you sell those launch consoles and then exit or move on to a new product having lost $240 per console.
But that was never the plan, the plan was you sell millions more consoles over many years and so overall they're profitable.
It's not razors and razor blades, Gillette sent me a free razor when I was a teenager because that's a razors and razor blades model. Sony doesn't give away consoles because they make money selling the console. They didn't make money on the first few million, which doesn't matter because they sold over a hundred million after that.
The reason they don't do razors and razor blades is because the attachment rate is much lower than most owners imagine unlike for razor blades. It's typically going to be 5-6 games per console. PS4 actually hit 8 games per console but that's a fantastically successful machine nearing the end of its life.
So, if you're losing $240 per console but you hope you can shift six games per console that is $40 per game you need to recoup to break even.
If you go out to a third party developer and you say "We want $40 per sale" they are going to laugh in your face. This isn't Apple strong-arming independent developers, the big games publishers (most obviously Take Two and Activision) absolutely are powerful enough to walk away from such a deal knowing that their competitors will do the same and then the console is dead.
I disagree. It doesn’t matter if the company makes money on the device or not. A device with a walled off App Store, be it a PS4, Xbox, Switch, or an iPhone, operates in the exact same murky legal waters. MS better be careful, or they could wind up breaking their own console’s ability to limit access to their store. Why shouldn’t Steam or Epic be allowed to sell games to an Xbox customer?
So you are suggesting console maker to sell at a loss while others come in and paid nothing for using their platform? Even EPIC have no problem with the console business model.
No, I think they're suggesting that console makers need to open up their app stores and that may result in them no longer being able to sell at a loss.
> Selling at a loss is also called "dumping" and Is generally considered as a illegal anticompetitive practice
No, this is wrong. Dumping is selling at a loss unsustainably in the short term to drive out competitors. If you do it sustainably, it basically can't be dumping.
Thousands of business have loss leaders, from supermarkets to rasers. Video game consoles are not an exception.
You then end up with no body buying the console. It would cost $999, and everyone would have problem justify that price tag. And the total market would shrink, which means for Game developers their Games would also have to be priced higher in order to make a return of investment. Normally that wouldn't work because pricing it higher also means less people are willing to buy, so the solution would be to lower the cost of making games. And less ridiculously expensive AAA titles.
Apple sure sells a lot of iPhones at around the $1000 price point, and they’re not selling those at a loss. I don’t see any reason to think that the laws of the physics are such that it’s simply impossible to sell a gaming console the same way that, you know, almost every product in the world is sold: for more money than it costs to make.
Very few people pay $1000 up front. Carriers have subsidies and 0% payment plans over 24 months. Apple also offers 24 month payment plans. The console market is much smaller than phone market. 100 million consoles being sold over the entire lifetime over 8 years is considered successful. Apple sells that many phones in two quarters.
There is also a history of consoles not selling well when the price becomes too steep from the Neo Geo for $699 to the XBox that was bundled with the Kinect.
People buying $1000 phones are on the upscale range, who would likely be in the PC gaming category if they gamed. Consoles are priced for the mid budget consumer who likely own $600 phones. On top of that, the price-tag of the phone is an amalgamation of several devices into one. The smartphone is so valuable people are willing to pay cost+margins on it and it STILL fully saturates society. The console unfortunately is not that.
Sure, but then the argument is nothing more than “because our product isn’t good enough to just sell it like every other normal product in the world, we have to sell it at a loss and then extract as much value as we can from developers by exerting total control over software distribution.”
Are you just arguing because you can't stand the idea of a world where everything isn't black and white? If the system as it has settled were so much of a problem for the developers, they would not have time and time again put their weight behind the companies pricing their consoles low.
Prices are all ephemeral anyway. How many of those "normal products" are only able to be sold for more than they are made for because we value the labor of the person making it less than we would the same labor from the person buying it?
> If the system as it has settled were so much of a problem for the developers, they would not have time and time again put their weight behind the companies pricing their consoles low.
To loop back around to the iPhone, pretty much every indie developer I know thinks that mobile phone games are priced too low, but nobody can change it because the expectation has been set that a mobile game can't be $30-60. It's just the way the market has evolved.
So markets are complicated. Sometimes they move in smart directions, sometimes multiple factors conflate together and they move in unsustainable directions. The fact that developers still write games for consoles doesn't necessarily mean that developers like the system they're a part of, or that they don't want it to be any better. It just means the expected value of signing those NDAs, using expensive locked down hardware, and paying revenue portions to the console maker still currently work out to be positive.
Games sell like hot-cakes on the Switch right now. Nintendo would honestly need to do some pretty horrible stuff to make a Switch release of almost any semi-popular game not worthwhile economically. But that doesn't mean developers love everything Nintendo does.
So be careful of reading too much into what developers do. We're Capitalists just like everyone else. If the market demands F2P micro-transactions, NDAs, DRM, or region-specific pricing, ultimately most of us will do what the market demands. Revenue splits are no exception.
That being said, I would argue the market for games publishing hasn't settled, and that it's really not shifting towards increasing revenue splits or developer costs. The original process for getting games on the XBox was way harder and way more expensive than it is today. The reason consoles have generally started to shift towards more open terms is because developers eventually got fed up with paying money to release bugfixes, and started shifting focus to consoles that made releasing software easier.
We're seeing the same trends with Steam and the Epic store. 30% was reasonable, until Epic started offering much better terms. Now Valve is starting to move towards 20%. Devs will work with any system that makes them money, but obviously they would prefer to take bigger cuts of each sale. People don't really appreciate that -- if Steam didn't have such a massive market share right now, no developer would rationally choose to release on Steam instead of Epic Store. We all want lower revenue splits.
Which was mostly my point, nothing is just as simple as "Sell things for more than they cost to make." Markets are weird, more so when you have non-tangible components like software and IP involved.
I'm not advocating for any model over any other, just acknowledgment that there exists a complex co-dependent relationship between the console owners and the developers.
>You then end up with no body buying the console. It would cost $999,
If people are bad at gathering enough money at once then there are options like pay 999 now or pay 1099 over 2 years period. This is not in the interest of the consumer so it will not happen without regulation.
Consoles are usually not sold at a loss. Maybe for the first year after launch, but they quickly get costs lowered to the point that they're profitable.
One interesting thing about the Wii/PS3/XB360 generation was that Wii was sold at a profit. Knowing that, it was pretty funny to see Sony/MS fanboys lambast the Wii's low attach rates as an impending failure when the model was totally different. Sony would need a customer to buy multiple games to turn a profit on a PS3, Nintendo could sell someone a Wii and Mario Kart and not have them buy anything else, and that'd likely be a happy and profitable customer.
We should note that the Windows app store is a massive failure, so Microsoft's actions as an also-ran are going to be "benevolent" and "open" because they have nothing to lose. Browse through the derelict mess that is the app store to understand just how miserable their state is. The overwhelming bulk of sales in the Windows app store are Microsoft's own products.
Recall when Microsoft was lagging far behind the other cool instant messenger kids, and was loudly crying for open interoperability and cooperation. Once MSN Messenger had a foothold, it slammed shut and their noble goals dissolved. Microsoft is certainly not alone in this self-serving morality -- it is a logical position -- but they do have a lot of examples in their corporate history.
Apparently the Microsoft employees are out in force today. It's also interesting how making an observation like this -- that the Windows app store is a failure -- leads people to pigeonhole. As I sit here on my Lenova 720 in Windows 10 Pro cross compiling an app between Windows and Linux in the WSL...hurrrRRRRrrr)
Even earlier than MSN Messenger was the RTF document format, promoted by Microsoft as an interoperability format to allow them to co-exist with Microsoft Word in a market dominated by WordPerfect, WordStar, etc.
And of course Microsoft dropped RTF like a hot potato when they managed to use their new Microsoft Windows platform to leverage into a huge market advantage for Microsoft Word. Other vendors were obviously initially reluctant to spend enormous resources to port their software to Windows, a competitor’s platform, but Microsoft could spend hugely on developent of Microsoft Word for Windows, making it very impressive graphically, and when the Windows platform was successful, all other word processing software vendors were left behind, forced to play catch-up. I also remember hearing that Microsoft were using secret Windows APIs to get nice things like toolbar icons in color, not available to non-Microsoft companies.
It's interesting RTF is discontinued when it is still the default format on the included word processor in Windows. I checked WordPad on Windows 10 and it still saves to RTF by default, though it supports docx and odt as well.
Unless they changed something the last couple of years, WordPad is just a wrapper around the Windows rich edit common control[1], which as its name implies, is based around RTF[2].
Microsoft is famously backwards-compatible, and support for RTF is still present in those programs which originally had it, like Write, the included word processor in Windows since Windows 1 (replaced in Windows 95 with WordPad, which retains its features). But is RTF usable for its original purpose – interoperability? Can you open a reasonably complex Word document and save it as RTF, and then open it in LibreOffice? Can you save an RTF document from LibreOffice and open it in Microsoft Word without loss? Is Microsoft working to maintain RTF interoperability in order to promote cross-program document compatibility? No. To quote Wikipedia, “Microsoft has discontinued enhancements to the RTF specification. New features in Word 2010 and later versions will not save properly to the RTF format.”¹
Upvoted for the attitude (of course MS's calls are entirely self-serving) but it's hard to know how much of a "failure" the Windows Store is - I tend to use it and recommend it as a safer-than-average port of call for the less skilled.
I would be willing to bet a non-zero amount of money that, much like the average Hacker News reader would woefully under-estimate how much .Net code is out there being written today, so to would we woefully underestimate how much usage the Microsoft Store gets.
I opened the Microsoft Store and had a look at the top 50 items in "most popular". It includes items with such mainstream appeal as the Windows Terminal, Ubuntu 20.04 and the VMWare client.
The most popular app is Roblox. It has 164 reviews. The second most popular app is Spotify. It has 57 reviews. On Android, it has 19 million reviews. Their Android TV app even has 200. The item with the most reviews is Minecraft, with 1000 reviews. On Android it has 3.5 million.
The Microsoft store also lets you install free apps with out logging in (if you keep clicking out from the login prompts) so it's probably also harder to get reviews.
While I agree that the windows store is used more than some people might think, it is used nowhere near as much as the Play or App Store are, and is nowhere near as import for Windows as the others are for their respective platforms.
Of course it is! For the vast majority of users, the Play or App Store is the only possible way to install software.
Of course the difficulty and headaches involved with windows package management are pretty asinine, they at least are an accessible and non-gated platform for both the developer and user, which can't be said for Android and iOS/MacOS.
Which is partly Microsoft's fault because Enterprises should have easily embraced the Microsoft Store for Business (emphasis on the "for Business" as a part of the name following one of Microsoft's more confusing name patterns; it's a separate more customizable "store front" than the "not for Business" consumer store): it's a lot nicer UX than System Center's "just ported from Silverlight" Vista-era ugliness, has more features than System Center (including easier license management for applications sold on the non-Business store), and better install technology. In one of Microsoft's many "forgot to build a bridge" problems with the Store, they forgot to provide easy upgrades from System Center, especially for the then (too many) companies still supporting Windows 7 side-by-side Windows 10 installs up until the security support deadline.
It's probably still too early to tell, but App Management for Microsoft Teams, updates to MSIX, and better Windows 7 compatibility for companies over-paying EOL extended security support agreements, at least for Microsoft/Office 365 companies, has opened the door to enterprises re-evaluating the Microsoft Store for Business. It might actually replace System Center like it was intended to, just years late.
I imagine the Windows Store gets billions in revenue, but much like Microsoft's claims about the great success of their cloud offering (where they hilariously count Office 365 as cloud revenue to compare against AWS and GCC) the overwhelming bulk will be people upgrading to paid Office accounts.
The .NET bit is an irrelevant strawman. We aren't talking about that, and it has zero relevance.
i wouldn't call it a failure i actually bought a couple of apps and I don't usually buy apps (in the past 5-6 years I think i bought another 3 on play store). its just that windows app delivery is traditionally done via application's website so it never took off especially cause at first it only catered for UWP stuff.
I don't necessarily disagree with your analysis of Microsoft's motivation. However, it does nothing to change my support of it. The 30% Apple takes for its App Store seem a bit much for a middle man.
The Windows app store gives a 95/5 cut to developers, as long as the download happened from an external link to the page. If the discovery happened via an app store search or marketing within the app store, that cut changes to 85/15 [1]
I would also like to find some revenue split data for the Xbox store, though I imagine that's far more nuanced, with many different contracts for different third parties. If I'm an indie developer with no negotiating power, is that a 70/30?
[1] https://9to5mac.com/2019/03/06/microsoft-store-revenue-share...