It’s More Than 3%
Consider Stripe, which is incredibly popular (and deservedly so). Stripe charges 2.9% plus $0.30 per transaction. That’s very fair and delightfully simple, but while that extra 30 cents per transaction is negligible for large transactions, for small ones, it’s very significant. Consider a $10 in-app purchase or monthly subscription charge. Through Stipe, that would incur $0.59 in fees — effectively 6%.
Shout out to John for mentioning the flat fee also usually associated with payments, which will mean it’s not break-even for merchants, it’s a net negative in most cases. Literally no one else seems to be mentioning this, which is wild because it meaningfully changes the math.
The whole reason many developers wish they could process their own payments in-app is to pay less in overall fees.
I’l push back on this bit, as reduced fees are absolutely a part of the equation, but they are not everything. I detailed the other benefits of using your own payments in June 2020 and they’re all still relevant today.
That slide above still looks like a good deal when compared to dedicated gaming platforms like Switch, PlayStation, and Xbox. It looks punitive, though, compared to install-whatever-you-want-from-wherever-you-want platforms like Windows and MacOS. It’s a matter of perspective, and while Apple’s perspective has been very consistent through the entirety of the iPhone era, they have conspicuously not explained their perspective as times have changed and as the platform has grown to half of a global duopoly.
I will never stop finding it funny that the argument is, “yes, the App Store fees are monstrously high compared to every single other way people sell apps today, but have you seen game consoles?”
My qualms aside, John does have a great overview of everything going on in this situation and you should read the whole thing 🙂