00:00:00 ◼ ► David Bernard, welcome to the talk show. I'm a terrible podcast host because I've wanted to have
00:00:05 ◼ ► you on the show for years. And here we are in 2024, first time on the show. Nice to finally be on.
00:00:15 ◼ ► You first covered my apps, and I gotta say thank you, back in the fall of 2008. So we have been
00:00:25 ◼ ► corresponding off and on, and you've covered my apps and writings I've done for decades now.
00:00:50 ◼ ► It was the only mileage logging app available when the app store first launched. Mine was ready,
00:01:01 ◼ ► I actually, a funny story. I mean, I thought about going to WWC 2008 because I'd started my company,
00:01:09 ◼ ► I was building apps, but it was so much money and I borrowed money from my family to start
00:01:14 ◼ ► the company. It was like ultimate bootstrapping. It felt like an insurmountable cost trying to get
00:01:23 ◼ ► this business off the ground to go to Cupertino, or I guess back then it was San Francisco still
00:01:29 ◼ ► for a week. But had I gone, they were signing up people on the spot and I would have had the app
00:01:36 ◼ ► on the app store day one, and you could have been writing about that day one as an alternate to the
00:01:47 ◼ ► Yeah, I remember when I mean, it's still expensive, but I mean, I remember when it was a
00:01:53 ◼ ► sit down and really talk about it at the table with the CFO of the company, you know, my wife
00:02:00 ◼ ► and figure out what the budget is and pulling shenanigans like I don't 2008 I might have
00:02:10 ◼ ► already been paying for a badge. But yeah, and I was getting press press badges by then but the
00:02:17 ◼ ► press badges were only good for the morning keynote, not even like the afternoon State of
00:02:21 ◼ ► the Union. So and I wanted to stay all week and go to sessions. And so eventually for several years
00:02:28 ◼ ► in a row, I bought myself a full price ticket, even into the like the lottery years when it was
00:02:35 ◼ ► like when it got to the which was very soon after 2008. Like 2008 was the first year first year with
00:02:44 ◼ ► iOS apps, because 2007 was the year the iPhone came out. And the only thing they said it WWDC,
00:02:49 ◼ ► ironically, was that you could do web apps. Right, which put a put a put a pin in that one. We'll
00:02:58 ◼ ► come back to that later in the show. And then 2008, the App Store had been announced like in
00:03:06 ◼ ► March. I think that was like the first time JAWS hosted an event. It was like a special
00:03:13 ◼ ► Greg JAWS react hosted event. I think that was it. But then did the App Store open before WWDC? Or
00:03:19 ◼ ► did it open at W like they announced the SDKs and everything in March, but then they didn't open the
00:03:24 ◼ ► App Store till 2000 July 11. So it was like one month after WWDC. So WWDC 2008 was like,
00:03:32 ◼ ► on the cusp of the App Store opening. Exactly. Right. Yeah. Yeah. I mean, all those dates are
00:03:39 ◼ ► kind of seared in my mind, because I had heard rumors in the fall of 2007. I think it was Steve
00:03:46 ◼ ► Jobs even said explicitly, yeah, we're gonna do an SDK at some point. I know it's like a huge
00:03:53 ◼ ► Mac nerd at the time. I worked in a recording studio. And so I had, I mean, I was using Macs
00:03:59 ◼ ► back in the 90s in the Texas State sound recording technology program where I where I studied and
00:04:05 ◼ ► finally bought my own Mac in like 2003. And then as a recording engineer, that's that was a primary
00:04:12 ◼ ► tool. And so I had a 17 inch power power Mac, power book, power book, power book, the lunch.
00:04:21 ◼ ► Yep. So I was super into all that and started in the fall of 2007, brainstorming, like what
00:04:29 ◼ ► possible businesses could I build? And my memory, and maybe we should pause and Google this,
00:04:36 ◼ ► but my memory is that it was Steve Jobs who made that full SDK announcement that I watched. And
00:04:43 ◼ ► this was back before live streaming. So I believe I watched it the night of, they posted the video
00:04:49 ◼ ► the night after whatever small group of press got to see it live. And I started my company
00:04:56 ◼ ► like days later. And so I was super inundated and all that stuff starting from March, early March,
00:05:02 ◼ ► when the announcement was made. I, as I recall, it was, we don't have to be, it's better to speculate.
00:05:08 ◼ ► No, but as I recall, it was in, in WWDC 2007, they announced that the greats, the sweet solution,
00:05:22 ◼ ► which I called a shit sandwich. And that was, I've told this story before, but in 2007 would have
00:05:29 ◼ ► been a year. I was there for the keynote with a press badge and still, I think it was my first
00:05:36 ◼ ► WWDC with a press badge and I, it was still, this is the greatest keynote of all time, right? So,
00:05:43 ◼ ► and I still think, man, if I had been like one year behind in terms of my popularity, whatever
00:05:51 ◼ ► it is that got me, that got somebody writing for a personal blog elevated to the level of the
00:05:59 ◼ ► attention of Apple PR, where you could qualify for a press badge. If I'd been like a year behind
00:06:03 ◼ ► and missed that one, I'd, I'd, I'd every day at some point, I'd think, God damn it. I missed the
00:06:08 ◼ ► best keynote of all time. But that was definitely, that might've been the last year where I didn't
00:06:13 ◼ ► pay for a badge for the full conference and a friend who worked at Apple supplied me with an
00:06:21 ◼ ► Apple engineer badge. And so for Apple engineers who were like in and out, there were a bunch of
00:06:29 ◼ ► badges that didn't have name, personal names on them. They just were like a different color badge.
00:06:34 ◼ ► And it just said Apple engineer. And the idea is they only printed so many of them. And people who
00:06:40 ◼ ► work at Apple would be like, I think I'm going to swing by on Tuesday, check it out. Somebody else
00:06:44 ◼ ► is coming on Thursday, might take that same badge. Well, I, I spent the week with a badge like that.
00:06:50 ◼ ► And I would just turn it around. It was only printed on one side. So I would keep it turned
00:06:54 ◼ ► around so that anybody who met me and knew me, I did, I just didn't want to talk about the fact
00:06:59 ◼ ► that that was my badge. I remember those early days of badge surfing. They've gotten a lot more
00:07:05 ◼ ► strict about it, but I I've definitely surfed a few badges and loaned my badge out over the years.
00:07:19 ◼ ► I pay for all my software now. I kind of felt that way about that badge. But the funny story
00:07:24 ◼ ► was the day after the keynote, it was Tuesday. That was the first time I ever met Phil Schiller
00:07:30 ◼ ► personally. And it was on the third floor of Moscone West. Were you ever at Moscone later
00:07:35 ◼ ► for WWDC? I was at every WWDC after that until, yeah, I missed a few in 2015, 16 era, but I was
00:07:43 ◼ ► there 2009, 10, 11, 12, 13, 14. It's kind of a neat, it really was. I miss it. It's the Moscone
00:07:50 ◼ ► West. Moscone West was, is a beautiful building and, and it was perfectly suited for WWDC in my
00:07:56 ◼ ► opinion. And I was at the third floor. And so anybody doesn't know it's a three floor thing.
00:08:01 ◼ ► The first floor is just sort of a lobby. And I guess the cafeteria is down there. And the
00:08:06 ◼ ► cafeteria is sort of also where they'd have a whole bunch of high-speed ethernet set up.
00:08:14 ◼ ► you can go in there with your MacBook and connect to ethernet and get all that. But the first floor
00:08:20 ◼ ► isn't conferency. It's get your badge. There's a place to eat. There's the big room where you can
00:08:24 ◼ ► sit. Second and third floors where all the, where all the conference halls are. But you oftentimes,
00:08:30 ◼ ► when you're on the third floor, which was where the keynote hall was, and then what they call it,
00:08:35 ◼ ► Presidio, they'd smallen it up from the keynote, but it was still like the biggest room. So like
00:08:42 ◼ ► at any given time, there's often, at least back then, there was like, what's the main session
00:08:49 ◼ ► at 10 o'clock in the morning on Wednesday? Like the one that the most, like what's new in UI kit
00:08:55 ◼ ► or something like that, right? Oh man, everybody wants to go to that one. Well, they put it up on
00:08:59 ◼ ► the third floor in the big, big hall. So a lot of times when you're leaving, you'd have kind of a
00:09:04 ◼ ► zigzag escalator ride, third floor to second, walk around second floor to first. And I was at third
00:09:11 ◼ ► floor and right behind me was Phil Schiller with Ron Okamoto, who I think has since left Apple,
00:09:16 ◼ ► but was like head of developer relations. And I thought to myself, "Oh, I got to introduce myself."
00:09:22 ◼ ► But you know, and at the time I always still had the, "Oh God, what if he has no idea who I am?"
00:09:28 ◼ ► Well, whatever, people probably come to Phil Schiller all the time. So I turned around and
00:09:33 ◼ ► said, "Hey, Phil, I'm John Gruber." And he definitely knew who I was, obviously red daring
00:09:39 ◼ ► fireball instantly. He said, "Hey, great to meet you." And then the next word, really, really nice,
00:09:43 ◼ ► really friendly. And he said, next words out of his mouth were, "Hey, I read your piece on
00:09:47 ◼ ► the keynote yesterday. I got to disagree with the shit sandwich." Right away. And then I'm thinking,
00:09:56 ◼ ► I'm thinking instantly, "Oh, now I'm wrong-footed." Now he wants to talk about the fact that I call
00:10:02 ◼ ► the web absolution as "shit sandwich." Whereas I'd been coming from, "Does he even know who I am?"
00:10:10 ◼ ► too instantly. Now he hates me. No, but he was totally Phil. He was very, he said it with a smile
00:10:17 ◼ ► on his face, but he obviously meant that he disagreed with it. And instantly I thought,
00:10:21 ◼ ► "Which way is my badge turned right now? And how weird would it be if I looked down?" And I did,
00:10:31 ◼ ► I sort of like looked down as little as I could and saw that it was turned to the white side. So
00:10:36 ◼ ► that was, I was in the clear at explaining that. And then we had like a little, it lasted long
00:10:43 ◼ ► enough that when we got down to the lobby, we stopped and kept talking. And I remember too,
00:10:48 ◼ ► after talking about the web app thing, we talked about the big announcement in 2008 was enterprise
00:10:55 ◼ ► support in iOS, right? So that you could get first-class Microsoft Exchange support in the
00:11:07 ◼ ► shouldn't be surprising. And that they really saw already first year that iPhone was going to be
00:11:23 ◼ ► How was your relationship with Apple back in those early days? Cause I thought you were going to say
00:11:28 ◼ ► something about your scoops cause you back then were a bit more of a Apple spoiler with spoiling
00:11:41 ◼ ► you started drifting away from kind of spoiling. It was never contentious at all. And my impression
00:11:50 ◼ ► is that while Apple, and I've talked about it with Phil and I've definitely brought it up with
00:11:58 ◼ ► Jaws and Federighi in the years since just sort of on stage when I've been interviewing them in
00:12:05 ◼ ► the live show about leaks and the thing that angers them and it's the way that Jaws and Phil,
00:12:13 ◼ ► you can just see how Jaws worked as Phil's right-hand man for so long before taking over
00:12:19 ◼ ► the role. They're so aligned. They're not alike. Well, they each have their own very distinctive
00:12:30 ◼ ► they're so aligned and the thing that infuriates them aren't the people who publish the leaks.
00:12:37 ◼ ► It's the people inside the company who do the leaking that that's the betrayal. And it's the
00:12:44 ◼ ► only thing they're angry about. So nobody was ever angry with me. I talked to, I had a really
00:12:48 ◼ ► interesting, I went to lunch with Bertrand after he left Apple. It was like the first year
00:12:54 ◼ ► after Craig took over as the head of software engineering and Bertrand Cerlet was, I guess,
00:13:03 ◼ ► retired, semi-retired. He sort of became an investor, but he was at WWDC and we went to lunch
00:13:09 ◼ ► and he asked me about how I knew certain of the things that I had leaked. And he was really just
00:13:15 ◼ ► curious because he thought when his perspective, and I guess it reflected a bunch of other people
00:13:20 ◼ ► at his level, was that the things I leaked or spoiled were often very different than what
00:13:33 ◼ ► the Windows version of Safari, you know, and the way I would do it was I wouldn't say Apple's going
00:13:39 ◼ ► to announce a Windows version of Safari. I would just say, here's my spitball ideas for what I'd
00:13:44 ◼ ► like to see this year at WWDC the night before. And then I listed a Windows version of Safari.
00:13:51 ◼ ► And then I remember that WWDC, the WebKit Safari team, you used to have an annual party,
00:13:58 ◼ ► wasn't it Chevy's, but it was somewhere, was that something Bear? It was like a beer place with
00:14:06 ◼ ► Bear in the name, sort of across from the W down there on the same, whatever that street is that
00:14:12 ◼ ► Moscone's on. Yeah, I've been there, but I can't remember the name either. Thirsty Bear, was that,
00:14:16 ◼ ► I think it was Thirsty Bear. And they would just have like an open, you know, hey, if you're WWDC,
00:14:27 ◼ ► their theory was that they blew it because the night before WWDC was when they flipped the switch
00:14:37 ◼ ► in the build for the Windows version of Safari to actually use the real user agent string they
00:14:44 ◼ ► were going to use. That said, it was Safari from Windows. And up until that point, they'd just,
00:14:50 ◼ ► I guess, been using the regular Safari Mac user agent string for all the builds. And when they've
00:14:57 ◼ ► made the build that they were going to ship to developers the next day with the actual user
00:15:02 ◼ ► agent string, they quick tested a couple sites and they tested Daring Fireball. And they thought
00:15:08 ◼ ► that's how they blew it. They were like, is that what happened? And then you saw it in your logs.
00:15:14 ◼ ► And I said, it wasn't. And I said, no. And I said, and think about it, what kind of a maniac would
00:15:20 ◼ ► I be if every night at midnight, I start looking at my server logs and they're like, yeah, actually,
00:15:26 ◼ ► that doesn't make sense. And then they're like, well, how did you know? And I'm like, I can't say.
00:15:29 ◼ ► I looked it up. Me.com. I think I got me mobile, me and me.com. I got the name the night before.
00:15:40 ◼ ► I don't know. I gave up on that because it just stopped. It wasn't fun. And as I did it,
00:15:48 ◼ ► I was growing in popularity and knew more people and knew more things. It almost felt like I was
00:15:55 ◼ ► cheating. Yeah. Shooting fish in the barrel. Yeah. Well, I looked up the announcement of the iPhone
00:16:02 ◼ ► SDK with Scott forest all believe you. And I both forgot that it was got forest all March 6. He did
00:16:08 ◼ ► the, I think Schiller opened it forest all did the meat and then jobs closed it and jobs talk more
00:16:17 ◼ ► about the, like the app store itself and the business opportunity and all that kind of stuff.
00:16:22 ◼ ► So, so March SDK announcement, is that video still available? I'll put it in show notes if it is.
00:16:28 ◼ ► All right. But let's go back to that. What was your developer experience before the iPhone?
00:16:41 ◼ ► but then the iPhone comes out and it was, I remember the original announcement was just one
00:16:46 ◼ ► of those great Steve jobs, open letters, right? Like thoughts on music and the thoughts, thoughts
00:16:52 ◼ ► on flash. There are the two big ones. And then I think it was just sort of a, okay, okay, shut up
00:16:58 ◼ ► about the SDK. We'll do it. Right. That was, it was like in the fall, right? And there was all of
00:17:05 ◼ ► this jailbreaking action going on, which is still amazing to me, like the pre app store development,
00:17:11 ◼ ► like Hockenberry had a version of Twitterrific going before there was an SDK. And I remember
00:17:26 ◼ ► Well, Steven has it now, like in the version of lights app, that's currently in the app store
00:17:32 ◼ ► is his. I'm not sure if he helped with that original, I mean, obviously Steven Troughton Smith
00:17:37 ◼ ► is exactly the sort of developer who could do this sort of black magic of without an SDK,
00:17:44 ◼ ► somehow Jerry rigging the tools so that developers could produce Xcode apps using nothing but private
00:17:53 ◼ ► API. It was amazing. But there was the first app I remember using was lights out. But I know Lucas
00:18:01 ◼ ► Newman was sort of, he was a delicious monster with Will Shipley at the time. But there were
00:18:11 ◼ ► And then Jobs said, okay, fine, we'll do it. Give us a couple months. We're going to make this super
00:18:17 ◼ ► secure. We got to tighten things up and we'll get back to you early next year with this thing.
00:18:26 ◼ ► It struck me as a, as a huge business opportunity. I, and actually I remember specifically
00:18:33 ◼ ► listening to Leo LaPorte's This Week in Tech. He had Amber McArthur on the show and they were
00:18:39 ◼ ► talking about Facebook apps and how, how many people kind of rode the wave of Facebook apps
00:18:47 ◼ ► from the early days. And so I was listening to that. That was maybe like December of 2007.
00:18:53 ◼ ► And I thought this iPhone SDK is going to be like that. Like this is, this is a tech wave.
00:19:10 ◼ ► never developed, never written software. I mean, I had like tinkered in HTML and CSS, like, you know,
00:19:16 ◼ ► most nerds at some point build your own website and stuff like that. But in March, I had, I had
00:19:23 ◼ ► already started, I had already kind of like done a business plan. I'd already like started like
00:19:27 ◼ ► floating the idea to my folks who'd always said, if you want to start a business, we'll, we'll figure
00:19:32 ◼ ► out a way to support you. And so within like hours of watching the SDK announcement, I was kicking
00:19:40 ◼ ► off a corporation and borrowed 20K from my family to start the company. My parents and my aunt and
00:19:48 ◼ ► uncle both pitched in because there's a lot of money. And that that's where the, you know, not
00:19:52 ◼ ► going to WWDC. It's like, am I going to take this, this limited, you know, 20K that family put in
00:20:00 ◼ ► that they weren't like rich or anything. It was, it was a lot of money to them to put it in the
00:20:03 ◼ ► company and, and fly out to WWDC in 2009 and, and decided not to. But yeah, so I just, I hit the
00:20:12 ◼ ► ground running as soon as the SDK was announced. And originally my plan was to learn to code.
00:20:19 ◼ ► And so I got a big nerd ranch Objective-C book, and I got two or three weeks into it and realized
00:20:29 ◼ ► that it was going to take more than three months to learn to code, much less learn to code and
00:20:35 ◼ ► build an app. And I didn't have that much runway. My wife was working, but not making much money at
00:20:41 ◼ ► the time. That 20K investment from my family was going to run out fairly quick. And so,
00:20:47 ◼ ► so I actually ended up hiring a developer, Jonathan Johnson. He's still in tech somewhere.
00:20:52 ◼ ► And he had been a long time coca developer, but even he struggled. Anybody writing these days,
00:21:05 ◼ ► there was an NDA in place. So you couldn't talk in forums. You couldn't write blog posts. There
00:21:12 ◼ ► were no books on iOS development. It was, you read the docs and you figured it out. And if you had
00:21:20 ◼ ► some prior knowledge of cocoa, all the better, but it was brutal. Those first few years of writing
00:21:27 ◼ ► iPhone apps. I mean, not as brutal as Craig Hockenberry figuring out how to write his apps
00:21:31 ◼ ► without even an SDK, but it was, it was rough going in those early days. And so I actually
00:21:37 ◼ ► never ended up learning to code because after that my business started taking off. And so I've worked
00:21:43 ◼ ► both with partners and with, and just paying contract developers to build the apps with me.
00:21:50 ◼ ► Yeah. I'm sort of in the same boat where I'm, I mean, I have a degree in computer science
00:21:56 ◼ ► and program quite a bit. I mean, I wrote the reference version of markdown and I write lots,
00:22:05 ◼ ► you know, you, if you read my website, you know, I write little scripts from time to time,
00:22:08 ◼ ► but writing full apps is just beyond my can. I can't explain it. Maybe sort of along the lines
00:22:18 ◼ ► of my writing too. I've never written a book and I've never really had an idea for a book. I mean,
00:22:24 ◼ ► and I could in theory do a collection of the best of daring fireball, which does it to me, doesn't,
00:22:29 ◼ ► I mean, it would be a book, but that's not writing a 300 page thing that stands on its own with the
00:22:37 ◼ ► narrative flow, right? Like my writing, my ability to write is sort of article length. That's, it
00:22:50 ◼ ► right? And so if the division between a full app and a script is sort of scope scripts, I can do
00:22:56 ◼ ► and enjoy doing and feel like I can do pretty well and programs just, I think I could, but I think
00:23:02 ◼ ► it would take me forever, right? That's the problem. And when you find, when you know a
00:23:07 ◼ ► really good app developer, it's like they can move fast, right? And they can get something off the
00:23:12 ◼ ► ground fast. And that's a good thing. It's a good thing to recognize, right? And it's sort of,
00:23:17 ◼ ► probably it was a hard thing for you to admit, right? You think, cause you could probably could
00:23:25 ◼ ► Yeah. Well, and it was like every six months I'd be like, oh, I should learn to code and I could
00:23:30 ◼ ► just do this. Anytime I'd get frustrated, like we're moving too slow. I'm spending too much
00:23:34 ◼ ► money. I mean, I had two separate projects where I got $50,000 into each of these projects with
00:23:40 ◼ ► contract developers and I didn't see the light at the end of the tunnel. And so I just, I
00:23:45 ◼ ► shit canned them and just took a hundred thousand dollar loss on those two projects. And so in
00:23:56 ◼ ► moments like that, I'm like, damn it, I should learn how to code. But what I think has ended up working out
00:23:59 ◼ ► for me in the long run is that by not coding, I spent my time thinking about things in different
00:24:08 ◼ ► ways and focused on different things. So I studied the app store hours and I would go look at the top
00:24:16 ◼ ► downloaded apps. I'd look at the trending, I'd look hours and hours unpacking all the different
00:24:21 ◼ ► apps and trying to understand the business models and reading you and a bunch of other folks. And
00:24:27 ◼ ► it just gave me such a different perspective, thinking more about the business and design and
00:24:35 ◼ ► marketing and that side of things versus being head down in code. And so I'm probably one of the
00:24:41 ◼ ► few people who's been around since the early days, who's just been like completely obsessed with the
00:24:46 ◼ ► app store, but not a developer. Well, but I think it's, oh man, how's my pal Merlin put it? I guess
00:24:57 ◼ ► it was a South by Southwest talk that Merlin and I, or panel just joint discussion around that time,
00:25:04 ◼ ► 2006, 2007. But the way he put it was obsession times voice, meaning, and that it equals success
00:25:14 ◼ ► as an independent creator. And you need, the voice is sort of your own taste and your perspective,
00:25:22 ◼ ► like the sort of things you'd want to build and the way you'd want to build them. And also the
00:25:28 ◼ ► way the problems you see with the existing things in that category, whether it's other for me,
00:25:33 ◼ ► like with Daring Fireball, with other sites that wrote about Apple, what do I, what would I do
00:25:38 ◼ ► differently? What would I, what would be different about my site? And then, but the obsession part
00:25:44 ◼ ► is just something ineffable. Like you either have it or you don't. And lots of people are
00:25:51 ◼ ► successful in fields. I mean, everybody knows people like this, people who spend their whole
00:26:01 ◼ ► was a train dispatcher for Conrail, which is like the train equivalent of an air traffic controller,
00:26:13 ◼ ► going without hitting other trains. And he didn't hate his job, but he had a long commute.
00:26:19 ◼ ► Cause, and it, and really for me and my sister, because he just, when we were really young,
00:26:26 ◼ ► decided he had to move or where he worked moved and it was either move the whole family and put
00:26:32 ◼ ► the kids in a new school or just have an hour plus commute five days a week, each way. And part of
00:26:39 ◼ ► he made that work cause there were other, he carpooled with other colleagues. So he didn't
00:26:44 ◼ ► have to do the driving all the time, but he didn't love his job. He really, you know, and it was high
00:26:48 ◼ ► pressure. I mean, you know, every single day he was responsible for making sure trains don't
00:26:58 ◼ ► whether it's a passenger car or not, or look at the thing in Ohio a couple of years ago, I mean,
00:27:05 ◼ ► terrible, terrible things happen. He didn't like the pressure. He didn't love the work. It wasn't
00:27:10 ◼ ► like a passion, but it was a good job, good career, good union. And so he did it for 40
00:27:17 ◼ ► years. I mean, it's a long time. I, and you know, it, it helped him promote the idea for me and my
00:27:24 ◼ ► sister to, to encourage us to follow, you know, try to find something you want, you want to do or
00:27:28 ◼ ► love to do. And I think for you, it's very clear that you just saw something ever since I've known
00:27:35 ◼ ► you in a way that you've always shared your knowledge about it. Like you saw the opportunity
00:27:39 ◼ ► with apps for the phone and you just had to do it. Right. I mean, yeah. So I started a business. I
00:27:47 ◼ ► probably would have figured out a way to do it on the side. So yeah. Yeah. Like something always
00:27:51 ◼ ► happens once an industry gets big, then it attracts the people who are interested in the money first.
00:27:58 ◼ ► So like when I was a teenager in the eighties, it was going to work on wall street, right? Example,
00:28:06 ◼ ► can't even be exemplified better than the fact that one of the most popular movies of the decade
00:28:10 ◼ ► was Oliver Stone's wall street. Right. But like that whole mindset I think American psycho with
00:28:18 ◼ ► Brett Easton Ellis's novel, and then the movie with Christian Bale, those sort of guys, it wasn't
00:28:24 ◼ ► cause they loved the work. It was just in the eighties. It was like, well, if you want to make
00:28:28 ◼ ► a lot of money, you go work on wall street. And then at a certain point after when the 2010s,
00:28:34 ◼ ► when mobile was clearly on a path to, Oh, this is going to be bigger than way bigger than PCs
00:28:41 ◼ ► ever were. Oh, it all of a sudden attracted all sorts of people who are just in it for the money
00:28:48 ◼ ► and the passion for making great apps was second. Right. But the people who I'm interested in are
00:28:54 ◼ ► the ones who are passionate about making great apps and then thinking, can I make a business out
00:29:01 ◼ ► of this app? Right. And that priority, that difference in priority makes is it, you know,
00:29:08 ◼ ► which one's first and which one's second, making the most money and then making a good app out of
00:29:12 ◼ ► that, or having this vision for a great app and then finding, figuring out a way to make it a
00:29:19 ◼ ► successful business. It makes a tremendous difference. And you can, you could go through
00:29:23 ◼ ► your app, your iPhone, and just go ABAB with each app and decide, you'll know, you, you know, which
00:29:31 ◼ ► apps were from our today from the obsessives who are after perfectionism and which ones are just
00:29:38 ◼ ► there for the money first. Yeah. And not to jump too far ahead in the conversation, cause I wanted
00:29:43 ◼ ► to bring this up later when we talk about the DMA and Apple and other things, but you kind of get the
00:29:51 ◼ ► sense that used to be Apple too, you know, Phil Schiller saying, Hey, what if we just cap app store
00:30:03 ◼ ► spit ball idea. He put out an email, what if we cap it at a billion run rate? And then once it
00:30:08 ◼ ► gets there, just start, you know, go from 30, 30% to 25%. I mean, that was because that was before
00:30:15 ◼ ► the 30, 15 offering. It was all 30. And it was, I don't think there were subscriptions yet.
00:30:20 ◼ ► Yeah. But yeah, why don't we go to 25 and then when 25 hits a billion, maybe we'll go to 20.
00:30:26 ◼ ► That more than anything was like that ethos of Apple of we're not building the app store to make
00:30:34 ◼ ► money on the app store. We're building the app store to empower our platform, to empower
00:30:38 ◼ ► developers, to create opportunity, to have cool apps. Like there were so many other reasons behind
00:30:46 ◼ ► the app store and then somewhere in all of this, it'd be started to become a lot of money. And now
00:30:52 ◼ ► Apple's a little bit more about the money than the passion. It feels like externally anyway.
00:30:57 ◼ ► Yeah. So it was funny as you were talking about that. I wasn't thinking how many people inside
00:31:03 ◼ ► Apple is that true of that, you know, now it's, it's such a huge driver of their stock price that
00:31:09 ◼ ► the kind of passion that it feels like there's still so much passion inside Apple for apps and
00:31:14 ◼ ► the platform and everything else. But it feels like we've lost a little bit of that because of
00:31:19 ◼ ► how important it is to them financially. And the fact that the business, is it more so ahead of the
00:31:26 ◼ ► passion these days? Yeah. Well, and like I said, it, the order of your priorities matter. It's not
00:31:33 ◼ ► if there's three or four things you really care about. These are the three or four reasons why
00:31:37 ◼ ► Apple has the app store. They want to empower developers to make new creative things that,
00:31:52 ◼ ► make the things of their imagination and put them out there. They want the users to be able to find
00:32:00 ◼ ► great apps that they love just because they want to make them happy. That's part of why people go
00:32:05 ◼ ► to work to Apple to make the users happy. And they know that just like the Mac where, yes, there's a
00:32:11 ◼ ► Mac app store now, but it's nowhere near as big a deal on the Mac as it is on the iPhone. And the
00:32:18 ◼ ► Mac itself is so much smaller, a user base that even if the Mac app store grew to be as important
00:32:24 ◼ ► on the Mac as it is on iOS, it still is dwarfed by iOS, but it's great for the Mac. Even in pre
00:32:32 ◼ ► app store days, it's great for Apple to say our platform has all of these great apps. And a lot
00:32:38 ◼ ► of these great apps are only available on the Mac because they're taking advantage in such deep
00:32:45 ◼ ► integrated ways with our system frameworks that that's great for us too, right? That's the win,
00:32:52 ◼ ► win, win circle. Apple does Apple's platform succeed when there are lots of great third-party
00:32:58 ◼ ► apps available. The developers succeed when they're able to make great apps and find a market
00:33:05 ◼ ► for them. And the users are happy when their device has all sorts of great apps games available
00:33:12 ◼ ► for their interests, right? That's that win, win, win scenario. And with iOS, with the app store,
00:33:20 ◼ ► like you said, it's very clear. I mean, there's, I don't, I think the only people who had disputed
00:33:26 ◼ ► are people within Apple who I think because they know the way their priorities used to be ordered
00:33:32 ◼ ► and never officially changed them. There was no, I don't think there was ever any kind of meeting
00:33:38 ◼ ► where they're like the new most important thing about the app store is increasing our rake.
00:33:43 ◼ ► Nobody ever said that it just happened and nobody wanted to turn the fire hose off, right? And so I
00:33:52 ◼ ► think in inside Apple, they still see the reasons why they joined the company. So many people at
00:33:58 ◼ ► Apple in higher positions have been there their whole careers or most of their careers with a
00:34:04 ◼ ► brief stint a couple of years away. And then they come back lots and lots and lots of Apple people
00:34:10 ◼ ► leave and then come back. That's one reason why, and everybody at Apple knows it. And it's one
00:34:15 ◼ ► reason why Apple employees often keep up their silence about their work after they leave because
00:34:20 ◼ ► they think I might want to come back because they know how many people come back. But yeah,
00:34:24 ◼ ► somewhere along there, it seems pretty clear that whether they admit it or not, or it's written on
00:34:29 ◼ ► the whiteboard in the CFO's office or Tim Cook's office, number one, make lots of money from the
00:34:36 ◼ ► app store. And I don't want to let Apple completely off the hook in those early days either though,
00:34:41 ◼ ► because there was a very strong commoditized or compliments vibe to the early app store was that
00:34:46 ◼ ► they were making a ton of profit on the iPhone as a hardware device and saw that as the primary
00:34:55 ◼ ► profit motive was to sell more iPhones. And the more apps we have, the more iPhones we sell.
00:35:08 ◼ ► if you pay $400 and get your subsidized plan or whatever in 2009 to get an iPhone 3G and it costs
00:35:18 ◼ ► $500 to load it up with apps, well, now you're competing for consumer pocket book. But if it's
00:35:27 ◼ ► free and 20 bucks to load it up with apps, you spend that $400 on the device and it feels like
00:35:34 ◼ ► a great deal. And I mean, Steve Jobs, even when he was announcing iAd, he said, "We created iAd
00:35:41 ◼ ► to help developers make free, to monetize their apps so they can keep them cheap, free and cheap."
00:35:47 ◼ ► Something along those lines. I actually have it screenshotted because I've used it. I've tweeted
00:35:52 ◼ ► that one out many times, but there was definitely a vibe of that commoditized the compliments.
00:35:58 ◼ ► And so it wasn't fully altruistic motives. It wasn't fully passion for apps. I think there was
00:36:09 ◼ ► Pete: Yeah, definitely. And I know Jobs, I think, totally bought into it, but I know that iAd was
00:36:17 ◼ ► Scott Forstall's baby. That Forstall personally thought this... And really, really, really,
00:36:23 ◼ ► because I actually talked to Scott after that keynote, off the record, in the press mingling
00:36:30 ◼ ► area. And it was a really, really interesting conversation, but it was really, really clear.
00:36:35 ◼ ► He was super enthusiastic about it, but really specifically from the perspective of indie
00:36:40 ◼ ► developers, that he really thought that this was going to solve a problem that they saw was there
00:36:47 ◼ ► on the... Even that early in the app store era, that developers trying to make a go of it
00:37:00 ◼ ► Geoff - It's funny, all these years later, I have been wishing for iAd 2.0. And the history of all
00:37:09 ◼ ► that is that once they launched it, I used it day one, and CPMs were ridiculous. I made great money
00:37:16 ◼ ► on iAd. I think David Smith, our mutual friend, he made a ton of money on iAd in the early days.
00:37:23 ◼ ► And then all these other AdMob and a bunch of other stuff started popping up, and more and more
00:37:27 ◼ ► developers were able to use that. And it just deprioritized from Apple at some point. But today
00:37:34 ◼ ► in 2024, freemium subscription apps, which is what I publish generally and work with at my day job at
00:37:42 ◼ ► Revenue Cat, there's still a lack of good ways to monetize free apps. So my weather app, I actually
00:37:49 ◼ ► pulled ads from the app and ended up using a hard paywall because we were running Google AdMob as
00:37:56 ◼ ► our ad aggregator. And I would get tons of complaints about gambling ads that were distracting
00:38:03 ◼ ► and animated. And then I'd get gun ads, and I'd go into Google and I'd take every little box to try
00:38:09 ◼ ► and like, and every box you tick makes you less money because it limits the pool of ads that can
00:38:15 ◼ ► be served. And I would do all of that and still get crappy ads and still have no idea what all
00:38:22 ◼ ► these ad SDKs closed source are doing in my app. And so finally, I was like, enough is enough. And
00:38:26 ◼ ► I pulled all the ad SDKs from my app. And so even in 2024, I think Scott Forestall was right that it
00:38:35 ◼ ► is an important thing that Apple or somebody still needs to solve. And it's never, even once Apple
00:38:41 ◼ ► moved on from it and all these other platforms came in and there was Mopub, that Twitterbot,
00:38:47 ◼ ► Facebook had their audience network for a while. Like there's been tons of solutions over the years,
00:38:52 ◼ ► but it's all been like a privacy mess. The ad quality has been terrible. Like there's never
00:38:57 ◼ ► been another iAd. It really was genuinely a good thing, but to this day, sad that Apple abandoned
00:39:04 ◼ ► it. And then they haven't come around and built 2.0. Let's do this thing that is all the existing
00:39:12 ◼ ► ones are crappy for various ways. And the fact that they're all crappy, this is not just for ads,
00:39:20 ◼ ► but this happens in a lot of fields. If everybody's in a race to the bottom and using bad
00:39:26 ◼ ► patterns and practices and the frameworks are getting bloated, it just makes everybody else
00:39:36 ◼ ► And then you have this opportunity to say, no, let's just do something totally opposite,
00:39:46 ◼ ► The original iAd announcement emphasized that they were going after mainstream big brands,
00:40:01 ◼ ► Right. And especially back then, casino ads where it's like sketchy because it wasn't as legal
00:40:06 ◼ ► or it wasn't legal in as many places. Let's make ads we can be proud of, right? I mean,
00:40:29 ◼ ► good for the advertiser, lightweight, not annoying. Basically, I want ads that people don't want to
00:40:35 ◼ ► block, which I think is a pretty good baseline. Yeah. And I think, while we're going down memory
00:40:43 ◼ ► lane, I think younger people just cannot fathom how expensive apps were in the box software era,
00:40:58 ◼ ► were like $700 or $800 if you wanted to get Photoshop 2.0. And then when Photoshop 3 came out,
00:41:06 ◼ ► you could get the upgrade for $299 or something like that. Apple used to charge $129 for new
00:41:15 ◼ ► versions of Mac OS X, or Mac OS 9 and Mac OS 8. It wasn't like they started it with Mac OS X.
00:41:27 ◼ ► and then a year and a half later, when the next major version came out, it was $129 just to upgrade
00:41:38 ◼ ► I lined up for Tiger and Jaguar both, I think. Yeah. We'd line up to pay $130 to upgrade our
00:41:48 ◼ ► operating system. They were shorter lines than the iPhone era. They didn't go out in the parking lot.
00:41:55 ◼ ► The Apple employees didn't have to come out with trays full of water bottles to give to people who
00:42:01 ◼ ► were waiting for hours. But you'd go to the Apple store and line up in the morning, and you'd meet
00:42:07 ◼ ► fellow Mac nerds who wanted to get the update on day one. And in addition to the nerdiness of just
00:42:14 ◼ ► wanting it right away, there was the camaraderie of meeting people who had the same sort of
00:42:21 ◼ ► obsession that would lead them to line up to pay $130 to upgrade their operating system. But stuff
00:42:28 ◼ ► was expensive. And there was a boom in, you know, there were a lot of indie developers in the '90s,
00:42:36 ◼ ► but that was sort of the era when we often called it shareware. And I know there were a lot of
00:42:41 ◼ ► developers, even if they were, the original idea with shareware was, it really goes back to the
00:42:49 ◼ ► era before the internet, when apps were distributed on floppy disks, and you'd go to like your local
00:42:56 ◼ ► Mac user group, like at Drexel, when I was at Drexel, there was a great Drexel Mac user group.
00:43:01 ◼ ► And it was like a, you know, in the building with all the student organizations, and you could go in
00:43:07 ◼ ► and if you, with empty floppy disks and get all of these apps, we didn't even call them apps then,
00:43:13 ◼ ► really, but get all these applications and games, of course, and just fill up as many floppy disks
00:43:18 ◼ ► as you could put in your backpack with all of these apps from a machine that they had set up,
00:43:24 ◼ ► just to have them all on a hard disk and save them. And the idea with shareware is that was
00:43:28 ◼ ► encouraged. Now you could share, I could, if I had a cool Tetris clone, I could share it to my
00:43:34 ◼ ► friend David, just give you a floppy disk or you give me a blank floppy disk and I'll give it to
00:43:39 ◼ ► you. And then the about box would say, if you enjoy this, you can send me $15 and there'd be
00:43:43 ◼ ► like a mailing address. Really? Right. You'd mail a check. Believe it or not, those developers,
00:43:51 ◼ ► most of them didn't make a lot of money that way. But the idea was, right. But most of those apps
00:43:58 ◼ ► that were truly shareware didn't have a lock screen. It wasn't like, oh, you can use it for
00:44:02 ◼ ► 30 days and unless you mail me a check and then I mail you back a code to type in, you could use it.
00:44:09 ◼ ► You could just use it forever and voluntarily pay if you wanted to. But the developers who made a
00:44:15 ◼ ► go of it professionally, you know, and had box software or even when it got to the download,
00:44:19 ◼ ► you know, the download era really opened it up to a lot more developers because the whole box thing
00:44:25 ◼ ► was such a pain in the ass. I mean, I was at bare bones software from 2000 to 2002 where we were
00:44:33 ◼ ► very much transitioning from selling box copies to, and we still did, we sold lots of box copies
00:44:40 ◼ ► to lots of developers or customers, but there were a lot of customers who were just downloading it
00:44:49 ◼ ► processing over the internet. But doing a box software release was a huge deal. I mean, we had
00:44:55 ◼ ► to print CDs or DVDs at some point. I guess CBB had it fitted on a CD. We printed copies of the user
00:45:04 ◼ ► manual and shipped them in the box. It's a real book. I have a couple of copies because I wrote
00:45:08 ◼ ► so much of it or contributed so much to it for the years that I was there. But that's all-
00:45:15 ◼ ► And then you got to figure out demand and forecast. Do we eat 10,000 copies? It's cheaper,
00:45:20 ◼ ► but are we going to sell 10,000? If we do 100,000 copies, it's even cheaper. But man, now we're
00:45:25 ◼ ► sitting on a giant pile and you got to warehouse them. You got to do it in a different world.
00:45:30 ◼ ► Right. And when your box of BB Edit 6.0.0 came, and then we had a 6.0.1 bug fix, you didn't have
00:45:38 ◼ ► to get a new box. You could download it. It used to be, I think it was Stuffit who made the
00:45:43 ◼ ► technology, but you could make an upgrader and the upgrader would just be effectively doing a binary
00:45:50 ◼ ► diff and just applying to the application and all the other components that were installed.
00:45:56 ◼ ► What's different between 6.0 and 6.0.1 because the download size mattered so much, right? Like
00:46:04 ◼ ► you really had to keep a download to the smallest possible size because people at home had very slow
00:46:11 ◼ ► connections. A lot of them were still on dial-up modems and the bandwidth cost for the company was
00:46:17 ◼ ► humongous. I mean, you used to pay... Even Daring Fireball, originally, I had to watch my bandwidth
00:46:25 ◼ ► just from a site with very few images and mostly text. When my site started getting popular,
00:46:33 ◼ ► I started getting notices from my then web host that I needed to upgrade my account to something
00:46:43 ◼ ► You just got in the habit of never posting photos and it just became part of your MO, right?
00:46:48 ◼ ► Right. But posting like a 50 megabyte app would have been ruinous for thousands of customers.
00:46:55 ◼ ► But anyway, it was a huge deal. But in that early Mac OS X era where two things I think happened,
00:47:06 ◼ ► first was the ability for independent developers to make download only. No, we don't have to do
00:47:13 ◼ ► any disks ever. We're never going to print a manual. Everything will be over the internet.
00:47:18 ◼ ► And so that made it so much easier for small developers who really just wanted to work on
00:47:23 ◼ ► the software to do it. And you didn't have to deal with the middlemen, the micro, whatever that damn
00:47:28 ◼ ► company was. One of the reasons its app was so expensive back then, such and such app or
00:47:37 ◼ ► word processor was $300. It was like micro somebody, I forget, but they were the middleman
00:47:44 ◼ ► who you give all your box copies to. And they were the ones who distributed to CompUSA and to Best Buy
00:47:52 ◼ ► and to whatever other mom and pop shops carried the box software. They took like 80% of the money.
00:47:58 ◼ ► It was like the opposite of the app store. And one of those reasons why Apple originally,
00:48:04 ◼ ► and they still make the argument, right? Even in recent years, like JAWS has made the argument
00:48:08 ◼ ► that like a 70/30 split where the developer keeps 70% is complete opposite of the box software era
00:48:16 ◼ ► when the developer only got like 20% of the money. So that was great. You could switch to direct
00:48:25 ◼ ► sales, cut out the middle person, no boxes, no printed manuals. And all you'd have to do is pay
00:48:31 ◼ ► for your credit card processing fee and et cetera. And then the second thing was CoCo and that the
00:48:37 ◼ ► CoCo frameworks and Objective-C really were and are a better way to write applications,
00:48:46 ◼ ► to structure them, to take advantage of built-in functionality in the frameworks and let one person
00:48:54 ◼ ► shows or three person teams make apps that in the '90s would have taken a hundred person companies
00:49:02 ◼ ► to make. Gus Mueller at Flying Meat can make Acorn, which is a legit image editor. It doesn't
00:49:11 ◼ ► have as many features as Photoshop, but it does compete with Photoshop. And it's him and his wife,
00:49:17 ◼ ► his wife handling the business and Gus doing all the development. That just wasn't possible before
00:49:22 ◼ ► CoCo. There were image editors, but I don't think that they could... I don't think Brent Simmons
00:49:27 ◼ ► could have made NetNewswire as nice as it was when it came out as a one person developer as he could
00:49:32 ◼ ► have in Mac OS 9 or would have taken him a lot more work. So there was that. And they could sell
00:49:38 ◼ ► the apps for real prices like 50 bucks or $40, $80 for this or 120 for a serious app, productivity
00:49:47 ◼ ► app. And I think everybody sort of had that idea when the App Store opened that it would follow
00:49:52 ◼ ► that Mac model of prices that were, I don't know, $10 and up at least, $10, $15, $20. There was this
00:50:02 ◼ ► sort of a sense like, well, the phone is smaller than the Mac, so they probably shouldn't be like
00:50:06 ◼ ► 50, 60, $70. They should be like 10, 15, $20. And then we'd get thousands of more customers because
00:50:15 ◼ ► there'd be more iPhone... Everybody knew there were going to be more iPhones sold than Macs,
00:50:19 ◼ ► and this would be great. And then it turned out that people thought 99 cents was way too
00:50:33 ◼ ► don't give Apple enough credit for helping to make that happen. Because early in the App Store,
00:50:41 ◼ ► there were those $10 and $20 apps. And what started happening pretty quickly was that folks
00:50:47 ◼ ► noticed that if you put your app on sale, you would get a bunch of downloads. That would push
00:50:52 ◼ ► you into the top charts because the top charts were based solely on downloads, not revenue.
00:50:58 ◼ ► They didn't introduce the top grossing chart until 2011, I think. And so you started having this race
00:51:06 ◼ ► to the bottom on pricing, incentivized very directly by the structure of the App Store,
00:51:12 ◼ ► not necessarily even by consumer demand or anything else. It was that if I drop my price,
00:51:18 ◼ ► I'm going to get more downloads. Therefore, I'm going to get higher in the charts. And if I get
00:51:23 ◼ ► higher in the charts, I get more attention and get more downloads. And so it was like a marketing
00:51:27 ◼ ► thing to drop your price. And then it really was early in the App Store, just this devolution of
00:51:34 ◼ ► prices from those $10 and $20 price points down to the floor of $0.99 in part because of the
00:51:41 ◼ ► incentives that the App Store created. And that happened so quick. I mean, it happened over months
00:51:47 ◼ ► since the App Store launched July 11, 2008. And by the fall, people were putting their apps on sale.
00:51:56 ◼ ► And there were enough people that for the mass market apps, $0.99 could work. And you had the
00:52:01 ◼ ► iBeers of the world at the end of the news, "Oh, they made a million bucks." But it still didn't
00:52:07 ◼ ► work, right? Like my gas cubby app and other apps, I played the pricing games and I tried $2 and $3
00:52:15 ◼ ► and $5. And you didn't have upgrades, much less subscription. And it was a mess. But to your point,
00:52:23 ◼ ► it was like we went from this era of software being expensive to now all of a sudden software
00:52:28 ◼ ► being super cheap. And I think that benefited Apple tremendously in the kind of accrued value
00:52:35 ◼ ► to their platform that users were paying for their hardware and perceiving their platform as a place
00:52:41 ◼ ► that you can get free and cheap apps versus having this platform where things were more expensive.
00:52:47 ◼ ► Pete: Yeah. Just sort of ballpark mapping it. It's like you could get to with a $50 app, you get 20,000
00:52:58 ◼ ► customers and now you've got a million dollars in revenue. And it depends how many employees you
00:53:03 ◼ ► have, but that's real money. But if you have three or four people working on a thing and not that
00:53:11 ◼ ► much overhead because you're not doing the printed stuff and you're not selling through a middle
00:53:16 ◼ ► person, a million dollars divided by four is pretty good. And you only need 20,000 customers
00:53:22 ◼ ► to get there. And I say you only getting to 20,000 customers for a new app can be really hard, but
00:53:28 ◼ ► it's manageable, right? It's not boiling the ocean. It's like you're boiling a swimming pool.
00:53:34 ◼ ► You could do it. You can heat up a hot tub. But if you're selling it for a dollar and you get 20,000
00:53:41 ◼ ► customers, it's not much money, right? It's really not. It's well, I guess we can go to WWDC. That's
00:53:56 ◼ ► something about back in 2008, the app store was so easy. A beer app made millions. And I was like,
00:54:02 ◼ ► "No." Yes, a beer app made it because it went viral. But that was the exception, not the rule.
00:54:09 ◼ ► It wasn't easy in 2008 because you still had all those factors that are today still in place is
00:54:15 ◼ ► that I was making more productivity and utility apps. So how many people need a mileage logging
00:54:21 ◼ ► app? Two to 5% of the population? And then you start doing that, "Well, 2% of a million people
00:54:30 ◼ ► is a lot of people." But then you have to get the attention of that 2%. And so if you get the
00:54:38 ◼ ► attention of 0.01% and then half of those do end up buying your app, the numbers ended up being so
00:54:45 ◼ ► much smaller. And the apps that that really did work for were just the mass market apps. It was
00:54:51 ◼ ► very much centered around, and the stories that made it sound so easy were all centered around
00:54:56 ◼ ► those mass market apps. And all the niche apps really suffered because of it. I mean, I did all
00:55:02 ◼ ► right, and I made it. Until I joined RevenueCat in 2019, I was full-time working on apps as a
00:55:10 ◼ ► non-programmer, probably one of the few people who could say that. So for whatever that was, like
00:55:15 ◼ ► 13 years, 100% of the money I made that provided for my family came from selling apps on the app
00:55:36 ◼ ► of course there are exceptions, but I think sports often works like that for the most part. If you
00:55:45 ◼ ► are a talented basketball player and you're a teenager, you're going to get noticed. If you're
00:55:52 ◼ ► good, clearly good enough to go on to Division I college. I think there's very few high school
00:56:00 ◼ ► kids, athletes who have that remarkable amount of talent who don't get it. And sometimes you're
00:56:07 ◼ ► overlooked. Like Steph Curry, I forget where he went to college, I watched that recent documentary,
00:56:13 ◼ ► but didn't go to a Tier I school. But he did play Division I college basketball. It was just
00:56:18 ◼ ► at a smaller school because he was like, "I don't know, that kid looks short and scrawny." So he was
00:56:25 ◼ ► overlooked, underrated, but he still eventually got to where he is today, a sure thing, all time great
00:56:32 ◼ ► hall of famer. There's very few people who probably out there in the world who deserve to be in the
00:56:38 ◼ ► NBA or the WNBA who aren't, right? You just sort of get there. And you want that with everything
00:56:44 ◼ ► in the world. You want the people who deserve to succeed to succeed. And I think the web really
00:56:57 ◼ ► And it maybe took a little longer to succeed than I had hoped, but I think I eventually wound up with
00:57:04 ◼ ► the success that I deserve. And then years later, when someone like Federico started Max Stories,
00:57:10 ◼ ► it's with as good as Federico's writing is and as interesting and good as Max Stories is,
00:57:16 ◼ ► I think it was effectively a sure thing that as long as the quality of the work kept up,
00:57:28 ◼ ► And I think that's what the App Store really has always been missing, right? You can make a great
00:57:35 ◼ ► app that in theory ought to be able to find whatever niche there is of users that could
00:57:42 ◼ ► and should make it a financial success, but it doesn't work, right? There's good apps that don't
00:57:48 ◼ ► make it. And I'm not just talking about my own Vesper, but it is, I think it's a self-serving
00:57:55 ◼ ► aspect of it aside. It's a pretty good example, right? And I've told this to, why didn't it work?
00:58:01 ◼ ► I mean, we never got past only having an iPhone version and an iPad version. We should have had
00:58:05 ◼ ► a Mac version, but we missed, we were too early for the subscription era and subscription pricing
00:58:11 ◼ ► might've been the thing that saved us, but selling a four or $5 notes app, it was very clear when I
00:58:18 ◼ ► did the analysis that what was happening, you can't prove it because you can't really prove
00:58:22 ◼ ► what the people are doing in the App Store. But it was very clear that when people were looking
00:58:29 ◼ ► for notes apps in the App Store, they would get a list of results and they would try the free ones
00:58:35 ◼ ► first and eventually found one that was like, well, it's good enough and it's free. And they
00:58:42 ◼ ► never get to the ones that you had to pay even just like four bucks. But if we were paid upfront
00:58:47 ◼ ► and the only way to try it was to spend four bucks and they, it's not that they were, I don't think
00:58:53 ◼ ► it was that people thought I'm never going to spend four bucks on a notes app, but they think
00:58:59 ◼ ► I'm going to try the free ones first, find one that's, ah, it's good enough. And then they never
00:59:03 ◼ ► get to the paid ones. And I think that's what killed. And I think that happened to a lot of apps
00:59:08 ◼ ► and I think it still happens. I think it's very, there's a luck aspect to it that is unfortunate.
00:59:14 ◼ ► And like the beer app that made a million dollars was a perfect example. There were all sorts of,
00:59:19 ◼ ► some of the fart apps made a lot of money and most of the fart apps made no money at all. And
00:59:24 ◼ ► it wasn't because some of them were good, it's really because some of them got lucky, right?
00:59:36 ◼ ► the app store just looks so different that I think for folks who weren't actually running an
00:59:43 ◼ ► app business back then, including a ton of people inside Apple, it's like, there's, there's like
00:59:47 ◼ ► kind of a history of the app store and app store monetization. That's just completely lost on folks
00:59:53 ◼ ► who weren't, who didn't try to make a go of selling three bucks a pop upfront download apps
01:00:01 ◼ ► back, back in the day. And, and for all the stories of success, like you were talking about,
01:00:06 ◼ ► it was, it was challenging because it, in people's mentality around it, because things were kind of
01:00:13 ◼ ► free and cheap of, Oh, I'd never pay for an app. I never spend that kind of money. And so you've
01:00:17 ◼ ► got this great notes app that's four bucks or five bucks or whatever you price it at. And yeah. And
01:00:22 ◼ ► yeah, it just, it, it, the hurdle to overcome, to spend anything was, was huge. And then especially
01:00:29 ◼ ► when there were tons of free apps, like Evernote that eventually started monetizing, but we're
01:00:35 ◼ ► able to just kind of ride that VC money and build a huge audience that they did. But yeah, it's,
01:00:42 ◼ ► it's, it's a, the, the, the way that it, the fact that you couldn't do paid updates, the fact that
01:00:48 ◼ ► for a long time, you couldn't be paid within that purchase. Like there were all sorts of rules,
01:00:54 ◼ ► the, the way the charts work. Like I wrote several posts over the years about how Apple has and
01:01:01 ◼ ► continues to shape the app store. And people often pretend that it's a, it's a free market. Oh,
01:01:09 ◼ ► you didn't succeed, but it's a, it's a free marketplace. But I think you drawing the parallel
01:01:14 ◼ ► to the web, the web really is free and open, and you have the opportunity to surface and build
01:01:22 ◼ ► businesses in whatever way you feel like. On the app store, there are so many different boxes you
01:01:30 ◼ ► have to tick and, and you have to fit yourself into the way the app store works and try to find
01:01:37 ◼ ► success in within the limitations of the structure of the app store as it actually exists. I mean,
01:01:44 ◼ ► I've likened it to economies where the app store is like a government and everything they do or
01:01:51 ◼ ► don't do is a tax policy is law enforcement is all these different things that shape a traditional
01:01:57 ◼ ► economy. And Apple is shaping that through the app review guidelines is shaping it through giving you
01:02:04 ◼ ► a fifth 15% on the second year renewal of subscription. That's an incentive. That's like a
01:02:10 ◼ ► tax break for subscription apps that you get a discount. If people say subscribe not allowing
01:02:16 ◼ ► paid updates like that, there's, there's no way to prove the counterfactual, but had they allowed
01:02:21 ◼ ► paid updates at some point early in the app store, I think the economics would have looked very
01:02:25 ◼ ► different. There's so many different ways, like errors of commission and errors of omission that
01:02:31 ◼ ► the app store would be a completely different place today were it not for, and the opportunities
01:02:36 ◼ ► and the developers who succeeded and didn't succeed. I mean, I definitely won't say that my
01:02:42 ◼ ► own choices didn't limit my success in some ways more than Apple did. I made my own choices about
01:02:48 ◼ ► what I built and didn't build and how I marketed and how I didn't market. And I think any and I've
01:02:54 ◼ ► done really well. So I'm not saying I like failed or anything, but any kind of potential additional
01:02:59 ◼ ► success I could have, should have, would have had, or other things. I think there's, there is some
01:03:05 ◼ ► essence of Apple's shape of the app store creating and defining the opportunities that would work and
01:03:24 ◼ ► on App Store search and App Store search is a disaster to this day in 2024. Surfacing apps that
01:03:32 ◼ ► are like buying reviews and manipulating search. I mean, actually I, as part of my day job at
01:03:37 ◼ ► Revenue Cat, I run this podcast called Sub Club. I actually had a guy on Steve Young last year
01:03:43 ◼ ► in the summer talking about App Store black hat tactics. And I had him on as like an education
01:03:51 ◼ ► thing. And we talked about it on the show and I was very upfront. I don't think some of the things
01:03:56 ◼ ► he was suggesting are moral. Some of them are clearly against the rules, but like developers
01:04:01 ◼ ► are still succeeding to this day using those black hat tactics and then search and other ways that
01:04:08 ◼ ► the apps will work actually incentivizes you to play those games. Yeah. In a way when there's
01:04:14 ◼ ► always been SEO with search on the web, but to me, it's, there's something fundamentally different
01:04:23 ◼ ► about like you can make a website that doesn't play SEO trickery and succeed, right? You'll,
01:04:32 ◼ ► like I said, you, it might take longer, but you'll eventually get the success you deserve
01:04:36 ◼ ► on the web because you'll get linked to from other websites. There's other ways to do it, but the
01:04:41 ◼ ► gamification of the app store is sort of central to it. There's no, there is cause it's cause it
01:04:47 ◼ ► is the only game in town. If you could only get two websites through Google, if, if the entire web
01:04:54 ◼ ► had been invented by Google and was a proprietary platform and Chrome is the only browser. And the
01:05:02 ◼ ► only way to get anywhere is with a search box that you can't type direct URLs. You just type a query
01:05:09 ◼ ► and only get to places through the results in one search engine, Google's results. The web would be
01:05:22 ◼ ► it's not loose boundaries that kind of shape the flow of how the economy works to go to your
01:05:31 ◼ ► economy allergy, but rigid rules and barriers and deliberate design from the owner of the platform
01:05:46 ◼ ► spends a ton of time and is constantly updating the search algorithm to punish those techniques
01:05:53 ◼ ► that are trying to manipulate SEO. And I mean, there's whole, I mean, I looked into this for,
01:05:58 ◼ ► for some of the stuff I write for revenue cat there's whole like industries around like
01:06:03 ◼ ► following Apple Google's changes and trying to figure out what they've changed and how they
01:06:08 ◼ ► changed it and how you can like leverage a new system and Apple kind of tweaks on the app store
01:06:14 ◼ ► search algorithm. And we see some shifts here and there, but it's yeah. And, and, and they have made
01:06:22 ◼ ► progress on it over the years. I don't want to act like they haven't done anything, but so many of
01:06:27 ◼ ► those dark patterns still work to this day. For example, one of them is that you can pay people
01:06:34 ◼ ► to search a specific keyword, scroll to your app and download your app after having searched that
01:06:39 ◼ ► specific keyword. And this is a technique. And again, Steve shared this on the podcast.
01:06:44 ◼ ► He actively uses this in or did in 2023. And yeah, it's hard for Apple to like guard against
01:06:52 ◼ ► that kind of thing. And maybe they guard against it in, in mass, but it's like a technique that
01:06:56 ◼ ► still works. So you want to rank for notes app in your example with Vesper over back in the day,
01:07:02 ◼ ► like you pay people to go search notes app and then download your app and it improves your
01:07:08 ◼ ► ranking for that keyword. And like those kinds of dark patterns are still working to this day.
01:07:13 ◼ ► And, and I mean, to be fair, I mean, SEO, like there's all sorts of dark patterns in SEO and
01:07:17 ◼ ► black hat SEO and all that kind of stuff. But, but yeah, the fact that everything does go through the
01:07:23 ◼ ► app store in that way means that Apple's search algorithm is incredibly important to the platform
01:07:30 ◼ ► and who succeeds and who doesn't succeed. And I don't think Apple has effectively managed it
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01:11:10 ◼ ► Let me ask you this before we move on to current events. But I think one of the other critical,
01:11:17 ◼ ► fundamental errors at the App Store is that they have user reviews at all. I don't think
01:11:23 ◼ ► they should. I think it was a mistake to have them. And I don't think it's ever helped the store.
01:11:40 ◼ ► Sometimes it's so obvious. It's been a while since I saw one that was super obvious. But every once
01:11:45 ◼ ► in a while, they'd surface on Twitter, and you'd go read the reviews. And it's so obvious that
01:11:49 ◼ ► somebody just paid one of those services where you can hire, like you said, to hire people to do a
01:11:55 ◼ ► search for a term, hire people to download and review. Because the reviews either A, make no
01:12:02 ◼ ► sense at all. Let's say it's a weather app, right? And it's a great notes app. Love it. And it's like,
01:12:07 ◼ ► it's not a notes app. What are you talking about? It's the best calculator I've ever used. And it's
01:12:14 ◼ ► a traffic app or something like that. It's like, or just nonsensical grammar, or just a bunch of
01:12:19 ◼ ► comments that are just obviously the exact same words. Yeah, I mean, the ratings and reviews are
01:12:26 ◼ ► gamed in a lot of different ways. And still to this day, I mean, Apple, it's like Amazon. I mean,
01:12:52 ◼ ► I don't think Apple and Amazon are taking it seriously enough. I'm sure they have teams. I'm
01:13:00 ◼ ► sure they work really hard. I'm sure they spend a lot of money. I'm sure they have sophisticated
01:13:04 ◼ ► algorithms and everything. But when you can get a third-party tool like FakeSpot, which these days,
01:13:09 ◼ ► I mean, I almost don't like shopping at Amazon anymore because everything is just knockoffs.
01:13:14 ◼ ► And speaking of search not being good, you search there and it's 50 knockoffs before you find the
01:13:20 ◼ ► thing you're actually looking for from a reputable retailer. But pretty much everything I buy of
01:13:25 ◼ ► consequence on Amazon, if it's not a name brand that I know and trust, I'm running it through
01:13:30 ◼ ► FakeSpot. And if FakeSpot can figure that out, Amazon should be doing more to find those quality
01:13:35 ◼ ► signals. And then similarly, I think Apple should be doing more. However much they're doing, they
01:13:40 ◼ ► should be doing more. The App Store is making tens of billions of dollars a year in profit for them.
01:13:45 ◼ ► They can do more to police this rather than just completely getting rid of it. Because I think
01:13:50 ◼ ► it is helpful to get signal from real humans as to the quality. But then that goes back to the
01:13:56 ◼ ► search thing too, though, is that one of the things that impact search ranking significantly,
01:14:02 ◼ ► Ariel from AppFigures is somebody who studies a search algorithm and has built search tools to
01:14:08 ◼ ► help developers figure out how to improve their search rankings. And one of the things he shares
01:14:13 ◼ ► is that the velocity of ratings has a huge impact on your search placement. Well, what do you do?
01:14:21 ◼ ► You game that. And so you asked for a rating earlier. It's explicitly against Apple's rules,
01:14:29 ◼ ► but people filter before showing the review prompts. So you say, are you enjoying this app?
01:14:35 ◼ ► Yes or no? If they say no, you send them to support. If yes, you send them to rate the app.
01:14:40 ◼ ► And I mean, huge apps. I think I saw realtor.com app doing that. Tons of apps do that, even though
01:14:46 ◼ ► it's explicitly against the rules. And that's just, you're clearly getting a bias. And then
01:14:52 ◼ ► the most frustrating thing for me personally is that I've seen all these games be played on the
01:14:57 ◼ ► app store for years. And I know that if I don't do those things, I'm fighting with one hand tied
01:15:03 ◼ ► behind my back. And I do, I don't morally think it's right to fake reviews and do all these kinds
01:15:10 ◼ ► of things. And so I don't do it, but then I'm bringing a knife to a gunfight. Like it's
01:15:16 ◼ ► It's like trying to compete in a sport that's riddled with PEDs without taking the PEDs,
01:15:24 ◼ ► right? Really? I don't know if cycling is still like that. But at least when I followed it in the
01:15:29 ◼ ► Christ, what was his name? Armstrong, right? In that era. And it turned out that he was on PEDs.
01:15:35 ◼ ► And it's, it was, but everyone was and yeah, but if you weren't, you really, you couldn't win,
01:15:41 ◼ ► you probably couldn't even qualify for the Tour de France. And baseball was a little different.
01:15:46 ◼ ► Baseball had a terrible, well, I will say terrible, a bad PED era when all these home runs were getting
01:15:53 ◼ ► set. And you couldn't use there was no chance you weren't going to win the home run. You weren't
01:15:59 ◼ ► going to be the home run leader without taking them when Barry Bonds and Alex Rodriguez are
01:16:04 ◼ ► hitting 50 6065 to 70 home runs a year that you weren't going to do it. But you could be an all
01:16:11 ◼ ► star, you could be Derek Jeter and never take the PEDs, but you're not going to hit the home runs.
01:16:15 ◼ ► But there was room in baseball for other players who had different skills and could just hit for
01:16:19 ◼ ► average, but like a sport like cycling, or like when the East Germans and the Russians were
01:16:24 ◼ ► cheating at swimming, right? You just, you weren't, you had no way you could beat them.
01:16:29 ◼ ► I mean, it was impossible. And this is what I talk about all the time on the App Store. Like,
01:16:33 ◼ ► I talk to a ton of developers, I do office hours weekly with with Revenue Cat, where any customer
01:16:39 ◼ ► or prospect or just anybody can book time with me. And we chat about how to make your app successful.
01:16:43 ◼ ► And one of the things I say is like, if you're not aware of what's going on, and you think you're
01:16:48 ◼ ► doing competitive analysis, you're looking at all these other apps, you're like, Oh, man, there's
01:16:52 ◼ ► this wallpaper app, it's making $500,000 a month, I should make a wallpaper app. Well, when you
01:16:58 ◼ ► actually like download the app and understand all the dark patterns, and then when you realize that
01:17:03 ◼ ► they're that successful, in part because they got high in search, well, how did they get high in
01:17:07 ◼ ► search, they probably manipulated the search rankings with buying reviews and filtering
01:17:12 ◼ ► reviews. And like, why are they still a 4.8 star app when they have like 1099 a week subscriptions
01:17:21 ◼ ► for wallpapers, that there's still just so much of that going on in the App Store. And and so
01:17:27 ◼ ► if you're going to play by the rules, you just have to at least understand what handicaps you
01:17:34 ◼ ► have in trying to play by the rules versus so many apps are still pulling all sorts of crap.
01:17:41 ◼ ► Right. It's like we talk about dark patterns, but there's different shades of darkness, right?
01:17:46 ◼ ► There's gray patterns, and then there's like black patterns, right? And the black one of the black
01:17:50 ◼ ► patterns is trying to create an app that like you said, like a wallpaper app, which is a legitimate
01:17:56 ◼ ► thing. A lot of people are into our friends at the icon factory have a what's it called wallaby,
01:18:07 ◼ ► something like that, no matter how good your wallpaper app is, I don't know what the maximum
01:18:11 ◼ ► fare price is. So let's just say ballpark for really good, really custom art, maybe 50 bucks
01:18:20 ◼ ► a year. And you can find a niche of people who love maybe and maybe it's using certain trademark
01:18:26 ◼ ► characters or an intellectual property, you know, 50 bucks a year for a wallpaper app. That sounds
01:18:34 ◼ ► premium, right? And if but tricking somebody into a three day trial that turns into a $10 a week
01:18:41 ◼ ► subscription, well, now you're talking $520 a year, which is ridiculous for a while, but that's a scam.
01:18:48 ◼ ► And the whole idea of those apps, as I understand it is they realize people are going to notice
01:18:54 ◼ ► eventually somebody at some point, you're going to look at your credit card bill or you're using
01:18:58 ◼ ► some kind of app like copilot or something that gives you you know, hey, you know, you're spending
01:19:02 ◼ ► a lot a lot of money on blank. And it's like, that's crazy. I didn't know that I thought the
01:19:06 ◼ ► wallpapers were free. But somehow, the presentation of the subscription screen was good enough to get
01:19:15 ◼ ► past app review, but somehow tricky enough that people who really would never agree in plain
01:19:22 ◼ ► language to a $10 a week recurring automatic subscription, somehow tap that button that gave
01:19:29 ◼ ► them a $10. That's an out that's theft. That's not, ooh, that's a little skeevy. I mean,
01:19:36 ◼ ► that's just stealing people's money. There's patterns, there's designs that get people there,
01:19:46 ◼ ► I mean, they're in a tough spot. Like, I do want to give them some credit where credit is due,
01:19:52 ◼ ► because I mean, yeah, we could, you and I could go on for 10 hours on this podcast. I don't know
01:20:02 ◼ ► model in that for all the complaints that we have now and complaining about search and complaining
01:20:08 ◼ ► about these $10 a week subscriptions and things like that, I do still think that the App Store
01:20:15 ◼ ► has been a great thing in the history of software that you have Apple curating. Are they the perfect
01:20:21 ◼ ► curator? No. But they are curating software and getting rid of the worst of the scams when news
01:20:28 ◼ ► pops up. Oh, this app is stealing your credentials. And those are going to pop up. Nobody's going to
01:20:33 ◼ ► be perfect at stopping those kinds of things. But guess what? It's off the App Store in seconds,
01:20:38 ◼ ► versus if that were on the web, people would be falling for that for years. And so I think
01:20:43 ◼ ► there's a ton of value in the App Store. But Apple, I mean, with all the regulation, with
01:20:50 ◼ ► everything going on around the world, and people complaining about this, that and the other,
01:20:55 ◼ ► it's a hard job running a platform like this. It's like balanced on a knife edge. Do you let
01:21:00 ◼ ► developers set their own prices so that if people are willing and able to pay $10 a week for
01:21:10 ◼ ► And I think that the Apple has had to, to a certain extent, not say that a wallpaper app
01:21:18 ◼ ► can't be worth $520 a year. Now we can sit here and say you're ripping people off. But for Apple
01:21:26 ◼ ► to say, "Okay, developer, you cannot charge $10 a week for your subscription." I think that's,
01:21:31 ◼ ► I appreciate that Apple hasn't drawn some of those lines, because I think that would be
01:21:37 ◼ ► limiting business. But I will say, I do think that there are more ways that Apple could continue to
01:21:44 ◼ ► shape the App Store to make those kinds of things less effective, which then makes it less attractive
01:21:49 ◼ ► as a business model. For example, and again, I want to chase so many different rabbits here,
01:21:56 ◼ ► but Apple's payments, while they do get taken advantage of by apps like those charging $10
01:22:02 ◼ ► a week or whatever, they are incredibly consumer friendly. And they send you the email every time
01:22:08 ◼ ► you're going to get a renewal. They do a lot, but I think there's more that they could do.
01:22:12 ◼ ► There should be a badge on the App Store for apps that you haven't opened in a month and they're
01:22:17 ◼ ► still charging you a subscription. Just check in. Legitimate apps that people are using and getting
01:22:22 ◼ ► value out of, they're not going to cancel those subscriptions. But those $10 a week, there's ways
01:22:27 ◼ ► that Apple could bring more attention to the apps where people use them once, forget that they're
01:22:33 ◼ ► subscribed. And again, full transparency, I work at RevenueCat. We benefit in some ways indirectly
01:22:39 ◼ ► from that, but I think our philosophy and my philosophy personally is that subscriptions
01:22:45 ◼ ► are an incredible win-win for consumers and developers. Is it when you can deliver value
01:22:52 ◼ ► over time and that value is paid over time as a subscription, you can continue to add more and
01:23:00 ◼ ► more value and build great software. And ultimately, like we were saying, compared to the box software
01:23:06 ◼ ► days of paying $130 to update your operating system, we're getting a ton of value for a
01:23:11 ◼ ► relatively inexpensive fee. But for that to be successful over the long haul, all of these dark
01:23:18 ◼ ► patterns and people forgetting that they're subscribed and things like that, it's better for
01:23:24 ◼ ► the subscription and software industry over the long haul for those kinds of things to go away,
01:23:30 ◼ ► even if in the short term subscription app developers and then platforms like ours that make
01:23:35 ◼ ► money from subscription app developers make less money in the short term. The fewer people who get
01:23:40 ◼ ► scammed into those subscriptions, the more people who are comfortable paying over time, the better
01:23:46 ◼ ► it is for everyone in the long haul. And so I do think there's still more Apple can do in so many
01:23:52 ◼ ► fronts to make it a better place for consumers and for developers. Yeah. And I'm looking at my
01:23:58 ◼ ► subscription list right now, and I pay for quite a lot of subscriptions through Apple. And a lot of
01:24:03 ◼ ► them, I last year broke down and subscribed to Bloomberg because I read enough Bloomberg articles
01:24:10 ◼ ► where it's like I should be paying to get past the pain wall. It's a professional thing, but it's a
01:24:16 ◼ ► super expensive publication. I'm looking, it's $35 a month. So, you know, $10 a week wouldn't be that
01:24:23 ◼ ► different really. I have Apple one is $32, 30, no, $38 a month. I keep raising the price on that. I
01:24:32 ◼ ► can't even keep track. For my family account. So, I mean, I subscribe, you know, clearly there are
01:24:36 ◼ ► things that $10 a week, I don't, I'd rather not because whatever was $10 a week, probably I'd save
01:24:43 ◼ ► money on a monthly or annual. And I think I would save money on my Bloomberg if I switched to annual,
01:24:58 ◼ ► Well, let's, you mentioned Revenue Cat a couple of times. So, tell me what is Revenue Cat?
01:25:05 ◼ ► We are a subscription app platform. So, we provide SDK that goes in the app that manages every,
01:25:14 ◼ ► that's how I actually came to Revenue Cat was I was switching my apps to the subscription model.
01:25:20 ◼ ► And it's so much code inside the app. And then you really need to have server infrastructure to
01:25:27 ◼ ► manage all this, validate receipts, to track the subscribers over time, to understand that they've
01:25:33 ◼ ► turned on or off auto renew and those kinds of things. And so, we provide that drop-in SDK.
01:25:39 ◼ ► It's in tens of thousands of apps now. So, if there's going to be a bug, we found it and
01:25:44 ◼ ► solve for it immediately. So, you don't have to pay attention to that kind of stuff. And then on
01:25:50 ◼ ► the server, we provide infrastructure where you can pass data to CRM tools to do win back campaigns.
01:25:58 ◼ ► So, it's just end to end. And we have a dashboard where you can look at your subscription revenue
01:26:03 ◼ ► and filter it by cohorts and things like that. So, it's kind of an end to end solution to help
01:26:14 ◼ ► your customers are developers who are making apps that use subscriptions. And the idea is to give
01:26:20 ◼ ► the developers a lot of tools that just aren't there and what you get from Apple, really.
01:26:26 ◼ ► Exactly. And Apple has made it somewhat easier with StoreKit 2. But even with StoreKit 2,
01:26:30 ◼ ► you need a server, you need to write a ton of code to process the payments and validate receipts and
01:26:36 ◼ ► all that kind of stuff. And so, we just make it way easier. And then you have some people who,
01:26:41 ◼ ► and I was this way. I was like, I don't want to put some third-party code between me and making
01:26:45 ◼ ► money. And what I've realized after being at RevenueCat for a while now is I want RevenueCat
01:26:52 ◼ ► code between me and making money. I don't want the one-off implementation that any developer I work
01:26:59 ◼ ► with wrote to manage this. And so, the fact that we manage, I think we've crossed $3 billion a year
01:27:07 ◼ ► in management of transactions across iOS, Android, and the web. And so, whose code do you want in
01:27:15 ◼ ► your app managing those subscriptions and whose server do you want running that? The one that's
01:27:20 ◼ ► processing $3 billion worth of payments every year or the one-off implementation that you're
01:27:25 ◼ ► going to write and have to maintain over time. So yeah, it's a lot of fun working there too. I run
01:27:30 ◼ ► a podcast called Sub Club, where I talk to industry experts about running subscription app businesses,
01:27:37 ◼ ► attend conferences, and do that sort of thing. My official title is Growth Advocate. And I get
01:27:43 ◼ ► a lot of leeway to come on, talk to industry folks, and talk to developers, and run the
01:27:49 ◼ ► podcast and things like that. So it's a lot of fun. All right. And so that leads us to your app
01:27:56 ◼ ► WeatherUp, which just had... What version is it now? 3.0 is what just launched recently.
01:28:05 ◼ ► So it's more of a traditional... A lot of people are screwing around with version numbers lately,
01:28:09 ◼ ► but I'm not a fan of it. I don't like it. It's funny because I was just talking on my podcast,
01:28:16 ◼ ► the Sub Club podcast, I had our CEO and a colleague interview me about WeatherUp on the
01:28:22 ◼ ► podcast. And we just did that a few days ago. And it dawned on me while discussing it that 3.0 is a
01:28:29 ◼ ► very box software era way to do updates. And we talked about how I took a very box software era
01:28:37 ◼ ► approach to doing the update, where we worked on it for a long time. We put all these features into
01:28:44 ◼ ► it and then rolled out this big 3.0. And so I'm actually leaning more these days, especially in
01:28:50 ◼ ► the era of subscriptions where you should just be pushing updates whenever anything's ready.
01:28:56 ◼ ► Instead of holding it all for these big updates, I'm going to contradict what I think you were
01:29:00 ◼ ► about to say, and say that I actually think that this whole 3.0 and 3.1 and big releases,
01:29:08 ◼ ► it's kind of a bygone era. It's our era. So I think you and I both have a fondness for it,
01:29:20 ◼ ► has switched overcast to... I know he switched to something different, but I think he does the sort
01:29:25 ◼ ► of dated releases. And so the one thing you want, no matter what your version numbers are,
01:29:31 ◼ ► no matter how you structure them and where you put the dots, they need to go up over time.
01:29:38 ◼ ► Right. And some people play goofy games. I forget what app it is, but there's some app that just
01:29:44 ◼ ► keeps making it, adding digits to pie. It's like 3.14, 3.141, 3.1415, 3. You know, which is funny
01:29:56 ◼ ► and clever, but it does, no matter what, you're always adding a digit. It keeps going up. And I
01:30:00 ◼ ► get it. And I think it ties into exactly what we were talking about in the first half of the show
01:30:05 ◼ ► with the box software, where one of the advantages, I think it's a huge advantage to subscription
01:30:13 ◼ ► pricing in general versus the big upfront payment, $500. And then for 2.0, that's when you got on
01:30:24 ◼ ► board. And then 3.0 comes out and you pay $250 for the upgrade or stick with 2.0 and not upgrade
01:30:32 ◼ ► and wait for 4.0 and see if they offer upgrade pricing, even if you only bought it at 2.0,
01:30:41 ◼ ► I held on to that student edition of Photoshop, whatever it was, like 5.0 for a decade.
01:30:46 ◼ ► But it leads users to make those decisions, right? It's an added decision for users of,
01:31:02 ◼ ► there wasn't so much... So many apps were sort of independent little islands as a user,
01:31:09 ◼ ► where you just get the app and you make your own files in that app's file format, and you'd save
01:31:15 ◼ ► them to your disk, and you could keep using an old version for a long time. And you could even
01:31:25 ◼ ► and have somebody who's on 3.0, but you're stuck on 2.0. They need to export in the older file
01:31:32 ◼ ► format, right? If they wanted to send you the file, or maybe the file format, if it's a text
01:31:36 ◼ ► editor, like BB Edit, well, it's a text file, it's a text file. You can always stay on the old
01:31:40 ◼ ► version. But you still had to make that decision as a user. Do I want to upgrade or do I want to
01:31:45 ◼ ► stay? And then I think worse from the development standpoint, it just led to... The only way to make
01:31:52 ◼ ► it work financially was to save up new features to combine all together in a big new 4.0 release
01:32:02 ◼ ► and batch them up. And it meant that in the interim between 3.0 and 4.0, you were really
01:32:09 ◼ ► mostly doing bug fixes and minor feature tweaks and saving all these features for one big dump
01:32:16 ◼ ► in 4.0, which it's better. It's a better thing for users if you just keep dripping new features
01:32:24 ◼ ► every couple months when they're ready. And it also is better as a developer of coordination-wise,
01:32:30 ◼ ► right? Everybody who was around in that era has war stories of a major upgrade that went wrong,
01:32:39 ◼ ► because, "Okay, we got to get to 6.0. Here's the features we're going to put in 6.0." And maybe two
01:32:45 ◼ ► of the features took way longer than it was expected, or one of them just didn't work out,
01:32:52 ◼ ► happened all the time, or didn't ship at all, right? There were a lot of companies that went
01:32:57 ◼ ► under because they planned for a big Datto release and ran out of money before they got it done.
01:33:03 ◼ ► And subscription pricing definitely helps with that a lot. It kind of solves the problem,
01:33:08 ◼ ► but I get it. The big problem with subscription pricing is the number of users out there who just
01:33:14 ◼ ► hate it, right? Either just refuse to buy any subscription software period because they're
01:33:21 ◼ ► that adamant about it, or they're at least going to complain about it, right? And I get it. I get
01:33:29 ◼ ► it. But there's pros and cons. And I think, like any issue, if you're a zealot on the issue,
01:33:36 ◼ ► you refuse to acknowledge the pros of the other side. All you want to do is hammer away at the
01:33:43 ◼ ► cons. I have a theory or an explanation for subscription fatigue. And this is the way I think
01:33:53 ◼ ► about it. Subscription fatigue is actually value fatigue. It's not that people hate the business
01:34:00 ◼ ► model. It's that they don't feel like they're getting the value they deserve from what they're
01:34:05 ◼ ► paying. But I think that's good. I think that's good for the industry, right? If you don't want
01:34:12 ◼ ► to subscribe to my weather app, if you don't want to subscribe to whatever, don't. But if you're
01:34:19 ◼ ► getting value, then you subscribe. I'm currently subscribed to like six different streaming
01:34:23 ◼ ► services. Do I love paying whatever it is, $80 a month? But you know what? I was thinking about
01:34:30 ◼ ► this the other day. I mean, that's so much cheaper than I used to pay in cable. I'm not watching any
01:34:36 ◼ ► ads. I'm getting unlimited, amazing content, like the golden age of TV. It might be over now,
01:34:42 ◼ ► now that ZURP is over and studios are pulling back and things like that. But it's like,
01:34:52 ◼ ► especially inflation-adjusted, way less than we were paying for cable TV just a decade ago.
01:35:06 ◼ ► mentality that's kind of a legacy mentality of software should be free. And I like that we've
01:35:14 ◼ ► kind of gone the full span from like shareware to like really expensive software. Then the app store
01:35:20 ◼ ► kind of did reset things that software should be free and cheap. And I should just be able to pay
01:35:24 ◼ ► 99 cents upfront and use it forever. But there's a reason why shareware was shareware because it was
01:35:30 ◼ ► like people just doing it for fun, side projects and things like that. And then there's a reason
01:35:39 ◼ ► the reason it got cheap was because it did get easier to build stuff. But now the things that are
01:35:54 ◼ ► massive team, hundreds and hundreds of people building this app to better track your fitness.
01:36:00 ◼ ► And so I think as people kind of come around, which people are... And people complain about
01:36:08 ◼ ► spending money no matter what, right? So if it weren't subscriptions and it was still five bucks
01:36:12 ◼ ► upfront, people would complain about five bucks upfront. And so I think like people complaining
01:36:16 ◼ ► about spending money is just the nature of things. But the whole subscription fatigue is that...
01:36:23 ◼ ► - Is that if you weren't getting... If you weren't anticipating getting some value out of it,
01:36:29 ◼ ► you wouldn't be complaining that you have to pay for it. Like, why would somebody even complain
01:36:35 ◼ ► about paying for my weather app? Because they want to use my weather app. Well, if you want to use my
01:36:40 ◼ ► weather app, it's because you see that there's value there. And then how do you fairly compensate
01:36:45 ◼ ► somebody for that value that they've created? And then especially how do you compensate them in a
01:36:50 ◼ ► way that incentivizes them to keep working on it and make it a viable business versus being this
01:36:57 ◼ ► like shareware, we're going to throw it out there in the world for free and just let it be what it
01:37:01 ◼ ► is. Well, you probably don't want me to do that to my weather app because guess what? It costs a lot
01:37:07 ◼ ► of money to provide the weather data in my weather app. If you find value in the app, you want me to
01:37:13 ◼ ► be successful over the long haul. If you're finding value, you want that value to increase over time,
01:37:19 ◼ ► not to just go away and sit on a shelf. See, I'm a bit of a subscription app zealot as a developer
01:37:27 ◼ ► and working at RevenueCat, but I do think more and more people are coming around to it being
01:37:33 ◼ ► a viable way to pay. And then if you're not finding value, cancel your subscription. It's
01:37:39 ◼ ► Jay Famiglietti Yeah, I mean, and again, I get it that there are pros and cons to both. And it's
01:37:45 ◼ ► just the way it is. And with the App Store, as you discussed earlier, there is no upgrade pricing
01:37:51 ◼ ► allowed in the App Store. And apps that have tried to figure out ways to effectively get upgrade
01:37:58 ◼ ► pricing, it's such a pain. The Tapbot guys, the Tapbot guys who are just wonderfully user-focused
01:38:07 ◼ ► developers, Mark Jardine and Paul Haddad, with Tweetbot in particular, I forget which version
01:38:14 ◼ ► of what doesn't really matter. But going from like, tweetbot two to tweetbot three was a paid
01:38:19 ◼ ► upgrade, five bucks or something like that. And what they did was make a bundle that included
01:38:27 ◼ ► tweetbot two and tweetbot three, like so one of the things you'd have to do is make an all new,
01:38:33 ◼ ► effectively SKU, right? It's like a new app. And so to have a paid upgrade that would let
01:38:39 ◼ ► people who didn't want to pay to upgrade keep using tweetbot two on their phones. You could
01:38:46 ◼ ► buy a bundle and the bundle included both and effectively gave you tweetbot three at a cheaper
01:38:59 ◼ ► Tons of people still complained. They got so many complaints. I remember when they did that,
01:39:03 ◼ ► like a real so many complaints. The real point of a bundle is so you could, I know Apple doesn't
01:39:09 ◼ ► charge for them anymore. But if you make a suite of a word processor and a spreadsheet and a
01:39:15 ◼ ► presentation app, and you want to sell all three at less than the price of each one individually,
01:39:22 ◼ ► like Microsoft Office or iWork or whatever, then you can make a bundle and include all of them at
01:39:26 ◼ ► a lower price. It wasn't meant for two versions of the same app. But it was what I'm laughing,
01:39:32 ◼ ► but it was all because they were trying to make their users happy. The users who wanted to get
01:39:38 ◼ ► the upgrade but wanted to pay an upgrade price because they'd already paid for tweetbot two.
01:39:42 ◼ ► And it just is so I hope and I know tweetbot is no longer a thing because the Twitter API
01:39:48 ◼ ► isn't a thing. But, you know, ivory, their Mastodon successor to tweetbot is subscription
01:39:54 ◼ ► only. And I think it's just the only way to go with the App Store. So whatever you think about
01:39:59 ◼ ► what developers should do, if it weren't for the App Store, it's just unrealistic not to take the
01:40:05 ◼ ► App Store for what it is. So what's the pricing for WeatherUp? Well, the pricing is currently $40
01:40:15 ◼ ► a year or $4 a month. I actually took advantage of Apple's new, there's a new thing with App Store
01:40:21 ◼ ► Connect that instead of doing $39.99, you can actually just make it $40. Yeah, right, right.
01:40:28 ◼ ► I just wanted to make it simple. So how so four times 1240. So 48 or 40, right? Yeah. If you pay
01:40:37 ◼ ► monthly, you're paying 48 dithering is current, we're going to raise the prices soon. That's a
01:40:42 ◼ ► spoiler. But it's currently five a month or 58 year. So 10 times the monthly price. So you get
01:40:49 ◼ ► two months free if you subscribe annually instead of whatever. Yeah, that's pretty much exactly what
01:40:54 ◼ ► it is with WeatherUp. Two months free. So what do you think I've my whole life, even as a kid,
01:40:59 ◼ ► I remember being annoyed by the dot 99 trick, because it just seems it's I mean, I even people
01:41:06 ◼ ► who don't obsess over things like design and pricing and stuff. Everybody knows it's a trick,
01:41:12 ◼ ► right? And I mean, the most famous trick of all is the way and I don't even know how again, I'm not a
01:41:17 ◼ ► big fan of government regulation in general, but I kind of feel like it should be. Even as a kid,
01:41:23 ◼ ► I thought how is that legal the way that gasoline is sold with nine tenths of a penny at the end,
01:41:29 ◼ ► not even a penny they sell to the 10th of a penny, just to make it look that much cheaper and get
01:41:35 ◼ ► actually make it that much that much closer to the whole price of a gallon. But you're really going to
01:41:40 ◼ ► do that you're going to take off one 10th of a penny, I mean, which you can't even actually
01:41:45 ◼ ► charge. So what do you think having shipped it at the nice even $4 or $40? Do you think it matters?
01:41:52 ◼ ► Or do you think that's one of those things that everybody does it because everybody does it?
01:41:55 ◼ ► Well, I'm actually doing an AB test right now. I haven't had enough traffic to reach statistical
01:42:02 ◼ ► significance. And so my result I just started the test recently. So if you're listening to this and
01:42:07 ◼ ► download the app, you may half of you will see $40 and a half of you will see $39.99. And I will
01:42:13 ◼ ► report back on Twitter at least as to whether it still works. But my hypothesis in launching at
01:42:21 ◼ ► that just simple $40 price point is that it doesn't work anymore. But we'll we'll see in the data. I
01:42:28 ◼ ► mean, that's a nice thing. The App Store does make it super easy. And then using RevenueCat actually
01:42:36 ◼ ► care yet. I'm I am super keenly interested in the results. So I can't wait to find them. But
01:42:42 ◼ ► well, hopefully this drives some more traffic so we can get to statistical significance. And I'll
01:42:47 ◼ ► share the result. But I am biased. I'm definitely rooting for even numbers to be close to close
01:42:53 ◼ ► enough. And I can't help but think that maybe they work better. I don't know. Because I feel
01:42:58 ◼ ► like it. It definitely makes the math easier, because the only way to really do it is to first
01:43:05 ◼ ► go through mentally a rounding up, right? So if the prices are $39.95 and $3.99, what you do in
01:43:14 ◼ ► your head is call it $4 and call it $48 and or $40. And then do four times 12 is 48. Okay, 48
01:43:25 ◼ ► versus four. So in your head, you're already doing it, right? So why not just remove that step from
01:43:30 ◼ ► the mental process of the user's evaluation of value? That's what I think. So can we and we'll
01:43:37 ◼ ► see if that one logical jump does actually make that big of an impact. So and what's what's the
01:43:44 ◼ ► story for free use of weather app? Whether we because it was we talked about this, like, what,
01:43:52 ◼ ► an hour ago, hour and a half ago, I removed ads from the app, because I was just so fed up with
01:43:59 ◼ ► the ad networks. And with a weather app, I've actually been losing money. So I actually removed
01:44:05 ◼ ► the ads before we launched this 3.0. And so I've been losing money for over a year now, because
01:44:11 ◼ ► every time somebody opens the app, it costs me money. And so to support a free user base,
01:44:18 ◼ ► you have to have some kind of monetization of that for user base. Well, if I hate ads and don't want
01:44:23 ◼ ► the the the ad SDKs in my app, the closed source doing who knows what inside my app. So with this
01:44:29 ◼ ► 3.0 update, I decided to do a hard paywall. And there was other reasoning behind that as well is
01:44:35 ◼ ► that the big exciting new feature for the for the 3.0, or actually the two big exciting new features
01:44:41 ◼ ► for the 3.0 update, or the Apple Watch app, including complications, and the win widgets,
01:44:48 ◼ ► which are interactive, and we can talk a little bit more about it. But guess what's super expensive
01:44:56 ◼ ► to provide as a weather app, complications and widgets, because every 15 minutes or so in the
01:45:02 ◼ ► background at Apple get Apple is actually pretty smart about this, that if it's on a home screen
01:45:08 ◼ ► that you don't access frequently, it will actually update those every 15 minutes. But the one that's
01:45:13 ◼ ► on your home screen, it tries to anticipate when you're going to open your open up your iPhone and
01:45:18 ◼ ► look at your home screen so that the data is fresh. So every 15 minutes to 30 minutes a day,
01:45:25 ◼ ► and then of course, it's not going to do that overnight when your phone's plugged in and
01:45:35 ◼ ► Do you think that you've sort of lucked into the fact that they don't just update all the time?
01:45:42 ◼ ► Or in so far as Apple's thinking is we want to conserve battery life and energy use, because
01:45:49 ◼ ► weather apps are an exception, I think, to most apps in terms of cost. There's much more of a cost
01:45:58 ◼ ► per API call. Whereas, I don't know, I've got sports apps on the mind from Apple Sports, but
01:46:08 ◼ ► other things aren't the developer isn't thinking so much about every single time this thing updates.
01:46:15 ◼ ► And if it's updating on the watch, and it's updating on their widget, there's two different
01:46:21 ◼ ► same user, but those count as different API calls. And you want you made the watch complications for
01:46:27 ◼ ► people to use them, you want people to use them. But do you think that they were thinking in terms
01:46:33 ◼ ► of that or is weather app weather up? I keep saying weather app. And I knew this before we started is
01:46:38 ◼ ► that let me ask you that as an aside, was that part of the naming of the app that it sounds like
01:46:42 ◼ ► weather app? No, it was we were originally called it weather Atlas, because as you've told me in as
01:46:50 ◼ ► you've beta tested the app, you really love how when you launch the app, the maps are prominent,
01:46:55 ◼ ► which again, is actually something very expensive. There's a reason a lot of weather apps hide the
01:46:59 ◼ ► maps, because that's one of the more expensive data calls is for the maps. And so every time
01:47:04 ◼ ► you launch the app, the maps loading costs us a lot of money. Anyway, so that the app was originally
01:47:09 ◼ ► weather Atlas. And then I went through a whole rebranding exercise, it's just tough finding a
01:47:15 ◼ ► name that for ASO, I don't want to name it some random thing that doesn't say weather. And then
01:47:20 ◼ ► just so people understand what it is, it needs to have weather in the title. And so then there's a
01:47:25 ◼ ► million different words you can combine with weather. The one thing I did do, and part of
01:47:31 ◼ ► me regrets up because people do say weather app and weather up. And when you're telling somebody
01:47:38 ◼ ► the name, people hear weather app instead of weather up. So part of me regrets it. But the
01:47:48 ◼ ► And it gives me some flexibility. And I don't know, I like it as a brand name, even if it has
01:47:54 ◼ ► some downsides on saying it out loud, but it's like, what's the weather, like, weather up?
01:48:00 ◼ ► No, I like it overall. And I think most of the time you see it rather than say it. And I think
01:48:26 ◼ ► No, no, no, I mean, it'll probably like hundreds down the weather. Yeah, I don't recommend anybody
01:48:37 ◼ ► Let me stop you there, though. I have a lot of developer friends. And I'm not sure that I know
01:48:42 ◼ ► a single one of them who wouldn't say that for their niche that they would say, Oh, no, don't
01:48:49 ◼ ► get into it. I think Rich Segal would tell people don't build a text editor. Don't do it.
01:49:15 ◼ ► reasons not to do it. But it is a competitive field, right? It is super competitive, right?
01:49:20 ◼ ► Yeah. You're asking if I lucked into Apple not updating as frequently. And I would actually say
01:49:28 ◼ ► that the opposite in some way. I mean, I, we definitely benefit from Apple being careful
01:49:37 ◼ ► and how frequently it updates the widgets and complications. But Brock, my cousin, who's a
01:49:43 ◼ ► developer working on it, he spent a ton of time, months and months working around Apple's
01:49:57 ◼ ► And so I challenge anyone to compare our frequency of update compared to other apps. And I think
01:50:10 ◼ ► updating weather app, because we invested so much time and we put the user experience ahead of our
01:50:15 ◼ ► costs. And that's part of why the app is more expensive than a lot of the weather apps is that
01:50:20 ◼ ► we do a lot of things in the, to create a better experience for users that costs us a lot more
01:50:26 ◼ ► money to deliver it in that way. And for example, one of the features I love about the app is that
01:50:31 ◼ ► you can actually set a widgets data source individually. I have a screen on my home screen.
01:50:43 ◼ ► Aris weather in the middle and Accuweather on the bottom. And so I swipe over to that one screen and
01:50:48 ◼ ► in an instant, I see the three different forecasts, see which one's forecasting rain, which one's not.
01:50:53 ◼ ► They all have the short term dark sky style next hour precipitation forecast. All three of those
01:50:59 ◼ ► come out different every time one says drizzle and in 10 minutes, one says it'll end in 25 minutes.
01:51:08 ◼ ► you sent me a screenshot of your three widgets and they were where you're in Austin, right? Or near
01:51:14 ◼ ► just south of Austin. Yeah. And it was profoundly different. I mean, it was, I think, I think you
01:51:22 ◼ ► probably even thought, cause especially you from your perspective as a developer, you're like,
01:51:25 ◼ ► do we have a bug? Cause I was, how is this possible that it's so different, but so yeah,
01:51:31 ◼ ► you've got three weather sources. I know other weather apps do too, but for people out there,
01:51:35 ◼ ► I don't think they realize this, that whether the weather providers out there, it's very expensive
01:51:52 ◼ ► does that cost money, right? Apple weather is actually the least expensive of, of the three
01:51:58 ◼ ► primary of the three that we use and of, of there are cheaper weather data providers out there than
01:52:04 ◼ ► Apple, but they're generally ones you don't want to use. And, and you can, and some apps just scrape
01:52:10 ◼ ► the national weather service data which you can get for free, but it's, it's not as good as the
01:52:16 ◼ ► proprietary models. Isn't that the act that's the Accuweather scam is that the Accuweather
01:52:21 ◼ ► Accuweather is such a big company that they sort of lobby to keep the free data source from the
01:52:27 ◼ ► national weather service, from sort of competing with them. At least I've read that, that they've
01:52:31 ◼ ► sort of, maybe that was true historically, but I don't, I don't think that's true anymore because
01:52:37 ◼ ► we've looked into it and we can, it's just not as good. My apologies to Accuweather if I've
01:52:44 ◼ ► besmirched you and I do like your forecast. All right. So the first thing people need to know is
01:52:49 ◼ ► if you're going to make a weather app, you are, you have to pay for the data and even, and I think
01:52:54 ◼ ► one of the nice things about Apple weather is that they've got, it's sort of like the DMA thing with
01:53:01 ◼ ► the, the, the service charge for apps where you get a certain number of calls for free.
01:53:09 ◼ ► Right. It's. Not enough to like actually run a weather app and have any level of success,
01:53:18 ◼ ► quickly, but it's at least you can, if you, if you have an idea to add weather on the side to
01:53:23 ◼ ► something, you can experiment with it without and wait to see if it's, if it's popular. Why do you
01:53:29 ◼ ► think Apple got into weather? I mean, they bought dark sky famously and sort of use that as the
01:53:47 ◼ ► DMed you and told you, you should write something about this, but I definitely DMed other folks in
01:53:51 ◼ ► the press when this was announced ages ago. You might've, I don't remember specifically.
01:54:21 ◼ ► essentially forced to use third-party apps because weather apps have notoriously, and there's been
01:54:27 ◼ ► all sorts of news stories, more so back in like the 2018, 2017 timeframe. But there were some
01:54:34 ◼ ► huge stories about weather companies and it's still happening. There's just not stories about
01:54:40 ◼ ► it. And then AT and ATT kind of lessen the impact of it, but most third part, not it's hard to say
01:54:47 ◼ ► most, but a lot of third-party weather apps sell user location data. And then even the weather
01:54:53 ◼ ► channel got bought by IBM and IBM was aggregating data acquired through the weather channel app and
01:55:05 ◼ ► selling to hedge funds and other businesses through their proprietary big data warehouse
01:55:11 ◼ ► kind of stuff. And so what was happening for a long time and ATT has minimized the impact because
01:55:18 ◼ ► it's can't be as directly tied to individual users, but it can still be tied to an IP address,
01:55:24 ◼ ► which your home address doesn't change. When you're out and about, you may maintain the
01:55:29 ◼ ► same IP address for a certain amount of time or whatever. And so there's a lot of shady stuff
01:55:35 ◼ ► still going on to this day, but I think Apple, at least in part, made that decision because of that.
01:55:42 ◼ ► And so one of the things we do in Weather Up, even though I don't think it's as necessary today as it
01:55:48 ◼ ► has been in the past, but there's actually two layers that we implemented to protect user data
01:55:56 ◼ ► even more so. So in the Weather app itself, we don't pass the full significant weather location,
01:56:06 ◼ ► latitude and longitude to the server. We actually lop off quite a few significant digits so that
01:56:12 ◼ ► it's essentially giving you the weather of your block, not giving you the weather of your actual
01:56:25 ◼ ► third-party service. And we don't know what those third-party services do or don't do with data. So
01:56:31 ◼ ► at least we're passing them your immediate block or two area. And realistically, your forecast is
01:56:39 ◼ ► not going to vary. People like to think that weather forecasting is that sophisticated,
01:56:44 ◼ ► that they're going to forecast for your house and not a block away. But we looked at the level
01:56:49 ◼ ► of precision and lop off enough significant digits where you're close enough where you're getting the
01:57:08 ◼ ► where the IP address still matters when a weather app is... If a weather app is selling your data,
01:57:24 ◼ ► your IP address. And so now all sorts of data brokers have your IP address associated with the
01:57:30 ◼ ► exact like you sitting in your home office or whatever level of precision of your location.
01:57:45 ◼ ► all of the queries through our own server so that the IP address that is sent, even with that
01:57:52 ◼ ► latitude and longitude that's not identifying your house, we still send that from our server
01:57:58 ◼ ► to the third party servers instead of sending it directly. So yeah, we created... And funny enough,
01:58:04 ◼ ► I mean, we were working on this stuff. We've been doing this in the app for four or five years now.
01:58:09 ◼ ► So even when ATT wasn't in effect and when there was more shady stuff going on, we'd already started
01:58:15 ◼ ► doing this. But I think that's ultimately why Apple did it. I mean, there's probably other reasons.
01:58:21 ◼ ► They are building out. I've been surprised we have not yet seen Apple Weather Plus where they
01:58:27 ◼ ► start charging for additional features. We've seen them coming out with more and more. Apple Fitness
01:58:33 ◼ ► is a subscription, Apple Arcade. They're going more and more in these directions. And so I kind
01:58:38 ◼ ► of expected it to be that, to be something that they put in the Apple One bundle or charge for
01:58:43 ◼ ► independently. So I'm kind of surprised they didn't do that. But when you look at the privacy
01:58:50 ◼ ► angle, I think it makes a lot of sense. Because not only are they able to provide the default
01:58:56 ◼ ► weather app, which is genuinely quite good these days, to enough users who aren't going to go seek
01:59:03 ◼ ► out these third-party weather apps, but they're also now able to provide data to developers like
01:59:09 ◼ ► me so that I'm not sending latitude, longitude, and IP address to these third-party services.
01:59:16 ◼ ► And so from a privacy angle, I think it makes a ton of sense. And I don't know that they ever
01:59:26 ◼ ► the motivation. But I can't help personally think that that was part of the motivation for them
01:59:32 ◼ ► doing it. I think so too, that the privacy angle was a big part of it. Because the one thing,
01:59:38 ◼ ► it's as a user, when you think of a weather app, you're very obviously thinking about weather,
01:59:44 ◼ ► right? And you might have different reasons. That's why there's, I love talking about Twitter
01:59:50 ◼ ► clients and Twitter-like clients like Mastodon threads and everything as a playground for user
01:59:56 ◼ ► interface experimentation. And we're definitely seeing it all over again with the explosion,
02:00:01 ◼ ► with the transfer of nerds from Twitter to Mastodon, and the way that Mastodon is totally
02:00:07 ◼ ► open. There are just a slew of really interesting, really great clients for it that are all different
02:00:15 ◼ ► from each other, right? There's reasons to one for another. And weather apps, I think are even
02:00:20 ◼ ► more of a playground in terms of just how different they look when you first open them.
02:00:27 ◼ ► I mean, you know this better than me even, but it's funny because I'm looking at the top charts
02:00:31 ◼ ► for the weather category and it shows how popular weather is that there's an entire category just
02:00:36 ◼ ► for it. And it's hilarious how many of them for me, instead of a get button, it's the cloud with
02:00:42 ◼ ► a download arrow because I've already tried so many of them. But I do think, I thought so too,
02:00:49 ◼ ► because what is the, you're thinking as a user, I want weather and maybe I want precipitation.
02:00:55 ◼ ► That was Dark Sky's claim to fame originally. I want to get alerts depending on where you live
02:01:00 ◼ ► and how suddenly rain might pop up. It could be literally not life changing, but daily habit
02:01:07 ◼ ► changing to be able to plan it. Or maybe you live somewhere like the desert and you hardly ever get
02:01:12 ◼ ► precipitation. So who cares? Maybe you travel a lot. And so being able to check the weather
02:01:17 ◼ ► in multiple locations is your big thing and you don't want to do a lot of taps, blah, blah, blah.
02:01:22 ◼ ► The one thing all weather haps have in common is they all get location access because it's,
02:01:29 ◼ ► however many people there are who are so privacy sensitive that they don't even let their weather
02:01:36 ◼ ► app know their location. I mean, it's got to be like 1%. I mean, because it's the whole point is
02:01:42 ◼ ► you want the weather where you are, wherever else you might be interested in, you're probably
02:01:46 ◼ ► interested in where it is. Very few apps get location access because most apps it would make
02:01:52 ◼ ► no sense, right? And games try it like games that have scammy monetization on the back end. But if
02:01:59 ◼ ► you download a game and the game says, and it's not like a Pokemon hunt game where you know that
02:02:04 ◼ ► you want it to have your location. If you're just playing a game where you tap things on the screen
02:02:08 ◼ ► and it says this app would like your location, you're like, what the fuck? What? It seems like
02:02:13 ◼ ► a scam. With a weather app, it's the most natural thing in the world. The only thing that's more
02:02:18 ◼ ► likely to get location access is a mapping app. And maps, I think, I mean, although there are lots
02:02:25 ◼ ► and lots of specialty map apps, I know, I think it was ATP was talking about the couple months ago
02:02:32 ◼ ► when Marco had to rent a truck, there's like a specialty app for truck drivers. It takes roots.
02:02:38 ◼ ► - Yeah, no, no, no. A friend of mine has a RV app and he explained to me in detail just how
02:02:45 ◼ ► valuable it is because you plug in how tall your RV app is. You plug in what voltage you need when
02:02:52 ◼ ► you arrive at a place and it guides you to not take the top off of your RV. - Right. Either take
02:02:59 ◼ ► the top off on a low underpass or like in New York state in particular just has a lot of, I think
02:03:06 ◼ ► they're usually the throughways and it's all that weird naming where there's highways and throughways,
02:03:12 ◼ ► but like a lot of throughways in New York are just no trucks allowed, right? You don't want to get a
02:03:16 ◼ ► ticket for driving. Even if it has nothing to do with fitting on an underpass, you want directions
02:03:22 ◼ ► for that. So I know there are specialty map apps, but for the most consumers, they really are just
02:03:28 ◼ ► using like the big name apps, right? Apple maps, Google maps, Waze, and whatever else. But weather,
02:03:33 ◼ ► there's a lot more diversity, but they all have location data and there's a lot of scammy ways to
02:03:39 ◼ ► monetize location data. - Yeah. And then not only is it that they get your location access,
02:03:49 ◼ ► they actually get it frequently. So if you're going to do a weather widget, it's going to update
02:03:56 ◼ ► every 15 minutes. So they're going to get your IP address and your exact location every 15 minutes.
02:04:11 ◼ ► it is pinging their servers maybe even more than every 15 minutes with your exact location and IP
02:04:18 ◼ ► address. So yeah, it's a perfect playground for privacy violation. - And I think, well,
02:04:25 ◼ ► like you mentioned ATT before, App Tracking Transparency, I think it was definitely played
02:04:30 ◼ ► a big way into the pre-App Tracking Transparency world, which it still happens, still happens today.
02:04:36 ◼ ► But I do think ATT stopped this to some degree, the spookiness of getting an ad in some other app,
02:04:44 ◼ ► I don't know, a game. You're playing a game that shows apps or ads and the ad is for a restaurant
02:04:49 ◼ ► two blocks away for you. That's weird. You're like, what? That's crazy. I never gave this app
02:04:54 ◼ ► my location data. And yet it knows something like to send you to a local Philadelphia area store or
02:05:00 ◼ ► restaurant or whatever it would be for wherever you live. I definitely think that's why Apple
02:05:04 ◼ ► got into it for one reason. And I think the other obvious reason is to control their own destiny
02:05:09 ◼ ► with their own weather app, which they clearly had a, I'm sure, and again, you know it better
02:05:15 ◼ ► than I do, a sort of, hey, let's get serious about the built-in weather app, which went from
02:05:28 ◼ ► like the skeuomorphic years before iOS 7, the weather app was really more of a widget. It was
02:05:34 ◼ ► sort of a one-page panel of the day's highlights, like a full-screen widget. And now it's much
02:05:41 ◼ ► richer. But that brings up the, it's sort of like Sherlocking, but the Sherlock was there from the
02:05:49 ◼ ► beginning, right? But how, and Notes apps have to face that, right? But weather is, calculator apps
02:05:56 ◼ ► have to face it. But anybody who wants to get in a weather game, and there's obviously, I'm looking
02:06:01 ◼ ► at the top charts here, there are an awful lot of weather apps, but they all have to compete with
02:06:10 ◼ ► Well, so weather up and then weather outlets before it weren't even my first weather apps.
02:06:17 ◼ ► So my first weather app was Perfect Weather. I think I launched that in 2011. So I've been
02:06:22 ◼ ► building weather apps for 13 years now. And when it keeps coming back, like the reason I keep
02:06:27 ◼ ► working on it is just that as good as the Apple weather app is, everybody makes very specific
02:06:35 ◼ ► choices on how they design their app and what features they expose, what features they don't.
02:06:40 ◼ ► And living here in the Austin, Texas area, radar is super important for most of the year,
02:06:54 ◼ ► even with Perfect Weather, one of the kind of key design features was that radar and the map
02:07:00 ◼ ► was going to be a primary component of the app. And still to this day, and again, like you and
02:07:06 ◼ ► I've discussed, like when launching the app and immediately seeing the map is more expensive for
02:07:13 ◼ ► us to provide as a weather app. And that's why so many apps, unless it's a radar specific app,
02:07:19 ◼ ► most regular weather apps in Apple's weather app specifically, they're not doing it on a cost
02:07:25 ◼ ► basis. They're from California where the radar doesn't matter. That's a whole nother tangent
02:07:31 ◼ ► about Apple building a weather app when they don't have weather in Cupertino for the most part.
02:07:36 ◼ ► Last couple of months, notwithstanding. But yeah, so I mean, it's just, it's been a playground for
02:07:42 ◼ ► me to build the weather app that I want essentially, and that I think enough people out there
02:07:47 ◼ ► want. And then that's where like the new widgets came in is that when Apple announced the widgets
02:07:53 ◼ ► and they shipped their widget for their weather app, it's fine, but it's not very information
02:08:03 ◼ ► dense. It doesn't tell you a lot of what's going on. You launch the app and you got to dig through
02:08:07 ◼ ► the app to get to the maps. And so we thought we could build something interesting in the space
02:08:15 ◼ ► that aligned more with what I wanted to see of the weather in an instant. And I will credit to
02:08:23 ◼ ► Ben Baharin. I forget the name of his creative strategy, something like that. You've known him
02:08:27 ◼ ► from the Apple press core. He's not press, but he's an analyst and goes to all the events and
02:08:33 ◼ ► stuff. He's been a weather app user for a long time. And when we were starting to explore building
02:08:40 ◼ ► an Apple watch app, I asked him like, what would you want in an Apple watch app? And he said,
02:08:45 ◼ ► I want to, I want a weatherman on my wrist. And after he said that, it struck me as rather
02:08:52 ◼ ► profound. And then we spent months thinking about that. What does a weather man on your wrist
02:08:56 ◼ ► actually mean? And what we kind of came to was this idea that most weather apps display the
02:09:03 ◼ ► weather as, as a table. It's Monday at 10 AM, it's going to be 89 degrees. Monday at 11 AM,
02:09:10 ◼ ► it's going to be 90 degrees. Monday at noon, it's going to be whatever. And to get to what
02:09:15 ◼ ► you're looking for requires a lot of scanning, a lot of like deciphering of the information.
02:09:20 ◼ ► And what does a weatherman do, weather person do on a newscast? They tell you what matters.
02:09:26 ◼ ► And so what we tried to do initially within the bounds of a complication, but then got to really
02:09:33 ◼ ► spread our wings with widgets once iOS, what was that? 15 shipped is to as succinctly as possible,
02:09:44 ◼ ► show as much as possible, but show what's most important. And so it's kind of hard to describe
02:09:50 ◼ ► in a podcast, but the display is a temperature line that goes up and down and you see three to
02:10:00 ◼ ► four days of forecast. And what do you see? Most times you're seeing the high and the low, which
02:10:05 ◼ ► is what you care more about. The temperature line is actually color coded. So if it's green,
02:10:10 ◼ ► it's comfortable. If it's blue, it's cold. If it's red, it's hot. And then all the kind of
02:10:15 ◼ ► gradient in between. So at a glance, you see what the general temperatures are going to be,
02:10:20 ◼ ► what the high and low is going to be. Then if it's going to rain, we have the rain precipitation
02:10:26 ◼ ► forecast behind that line as blue bars. So I turn my wrist up and or open my home screen. And in an
02:10:32 ◼ ► instant I see whether it's going to rain in the next three days or not. There's no like thinking
02:10:37 ◼ ► and looking at percentage numbers and everything else like that. It's just like more blue
02:10:41 ◼ ► means more potential rain, less, no blue means it's not forecasted to rain at all in the next
02:10:46 ◼ ► three days. And you just are able to understand that in an instant by looking at it. And then
02:10:51 ◼ ► if it's currently raining, what do you want to know about? You want to know about the current
02:10:54 ◼ ► rain. And so we don't take up extra space in the widget having this like blank space saying it's
02:11:01 ◼ ► not raining, but when it is raining, we'll do that next hour, short term, like dark sky style
02:11:07 ◼ ► forecast of what the precipitation is going to look like over the next hour. And we kind of push
02:11:12 ◼ ► in time. The first hour kind of expands out to show that that next hour of rain. And so,
02:11:21 ◼ ► yeah, I mean, I'm rather partial to it myself having created it, but I love that I can just
02:11:27 ◼ ► flip my wrist over or look at my home screen and kind of instantly know what's going on,
02:11:31 ◼ ► whether it's raining now or going to rain, what the temperatures are like, what the highs and
02:11:35 ◼ ► lows are going to be over the next few days. Yeah, I'll try to get this in as the album art for this
02:11:40 ◼ ► chapter. But I realized that this discussion, this particular one would work better on YouTube,
02:11:46 ◼ ► or we could show a couple of slides, but hopefully right now, as we're talking, the chapter art is the
02:11:52 ◼ ► widget for weather up. And then the problem with showing it even as a chapter is that with iOS 17,
02:11:59 ◼ ► we were able to do interactive widgets, and that's been a ton of fun to experiment with. And so the
02:12:04 ◼ ► real thing is a YouTube video because it's super interactive now. It's fundamental to the design.
02:12:12 ◼ ► And the one I use is the sort of full width, I forget what you call it, probably medium size.
02:12:39 ◼ ► because when I came down here to my podcast cave, when we started, it was actually a nice,
02:12:47 ◼ ► and I saw that the map had a big green thing over the city, I was like, what the hell? And then so
02:12:52 ◼ ► it turns out I didn't know it was raining. Didn't look like rain earlier. But yeah, because it's
02:12:57 ◼ ► drizzling for the next hour here. It starts with next hour, and it's a quadrant. Then it says
02:13:04 ◼ ► Wednesday the 28th, Thursday the 29th, Friday the 1st. And I get a three-day forecast ahead. And I
02:13:09 ◼ ► can see- Yeah, I might as well take a screenshot because mine's actually a pretty good example of
02:13:14 ◼ ► everything you're talking about. But I've got drizzle for the next hour in Philadelphia. Lots
02:13:19 ◼ ► of rain tomorrow. It's like a 93% chance of rain. And I can see the bars of where it's going to
02:13:25 ◼ ► happen, right? Each bar is an hour. It's going to- Looks like it's going to be a miserable- Well,
02:13:30 ◼ ► 62, which is warm for February. And then it's going to get cold but dry on Thursday and Friday.
02:13:36 ◼ ► Well, that's great. But with big swings. And I can see the colors. It's going down to 29 degrees
02:13:41 ◼ ► overnight Thursday, but then it's going to go up to 51 midday on Friday. And I see all of this
02:13:47 ◼ ► in one panel. And it's very information-dense, but also very clear and very easy to parse and scan.
02:14:04 ◼ ► is I can tap right here on the widget. I can tap next hour. And it expands the whole widget to show
02:14:12 ◼ ► the next hour in detail. And then just tap again to go back to the overview. And I could tap on
02:14:18 ◼ ► Wednesday. And it just shows me Wednesday. And it just expands the whole widget to show the whole
02:14:24 ◼ ► day's forecast on Wednesday. Right in the widget. I didn't open the app. I didn't leave my lock
02:14:30 ◼ ► screen or the whatever you call the first home screen, the zero home screen where you can stack
02:14:35 ◼ ► your widgets. Really, really. And then just tap to go back. And if I do want to launch the app,
02:14:41 ◼ ► I can just tap at the bottom and it launches the app, which is- And the app is a very- It doesn't
02:14:47 ◼ ► look like it's not the same brand, but it's a totally different presentation. And I get it
02:14:53 ◼ ► because what's the point if the app just shows the same thing as the widget? I would say it's
02:15:00 ◼ ► very fair to describe it as a widget first design overall. Yeah. And we want to make the widget
02:15:08 ◼ ► experience an option in the app. We just decided to prioritize making a great widget first.
02:15:20 ◼ ► that an option eventually. But like you said, it's like if you already looked at the widget,
02:15:25 ◼ ► you're probably not wanting to just see the same thing. And so in the app, the way the weather is
02:15:31 ◼ ► displayed is that kind of more standard weather app where it's just like a line of numbers,
02:15:36 ◼ ► which has its place. I mean, in some ways I do actually sometimes like seeing it a different way.
02:15:42 ◼ ► So when I'm looking at the widget and then I open the app and I see essentially the same
02:15:46 ◼ ► information, but presented differently, you process it differently. And so in some ways
02:15:52 ◼ ► it is nice to have both, but we'll probably make it an option in the future to make the
02:15:56 ◼ ► app itself look more like the widget. Well, it's good as it is. And then also on the widget,
02:16:01 ◼ ► at the bottom right, there's a right arrow that if I can want more days, I can just get more days.
02:16:15 ◼ ► I forget how many releases it was where there were widgets, but they, all you could do is you
02:16:21 ◼ ► tap the widget, it opens the app and there's no interactivity at all. And it's a battery saving,
02:16:25 ◼ ► right? And they don't want effectively to have these apps running all the time because it would
02:16:32 ◼ ► drain the battery. And so they've, however, however much hair developers have pulled out
02:16:57 ◼ ► And it's complicated enough that you can understand why it took them a couple of years to get there.
02:17:03 ◼ ► But this, these widgets are so fundamentally different than they would be as static widgets.
02:17:13 ◼ ► a whole weather app right there in the widget. A simplistic one that fits in a very small area,
02:17:19 ◼ ► but with the information density gives you everything you need to know. And from, to me,
02:17:25 ◼ ► the big ones are precipitation, very obvious presentation, temperatures, which are on a graph
02:17:30 ◼ ► and have numbers marking the highs and lows. And then the little icons to show you the,
02:17:35 ◼ ► is it going to be sunny? Is it going to be cloudy? What's what's the cloud cover going to be like?
02:17:51 ◼ ► we spent years and thousands of iterations of refining, refining, refining to get to this
02:17:58 ◼ ► exact presentation that I think is a really nice refined view that's information dense,
02:18:06 ◼ ► but still visually appealing and not cluttered. And I I'm really proud of the work we did on this.
02:18:17 ◼ ► Well, it's both at once is that I think you need to be prepared for your widget to be ripped off.
02:18:24 ◼ ► Yeah. Because the good news of that is that it's clever and original and incredibly useful.
02:18:31 ◼ ► And that's very flattering to your design work and the, like you said, the iterations it takes
02:18:36 ◼ ► to get there. Just the grind of doing thousands of iterations to wind up with this thing that seems
02:18:42 ◼ ► totally obvious. But the bad news is it's, I think that's, it's going to be a copy because it is.
02:18:49 ◼ ► And then whenever people go, it's not, I just good ideas are out there to be shared. Right. And they,
02:18:55 ◼ ► and, and they, they flow, but the, it, you, the best designs in anything end up seeming so obvious
02:19:05 ◼ ► that people think, well, of course that's how it is because how else would it be? Right. Of course,
02:19:11 ◼ ► all phones today are just slabs of glass with a touchscreen because anything else would be stupid.
02:19:16 ◼ ► So they all of course look like iPhones, but the iPhone didn't look like any phone before it.
02:19:21 ◼ ► Yeah. And if you're, if you haven't ever been a, if you haven't ever done that, where you've done
02:19:28 ◼ ► the iteration and iteration and grunt work to, to build something like that, I think the weight of
02:19:38 ◼ ► things getting ripped off hits different than when you've actually experienced that. Cause I've, I've
02:19:44 ◼ ► had that with other apps that we spent months and years of building this thing and then, oh,
02:19:50 ◼ ► it's so obvious. And then people just rip it off and, and it feels like theft, IP theft in, in,
02:19:59 ◼ ► in, in a way that's why copyrights exist. That's why patents exist because you want to have like
02:20:05 ◼ ► some incentive to go through all of that work to refine and build something useful. And you
02:20:12 ◼ ► want to have some level of protection at a societal level to protect that. But some things just aren't
02:20:19 ◼ ► really copyrightable and aren't really patentable and I'm not going to go file a patent on it,
02:20:35 ◼ ► they really get it. Let's hope. Yeah. I don't want to, I didn't want to turn this into a downer.
02:20:41 ◼ ► It's supposed to be. No, no, no. I mean, it's a fascinating topic though about, yeah, about what,
02:20:46 ◼ ► what is ripping off? And I've actually written about this and, and you know, one of the, one of
02:20:50 ◼ ► the things I, I wrote about was when Steve Jobs said and used the quote about stealing and great
02:20:57 ◼ ► artists and it's actually, I'm totally botching it, but it was, it was actually like a English
02:21:03 ◼ ► poet or something who said great artists steal. And in the essence of that though, in my mind,
02:21:11 ◼ ► good artists copy great artists. There you go. Thank you. And the essence of that in my mind is
02:21:17 ◼ ► that the steal part connotates that you make it your own, not that you like rip something off.
02:21:27 ◼ ► It's that the people who, who borrow and have the good taste to make it something better,
02:21:33 ◼ ► make it something unique to add to it. That's fair. If somebody takes some of the ideas
02:21:39 ◼ ► and some of the design work that I spent hundreds of hours and, and years of my life on, if they
02:21:46 ◼ ► take aspects of that and, and do their own thing, more power to you. If you take 90% of what I did
02:21:54 ◼ ► and just tweak a couple of things and call it your own, that's, that's bullshit. That is, that is,
02:22:00 ◼ ► that's just stealing from me. And that's where I kind of draw the line intellectually was like,
02:22:09 ◼ ► but have the good taste to actually remix it. Don't just do the same thing. For example, I mean,
02:22:16 ◼ ► and we backed into it looking somewhat like weather line in that, you know, Ryan Jones,
02:22:22 ◼ ► he's actually a friend. He lives here in Austin. We hang out and I've known him for years.
02:22:34 ◼ ► weather icon on a line and that's why he called it weather line. And it was a great app eventually
02:22:39 ◼ ► got bought and closed down. And so you could say we quote unquote borrowed from weather line
02:22:46 ◼ ► in putting those on the line. Now the true story of it all was that we, we were the original mocks
02:22:51 ◼ ► up was had it not on the line. And then because the Apple watch complication was so small and
02:22:57 ◼ ► that's what we were designing for. We put it on the line and it was only after that, that I was
02:23:02 ◼ ► like, Oh crap, we just like replicated weather line. And it is different from weather line.
02:23:07 ◼ ► Cause he had the high temperature on one line and the low temperature on the other line. And
02:23:11 ◼ ► that always kind of broke my brain because it's actually one continuous line. And that's what we
02:23:15 ◼ ► ended up doing is that the high goes up and then the low goes down and the high goes up because it
02:23:21 ◼ ► is actually one line in a chart for the temperature going up and down. But anyways, you can look at
02:23:27 ◼ ► weather line and look at weather up and see some vague similarities in that we put the icon on the
02:23:33 ◼ ► line, but it does not look in any way like weather line. Like we did a lot of. Interesting and
02:23:38 ◼ ► innovative stuff again, whether or not that that could be viewed as borrowing from him or not.
02:23:46 ◼ ► developer community where I think sometimes people kind of steal with a little too much
02:24:09 ◼ ► But I think that's, again, I think that's best done when you take inspiration, but then actually
02:24:15 ◼ ► add a ton of value yourself versus like mostly just ripping somebody else off. And that's what
02:24:20 ◼ ► I would be. If I do get ripped off, that's what I'd be most pissed off about is not if somebody
02:24:25 ◼ ► kind of has a good taste to make it their own is that if, if it just pretty much ripped off
02:24:31 ◼ ► everything I worked so hard on. I think it's a confounding quote on the surface. I think that's
02:24:36 ◼ ► what makes it so interesting that good artists copy great artists steal because steel sounds
02:24:42 ◼ ► like a worse crime than copy. Right? Like steel sounds like that's the real crime, but the meaning
02:24:48 ◼ ► of it. Well, why would that be the great artists? Right. And it's exactly, you expressed it very
02:25:00 ◼ ► examples of that are like an app that literally tries to be a clone. When, and take a name that
02:25:07 ◼ ► sounds similar, spell it weather up with two P's. I don't know, weather down, call it weather down.
02:25:14 ◼ ► And, and it just looks like the app it's at a glance it's side by side, right? It's it famously,
02:25:22 ◼ ► if you squint and it looks like the same app, you've probably just ripped them off. Right.
02:25:26 ◼ ► If you can't tell if you have to squint to see the difference. Yeah, it's probably too much.
02:25:30 ◼ ► So it's, and it's interesting that I can think of a couple of examples. Like I remember
02:25:37 ◼ ► in the nineties, there was a big controversy that erupted that Quentin Tarantino's Reservoir Dogs
02:25:44 ◼ ► was supposedly just a blatant copy of a Hong Kong action movie called City on Fire. And it
02:25:52 ◼ ► instantly, I loved Reservoir Dogs. It was like one, it was like a bolt of lightning was like,
02:25:57 ◼ ► I'd never seen a movie like this, or it was so seemed so original in so many ways. And then to
02:26:02 ◼ ► see that there's this controversy that it was just a blatant ripoff of a Hong Kong movie.
02:26:11 ◼ ► we had like a hard time getting the tape at the video store because other people were doing the
02:26:16 ◼ ► same. And then we rented it and it was a great movie. And I'd seen other Hong Kong action movies,
02:26:28 ◼ ► there were gangsters who all wore black suits and there were like a couple of things like that,
02:26:33 ◼ ► but they weren't, it wasn't the same. It was a totally different movie. It's a great movie.
02:26:37 ◼ ► Anybody out there who's looking for a subtitled Hong Kong gangster action movie, go rent City on
02:26:43 ◼ ► Fire. It's fricking great, but it's not Reservoir Dogs, right? That's a steal. He stole, oh man,
02:26:51 ◼ ► those guys in the dark suits were so cool. I'll just copy that. And Tarantino was, his reaction
02:26:56 ◼ ► to it too is like telling people like, oh man, I've told everybody in the world to watch City
02:27:04 ◼ ► It was like the accusation was that because it was a Hong Kong movie with subtitles that Quentin
02:27:09 ◼ ► Tarantino thought no one in America had seen it, but it's exactly the sort of film that Quentin
02:27:13 ◼ ► Tarantino has spent like before he made Reservoir Dogs when he worked in a video store, was telling
02:27:19 ◼ ► people rent this movie. He, you know, that's stealing, not copying, right? And same thing
02:27:25 ◼ ► with Star Wars and the Kurosawa's Hidden Fortress, right? Where it's, I don't know, there's a princess
02:27:32 ◼ ► and a couple of young guys with weapons and they've got to get into a fortress and it's the
02:27:38 ◼ ► Death Star. And it's, but you watch, it's not like Kurosawa is an obscure filmmaker. He's revered as
02:27:45 ◼ ► one of the great filmmakers of all time. George Lucas, again, like Tarantino would tell people,
02:27:50 ◼ ► yeah, you should go, if you should go find every single Kurosawa movie that's ever been made and
02:27:55 ◼ ► watch them every night for the next two weeks, go watch them. That's not a rip off. And then
02:28:00 ◼ ► on conversely, the biggest, to me, perhaps the biggest mistake Apple ever made ever, and it not
02:28:08 ◼ ► so much that the lawsuit and losing it sunk them, but it just exemplified how the company's
02:28:15 ◼ ► leadership went wrong was when under John Sculley, they sued Microsoft in the famous look and feel
02:28:26 ◼ ► and they spent years litigating, trying to sue Microsoft for copying the Mac with windows.
02:28:33 ◼ ► And effectively they were trying to say that they, Apple should own the concept of the WIMP
02:28:43 ◼ ► interface, windows, icons, a mouse pointer, and that you move a little arrow around the screen
02:28:49 ◼ ► and you have rectangular windows and menus and buttons. And it's like, which way are you going
02:28:56 ◼ ► to have it though? Like the problem with that lawsuit is, was the Mac better designed and way
02:29:01 ◼ ► more, way more elegant than windows or were they the same thing? Right. And Apple on the one hand
02:29:07 ◼ ► was saying the Mac is way better than windows and windows is kind of gross. And especially windows
02:29:14 ◼ ► two and three before windows 95, but even with windows 95, the whole point should have been
02:29:20 ◼ ► we're better, right? We're the whole point of Apple is to make the best computers and to waste
02:29:25 ◼ ► years of the executive's attention on this lawsuit with the goal being to, if they had won somehow
02:29:34 ◼ ► keep Microsoft from shipping a graphical user interface into what stick with DOS forever. And
02:29:41 ◼ ► that's the way it should be. I mean, obviously that was goofy. It just showed that they had the
02:29:45 ◼ ► wrong idea and they were worried that Microsoft had stolen their ideas and gone in their own way.
02:29:51 ◼ ► Right. There was no confusion over whether you were using windows or a Mac, right? If they had
02:29:56 ◼ ► made windows such that you looked at it and it looked just like the Mac and use similar fonts and
02:30:06 ◼ ► you know, it just exemplified that Apple had lost the way we, and the way is to just keep moving
02:30:13 ◼ ► forward and making awesome products that are better than the competition. Right. Yeah. But
02:30:18 ◼ ► as a maker, I empathize with the desire to protect all the work that went into that. And then folks
02:30:26 ◼ ► will, will be shouting into their, into the abyss, listening to this podcast saying, well, Apple
02:30:32 ◼ ► ripped off wimp from Xerox park. And, and, and that's a whole nother thing where, and that actually
02:30:44 ◼ ► stole it in, in that stealing sense that like they had the time and good taste to make it something
02:30:53 ◼ ► way more, way better, way different than what Steve jobs saw at Xerox park. They did not
02:31:06 ◼ ► They also licensed it on partners. So they actually got like a life that's true. They were
02:31:13 ◼ ► given a tour and told, yeah, take all the, you know, we're here to make ideas, take all the
02:31:17 ◼ ► ideas you want. So even if you do think it was a blatant rip off that they should be ashamed of,
02:31:21 ◼ ► they did license it. But be right. It is always the knee jerk reaction to those accusations about
02:31:27 ◼ ► Apple that Apple ripped off the Mac from park. But if you've ever tried to use that, and I know you
02:31:31 ◼ ► can't actually get, I don't know, a PDP 11 or whatever the hell machine you needed to run their
02:31:36 ◼ ► software, but those, whatever those machines were, you can't get the hardware. But if you've ever
02:31:40 ◼ ► watched, go to YouTube and watch the park system in action, it's inscrutable. It is, it is graphical
02:31:48 ◼ ► and there is a mouse that you move around, but it's got like four buttons and it's not clear at
02:31:53 ◼ ► all, which, you know, it's not like, Oh, main button and then contextual menu button, like two
02:31:58 ◼ ► button mice today. It was like, I don't know, the select button, like you needed to use a select
02:32:04 ◼ ► button to select text and very, very confusing in a way it, anybody familiar with the Mac
02:32:10 ◼ ► would never be able to sit down in front of the park system and use it way different. Not,
02:32:18 ◼ ► and they might be like, Oh, this is weird. This is weird. That looks ugly. These icons are terrible.
02:32:23 ◼ ► The whole thing is kind of ugly in the windows three era, but you you'd find your way around
02:32:27 ◼ ► the park system. You wouldn't even find your way around. You really needed to read the manual,
02:32:31 ◼ ► but, and one more point on that, this crazy tangent we've gone on is that I think your kind
02:32:37 ◼ ► of comments about windows exemplifies as well, that they did copy. They didn't steal in that it
02:32:45 ◼ ► looks so familiar, but the, but to me, the essence of, of stealing, since we're, we're going really
02:32:58 ◼ ► you spend the time to really understand what's going on because if you're going to make it your
02:33:04 ◼ ► own, if you're going to add value, you have to, if you're just going to copy, you copy.
02:33:09 ◼ ► And then windows three, one, I mean, windows three and then three, one, and like windows for a long
02:33:14 ◼ ► time sucked. So they copied it, but they didn't, they didn't understand. Well, no, I would say they
02:33:18 ◼ ► stole it. I'd say they stole it, but they stole it poorly. No, I mean it because a copy to me is
02:33:28 ◼ ► a clone. A copy is, Oh, it's exactly like the Mac. There's a trash somewhere on the spectrum.
02:33:44 ◼ ► on that spectrum of copying enough that they didn't under really understand like the fact
02:33:50 ◼ ► that Apple pioneered the graphical user interface and the way they did you, and this is where like,
02:33:58 ◼ ► I understand the design choices and all the different iterations that we tried that didn't
02:34:05 ◼ ► work that led us to this current design of weather up in the, the person who just copies that doesn't
02:34:12 ◼ ► have that experience. And they won't have the taste moving forward to, to, to have that depth
02:34:19 ◼ ► of what does work and doesn't work and why it works because they didn't do those thousands
02:34:23 ◼ ► of iterations. And so for however much windows did in some ways steal and make it their own,
02:34:28 ◼ ► I think they fall further toward the copying side of the spectrum because they didn't have that
02:34:36 ◼ ► depth. And it showed, I guess you could say they just didn't have the taste period. I said that
02:34:43 ◼ ► many times, but they didn't have the good taste both in evolving it into the place where it was.
02:34:49 ◼ ► And they didn't have the context of why the Mac was what it was. Right. And then the other,
02:34:53 ◼ ► just while we're on this, I think I put this out there before, but to me, the other damning thing
02:34:58 ◼ ► about the Apple leadership from 90 to 95, and it's, it's tied right in with the look and feel
02:35:03 ◼ ► lawsuit where they decided to use lawyers to try to keep the Mac as the preeminent GUI, as opposed
02:35:10 ◼ ► to using designers and engineers to make the Mac even better. Right. And it sounds a little
02:35:16 ◼ ► superficial, but it mattered at the time. It was a very big deal. If you were into computers that
02:35:22 ◼ ► in the nineties and you know, in the Mac went from black and white to color and color just became
02:35:27 ◼ ► even on PCs, like one of the reasons windows three was so ugly, it was, it was designed to work on
02:35:32 ◼ ► computers that could only show 16 colors at a time. And then as it became 256 was actually kind of
02:35:39 ◼ ► magic, but once you got to like 256 colors on screen at a time, let alone, if you could get to
02:35:45 ◼ ► thousands, you could make things that looked 3d and you could make, you know, use little shading
02:35:50 ◼ ► tricks to make the windows look like they had depth and make the buttons actually look like they
02:35:55 ◼ ► pressed and went in. And that was really, it just seemed cool. And it seemed like the way things
02:36:00 ◼ ► ought to be. And it informed two decades of user interface design of making things look 3d and
02:36:07 ◼ ► textured and depth and cool. And meanwhile, Mac system seven was, even though the screens were
02:36:12 ◼ ► color and it could show color content, the UI was just flat black and white and the buttons were
02:36:17 ◼ ► still flat. And the most damning thing about windows 95 was that they ripped off next, not
02:36:27 ◼ ► Apple, right? No, it's true. Look, look, look at next step from when they started in 1989 and they
02:36:35 ◼ ► were had grid, they had gray scale screens instead of black and white screens. And that doesn't sound
02:36:39 ◼ ► like a huge difference, but it let them have depth from the beginning shading. And then they
02:36:43 ◼ ► got color and look at screenshots from next step in the early nineties. And it looks, it then look
02:36:51 ◼ ► at windows 95 and it's, Oh, windows 95, windows 95 to me is more of a ripoff look and feel wise
02:36:57 ◼ ► of next step than windows three was of the Mac. It was way more of a ripoff the windows 95 windows
02:37:06 ◼ ► style, which admittedly looked a lot cooler than before and kind of look cooler. I don't think
02:37:10 ◼ ► better than the Mac. And it was an organized as well. And they're weird ideas about what the
02:37:17 ◼ ► buttons and the title bars of the windows do. I never was into, but it just overall just kind of
02:37:22 ◼ ► looked cooler because it was 3d and gray scale and not flat black and white, but it really looked
02:37:28 ◼ ► like next. And part of the job of Apple is to be the company that makes the things that all the
02:37:34 ◼ ► other companies rip off, right? That's it is, that's how Apple, the fact that Samsung is now
02:37:40 ◼ ► making phones with titanium on the sides, that's just proof that Apple still has it. And that's
02:37:46 ◼ ► what I meant when I complimented you on the fact that I'm predicting you're about to get ripped
02:37:49 ◼ ► off because it means you're onto something. All right, I'm going to take a break here and thank
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02:40:43 ◼ ► and the App Store. I don't know how much of the previous three hours is going to get cut,
02:40:51 ◼ ► but we're three hours. And we could easily talk three hours on this. So you you and I commiserate
02:40:58 ◼ ► is when I first started thinking I should have you on the show. But we commiserated quite a bit when
02:41:02 ◼ ► Apple announced their DMA compliance plan three weeks ago, four weeks ago, well, sometime last
02:41:07 ◼ ► month. The the date is forever seared into my mind because I launched my 3.0 update. And I had the PR,
02:41:19 ◼ ► I had the press embargo set for the exact moment that Apple set the embargo for the DMA news.
02:41:27 ◼ ► And it kind of ruined my day to be honest. What was the date? This date that will live in infamy?
02:41:32 ◼ ► January 25th at 10am Pacific time. Literally the same time. That was a Thursday, right?
02:41:45 ◼ ► you know of any like press embargoes coming? I'm trying to like pick a nice quiet day. And then
02:41:52 ◼ ► boom, people people tend to pick Mondays and Tuesdays for good news, and happy announcements,
02:41:59 ◼ ► and they tend to, of course, infamously put bad news or unpleasant news and announcements
02:42:07 ◼ ► at the end of the afternoon on Fridays, right? That's a telltale sign that a company whatever
02:42:19 ◼ ► no person's land, right? So you don't expect something like that on a Thursday at 10am.
02:42:29 ◼ ► Here's why I think Apple chose Thursday. I think Apple chose a Thursday because it gets them closer
02:42:37 ◼ ► to the end of the week, because it is something that they did begrudgingly, right? So it's bad
02:42:42 ◼ ► news. So they didn't do it on a Monday or Tuesday. But they wanted a day or two to talk about it,
02:42:50 ◼ ► right? I was in multiple WebEx briefings that I was invited to by Apple to talk to people,
02:42:57 ◼ ► you know, on Thursday. And then on Friday, there was a follow up because there were so many
02:43:02 ◼ ► questions about it. And I think they I don't know that they anticipated that they do a second day of
02:43:08 ◼ ► media briefings. But I think they at least plan to make room for it. And so announcing it on Friday
02:43:13 ◼ ► would have kind of wrecked that because it would add away till Monday. So backwards, you know,
02:43:18 ◼ ► if you knew what was coming, you could kind of see why they picked Thursday. But that's kind of
02:43:23 ◼ ► amazing. I knew you. I knew you collided with it because we were texting about it. I didn't realize
02:43:28 ◼ ► it actually was the exact same moment. 10am exact same moment. Yeah, we ended up TechCrunch in nine
02:43:34 ◼ ► to five. No, TechCrunch and MacRumors ended up publishing an hour early because they were like,
02:43:39 ◼ ► "Hey, some big news is incoming. You probably want us to post it now." So I was like, "All right,
02:43:44 ◼ ► go ahead." So yeah. And it's not just that you ran into some big news that just happened to
02:43:55 ◼ ► maybe overshadow WeatherUp's launch. But it's also news that is of keen interest to you
02:44:03 ◼ ► anyway, personally. And all the press who would otherwise maybe have considered even writing about
02:44:10 ◼ ► it. Anybody in the kind of spheres I run in, any press that would write about apps was immediately
02:44:19 ◼ ► just heads down digesting the DMA stuff. And then I didn't even get to finish my launch plan. I didn't
02:44:25 ◼ ► even tweet from my company account. I didn't get to have a celebratory dinner. Instead, the moment
02:44:32 ◼ ► the launch is done, the moment it's like out there in the world, I'm reading European regulation and
02:44:48 ◼ ► Your story trumps mine because you had release. No, it does. So I'm not trying to out bad timing
02:44:57 ◼ ► you. But it did fall during the review period, the six days I had exclusive with the Vision Pro
02:45:04 ◼ ► before the embargo for the Vision Pro. So all of the time I spent figuring it out and then writing
02:45:10 ◼ ► about it the next day was all time taken away from my Vision Pro review. And I joked about this
02:45:19 ◼ ► somewhere else. I think on another podcast, maybe I tweeted or something. But you got to think
02:45:26 ◼ ► that the timing is maybe a little too coincidental. Here's this vision. And I didn't know the exact
02:45:34 ◼ ► because you were under embargo. So nobody told me when exactly they got the review units and then
02:45:39 ◼ ► when in the middle of that the DMA news dropped. But my joke was that Apple scheduled it then
02:45:46 ◼ ► because it was like, here's the DMA news. Oh, and by the way, here's your Vision Pro to go review.
02:45:51 ◼ ► I do think that they looked at the calendar and some aspects of it were outside their control,
02:45:58 ◼ ► like the DMAs, whatever you want to call it. March 1st. Or March 6th, I thought was the come
02:46:02 ◼ ► into effect date. I think. Somewhere, yeah. I don't think it comes in. Yeah, I think it comes in.
02:46:07 ◼ ► And I guess that means iOS 17.4 is coming out in the next few days, I guess. Yeah, it has to.
02:46:15 ◼ ► Well, I don't know. I don't know how much trouble they're in if it comes out a week after the DMA
02:46:20 ◼ ► comes into effect. But I don't know. I don't know. Their rules for how they find companies are rather
02:46:26 ◼ ► inscrutable. But that's the March 6th or 7th, whatever the day is when the DMA comes into effect
02:46:32 ◼ ► was set in stone. So they kind of needed to announce it before that. But I think they did.
02:46:36 ◼ ► They looked at the calendar. And obviously, the date they decided to release the Vision Pro was
02:46:41 ◼ ► entirely in their control. But I think in hindsight, and looking at how ready Vision Pro is,
02:46:48 ◼ ► I mean, 1.0 is a little rough, but I think they were I think they were set even back at WWDC. I
02:46:54 ◼ ► think they were pretty sure they could launch and wanted to launch in January. And I think that they
02:46:59 ◼ ► probably, if not for the holidays, probably could have launched earlier like November or December.
02:47:06 ◼ ► But I think that there's no way that they wanted to launch this distracting niche product that
02:47:14 ◼ ► it was only they knew whether it was what they could produce or how much interest there was.
02:47:19 ◼ ► Some kind of thing that's going to sell in hundreds of merely from Apple's perspective,
02:47:25 ◼ ► merely hundreds of thousands of units, they did not want to distract from the iPhone 15 models,
02:47:32 ◼ ► which, you know, and MacBook M3 models, which they knew were coming out. And the new Apple Watch,
02:47:38 ◼ ► which came out alongside the iPhones, these things that people do buy in the tens of hundreds of
02:47:43 ◼ ► millions as holiday gifts, they didn't want to distract from. So I think that they knew,
02:47:54 ◼ ► ever since June. And then I think they kind of looked at the calendar with the DMA and kind of,
02:48:05 ◼ ► right before the Vision Pro so that however much shit eating of sandwiches there's going to be,
02:48:18 ◼ ► You can't help but think that. I mean, I'm sure people in Apple have their reasons and they're
02:48:23 ◼ ► going to think we're just making stuff up, but you can't help but think that from the outside. And
02:48:29 ◼ ► then, then especially it being in the, in the review window, I didn't realize you even already
02:48:33 ◼ ► had the Vision Pro on your person when you got this news. They could have done it a week earlier,
02:48:54 ◼ ► So where, now that it's, the dust has settled on kind of analyzing their compliance plans.
02:49:04 ◼ ► Well, but I think we at least, I think, I think we understand it now, right? I think that, that was
02:49:09 ◼ ► really the hard part, really. It took me like a full day of kind of organizing my thoughts before
02:49:14 ◼ ► I could structure them into, oh, I see that here's the outline of what the options are for developers.
02:49:23 ◼ ► It is. I think it kind of has to be. I don't, did they purposefully make it a little more complex
02:49:28 ◼ ► out of spite than it needed to be? I don't think so. I actually, I don't think so. I think the DMA
02:49:37 ◼ ► itself is so complex and has conflicting, I mean, it's anybody who reads my stuff and listens to the
02:49:44 ◼ ► show knows I'm not a fan of the DMA at all, to say the least. But even just trying to put aside my
02:49:50 ◼ ► feelings about whether it's a good idea or not, I think it's undeniable that some of the edicts in
02:49:57 ◼ ► it are conflicting. And it's not that the people who think it's all about opening, just opening up
02:50:04 ◼ ► the app store and open, open, opening payments and opening this and opening that haven't read the DMA,
02:50:10 ◼ ► because the DMA also includes a lot of stuff that it's like in the law, it's not just, oh,
02:50:19 ◼ ► to be as secure and private as they possibly could be and were before. And those two things
02:50:26 ◼ ► are sort of sideloading and keeping things private and secure are sort of at odds by definition,
02:50:50 ◼ ► and Apple to their, in my opinion, to their credit, remains critical of. They're flat out saying in
02:50:56 ◼ ► their documentation for it that we think this is a bad idea and we don't think this is in the user's
02:51:01 ◼ ► interest or in the platform, anybody's interest really. But that's the law and we'll comply with
02:51:07 ◼ ► it. But I think other than the third-party app stores, a lot of it is sort of an honest
02:51:13 ◼ ► rethinking on Apple's part of what would we do differently if we had it to do all over again.
02:51:23 ◼ ► in this conversation as it kind of, I made some notes before we started our chat today.
02:51:40 ◼ ► what would we do different today had we to start all over again? It was a little bit more,
02:51:53 ◼ ► compliance. And otherwise, I think it was a little bit of a, how do we rethink the app store
02:52:00 ◼ ► for an allow new business model? And to their credit, there are all sorts of new opportunities
02:52:07 ◼ ► created by the way they chose to do the compliance, but they rethought it in a way that still
02:52:21 ◼ ► Well, that's what I mean though. I think that that's one of the conclusions that came from,
02:52:26 ◼ ► that if we had it to do all over again, we'd still want our pound of flesh, but how would we do it?
02:52:39 ◼ ► and I think a lot of people listening to this will have a different perspective. And I can respect
02:52:51 ◼ ► incredible web business. They didn't have to ask permission from anybody. They wrote their own
02:52:57 ◼ ► framework, Ruby on Rails, to build the business. They built out their own credit card payment
02:53:08 ◼ ► business that they run and love to talk about what a great business it is and other stuff.
02:53:22 ◼ ► on another platform, and now all of a sudden after decades of running the business the way you want
02:53:29 ◼ ► to, not having any form of gatekeeper, not having to pay anybody other than credit card fees or what
02:53:36 ◼ ► you choose to pay to come to a platform like iOS, and all of a sudden you're having to jump through
02:53:42 ◼ ► all these different hoops. You're having to pay a commission. You're having to do all these things.
02:53:45 ◼ ► I can respect his view of the world that he should be allowed to publish apps to this platform
02:53:55 ◼ ► without having to follow any rules or do anything else. I can disagree with it because I do,
02:54:09 ◼ ► Apple's work on the platform and the intellectual property that they've created, which we had a long
02:54:16 ◼ ► talk about IP just now and whether or not that should be defensible and what you should get paid
02:54:21 ◼ ► for or whatever. But I do think at a fundamental level, it's Apple's platform and they have some
02:54:29 ◼ ► right to charge developers to be on that platform. And so then what it comes down to is how much,
02:54:39 ◼ ► like what's fair, but even the fair statement, it's their platform. So what's fair is what they
02:54:48 ◼ ► determine. And this is where regulation gets really tricky because even the judge in the
02:54:54 ◼ ► epic case, and it appears that the EU is not telling Apple that they can't charge developers.
02:55:00 ◼ ► So then now what do they charge developers? And so I think the DMA though, and the way Apple complied
02:55:08 ◼ ► in a way, especially the core technology fee is designed in a way for Apple to make similar
02:55:18 ◼ ► amounts of money and capitalize on the platform at the levels they've currently been capitalizing on
02:55:25 ◼ ► the platform. But then ultimately for developers, that then creates similar problems as with the
02:55:31 ◼ ► current 30%. Because for a lot of developers, 30% is, and especially 15% for the small developers,
02:55:37 ◼ ► is actually quite reasonable. The increased conversion you get, not having to deal with taxes,
02:55:48 ◼ ► Apple supports hundreds of different payment methods around the world. If you're in Africa
02:55:53 ◼ ► and you're paying in M-Pesa or whatever different, I forget what country that even is, but there's
02:55:58 ◼ ► all these different payment things that they handle out of the box, that even Stripe, the
02:56:03 ◼ ► stripes of the world don't fully support and don't collect and remit your taxes. And there's so many
02:56:08 ◼ ► things that Apple does that are actually quite valuable to developers. But how valuable?
02:56:22 ◼ ► challenged, that 30% is a huge burden on a business that pays such a significant portion
02:56:30 ◼ ► of their revenue out in royalties compared to me, somewhere in the middle as a weather app that pays
02:56:36 ◼ ► out so much of my potential profit to the weather data providers to Fortnite on the way other end,
02:56:48 ◼ ► literally near zero marginal costs on goods. And so the 30%, and then you get different benefits
02:56:56 ◼ ► of the app store, you get different benefits of the APIs. It's a complex equation. And even in
02:57:02 ◼ ► the 30% and 15%, you have winners and losers on a spectrum. And then the problem with the DMA is
02:57:11 ◼ ► that because of the core technology fee, it just distributes that same spectrum, but in a different
02:57:16 ◼ ► way. For some apps, the core technology fee can actually potentially be a very good deal.
02:57:21 ◼ ► For a lot of apps, probably most apps, it's just not a viable option because they use some form of
02:57:29 ◼ ► freemium model where having to pay per user just completely breaks the model. So yeah, I still,
02:57:36 ◼ ► and I've tweeted about this, you and I have talked about this. I still long for a day when Apple
02:57:42 ◼ ► rethinks the app store from a more kind of first principles, like blank slate, where how much
02:57:49 ◼ ► should we make? How much value are we providing to developers in this opportunity of the app store?
02:57:58 ◼ ► And then how do we more equitably distribute that, charging those developers in a way that
02:58:07 ◼ ► maintains business opportunity in a way that still does compensate Apple to a certain amount?
02:58:21 ◼ ► and now I remember that event and I remember the Jobs portion, and it was when he explained the
02:58:26 ◼ ► 30-70 split and said, "Free apps, we're not going to charge you anything, and we'll do the
02:58:33 ◼ ► distribution. We'll handle all of that, and we'll cover our costs by taking 30% of the apps that are
02:58:42 ◼ ► paid." And he said, I think he even said like, "Break even." I think he more or less said,
02:58:48 ◼ ► "I think we'll run this at break even." And I think that they meant it at the time. And I think
02:58:53 ◼ ► the reason they meant it is that they were so intimately familiar with the iTunes Music Store,
02:58:58 ◼ ► which famously the app store was built on. And still, maybe even today exhibits a little bit of
02:59:05 ◼ ► that. But for a long time, really, they were sort of selling apps the way they sold songs.
02:59:10 ◼ ► And I think they knew that the music store was not a huge moneymaker for Apple. And they took
02:59:19 ◼ ► every 99-cent song, they got 30 cents. And I think they thought that's how the app store might work
02:59:25 ◼ ► out and that would be fine. And it just turns out that 30% of app sales was way more lucrative than
02:59:33 ◼ ► 30% of 99-cent songs and $10 albums. And with the commissions they had to pay to the music labels.
02:59:45 ◼ ► The other thing I think a ton of people forget is that it genuinely was a good deal at the time.
02:59:49 ◼ ► And Apple still talks about, "Oh, before the app store, it wasn't all box software." But even those
02:59:58 ◼ ► companies you were talking about three hours ago, headphones and others, even if you were setting up
03:00:03 ◼ ► downloads, you were paying exorbitant fees on the bandwidth. People today, it's hard to even
03:00:10 ◼ ► comprehend unless you were doing business in that time, that just the bandwidth of having a 200-megabyte
03:00:17 ◼ ► app that people are downloading was very expensive. Doing credit card payments back before the app
03:00:24 ◼ ► store was way more expensive and way more work. You had to pretty much build out your own payment
03:00:30 ◼ ► system. And then you had to collect and remit the taxes yourself and deal with compliance around the
03:00:35 ◼ ► globe if you're selling a different... Or take the risk of not complying and not collecting taxes.
03:00:41 ◼ ► And so it was genuinely... In my business plan in 2008 that I submitted to my dad and uncle and mom
03:00:55 ◼ ► distribution on the app store, not have to ever worry about credit card fees, not have to worry
03:01:00 ◼ ► about taxes, compliance, and all those other things. It was genuinely a fantastic deal in 2008.
03:01:08 ◼ ► Yeah. And the comparisons to box software, one of the reasons I have to roll my eyes at that
03:01:13 ◼ ► in general is 'cause we're not talking about computers, we're talking about phones. And the
03:01:17 ◼ ► way that software worked on phones at the time was entirely through the carriers. And the way they
03:01:23 ◼ ► solved the things like the credit card processing problem and stuff like that was that they didn't
03:01:30 ◼ ► charge the user by the credit card, they would charge you on your Verizon bill. And if you wanted
03:01:37 ◼ ► to get the new snake game or whatever the hell was available for your whatever phone you got from
03:01:42 ◼ ► Verizon or AT&T that could play games, you paid AT&T and it showed up on your phone bill. And the
03:01:48 ◼ ► way you got the game, you had to go through the carriers. And it wasn't like the app store where
03:01:54 ◼ ► you signed up for a $99 account and downloaded an SDK and just sort of submitted your app and then
03:02:00 ◼ ► it would show up. There weren't, never were thousands of apps, let alone hundreds of thousands,
03:02:06 ◼ ► let alone millions or however many apps there are, there were like dozens. And each one of them had,
03:02:12 ◼ ► you didn't go through developer relations at Verizon, you went through business development,
03:02:17 ◼ ► right? And so there's a reason why nobody remembers getting apps even on their smartphones
03:02:26 ◼ ► you know, lots of people had Blackberries and lots of people loved them, but it wasn't because they
03:02:30 ◼ ► could get apps for that. It was because of the built-in app for the messaging and the email.
03:02:38 ◼ ► Oh, more, more. Yeah. I don't know. Who knows? Yeah. But you know, and nobody got the same deal.
03:02:47 ◼ ► Electronic Arts, surely Electronic Arts was better at negotiating with AT&T than a startup
03:02:54 ◼ ► with 20 people or something like that. But it all went through them and they approved it and
03:02:59 ◼ ► it was limited and it was just nothing like this. And it's just the way that the app store is just
03:03:04 ◼ ► one of numerous ways that Apple broke the control of the carriers, right? And forget about global
03:03:09 ◼ ► distribution because if you went through Verizon, you were in the US, you weren't even, couldn't
03:03:13 ◼ ► even get to Canada because, you know, yet I go through Canadian carriers. So yeah, but, but again,
03:03:18 ◼ ► on the other hand, that's 17 years ago, right? And you, all right, you successfully changed the world.
03:03:26 ◼ ► But I think to go back to my point of thinking that at least the core technology fee to me is
03:03:33 ◼ ► the component of their compliance with the DMA that to me is the, hmm, what would we do all over
03:03:40 ◼ ► again? Because the loophole, and I don't mean it in a bad way, it's some loopholes are good things,
03:03:46 ◼ ► but the loophole that I think Apple never foresaw in 2007, 2008 when they launched the app store
03:04:01 ◼ ► but like literally trillion dollar ideas, right? Meta, Facebook slash now Meta built a,
03:04:10 ◼ ► what's now a trillion, $2 trillion company entirely based on apps that you never pay for.
03:04:18 ◼ ► There's no pro mode for Instagram. I mean, I know there's some paid things in there for getting,
03:04:23 ◼ ► but you don't, it's not a paid app, right? And the whole idea, like if you told people that they
03:04:29 ◼ ► needed to pay $5 to download the Facebook app, they'd be like, what the hell are you talking
03:04:33 ◼ ► about? It doesn't make any sense to them. But that I think Apple sort of knew there'd be lots
03:04:38 ◼ ► of free apps, but that they'd be sort of hobbyist things or teasers for the paid app. And that I
03:04:43 ◼ ► really do think coming from the fresh 2007, they were still at that time when they launched the app
03:04:49 ◼ ► store, they still were selling upgrade copies of Mac OS X. They were lowering the price by then.
03:04:55 ◼ ► It was no longer $129. It was like, there was one version that was like $70. And then it was $29.
03:05:06 ◼ ► we're going to make them free. But yeah, I think you had to pay $5 for an iOS update one time.
03:05:11 ◼ ► I was going to bring that up. It was the iPod touch. They were accounting for the revenue
03:05:23 ◼ ► 10 bucks. Yeah. Like $999. Yeah. Yeah. Because they were, they were accounting for the phone
03:05:29 ◼ ► amortized over quarters. So if you spot a $600 iPhone 3G that they were accounting for it over
03:05:37 ◼ ► the lifetime of your two year mandatory contract with AT&T. And so because they were amortizing
03:05:44 ◼ ► the cost a year and a half in, they were still hadn't fully booked the money you'd already give
03:05:49 ◼ ► them. And therefore under their interpretation of the accounting laws, whether those interpretations
03:05:54 ◼ ► are right, I don't know, I'm not an accountant or a lawyer, but they thought that was okay
03:05:58 ◼ ► to give free updates. But that because they booked the whole revenue from the iPod touch on sale,
03:06:03 ◼ ► like they'd done with all other iPods, which never really got major OS updates. They felt like
03:06:10 ◼ ► legally they had to charge. I mean, and people today, I mean, that's, try telling people when
03:06:15 ◼ ► iOS 18 comes out next year, that they have to pay $10. I mean, it's, but coming from that world,
03:06:21 ◼ ► I think that's what they thought. They thought the money that will be made on this app store will
03:06:25 ◼ ► come from games and apps like the Mac, where people pay one time 10, 20, $40, $5, whatever
03:06:34 ◼ ► the price is, they'll pay and then they'll get the app. And they never foresaw things like Facebook,
03:06:38 ◼ ► or all the zillions of other bigger companies that have followed where that's sort of now
03:06:44 ◼ ► the default model, where it's the App Store is sort of more like the web from their perspective.
03:06:50 ◼ ► And it's not the total freedom of the web in the 37 signals David Heyermeyer Hanson fashion,
03:06:55 ◼ ► where you can do whatever you want. But it's like the web, where to get to facebook.com,
03:07:02 ◼ ► you go to a browser and type facebook.com. And now you're there. And to get Facebook on your phone,
03:07:08 ◼ ► you go to the App Store, or Play Store on your phone, and you type Facebook and then tap the
03:07:14 ◼ ► download button. And now Facebook is on your phone. Right? It's sort of like that. And that
03:07:19 ◼ ► data, they don't pay, there's no platform owner, they pay anything to but I think Apple saw that
03:07:25 ◼ ► there's these companies that have worth many of them worth billions of dollars, a handful that
03:07:36 ◼ ► a hundred dollars a year. I use this analogy recently that I have personally paid Apple
03:08:07 ◼ ► And I think this is a kind of new paradigm where apps that choose to use this new, who choose the
03:08:16 ◼ ► new model will pay whether they would, no matter how they monetize. And so that, that part of it is
03:08:22 ◼ ► interesting. Right. I, you know, I think part of it, if, are they going to do that part worldwide?
03:08:30 ◼ ► Maybe. I think maybe they might see how this works out and maybe offer developers a option to get a
03:08:37 ◼ ► lower commission rate on in-app sales or more flexibility on in-app sales in terms of how you
03:08:44 ◼ ► process them on your own or whatever, in exchange for agreeing to a new deal where you send Apple
03:08:51 ◼ ► 50 cents for every download over a million. And again, it's like a loophole. And again, I'm not,
03:08:56 ◼ ► I'm not, if you think Apple is greedy with the app store, then what I'm describing isn't absolving
03:09:03 ◼ ► Apple. It's Apple trying to get, how do we get money from the, from Facebook and Google? Right?
03:09:10 ◼ ► Yeah. And, and, and my personal contention, I mean, I know you and I, again, probably fall well
03:09:17 ◼ ► closer to what a lot of people, maybe not your audience specifically, but I think a lot of people
03:09:21 ◼ ► more broadly would think are Apple shills or Apple fanboys and defending Apple and everything else.
03:09:27 ◼ ► I don't think Apple is greedy in the app store in the sense of like, they have created hundreds of
03:09:34 ◼ ► trillions of dollars of value over the last 17 years, not only in the iOS platform, but in
03:09:41 ◼ ► Android being able to copy them and create the, I mean, they, they created the modern smartphone
03:09:53 ◼ ► And so I don't as much in my mind, think about them being greedy. And what I personally care
03:10:00 ◼ ► more about is the, is the business opportunity of the app store and how much them not evolving those
03:10:09 ◼ ► business opportunities over time is limiting what developers build, which then ultimately limits
03:10:16 ◼ ► what consumers have access to, which limits their ultimate upside of, I mean, even things like the,
03:10:23 ◼ ► the fee at some price, all the big players like Netflix would come back to the app store and they
03:10:31 ◼ ► they'd make money where they weren't currently making money. And so, and then the problem with
03:10:37 ◼ ► the core technology fee is that it is similarly very limiting on what kind of business models
03:10:46 ◼ ► will work and be able to pay that 50 cent technology fee. So it's fine. Apple make your
03:10:51 ◼ ► money, but the problem with both models and that's why in some ways I do like that we now have a
03:11:00 ◼ ► whole new model. I mean, I was even thinking a few weeks ago, as I was digging into all this stuff,
03:11:04 ◼ ► I should go raise some money and, and build, cause I've always loved pushing the boundaries of iOS.
03:11:09 ◼ ► I've gotten my apps rejected so many times for stupid stuff. That's so frustrating to talk about
03:11:14 ◼ ► now, but things like using notifications to launch apps, Apple rejected my app and said,
03:11:20 ◼ ► you're misappropriating the API. That's not what we designed it for. You can't launch this app.
03:11:25 ◼ ► And, and I didn't, and like, I had to remove that feature completely from the app. And so I've had
03:11:31 ◼ ► so many cases like that, where I try to do something and get rejected for, for innovating.
03:11:38 ◼ ► And then I spent a decade like scared to innovate the, the shortcuts guys workflow, which Apple
03:11:44 ◼ ► bought and turned into shortcuts. They pushed the boundaries a lot more than I did in part because
03:11:52 ◼ ► they hadn't gotten burned. And they were, I had like kids to feed and I was, I was genuinely
03:11:57 ◼ ► scared at times that my whole business was going to go down. And so with this new opportunity in
03:12:03 ◼ ► the EU, there is some like excitement inside of me that we're going to see new apps, new business
03:12:09 ◼ ► models, new opportunities that were, that are just never possible on the app store. And the most
03:12:14 ◼ ► obvious of which unfortunately is porn. I think that's probably, I mean, if somebody's not already
03:12:19 ◼ ► building it, the like OnlyFans store or something like that is, is going to happen. But, but the,
03:12:25 ◼ ► the point being that I do think there's a ton of opportunity. The problem is that, is that, is that
03:12:40 ◼ ► really well and can get, and can do innovative things and kind of get out from under the
03:12:44 ◼ ► commission, but it's going to be a really bad deal for others. And, and I don't think it's
03:12:51 ◼ ► an exact mirror of the current commission. I think there's a lot of overlap of businesses that still
03:12:58 ◼ ► just can't make it work. And I think Spotify is a good example. They, they're kind of the canonical
03:13:04 ◼ ► example of an app that just gets screwed either way because they have a huge freemium base that
03:13:10 ◼ ► they monetize via advertising and don't pay Apple a penny and Apple can argue, well, hey, look at
03:13:15 ◼ ► all the revenue they're making and not paying Apple a penny, but at 50 cents a download and
03:13:20 ◼ ► 50 cents an update every year, that that's not, it's very unlikely to be economically viable for
03:13:26 ◼ ► them. And then on the flip side, when they're paying so much of their revenue out in royalties
03:13:31 ◼ ► and have such a low margin business, it's really hard for them to operate under the existing rules
03:13:38 ◼ ► paying Apple 30 or 15%. And so there is still this squeeze in the middle of neither of these
03:13:45 ◼ ► are actually good opportunities. Yeah. I think Spotify though is, I mean, they're obviously
03:13:52 ◼ ► because they're in the EU and they're famously it's on, on the record that they've been a bug
03:13:58 ◼ ► in the European commission's ear for years asking for regulatory help to, to force Apple to help
03:14:07 ◼ ► them. And I would compare it to Apple in the early nineties when Apple was hoping to beat windows
03:14:19 ◼ ► I think Spotify is just bad at business. I mean, and Apple in their last week issued a statement
03:14:26 ◼ ► and the numbers are eyeopening in the EU. Spotify has 56% market share and second place is Amazon
03:14:33 ◼ ► and third place is YouTube music and Apple's in fourth place with 8% market share. And I guess
03:14:39 ◼ ► that's EU overall, not EU iPhone only, but Apple has Apple music on Android, right? They compete
03:14:47 ◼ ► in music across cross-platform. And so Spotify is dominant. I mean, it's a majority market share
03:14:54 ◼ ► by some definitions. Spotify has a monopoly that Apple doesn't have. If anybody's a monopolist
03:15:00 ◼ ► and they're just bad at monetizing, they have so many users and they're really bad at monetizing.
03:15:05 ◼ ► I mean, there's no reason their ad business shouldn't be better. They have so many users,
03:15:09 ◼ ► they're, it's their fault that they're bad at making money, but their solution isn't to get
03:15:14 ◼ ► better at making money. Their solution seemingly is getting the European union to protect them
03:15:20 ◼ ► legally, in my opinion. I mean, cause I think, I think you have a point. And I think that Spotify
03:15:26 ◼ ► is not the perfect example in this, but, but I think like my point, and I probably shouldn't have
03:15:32 ◼ ► brought up Spotify cause they have made a lot of comments and they're like kind of aggrandizing.
03:15:37 ◼ ► They've helped shape the DMA. It's impossible that if we didn't bring up Spotify, even briefly,
03:15:42 ◼ ► we'd be doing just justice to the conversation. It's, it's there. They are front and center in
03:15:47 ◼ ► this. They really are. But it's so aside from like them having the EU's ear, aside from a lot of the
03:15:53 ◼ ► kind of self-serving comments and disingenuous, seemingly disingenuous comments that they've made
03:15:58 ◼ ► about all of this, I bring them up as an example of an, of the spectrum of business opportunity on
03:16:06 ◼ ► the app store is that you have on the far side, I mean, Kindle, let's take as a different example,
03:16:14 ◼ ► Kindle is a low margin business. They pay such a high percentage of revenue on the books to the
03:16:22 ◼ ► publishers that they, they are a margin challenged business. It's hard to build. And there's,
03:16:35 ◼ ► especially when your distribution channels then eat up more than you actually make a margin.
03:16:42 ◼ ► And so maybe the Kindle is a better example of this, but my, my point in bringing up Spotify
03:16:53 ◼ ► what do you even call it? The new opportunity, the new paradigm, the new whatever under the DMA
03:16:58 ◼ ► regulation in Europe is a flip side of the same coin in that it's a, it's generally going to be
03:17:06 ◼ ► a bad deal for margin challenged businesses and or freemium businesses. And so there's the,
03:17:12 ◼ ► and I think that's an important way to look at this is that for, and I think Apple maybe to a
03:17:20 ◼ ► fault internally leans too heavily on, we'll look at all the look at it. I mean, they say this in
03:17:26 ◼ ► like the press, well, look at all the developers who are only paying 15%. It's like, yeah, great,
03:17:30 ◼ ► but like, that doesn't absolve you of like all the others who are paying way more than 30%. And then,
03:17:36 ◼ ► well, Hey, you get a million downloads for free. Well, okay. That's great. But most people aspire
03:17:42 ◼ ► to build a bigger business and are going to hit that at some point the regulation or the
03:17:47 ◼ ► compliance, the way it stands in the existing app store in my mind does not account for the disparity
03:17:56 ◼ ► in, and this is why so many companies do custom deals, right? Like if, if, if Apple had the
03:18:02 ◼ ► bandwidth to just custom negotiate and say, Hey, Spotify, like we're competing with you.
03:18:08 ◼ ► We have their default music player. We have, we understand your margins. Like you're going to get
03:18:13 ◼ ► to pay 5% instead of 15% or 30% that would solve it. But then how does Apple negotiate a million
03:18:20 ◼ ► different custom deals for all the different people? And again, maybe Kindle is a better
03:18:29 ◼ ► to a limited extent. But the point being like the opportunity, the business opportunity discourages
03:18:36 ◼ ► any kind of margin challenge business on either side with the DMA or with the existing commission.
03:18:46 ◼ ► the existing app store rules. And then with the new rules, there's a different section of
03:18:55 ◼ ► I forget if it's only on dithering or on this show too, but the one thing I had to rethink was when
03:18:59 ◼ ► these rules first came out and Ben and I did the math in our heads on dithering and we're like,
03:19:05 ◼ ► well, let's just say Facebook has a billion users of all their apps combined in the EU,
03:19:10 ◼ ► which seems like a fair, you know, across WhatsApp, Instagram, and Facebook, a fair round number.
03:19:16 ◼ ► Well, then they'd have to pay Apple $500 million a year. And well, who do that? Because that's a
03:19:22 ◼ ► huge number. And then you think about, but then rethinking it, thinking about meta's actual
03:19:27 ◼ ► finances, $500 million a year is not that much for them. And the best example is Google who famously,
03:19:36 ◼ ► and now, you know, this came out in lawsuits recently. Everybody's been speculating about
03:19:40 ◼ ► it for years, but the Google pays Apple roughly best estimates $20 billion a year to be the
03:19:47 ◼ ► default search in Safari. Like for some of these companies paying for access to the users of Apple's
03:19:55 ◼ ► products is worth $20 billion a year for Google for search for the iPhone. So 500 million is 40th
03:20:03 ◼ ► of that. It's smaller. I'm not saying, and I know Zuckerberg's come out and said, he doesn't think
03:20:08 ◼ ► this looks good. Doesn't think that Facebook's going to do it and whatever, but it's not
03:20:12 ◼ ► ridiculous to think that they would or that other, some other companies would, even if they do have a
03:20:18 ◼ ► billion users and wind up paying Apple $500 million a year, if your monthly income from the average
03:20:24 ◼ ► user of your app is way more than 50 cents a year, it might be a great deal. And I thought it was
03:20:30 ◼ ► really interesting recently that Epic, that Apple is going to let them have a subsidiary in Europe,
03:20:36 ◼ ► get a developer account back and there's Epic has announced it. They're going to make an Epic game
03:20:41 ◼ ► store. And I think that's super interesting. And you know, and like I wrote on Daring Fireball,
03:20:48 ◼ ► I, Apple can hold a grudge and they definitely play hardball, no doubt about it, no argument,
03:20:53 ◼ ► but I don't think they're a spiteful company. I don't think they're cut off their nose,
03:20:57 ◼ ► despite their face. And while they might dislike Epic because of that whole lawsuit. And,
03:21:03 ◼ ► but I think if they could think strategically that, Hey, if Epic can take advantage of these
03:21:09 ◼ ► rules and build and be happy, that's the sort of thing that would make any regulator at the EU
03:21:14 ◼ ► think, well, we won, right? We forced Apple to open up a store that lets their enemy Epic open
03:21:20 ◼ ► a store and have a game store. And now there's another place where iPhone users can get games in
03:21:27 ◼ ► the EU. And that would be a win. I think Epic said they're doing it. So like the argument,
03:21:36 ◼ ► nobody's going to use these rules. And so it's ridiculous. And I thought that at first too,
03:21:42 ◼ ► right? Just doing that back to the envelope math and thinking, well, my God, $500 million is a
03:21:46 ◼ ► lot of money, but it's not a lot of money to meta. So I think, you know, if Epic's doing this,
03:21:52 ◼ ► somebody else will, you mentioned porn and we can laugh because porn is funny in a way, but porn,
03:21:57 ◼ ► porn also is very popular. And if you think like, if you think like, I think that software tends to
03:22:07 ◼ ► comp complex software tends to be better in a native app than in a web app, then like the
03:22:14 ◼ ► argument now for the fact that the Apple did won't allow porn in the app store is that, well, you
03:22:19 ◼ ► know, the good news is safaris out there and there's zillions of porn sites that you can access
03:22:25 ◼ ► all you want on the web. But I think you can get ready or right, right, right. You can,
03:22:31 ◼ ► or HBO Max, right? But if all if all you want is porn, you're you're you're not lacking on the
03:22:36 ◼ ► iPhone. But could you get a better porn experience through a native app, right? And for something
03:22:42 ◼ ► like a two way camera where you see them and they see you might work a lot should, in theory,
03:22:48 ◼ ► work a lot better in an app. And maybe, you know, processing payments through their custom processor
03:22:53 ◼ ► through an app might be better than doing it through the web. So I think you're right. I
03:22:57 ◼ ► think there will be a porn store or store full of porn stars. And I it's also very true. It's an
03:23:05 ◼ ► America society wise has a it's our pure our puritanical roots from the founding of the
03:23:12 ◼ ► country. We have a more puritanical view of porn than other countries in Europe, especially and
03:23:19 ◼ ► Europe and Europeans see that as a source of pride, like in a way that Americans are, in my opinion,
03:23:27 ◼ ► rightfully proud of our freedom of the press and freedom free speech. Europeans are proud of the
03:23:34 ◼ ► fact that porn is more acceptable there and that Amsterdam has had a red light district since
03:23:41 ◼ ► forever and prostitution is not as frowned upon morally or ethically. And so I think the European
03:23:54 ◼ ► again, we'd see that as a win, right? That Apple was never going to allow it. Apple still doesn't
03:24:00 ◼ ► allow it outside the EU. But thanks to us and our wonderful DMA law, now all the proud citizens of
03:24:06 ◼ ► the EU have a better porn experience on their iPhones than people outside the EU. It is funny.
03:24:13 ◼ ► It's I agree. It is funny. But I also think it's true. I don't think it's the case that no one's
03:24:18 ◼ ► going to use it. I think there's going to be an epic game store. I hope it's successful. I think
03:24:27 ◼ ► I think there will be and I'll give you my list of five opportunities that I do think exist under
03:24:35 ◼ ► the new DMA rules. But let me step back just to further make that one point I was making about
03:24:42 ◼ ► the spectrum of business attractiveness and margin challenge of operating on the app source.
03:24:50 ◼ ► I should know these exact numbers because I've read them 100 times and I'm trying to channel
03:24:55 ◼ ► my best Eric Seufert. But I believe it was in one of his updates or one of Ben Thompson's updates
03:25:00 ◼ ► talking about the revenue per user in Europe is actually significantly lower than the revenue per
03:25:07 ◼ ► user in the US. And then you combine that with the fact that WhatsApp either monetizes very little,
03:25:15 ◼ ► then Instagram monetizes, I think the best of all of them. And then the Facebook blue app monetizes
03:25:21 ◼ ► less than that. So let's say in Europe, I think it's closer to the single digit, low single digit
03:25:29 ◼ ► euros per user per year in the EU compared to the US. And so let's just, I mean, I don't know the
03:25:37 ◼ ► exact numbers I should, but let's say it's $4 for euros a year per user. Paying 50 cents out of $4
03:25:45 ◼ ► is a lot, that's 12.5%. So that's actually on a margin basis, a pretty big hit and actually
03:25:55 ◼ ► fairly close to your 15 and 30% if it were, let's say a subscription and at the second year they
03:26:02 ◼ ► start paying 15%. And so that again, to my point is that even though it is a new opportunity,
03:26:14 ◼ ► the amount apps are actually going to pay as a percentage of the revenue can still be actually
03:26:21 ◼ ► crazy high. But the opportunities I see, so to flip this around is that there's, like you were
03:26:26 ◼ ► saying, kind of hacks and loopholes around this, right? So you could start an app store that was
03:26:32 ◼ ► all paid up front. And these are some of the ideas I was kicking around. Like maybe I should go raise
03:26:37 ◼ ► money and go build my own European app store where I can flaunt the app store rules and do whatever
03:26:42 ◼ ► I want with innovative utility apps and other apps. And so the way to get around some of this
03:26:48 ◼ ► is that you charge. And there's actually a ton of apps starting to do this on the web. It can be a
03:26:54 ◼ ► dark pattern where they charge a dollar to start your free trial, but then they get your credit
03:26:59 ◼ ► card on file and then they can charge you whatever they want and the subscription fee is really high.
03:27:03 ◼ ► I've seen, and that's actually another argument for Apple's payments being very friendly,
03:27:13 ◼ ► enough people will likely do that if your value prop is strong enough. And then you have things
03:27:20 ◼ ► like AAA games or more well-known apps and other stuff where you can get around that with charging
03:27:30 ◼ ► some kind of fee upfront. And then, I mean, you do have tons of high average revenue per user apps.
03:27:37 ◼ ► Yeah. I think Fortnite will qualify for that. There might be a zillion users who never pay anything,
03:27:43 ◼ ► but Epic knows what the average user pays and they know how the whales who love to buy the outfits
03:27:50 ◼ ► and the dances and whatever else there is for sale, they know the average they make per user.
03:27:55 ◼ ► Right. But I mean, Fortnite's actually probably an example where it's actually quite low. Like,
03:28:00 ◼ ► they're the canonical ultra freemium where the whales are paying $10,000, but on average,
03:28:07 ◼ ► it's like 25 cents per user per year monetization because they have this massive freemium.
03:28:11 ◼ ► Oh, you think it's that low? I think it's higher than that. I don't think they'd be making it.
03:28:15 ◼ ► It may be higher than that, but my point is just that it's on the lower side. It's not like,
03:28:20 ◼ ► the apps I'm talking about more of like high average revenue per user, like the pro-sumer apps,
03:28:26 ◼ ► I mean, Microsoft would be a good example. Like they could open a store selling Microsoft Word
03:28:31 ◼ ► and Excel and other apps like that where their average revenue per user is going to be quite high
03:28:42 ◼ ► So I do think there's opportunities for that. I think to my earlier point about getting rejected
03:28:48 ◼ ► so many times, like there's opportunities to do innovative things that Apple doesn't currently
03:28:52 ◼ ► allow on the app store, even within the current APIs that I think would be attractive enough to
03:28:58 ◼ ► get attention and find a way, again, around the core technology fee. And then B2B and pro-sumer
03:29:06 ◼ ► apps. Yeah, I think there's a ton of opportunity here. There is some risk though. And one of the
03:29:14 ◼ ► things I'm hoping Apple will do at some point, whether forced to or not, is allow for some kind
03:29:22 ◼ ► of cap on the core technology fee that if an app goes viral, because that's one of the big risks.
03:29:30 ◼ ► I talked to a lot of developers about it. Well, yeah, probably 99.999% of developers are never
03:29:37 ◼ ► going to get a million downloads in the EU, but there's going to be that one developer who does.
03:29:42 ◼ ► Well, David Smith and Widget Smith is the perfect example. And I mean, he's been upfront because he
03:29:47 ◼ ► exploded in popularity when Widget Smith went literally viral, like with TikTokers saying,
03:29:53 ◼ ► "Got to get this app, Widget Smith, because look what you can do. A, B, and C." And some other
03:29:57 ◼ ► TikTokers all followed each other and made their own things that they could do with Widget Smith.
03:30:01 ◼ ► And all of a sudden, Widget Smith went from, "Hey, pretty popular by the standards of David Smith's
03:30:06 ◼ ► other apps, which are all great," to millions of users very quickly. So for him, if it had
03:30:13 ◼ ► been a 50 cent per user over a million, I think he tweeted it or I don't think it was only private,
03:30:20 ◼ ► but it's very obvious. It would have bankrupt him if they had tried to collect the money instantly.
03:30:26 ◼ ► Right, because there was no nice scale. Like if you're imagining that, "Oh, you're getting to
03:30:32 ◼ ► 800, 900,000 users and now you can prepare to hit that limit and you think you're going to get to a
03:30:38 ◼ ► million and then you get to a million point one and you're only paying $50,000 on the 100,000
03:30:45 ◼ ► over a million and you can adjust the way you're monetized. If you feel like, "Ooh, if we keep
03:30:55 ◼ ► 500,000 users to 10 million users because you went viral on TikTok, you've got a $4.5 million bill.
03:31:03 ◼ ► And so that's where taking advantage of these opportunities either needs to be a big company
03:31:11 ◼ ► that knows the risk and has the financial backing and tolerance for that level of risk or Apple
03:31:20 ◼ ► needs to find some way to cap the risk for smaller developers. Because right now I wouldn't recommend
03:31:26 ◼ ► it for small developers. If you run a freemium app, it's not a good idea to accept the new
03:31:31 ◼ ► terms generally because will you likely hit the million downloads? No, but if you do and Apple
03:31:37 ◼ ► doesn't give any provision for getting out of it, you're screwed. Right. And that makes me wonder
03:31:41 ◼ ► back to my point of Apple. I do think genuinely designing this to be used. And again, the fact
03:31:48 ◼ ► that it does not address all the complaints and perhaps none of the complaints of their
03:31:53 ◼ ► most vehement critics, but that the DMA wasn't written to satisfy those critics either. It
03:31:58 ◼ ► doesn't satisfy everyone, but it does. It might be interesting for some, and that doesn't mean
03:32:03 ◼ ► it's uncompliant with the DMA. But I do think that in terms of what would we do if we had to
03:32:09 ◼ ► do this all over again, seeing how that mobile world evolved, I think on the forefront of Apple's
03:32:16 ◼ ► mind or meta and Google and Microsoft and Amazon who've built these apps that get used all the time
03:32:23 ◼ ► and that they don't see any money from. Well, that's not true of Microsoft. Microsoft has
03:32:28 ◼ ► all the office apps in the store. Yeah, they do. They make hundreds of millions and we don't know
03:32:32 ◼ ► what backdoor deal is. Microsoft did. And then same with Amazon. Amazon has some things on the app
03:32:38 ◼ ► store, but you're making a point. There are tons of Uber and Facebook and Uber. Uber is a good
03:32:43 ◼ ► example. Apple almost nothing. Uber's entire business would not exist without the iPhone,
03:32:48 ◼ ► in my opinion. And I've had this argument where I just don't think that if the mobile world had
03:32:53 ◼ ► evolved in the BlackBerry sort of way, that there would have been enough people to make it useful.
03:33:00 ◼ ► Uber's whole premise was that effectively everyone would have a device that could show maps and GPS
03:33:07 ◼ ► and do credit cards and stuff, not just the 5% of people who own smartphones pre-iPhone.
03:33:14 ◼ ► Because I saw a pitch deck recently and the original thing was like, you would just text,
03:33:19 ◼ ► pick me up at work in five minutes. And it's a great pitch deck thing, but it's now looking back,
03:33:26 ◼ ► you can see a million reasons why that doesn't work. Like how do you know they're actually going
03:33:29 ◼ ► to be there in five minutes? And it's so obvious that having that pinpointed location of the driver
03:33:35 ◼ ► and the always on GPS where they can find you and like all the things that made Uber were the
03:33:40 ◼ ► smartphone, but they did start. Didn't they launch right before? Was it the 3G that got a GPS? Because
03:33:49 ◼ ► the original iPhone didn't have full GPS. No, the original iPhone only triangulated between
03:33:55 ◼ ► cell towers. Right. So it was like a 3G, which was released. I guess that was released in 2008
03:34:01 ◼ ► and they didn't launch in 2009. But it was, yeah, it's interesting. But to your point, the Uber has
03:34:08 ◼ ► made a ton of money and built an entire business on these technologies, whether they could have
03:34:12 ◼ ► built very unlikely that they could have built what they have today, whether or not they started
03:34:18 ◼ ► before GPS or whatnot. Yeah. And I remember when Uber came out, even with GPS, it was inaccurate
03:34:24 ◼ ► enough that there were often problems where the car would show up on the wrong side of the block,
03:34:27 ◼ ► like in New York City, like you're on 42nd Street, and they think you're on 43rd Street around the
03:34:33 ◼ ► corner or something like that. But I do I just I don't know, I could be wrong. But I do think that
03:34:38 ◼ ► these rules were designed basically with all these billion dollar companies aren't paying us anything,
03:34:43 ◼ ► how could we get money from them and left over, unthought of are the the long tail of smaller
03:34:51 ◼ ► developers who have hundreds of thousands of dollars or maybe low millions of dollars of
03:34:57 ◼ ► revenue, where and and a much lower revenue per user that this these rules are just unpalable to
03:35:06 ◼ ► that's okay, because for 99% of those small developers, the current situation with the small
03:35:17 ◼ ► infrastructure and the access to the platform and everything else from 15%. It's not that bad.
03:35:22 ◼ ► It's really not. All right. I said at the front, I should have had you on the show years ago. And
03:35:27 ◼ ► I think the runtime the runtime we've gotten to is proof that I was right. I was correct. I made
03:35:33 ◼ ► a grievous error by waiting until now to have you on the show, David, but we've got to wrap it up at
03:35:38 ◼ ► some point. I want to thank our sponsors at squarespace.com/talkshow and our good friends one more
03:35:47 ◼ ► time I get to say the word nuts nuts.com/the talk show. David's great, great weather app that you
03:35:55 ◼ ► all should immediately if you didn't pause the podcast halfway through to go download it is
03:36:00 ◼ ► weather up. Just search for weather up in the App Store and you'll get it. Is that the best URL or
03:36:05 ◼ ► is there a better URL than just search search in the app for weather app does actually find it
03:36:11 ◼ ► thankfully. So do you know we're not paying you to search for weather up bird we're just encouraging
03:36:16 ◼ ► you strongly and telling you it is absolutely worth your time. And absolutely do not miss the
03:36:23 ◼ ► widgets in weather up it is if if you look at the app, you're like, I don't know if this is the
03:36:29 ◼ ► weather app for me and the app itself, which I think is great. I love the map first presentation.
03:36:34 ◼ ► Don't skip the widgets before you make your decision. It is that key. David is active on
03:36:40 ◼ ► Twitter at Dr. Barnard, Dr. Barnard. My middle name is Richard. That's where that came from.
03:36:49 ◼ ► But it's your doctor. Yeah, but I've known that I've known that you must have I didn't know your
03:36:54 ◼ ► middle name exactly. But I figured it was your middle name issue. But I've always and I knew
03:36:58 ◼ ► you weren't a medical doctor, or you don't seem like the type with a PhD either just but not in
03:37:05 ◼ ► my mind. In my mind, your Twitter handle has always been Dr. Bernard and in the other guy,
03:37:10 ◼ ► he was on my show a couple years ago. But I don't know if you're familiar with the political
03:37:13 ◼ ► economic columnist Matt Iglesias. He's he's on substack. Now he was a founder of Vox, but he's
03:37:21 ◼ ► his name is Matt. Y-G-L-E-S-I-S. I'm not quite sure what the ethnicity of his surname is, but
03:37:30 ◼ ► it's Matt Iglesias with a Y. But his Twitter name is just all mushed together. And even though I
03:37:36 ◼ ► know his name is Matt and he got more Matthew, but he goes by Matt. I've always read his Twitter
03:37:41 ◼ ► handle is Matty. Even Matty Iglesias. So Dr. Bernard. A decade ago, Rene Ritchie, I think it
03:37:53 ◼ ► Yeah, you're a doctor of apps. Yeah, you should be. You're officially a student of the App Store.
03:37:58 ◼ ► You're an unofficial doctor. So thank you for your time. And I will I will have you back on soon.
03:38:03 ◼ ► We'll have to have to have you back on once the dust settles on on how much of this DMA stuff is