Apple executives have discussed not to ‘leave money on the table’ when deciding Apple TV subscription fees

Emails from Apple executives revealed in Epic Games lawsuit against Apple highlight how the company came to its conclusion to cut all App Store transactions by 30% so as not to “leave money behind on the table”.

A discussion thread from 2011, spotted by The edge, presents Apple Services Chief Eddy Cue discussing the commission the company should charge vendors for content subscriptions accessible through Apple TV (an “ App Store ” on the set-top did not exist at the era.) Apple executives considered charging for a 40% subscription – a time reduction, a one-time 30% reduction, a 30% ongoing charge, or custom agreements with different vendors.

The Apple team finally decided to charge the same 30% fee as on the iTunes Store and the “App Store”. Another email also explains how Apple should negotiate referrals, where “Apple TV” apps connect to a provider’s website for customers to subscribe to the service directly.

One executive said he wanted to make sure to protect the 30% fee that had long been listed in the “App Store,” but said it would remain open to other transaction structures.

“I don’t want to make a deal where we get less than 30%. That’s what’s on the app store and we can’t make a different deal here. If that’s not possible, I want to make it a… time bounty, but we have to be very careful here so that it doesn’t spill over to the App Store, ”wrote one executive. (The emails are organized in such a way that it is difficult to tell who is replying to whom.)

Overall, the discussion thread seems to suggest that discussions have evolved in an off-the-cuff way among Apple executives regarding vendor fees during the early development of the “Apple TV” platform, maximum profit. being the main concern.

Amid increasing scrutiny of its “App Store” practices, Apple in November announced the Small Business Program, which reduced App Store fees to just 15% for developers earning less. one million dollars per calendar year. The “App Store” commission remains at 30% for developers earning more than $ 1 million per year.

The program has since received praise from many developers, but some major developers, including Epic Games, have criticized the move, claiming it undermines “App Store” rules. “Epic Games” is not eligible for the reduced commission because it exceeds the $ 1 million threshold. Apple said the program would benefit the “vast majority” of “App Store” developers.