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Under the Radar

Under the Radar 31: Today’s App Store Announcements

 

00:00:00 ◼   ► welcome to under the radar our show

00:00:01 ◼   ► about independent iOS app development

00:00:03 ◼   ► I'm Marco Arment and I'm David Smith

00:00:05 ◼   ► under the radar is never longer than 30

00:00:07 ◼   ► minutes so let's get started so today we

00:00:10 ◼   ► wanted to talk about these interesting

00:00:12 ◼   ► changes that were announced about the

00:00:13 ◼   ► App Store today as of as a time of

00:00:16 ◼   ► record they were announced about an hour

00:00:17 ◼   ► ago

00:00:18 ◼   ► Apple has officially recognized the

00:00:20 ◼   ► speed of apps of a preview times being

00:00:23 ◼   ► being improved some updates to the auto

00:00:26 ◼   ► renewing subscription plans and some

00:00:28 ◼   ► expansions of capabilities to

00:00:30 ◼   ► subscriptions there and then number

00:00:32 ◼   ► three is they've announced that search

00:00:35 ◼   ► ads will be coming to the App Store what

00:00:36 ◼   ► do you say we talk about the

00:00:38 ◼   ► subscription changes sure so as best we

00:00:41 ◼   ► can tell and there's a great page we'll

00:00:43 ◼   ► have a link to it in the show notes of

00:00:44 ◼   ► like the what's new in subscriptions

00:00:46 ◼   ► that Apple's laid out see there's some

00:00:48 ◼   ► good color you kind of get from Phil's

00:00:50 ◼   ► interview but the real meat of it is on

00:00:52 ◼   ► developer.apple.com and it seems like

00:00:56 ◼   ► there's two or three big deals one is

00:00:59 ◼   ► that you can now essentially offer Auto

00:01:02 ◼   ► renewing subscriptions in any app type

00:01:05 ◼   ► this used to be really some of somewhat

00:01:08 ◼   ► of a vaguely defined rule but you had to

00:01:10 ◼   ► be a magazine or a cloud services

00:01:13 ◼   ► company or a dating site I think we're

00:01:15 ◼   ► the three things that you could do yeah

00:01:17 ◼   ► it was always this rule has always been

00:01:18 ◼   ► very vague it used to only be like

00:01:21 ◼   ► periodic content first they used to be

00:01:23 ◼   ► able to be newsstand like in the very

00:01:24 ◼   ► very first implementation of it back in

00:01:26 ◼   ► 2011 and then it kind of expanded to be

00:01:30 ◼   ► like well you could be newsstand or it

00:01:32 ◼   ► could be a handful of things that we

00:01:35 ◼   ► that had like you know recurring costs

00:01:37 ◼   ► like cloud services companies like I

00:01:39 ◼   ► know Evernote started using it very

00:01:40 ◼   ► early on for their premium service and

00:01:43 ◼   ► it was the kind of thing where you could

00:01:44 ◼   ► apply to do it and you could submit an

00:01:47 ◼   ► app that did it and it seemed fairly

00:01:49 ◼   ► inconsistent as to what got through app

00:01:52 ◼   ► review for that and what didn't and what

00:01:53 ◼   ► counted as like an ongoing service or

00:01:57 ◼   ► ongoing content and what didn't count

00:01:58 ◼   ► and so it was oh it was always very kind

00:02:02 ◼   ► of risky to attempt to do that if you

00:02:03 ◼   ► were just like an app that wanted

00:02:05 ◼   ► subscription revenue for for some other

00:02:07 ◼   ► reason outside of those narrowly defined

00:02:09 ◼   ► boxes yeah and so now that seems like

00:02:12 ◼   ► that's

00:02:13 ◼   ► those kind of criterias are going away

00:02:15 ◼   ► and any app category or type is

00:02:18 ◼   ► available I think I mean that honestly

00:02:20 ◼   ► that's that's still left a little bit

00:02:22 ◼   ► vague and in the language on on the page

00:02:24 ◼   ► it still left a little bit vague it's it

00:02:29 ◼   ► still kind of sounds like okay now any

00:02:31 ◼   ► app category can do this but you still

00:02:35 ◼   ► should be offering some kind of like

00:02:38 ◼   ► ongoing service backing it or some kind

00:02:42 ◼   ► of ongoing content delivery so it's

00:02:44 ◼   ► still a little like so if you just made

00:02:46 ◼   ► like a really good calculator that

00:02:47 ◼   ► didn't have a service behind it i it's

00:02:50 ◼   ► not entirely clear that you would be

00:02:52 ◼   ► allowed to subscription price it yeah

00:02:54 ◼   ► and I think that is probably the most

00:02:56 ◼   ► significant thing to note is that it

00:02:58 ◼   ► does seem like the like on in on the

00:03:01 ◼   ► developer page they're talking about the

00:03:03 ◼   ► types of an order of renewable

00:03:04 ◼   ► subscriptions are for content or for

00:03:06 ◼   ► services and so it doesn't sound like in

00:03:09 ◼   ► the sense of if you wanted to just say

00:03:11 ◼   ► like here's my app and you will pay me

00:03:14 ◼   ► whatever a few dollars a month a year to

00:03:17 ◼   ► use this going forward that you would be

00:03:21 ◼   ► able to you'd there'd have to be

00:03:22 ◼   ► something that you were giving the user

00:03:26 ◼   ► on an ongoing basis and I'm sure there's

00:03:28 ◼   ► many ways around that like you can just

00:03:29 ◼   ► kind of structure something in your app

00:03:31 ◼   ► that will make that you know check that

00:03:34 ◼   ► box but it doesn't sound like in in if

00:03:37 ◼   ► you were just trying to do like a

00:03:38 ◼   ► general purpose if you want to use my

00:03:42 ◼   ► app you have to pay that doesn't sound

00:03:45 ◼   ► like that's quite there um but it's

00:03:49 ◼   ► expanding it certainly more and I

00:03:51 ◼   ► imagine as we this gets rolled out and

00:03:53 ◼   ► people start sort of pushing the edges

00:03:55 ◼   ► of it will have a better understanding

00:03:56 ◼   ► of exactly what that means but at the

00:04:00 ◼   ► very least more people are going to be

00:04:02 ◼   ► able to do subscriptions than could do

00:04:05 ◼   ► subscriptions before yeah and it seems

00:04:07 ◼   ► like the implementation of them is

00:04:09 ◼   ► certainly improving but it seems like

00:04:11 ◼   ► it's based on the auto renewing

00:04:13 ◼   ► subscription type that we've had since

00:04:14 ◼   ► 2011 it you know it's it's still it

00:04:17 ◼   ► isn't like some kind of separate app

00:04:19 ◼   ► store payment structure like you know

00:04:21 ◼   ► free versus paid upfront like it's not

00:04:23 ◼   ► going to be like a automatic it seems

00:04:24 ◼   ► like it's going to be a lot more like

00:04:27 ◼   ► what we

00:04:27 ◼   ► had before which is here's an in-app

00:04:28 ◼   ► purchase type you have to as a developer

00:04:30 ◼   ► you have to code the support for this a

00:04:32 ◼   ► net purchase type in your app you

00:04:34 ◼   ► probably have to write the backing

00:04:35 ◼   ► service to validate them I'm not sure

00:04:37 ◼   ► there's gonna be like I'm sure there's

00:04:38 ◼   ► companies that will do that for you for

00:04:40 ◼   ► a fee but you know you are still kind of

00:04:43 ◼   ► manually implementing this in your app

00:04:44 ◼   ► so it's not it's not as easy as you know

00:04:47 ◼   ► if you have a paid app a paid upfront

00:04:49 ◼   ► app you literally just like set a box

00:04:51 ◼   ► and iTunes Connect saying this app costs

00:04:52 ◼   ► X dollars and you don't have to deal

00:04:54 ◼   ► with anything else ever again you know

00:04:56 ◼   ► in relation to collecting money from

00:04:57 ◼   ► people it's not going to be that easy

00:04:58 ◼   ► it's it's still an in-app purchase that

00:05:00 ◼   ► you have to code for you have to account

00:05:03 ◼   ► for in your app ultimately though I

00:05:04 ◼   ► think this is the better way to do it

00:05:06 ◼   ► because this gives you flexibility in

00:05:07 ◼   ► the app to do things like what if you

00:05:10 ◼   ► know what if you want to have some

00:05:11 ◼   ► amount of your apps functionality or

00:05:13 ◼   ► content be available with it without

00:05:15 ◼   ► subscribing and then have some other

00:05:17 ◼   ► section of it be available with the

00:05:19 ◼   ► subscription then you know this allows

00:05:20 ◼   ► you to set that balance yourself so that

00:05:22 ◼   ► I think is is the right way to do this

00:05:24 ◼   ► ultimately though this is you know

00:05:27 ◼   ► assuming that that they will allow all

00:05:29 ◼   ► apps to use this which again it's the

00:05:31 ◼   ► wording is kind of vague that I think it

00:05:34 ◼   ► boils down to this one sentence on on

00:05:35 ◼   ► the page on their site which says

00:05:37 ◼   ► although all categories of apps will be

00:05:40 ◼   ► eligible this Benzema this business

00:05:42 ◼   ► model is not appropriate for every app

00:05:43 ◼   ► so I guess it depends on their

00:05:46 ◼   ► definition of eligible and appropriate

00:05:48 ◼   ► it does that mean does appropriate mean

00:05:50 ◼   ► they don't recommend we do it or does

00:05:52 ◼   ► appropriate mean they won't let us do it

00:05:54 ◼   ► so that's that's again still unknown but

00:05:56 ◼   ► I think subscription pricing is a really

00:06:00 ◼   ► really interesting compromise to what

00:06:03 ◼   ► developers have been asking for in the

00:06:05 ◼   ► App Store for a long time which is like

00:06:06 ◼   ► you know upgrades trials some some kind

00:06:08 ◼   ► of way to make money from people ongoing

00:06:10 ◼   ► because software as we've just before

00:06:13 ◼   ► you know software people expect ongoing

00:06:17 ◼   ► functionality they expect updates they

00:06:19 ◼   ► expect bug fixes they expect you to be

00:06:22 ◼   ► putting in effort to improve and fix

00:06:24 ◼   ► your software over time for them and so

00:06:27 ◼   ► when they pay for it they expect not

00:06:29 ◼   ► only am i paying for the software to use

00:06:31 ◼   ► now I'm paying for upgrades forever like

00:06:34 ◼   ► that's basically you know as much as

00:06:35 ◼   ► developers like to like to fight against

00:06:37 ◼   ► that with things like different versions

00:06:39 ◼   ► and paid upgrades the way people

00:06:40 ◼   ► perceive it

00:06:41 ◼   ► is I pay for this thing and therefore I

00:06:43 ◼   ► expect updates forever and so to try to

00:06:46 ◼   ► try to track the balance between like

00:06:48 ◼   ► what users want which is paying either a

00:06:50 ◼   ► zero or one time and then getting this

00:06:53 ◼   ► forever and versus what we need which is

00:06:54 ◼   ► ongoing revenue to fund the development

00:06:56 ◼   ► of these ongoing things and to fix

00:06:58 ◼   ► things over time and to improve things

00:06:59 ◼   ► over time subscriptions I think are a

00:07:03 ◼   ► really good compromise there because

00:07:05 ◼   ► look we're never gonna get paid upgrades

00:07:07 ◼   ► in the App Store we're never gonna get

00:07:08 ◼   ► like automated free trials this is the

00:07:11 ◼   ► they're giving us the system now they

00:07:13 ◼   ► gave us in-app purchase at first to to

00:07:16 ◼   ► kind of first semi simulate free trials

00:07:20 ◼   ► and types of upgrades sort of and now

00:07:23 ◼   ► they're giving us subscriptions to to

00:07:26 ◼   ► basically replace ongoing upgrade

00:07:28 ◼   ► revenue and there's some ups there's

00:07:30 ◼   ► some downs but I think it's pretty clear

00:07:33 ◼   ► this is Apple's message this is this is

00:07:34 ◼   ► them saying like we're not giving you

00:07:36 ◼   ► those other things this is what we're

00:07:37 ◼   ► giving you figure out a way to make this

00:07:39 ◼   ► work for you or to make the other stuff

00:07:41 ◼   ► that we already offer through in-app

00:07:42 ◼   ► purchase work for you and there's the

00:07:45 ◼   ► user side of this of course is is a big

00:07:48 ◼   ► question mark but the the developer side

00:07:51 ◼   ► as I think is very very clear now is if

00:07:53 ◼   ► you want ongoing revenue you know for

00:07:56 ◼   ► for people who just use your app if you

00:07:59 ◼   ► want on long everything you need to

00:08:00 ◼   ► either find a way to to convince them to

00:08:02 ◼   ► pay for this for a subscription price

00:08:03 ◼   ► like this or you have to do something

00:08:05 ◼   ► like advertising where you just kind of

00:08:07 ◼   ► automatically get paid with with usage

00:08:09 ◼   ► of your app over time I don't know what

00:08:12 ◼   ► do you think it's definitely a mixed

00:08:15 ◼   ► feeling that I have when I spent I saw

00:08:17 ◼   ► this news because on the one hand I'm

00:08:20 ◼   ► very glad that something is happening

00:08:22 ◼   ► like oK we've talked about for many

00:08:26 ◼   ► episodes like there's a lot of things

00:08:27 ◼   ► that feel not great in the App Store and

00:08:30 ◼   ► for years it's felt like nothing was

00:08:32 ◼   ► ever gonna change like what we had is

00:08:34 ◼   ► just what it was and that's where it was

00:08:37 ◼   ► going to be in eternity and I'm very

00:08:40 ◼   ► excited that things are changing that

00:08:43 ◼   ► whether this is a result of Phil

00:08:45 ◼   ► Schiller taking over the App Store more

00:08:48 ◼   ► fully or if it was just time for this to

00:08:50 ◼   ► happen or whatever the reason something

00:08:52 ◼   ► has caused this like changes to start

00:08:55 ◼   ► happening the things are starting to

00:08:56 ◼   ► sort of bubble up in the App Store and

00:08:58 ◼   ► are changing which overall I'm pretty

00:09:02 ◼   ► excited about because I think things

00:09:03 ◼   ► weren't in a great place and I mean you

00:09:05 ◼   ► never know it could be worse overall in

00:09:07 ◼   ► the end but I'd rather have I'd rather

00:09:09 ◼   ► to sort of find my way in a store that

00:09:11 ◼   ► was evolving and changing because in a

00:09:14 ◼   ► lot of ways like being a small developer

00:09:17 ◼   ► there's a lot of benefits when things

00:09:19 ◼   ► are more in flux because I can try

00:09:22 ◼   ► things out with much less overhead and

00:09:24 ◼   ► kind of dive in and there's less risk

00:09:26 ◼   ► than if I was a bigger company I can be

00:09:29 ◼   ► a bit more flexible and agile in that

00:09:31 ◼   ► way so overall I like that I'm not sure

00:09:36 ◼   ► if an annex and expansion of auto

00:09:38 ◼   ► renewable subscriptions is like

00:09:42 ◼   ► fundamentally going to improve the

00:09:44 ◼   ► situation in terms of making a viable

00:09:46 ◼   ► business in the app store it's I think

00:09:49 ◼   ► the types of applications where it will

00:09:51 ◼   ► make sense exist but they are more and

00:09:56 ◼   ► more limited and the thing that I worry

00:10:01 ◼   ► about as a user is if this is where

00:10:04 ◼   ► software goes but like if all of my

00:10:07 ◼   ► software requires an ongoing

00:10:09 ◼   ► subscription to have there's a very I

00:10:12 ◼   ► think you'll hit a fatigue point with

00:10:14 ◼   ► that where customers won't want to

00:10:17 ◼   ► download software or new software if in

00:10:20 ◼   ► their mind it's going to come you know

00:10:22 ◼   ► come with it a monthly charge of a

00:10:25 ◼   ► dollar a month or whatever it is into

00:10:27 ◼   ► their you know on their iTunes account

00:10:30 ◼   ► every single month in order to use any

00:10:32 ◼   ► of the apps and if they stop paying all

00:10:33 ◼   ► of a sudden all their apps stop working

00:10:35 ◼   ► and so I would imagine a lot of

00:10:37 ◼   ► customers would you know fight against

00:10:39 ◼   ► would push against that and in many ways

00:10:41 ◼   ► that could push even stronger pressure

00:10:44 ◼   ► towards the just sort of like software

00:10:46 ◼   ► being free model where the expectation

00:10:49 ◼   ► is that it'll be free and the reality is

00:10:51 ◼   ► in the App Store right now I mean this

00:10:53 ◼   ► is my own experience from trying every

00:10:55 ◼   ► business model known to man is that the

00:10:57 ◼   ► most success I've ever had is in the

00:11:00 ◼   ► just sort of give it all away for free

00:11:02 ◼   ► and put ads in it model which I don't

00:11:06 ◼   ► love

00:11:07 ◼   ► I have a hard time believing that the

00:11:11 ◼   ► percentage of my customers who would be

00:11:14 ◼   ► willing to pay a non insignificant

00:11:16 ◼   ► amount I mean one thing that I'm very

00:11:18 ◼   ► curious about yes there's a bunch of

00:11:20 ◼   ► stuff in here about different like 200

00:11:24 ◼   ► different price points and you can

00:11:25 ◼   ► specify different price points in

00:11:26 ◼   ► different territories and there's a lot

00:11:28 ◼   ► more flexibility there and I'm really

00:11:30 ◼   ► intrigued to see if we're going to get

00:11:32 ◼   ► something where the payments that you we

00:11:36 ◼   ► are charging can be lower or like in a

00:11:40 ◼   ► way that charging somebody a couple of

00:11:43 ◼   ► dollars a year maybe much maybe a bit

00:11:46 ◼   ► more palatable than charging them a

00:11:48 ◼   ► minimum of 99 cents per month which I

00:11:50 ◼   ► believe is the in the current form of

00:11:52 ◼   ► Auto renewing in-app purchases that's

00:11:55 ◼   ► the lowest tier you could do is a dollar

00:11:58 ◼   ► a month and maybe it's maybe I'm being a

00:12:01 ◼   ► little hard hard on my own software but

00:12:04 ◼   ► I I don't think a lot of people would

00:12:06 ◼   ► view a lot of what I make is worth more

00:12:09 ◼   ► than that where they're paying twelve

00:12:11 ◼   ► twelve dollars a year for it and but

00:12:14 ◼   ► maybe they would be willing to pay a few

00:12:16 ◼   ► dollars a year for it and so if there's

00:12:18 ◼   ► those types of things that's interesting

00:12:20 ◼   ► to me and I'm also quite interested in

00:12:23 ◼   ► the way that like in-app purchase or

00:12:24 ◼   ► auto renewing has a lot of flexibility

00:12:27 ◼   ► in it like the actual fundamental API as

00:12:29 ◼   ► it exists today and I imagine going

00:12:31 ◼   ► forward or it has built-in support for

00:12:34 ◼   ► things like free trials and bonus

00:12:36 ◼   ► periods and things where you can have a

00:12:39 ◼   ► bit more flexibility about the way the

00:12:42 ◼   ► first you know someone is I'm being

00:12:43 ◼   ► unboard into paying for your sock for

00:12:46 ◼   ► your you know for your software for your

00:12:47 ◼   ► service so that's certainly nice in

00:12:50 ◼   ► terms of a lot of people have been

00:12:52 ◼   ► asking for years for free trials on the

00:12:53 ◼   ► App Store and with in-app purchase you

00:12:56 ◼   ► can sort of get there you know they're

00:12:58 ◼   ► exactly how that goes like is gonna be

00:13:00 ◼   ► an interesting thing to navigate an app

00:13:02 ◼   ► review of app review typically doesn't

00:13:04 ◼   ► allow your app to be have a time limited

00:13:08 ◼   ► free trial but you can sort of get

00:13:10 ◼   ► around that if a your app is tied to an

00:13:12 ◼   ► online service and so will we be able to

00:13:16 ◼   ► work something out there but

00:13:18 ◼   ► I said overall it's kind of this weird

00:13:20 ◼   ► mixed feeling of I feel like I'm glad

00:13:22 ◼   ► that this is changing I really hope this

00:13:25 ◼   ► isn't the only change that we're gonna

00:13:27 ◼   ► see in the near future but I think it's

00:13:30 ◼   ► a good thing overall that it's happening

00:13:32 ◼   ► and the reality is even if maybe only a

00:13:35 ◼   ► few a very particular genre of

00:13:40 ◼   ► application will now be made more viable

00:13:42 ◼   ► maybe that's that's enough I don't know

00:13:45 ◼   ► it doesn't have to benefit me or you

00:13:46 ◼   ► necessarily but if all of a sudden

00:13:49 ◼   ► there's you know a few hundred

00:13:50 ◼   ► developers who can now make a viable run

00:13:53 ◼   ► at the App Store like that sounds great

00:13:55 ◼   ► overall yeah I mean and you know as you

00:13:59 ◼   ► said like that I don't think this is

00:14:00 ◼   ► going to address you know that there are

00:14:02 ◼   ► basically two challenges that that are

00:14:04 ◼   ► that developers face for monetization in

00:14:06 ◼   ► the App Store two big ones

00:14:07 ◼   ► one of which one of those challenges is

00:14:09 ◼   ► when people do want to give you money

00:14:12 ◼   ► our options for how to collect that

00:14:14 ◼   ► money have been limited and this

00:14:16 ◼   ► addresses that head-on this gives a lot

00:14:19 ◼   ► more developers a way to collect money

00:14:21 ◼   ► in a different way that might be a

00:14:22 ◼   ► better way that might earn them more

00:14:23 ◼   ► over time and the second challenge that

00:14:26 ◼   ► developers face is from conversation is

00:14:28 ◼   ► that there's just so many other apps out

00:14:30 ◼   ► there that it's hard to give in people

00:14:32 ◼   ► to pay anything for your app if there's

00:14:34 ◼   ► a million other free ones that do

00:14:35 ◼   ► something close enough and this don't

00:14:38 ◼   ► this is not going to address that at all

00:14:40 ◼   ► I do I do kind of argue though in

00:14:43 ◼   ► general that that's not really Apple's

00:14:45 ◼   ► problem that's that's our problem as

00:14:47 ◼   ► developers like that's just the market

00:14:48 ◼   ► that the market is full of competition

00:14:50 ◼   ► and full of alternatives and if somebody

00:14:53 ◼   ► else can do can offer the same thing for

00:14:54 ◼   ► us that that we can for cheaper then you

00:14:57 ◼   ► know good on that like that's that's

00:14:59 ◼   ► their prerogative and so I don't I think

00:15:02 ◼   ► this is Apple doing what they can to

00:15:04 ◼   ► help apps that are worth paying for earn

00:15:08 ◼   ► more money or collect money more easily

00:15:10 ◼   ► and and to solve oh you know ongoing

00:15:12 ◼   ► revenue in a new way which before we go

00:15:15 ◼   ► we only had basically we had crappy ways

00:15:18 ◼   ► to do it before and now we have a less

00:15:20 ◼   ► crappy way to do it potentially I have

00:15:22 ◼   ► in the past written about how much I

00:15:23 ◼   ► didn't like the implementation of Auto

00:15:25 ◼   ► renewing subscriptions I am reserving

00:15:28 ◼   ► judgment of this new one until I see it

00:15:30 ◼   ► and possibly

00:15:31 ◼   ► even use it for my subscriptions we'll

00:15:33 ◼   ► see but I I they say they're changing it

00:15:36 ◼   ► this is like you know subscriptions 2.0

00:15:38 ◼   ► they're saying so I'm willing to give it

00:15:39 ◼   ► a shot

00:15:40 ◼   ► it will see if it's improved in in in

00:15:43 ◼   ► meaningful ways it sounds it sounds from

00:15:45 ◼   ► the language and the pigs that that it

00:15:46 ◼   ► has so I will wait and see on that the

00:15:48 ◼   ► other before we quickly leave this topic

00:15:50 ◼   ► the other thing to talk about on the

00:15:52 ◼   ► subscription front is that they they're

00:15:54 ◼   ► changing the revenue split that they are

00:15:57 ◼   ► so normally the revenue split is 70/30

00:15:59 ◼   ► Apple gets we get seventy applicants

00:16:01 ◼   ► 31st for Auto renewing subscriptions of

00:16:04 ◼   ► this new type are all actually for auto

00:16:07 ◼   ► doing subscriptions there's changing the

00:16:09 ◼   ► split from 70/30 to 85 15 after the

00:16:13 ◼   ► first year so any subscriber you've had

00:16:16 ◼   ► for more than a year you will start to

00:16:18 ◼   ► earn more from them you'll start to earn

00:16:20 ◼   ► 85% set of 70% so this is basically

00:16:24 ◼   ► incentivizing you to create you know

00:16:27 ◼   ► it's if you have a way to make money

00:16:28 ◼   ► from people over time this is

00:16:30 ◼   ► incentivizing you to both use this

00:16:32 ◼   ► system for for doing that and to to make

00:16:36 ◼   ► something that is worth people

00:16:38 ◼   ► subscribing to for more than a year and

00:16:39 ◼   ► that's kind of cool and it's it's kind

00:16:42 ◼   ► of cool to see you know this is this is

00:16:44 ◼   ► the the first exception to the 70/30

00:16:47 ◼   ► rule at least that's been publicized in

00:16:50 ◼   ► the history of the App Store there I was

00:16:51 ◼   ► able to find an article on I think was

00:16:54 ◼   ► recode that I'll link to in the show

00:16:56 ◼   ► notes from back in April that said that

00:16:59 ◼   ► some of the video services on the Apple

00:17:01 ◼   ► TV we're getting this 85/15 deal right

00:17:04 ◼   ► up front as part of the negotiation with

00:17:06 ◼   ► Apple but other than that I have never

00:17:08 ◼   ► heard of any exceptions to the to the

00:17:10 ◼   ► 70/30 split so I think that was

00:17:12 ◼   ► interesting and it's originally

00:17:13 ◼   ► considered to like where Apple might go

00:17:15 ◼   ► with a 7 with the 85 15 option in the

00:17:18 ◼   ► future they can use this as a way to

00:17:20 ◼   ► incentivize development to in a certain

00:17:23 ◼   ► way or on certain platforms that need

00:17:25 ◼   ► help so for instance they could you know

00:17:27 ◼   ► if if Apple TV isn't getting enough

00:17:29 ◼   ► developer attention they could say all

00:17:30 ◼   ► right now everything on Apple TV is

00:17:31 ◼   ► 85/15 if if they wanted to incentivize

00:17:34 ◼   ► people to go to the Mac App Store they

00:17:35 ◼   ► could say all right now all Mac App

00:17:36 ◼   ► Store apps are 85/15 so something

00:17:39 ◼   ► interesting interesting to consider is

00:17:40 ◼   ► like using using this this new lower

00:17:43 ◼   ► lower Commission basically

00:17:45 ◼   ► so we make more money as a way to

00:17:47 ◼   ► incentivize different development or

00:17:49 ◼   ► apps on different platforms that that

00:17:51 ◼   ► need incentives to spur development

00:17:53 ◼   ► exactly and I think the the actual in be

00:17:57 ◼   ► like impact of this in this narrow case

00:17:59 ◼   ► is it's nice I mean I guess if I had a

00:18:02 ◼   ► subscription that had more than a

00:18:03 ◼   ► years-long like subscriber base I love

00:18:07 ◼   ► it like one day my revenue just goes up

00:18:10 ◼   ► a little but like by far the more

00:18:11 ◼   ► fundamental thing that this is really in

00:18:13 ◼   ► treating with is it's the first sort of

00:18:16 ◼   ► chink in the in my in the like well it

00:18:19 ◼   ► will always be 70/30 for everything

00:18:21 ◼   ► forever and if that's no longer true and

00:18:24 ◼   ► it's like demonstrably not true that in

00:18:27 ◼   ► this particular case they're changing

00:18:28 ◼   ► the split what else could they change

00:18:30 ◼   ► the split on like you said and driving

00:18:32 ◼   ► they can incentivize whatever they want

00:18:34 ◼   ► and that's intriguing you know are what

00:18:37 ◼   ► you could imagine things where it's a

00:18:39 ◼   ► different revenue split for the first

00:18:42 ◼   ► revenue you make in a year to try and

00:18:44 ◼   ► help smaller developers you could

00:18:47 ◼   ► imagine you know trying to encourage

00:18:48 ◼   ► people to different platforms to try

00:18:50 ◼   ► different incentivize different business

00:18:52 ◼   ► models there's all kinds of things that

00:18:54 ◼   ► not having it be strictly 70/30

00:18:57 ◼   ► everywhere you know can certainly make

00:19:00 ◼   ► the imagination run wild with and so you

00:19:03 ◼   ► know it's certainly a good thing I don't

00:19:05 ◼   ► think it's immediate I can if your

00:19:07 ◼   ► business wasn't viable at 70/30 having

00:19:10 ◼   ► to wait a year for it to switch to 85 15

00:19:13 ◼   ► to become viable seems a little bit of a

00:19:15 ◼   ► stretch but it's certainly you know I'll

00:19:18 ◼   ► take it it's better than nothing for

00:19:20 ◼   ► sure our sponsor this week is Braintree

00:19:23 ◼   ► now we talked about ease of payments

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00:19:27 ◼   ► for this week why make payment

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00:20:04 ◼   ► / radar that's it once again

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00:20:11 ◼   ► once again all right so let's talk about

00:20:13 ◼   ► app store search ads this was rumored a

00:20:16 ◼   ► few a few weeks or months ago and it now

00:20:20 ◼   ► it apparently is real they are really

00:20:21 ◼   ► doing app store search ads and so what

00:20:25 ◼   ► do you think I'm not delighted that's

00:20:29 ◼   ► for sure

00:20:30 ◼   ► the things that I think so probably good

00:20:33 ◼   ► at paint paint a word picture as they

00:20:35 ◼   ► say for what's happening is in the App

00:20:38 ◼   ► Store when you go to the Search tab and

00:20:40 ◼   ► you type in what you're looking at what

00:20:42 ◼   ► you're looking for they will now be

00:20:44 ◼   ► potentially a ad at the top of that

00:20:47 ◼   ► screen you can get an example of this if

00:20:50 ◼   ► you go to the search ads page in our

00:20:52 ◼   ► show notes and the placement there is

00:20:55 ◼   ► going to be based on an auction and a

00:20:58 ◼   ► combination of who's willing to pay the

00:21:00 ◼   ► most for that spot as well as some vague

00:21:03 ◼   ► relevance metric but essentially people

00:21:06 ◼   ► are going to be able to pay money to

00:21:07 ◼   ► appear in the App Store Search tab at

00:21:11 ◼   ► the top of the results which is pretty a

00:21:14 ◼   ► pretty big deal like Apple even says on

00:21:16 ◼   ► their page that about 65 percent of

00:21:18 ◼   ► downloads come from searching in the App

00:21:21 ◼   ► Store so you know a substantial majority

00:21:24 ◼   ► is going to be coming from there and the

00:21:27 ◼   ► things that come to mind first and I see

00:21:29 ◼   ► this is this really is unfortunate for

00:21:32 ◼   ► apps that are currently the second

00:21:34 ◼   ► search result for a particular term

00:21:36 ◼   ► things are gonna fall off the screen

00:21:37 ◼   ► because previously like back in the old

00:21:40 ◼   ► days when you would did a search you

00:21:41 ◼   ► would be able to see maybe like five or

00:21:42 ◼   ► six results at once then they switch to

00:21:44 ◼   ► the cards view we have now where your

00:21:47 ◼   ► first two screenshots are a screenshot

00:21:49 ◼   ► and your app preview are shown on that

00:21:51 ◼   ► first screen and so they take up a lot

00:21:53 ◼   ► more vertical space and so you can see

00:21:54 ◼   ► the top result and the teeny little bit

00:21:59 ◼   ► of the second result and now if there's

00:22:02 ◼   ► an ad you're only ever going to see that

00:22:03 ◼   ► top result and the paid ad so that's a

00:22:06 ◼   ► little unfortunate because I've

00:22:08 ◼   ► definitely seen in my own apps where if

00:22:10 ◼   ► you fall off that first page

00:22:13 ◼   ► yes if the user has to scroll it's a

00:22:15 ◼   ► substantial reduction in user interest

00:22:18 ◼   ► views on your page etc so that's a

00:22:21 ◼   ► pretty big deal if now only two apps are

00:22:24 ◼   ► gonna be shown in that in the initial

00:22:27 ◼   ► search screen one of them is paid to get

00:22:29 ◼   ► there and the other one is just the top

00:22:30 ◼   ► result so if you're the top results like

00:22:32 ◼   ► hooray things are looking good for you

00:22:34 ◼   ► if you're the second result or below

00:22:36 ◼   ► it's getting worse and then there's just

00:22:40 ◼   ► like the fundamental thing about it when

00:22:42 ◼   ► I look at it that feels it feels weird

00:22:45 ◼   ► to have to pay to show up in search

00:22:49 ◼   ► rather than search just being really

00:22:52 ◼   ► relevant and helpful and I can see the

00:22:56 ◼   ► areas where this unlike this is helpful

00:22:57 ◼   ► where if you're launching a new app and

00:22:59 ◼   ► you you know you're never gonna be the

00:23:02 ◼   ► first search result on your first day

00:23:04 ◼   ► and so you want to try and find your way

00:23:07 ◼   ► into that like you can do a big spend on

00:23:09 ◼   ► that first day and hope you know I hope

00:23:11 ◼   ► that really helps at your launch and

00:23:13 ◼   ► that sort of makes sense

00:23:15 ◼   ► and it makes a lot of sense I suppose

00:23:16 ◼   ► for someone generic terms but what I

00:23:20 ◼   ► worry about a lot is how is the HAR

00:23:23 ◼   ► they're going to police and manage you

00:23:26 ◼   ► know and someone searches for a specific

00:23:27 ◼   ► app you know so someone goes into the

00:23:29 ◼   ► App Store and searches for a pedometer

00:23:31 ◼   ► plus plus and my competitor like right

00:23:35 ◼   ► now if you go into the App Store and

00:23:36 ◼   ► search pedometer plus plus I'm the

00:23:38 ◼   ► number one result which intuitively

00:23:40 ◼   ► makes sense but if I in the future you

00:23:43 ◼   ► do that search the top result is going

00:23:45 ◼   ► to be a competitor of mine who wants to

00:23:49 ◼   ► be placed on the top of there that feels

00:23:52 ◼   ► really weird

00:23:53 ◼   ► and am I gonna have to pay for that like

00:23:55 ◼   ► am I gonna have to start paying like

00:23:58 ◼   ► protection money to keep people

00:24:00 ◼   ► searching for my apps name relevant to

00:24:03 ◼   ► me you know so that I would be the both

00:24:05 ◼   ► I guess the paid results and the natural

00:24:08 ◼   ► result like that starts to feel really

00:24:11 ◼   ► weird and awkward and not great but I

00:24:16 ◼   ► mean I don't know if this seems like

00:24:18 ◼   ► this is the new reality then I'm just

00:24:20 ◼   ► gonna deal with that and try as best I

00:24:24 ◼   ► can to work it

00:24:25 ◼   ► work up to my favor but I definitely

00:24:27 ◼   ► have a lot more apprehension about this

00:24:29 ◼   ► than I do about the subscriptions change

00:24:31 ◼   ► honestly I am excited about search ads

00:24:34 ◼   ► because like if you look through their

00:24:35 ◼   ► page it seems like it's it's more

00:24:38 ◼   ► complicated and both both more simple

00:24:40 ◼   ► more complicated than than what I would

00:24:41 ◼   ► have guessed it is auction-based which i

00:24:43 ◼   ► think is good and if you look they have

00:24:46 ◼   ► a little screenshot of the interface to

00:24:48 ◼   ► buy one of these ads and they say also

00:24:51 ◼   ► like it says ads will only be shown as

00:24:54 ◼   ► relevant to the search query if an ad is

00:24:55 ◼   ► not relevant to what the users looking

00:24:57 ◼   ► for it will not be shown regardless of

00:24:59 ◼   ► how much you're willing to pay so that

00:25:01 ◼   ► means it it sounds like they're gonna

00:25:03 ◼   ► try to make it impossible for you to

00:25:05 ◼   ► like keyword spam in a way that would be

00:25:07 ◼   ► kind of odd or uncomfortable or

00:25:10 ◼   ► inappropriate I'm curious to see how

00:25:12 ◼   ► that works out in practice that sounds

00:25:13 ◼   ► really great if it works and also it

00:25:15 ◼   ► looks like you can kind of let them kind

00:25:19 ◼   ► of like place you automatically if you

00:25:21 ◼   ► want to or you can add in certain

00:25:22 ◼   ► keywords that you want to be that you

00:25:24 ◼   ► want to like bid on also but it seems

00:25:26 ◼   ► like it's a fairly high level buying

00:25:28 ◼   ► process rather than like a low level all

00:25:30 ◼   ► right whenever you search for this exact

00:25:32 ◼   ► string I will pay up to up to five

00:25:35 ◼   ► dollars two beads to be on that first

00:25:36 ◼   ► spot like it isn't quite that rigid or

00:25:39 ◼   ► that or that specific it looks like so

00:25:41 ◼   ► I'm really curious to see how they do

00:25:43 ◼   ► this as a developer like I right now

00:25:45 ◼   ► it's like okay well right now over cash

00:25:47 ◼   ► is growing at a rate that's okay but I'd

00:25:49 ◼   ► like it to grow faster I'm willing to

00:25:51 ◼   ► pay a little bit for that how do I do

00:25:52 ◼   ► that I mean the App Store is the perfect

00:25:55 ◼   ► like app store search is the perfect

00:25:56 ◼   ► place for me to do that

00:25:58 ◼   ► as far as I know from before I mean if

00:26:00 ◼   ► you've ever done it it seems like it

00:26:02 ◼   ► would be the perfect place to do that

00:26:03 ◼   ► I'm willing to pay money if somebody

00:26:05 ◼   ► searches for like podcasts to pet to be

00:26:07 ◼   ► in that top slot I'm like I'm willing to

00:26:10 ◼   ► try that and so to have this new option

00:26:13 ◼   ► to grow my app if it's done tastefully

00:26:15 ◼   ► which it looks like it might be this

00:26:17 ◼   ► honestly looks very promising the way

00:26:19 ◼   ► that on this page they've set up here I

00:26:21 ◼   ► would love to have that option and it

00:26:24 ◼   ► looks like it's probably not going to

00:26:26 ◼   ► make it impossible for other apps to get

00:26:28 ◼   ► discovered because it's so limited to

00:26:30 ◼   ► like what people can buy and and you

00:26:32 ◼   ► know what portion of the screen is

00:26:34 ◼   ► devoted to this ad I think it looks like

00:26:36 ◼   ► it's gonna be good but we'll see I mean

00:26:39 ◼   ► thinking's gonna take a lot of

00:26:40 ◼   ► experimentation I've actually you know

00:26:41 ◼   ► trying the system out spending of you

00:26:43 ◼   ► know maybe a few hundred dollars buying

00:26:44 ◼   ► some ads first and see like we know what

00:26:46 ◼   ► works what doesn't

00:26:47 ◼   ► there's a lot of ways to advertise for

00:26:49 ◼   ► apps and most of them don't work very

00:26:50 ◼   ► well this one might work so I'm excited

00:26:53 ◼   ► you know I think this will be I think

00:26:55 ◼   ► this could be really good and there's

00:26:57 ◼   ► definitely like we've said with all this

00:26:58 ◼   ► like I love that they're trying

00:27:00 ◼   ► something that they're not yeah like

00:27:02 ◼   ► that part of it is good and sort of

00:27:05 ◼   ► unequivocally I'm very I would rather

00:27:07 ◼   ► things like this exist and make me a

00:27:09 ◼   ► little nervous

00:27:09 ◼   ► then things not exist at all and make me

00:27:12 ◼   ► be even more nervous that this platform

00:27:14 ◼   ► that I make my living on is just

00:27:16 ◼   ► stagnant so I'm definitely excited that

00:27:18 ◼   ► it exists and it's interesting to to

00:27:21 ◼   ► think about how having to think about my

00:27:25 ◼   ► like all my customers from the

00:27:27 ◼   ► perspective of what are they worth to me

00:27:29 ◼   ► is like the immediately thought maybe

00:27:31 ◼   ► this is just like me and my numbers

00:27:33 ◼   ► brain where I think about these things

00:27:34 ◼   ► but essentially what it comes down to is

00:27:35 ◼   ► I now have to in a very concrete way say

00:27:38 ◼   ► what is a customer worth to me because I

00:27:41 ◼   ► can now in many ways pay that amount of

00:27:44 ◼   ► money to acquire that customer or at

00:27:48 ◼   ► least have a promising venue with which

00:27:51 ◼   ► to acquire them and so if I can say you

00:27:53 ◼   ► know a new user is worth 50 cents to me

00:27:56 ◼   ► and I can come into the search ads page

00:27:59 ◼   ► and pay you know 49 cents for that user

00:28:03 ◼   ► I'm coming out ahead I as soon as I can

00:28:06 ◼   ► understand and wrap my arms around what

00:28:08 ◼   ► like these are all like the terms like

00:28:10 ◼   ► the average value per of each customer

00:28:12 ◼   ► and those kinds of things once I can do

00:28:14 ◼   ► that I can sit down and say okay I'm

00:28:17 ◼   ► just going to pay as long as I break

00:28:19 ◼   ► even or slightly come out ahead I can

00:28:23 ◼   ► keep putting you into this weird cycle

00:28:26 ◼   ► where I can just keep taking money out

00:28:27 ◼   ► of the app and putting it in to a point

00:28:29 ◼   ► mm-hmm and maybe the value of my

00:28:31 ◼   ► customers will go down at a certain

00:28:33 ◼   ► point as you do that like new there's a

00:28:34 ◼   ► dilution effect but overall it certainly

00:28:37 ◼   ► is a very intriguing way and maybe it's

00:28:39 ◼   ► a good thing for you know for us as app

00:28:43 ◼   ► developers to be forced to think of our

00:28:45 ◼   ► apps in a more tangible business sense

00:28:48 ◼   ► in that way that it isn't this kind of

00:28:49 ◼   ► vague crafty thing that I'm sort of like

00:28:52 ◼   ► I don't really know

00:28:53 ◼   ► the value of it's kind of like I just

00:28:55 ◼   ► make this stuff and I put it out in the

00:28:56 ◼   ► world it's like no each I can sit down

00:28:58 ◼   ► and say I get this much revenue from

00:29:00 ◼   ► this many users that means each user is

00:29:03 ◼   ► worth this much to me so I can pay up to

00:29:05 ◼   ► this amount to acquire new ones and

00:29:06 ◼   ► that's that's maybe a good thing for us

00:29:09 ◼   ► to have to think about and I think it

00:29:11 ◼   ► can help

00:29:11 ◼   ► it can help newcomers like everyone's a

00:29:13 ◼   ► little bit worried like what's this

00:29:14 ◼   ► gonna do to the toy like the little guys

00:29:15 ◼   ► I thinks will actually help newcomers

00:29:17 ◼   ► give them an option that if they

00:29:19 ◼   ► wouldn't otherwise be visible for a

00:29:21 ◼   ► search query give them away to get in

00:29:24 ◼   ► there you know like that I think this

00:29:26 ◼   ► actually could be really good if done

00:29:27 ◼   ► right and it looks pretty promising so

00:29:29 ◼   ► far so we'll have to see all right and

00:29:31 ◼   ► finally we want to very briefly talk

00:29:33 ◼   ► about the the app review times being

00:29:36 ◼   ► formally acknowledged you know we said

00:29:38 ◼   ► that this would be great if this sticks

00:29:40 ◼   ► around and one of the ways to make sure

00:29:42 ◼   ► it'll stick around is if Apple formally

00:29:45 ◼   ► acknowledges it in public and they did

00:29:46 ◼   ► so fast a preview is probably sticking

00:29:49 ◼   ► around and that's great thank you for

00:29:51 ◼   ► listening everybody thanks to Braintree

00:29:53 ◼   ► for sponsoring and we'll talk to you all

00:29:54 ◼   ► next week bye