Apps that do nothing when you download them are against Apple’s rules, says the company’s top marketer, Phil Schiller.
“You download the app and it doesn’t work, that’s not what we want on the store,” Schiller told Matthew Panzarino.
The context: Apple is blocking updates to an email app named Hey from Basecamp that requires a paid subscription to the Hey service before it’s activated and useful. And not just blocking updates: Apple is threatening to remove Hey from the App Store.
There are probably thousands of apps that do nothing when you first download them. Likely hundreds of them are in the smart home or Internet of Things categories.
And they’re easy to find.
This week has been contentious for Apple. The company released a report highlighting all the free benefits the iOS ecosystem enables for the world the same week that the EU opened two antitrust investigations against it. This same week we found out that Apple has rejected Facebook’s social gaming app for the fifth time. And, of course, this same week, Basecamp’s innovative new email app Hey has basically been turfed from the iOS App Store for being DOA, or, perhaps, DOD: dead on download.
It’s understandable: Apple doesn’t want to allow free-to-download apps that don’t do anything until you pay for them. User experience matters.
It’s just that you pay for them a different way.
Essentially, Hey and Apple are dealing with the consequences of 18th-century thinking around what products and purchases are, and trying to shoehorn yesterday’s model into today’s digital ecosystems.
Take the Wemo app from Belkin. It helps you connect and control smart switches and outlets throughout your house. I have it on my phone to control some of our smart home features, but guess what: until you add smart switches, it does precisely nothing.
Shockingly perhaps, those switches are not free.
Oh, and by the way, if you get accidentally disconnected from those switches (account issues, WiFi issues, hardware problems) the app is essentially useless.
The Dyson app is basically identical.
Connected to your digital devices from Dyson, it can control them, start them, schedule them, stop them, and return information about your air quality and where your robot vacuum cleaner goes. Disconnected, it’s useless.
Without a Dyson device — and yes, those cost not a little bit of money — the app is scrapware: essentially digital detritus taking up space on your iPhone or iPad.
Other apps like this include:
Right now, Apple has some valid points. Apps should offer functionality when you download them. And if Apple is maintaining the App Store, keeping out the trash and malware, and offering a place for hundreds of millions of people to discover your services and use your products, it deserves some cut of the proceeds.
But all of these companies’ apps, which Apple has no problem hosting on the App Store, return no explicit value back to Apple. No dollars, in other words.
On the other hand, every app that gets added to the App Store, paid or free, subscription or ad-supported, adds value to the iOS ecosystem by adding yet one more thing customers can do with their iPhones and iPads. The more value added to the iOS ecosystem, the more Apple can afford to maintain its profit margins on hardware in the 60% range. This is precisely how Apple can earn more revenue from the mobile ecosystem than all competitors combined globally: 51% of revenue share.
That’s worth something too.
The core problem is that Apple’s rules are inconsistently applied.
Amazon and Netflix get a pass, and the reason why is probably exactly what you’re thinking: they’re big, powerful companies with lots of money and plenty of influence. Just a month or so ago we learned of the existence of an Apple program to allow in-app purchases that do not use Apple’s purchasing platform and therefore don’t pay a 30% cut to Apple, and that Amazon, Netflix, Canal+, and Altice One are in this program.
What’s so special about these companies? Well, they’re politically powerful, for one. And they have significant off-App-Store businesses. That’s something that Basecamp doesn’t have — at least not to that scale. And certainly something that the brand-new email app Hey doesn’t have.
And that smacks of injustice.
The little guys pay tax while the big boys find loopholes.
Ultimately, Apple is going to have to figure out a more consistent, more above-board, more open, and more equitable model, and that might involve a sliding scale of revenue capture so that the Amazons and Netflixes of the world don’t get a free pass while the Heys of the world get shaken down for what to Apple is just a few pennies.
If Apple doesn’t do it quickly, the EU antitrust lawyers just might force them.