Apple Expects Google Voice App Developers To Pay Refunds Out Of Pocket

http://www.gizmodo.com.au/2009/08/apple-expects-google-voice-app-developers-to-pay-refunds-out-of-pocket/

by vaksel • 17 years ago

82 67 17 years ago

gizmodo.com.au

quoderat• 17 years ago

If Apple gets any more evil, they will become kind of parody found in a Mike Myers movie. Makes me regret buying my Cinema Display from them

9oliYQjP4• 17 years ago

I went to a free iPhone Developer Tech Talk where they specifically addressed this policy. Not too many developers in the audience seemed thrilled about it, but it was laid out in front of them. If a customer comes to you for whatever reason asking for a refund, Apple's official policy is that it is your problem to deal with. I specifically made a note about it because I caught the Apple representative's very lawyer-esque response which was to minimize what he said at all about the issue, except to really say "it's your problem".

I might add that I don't think this policy is due to maliciousness on Apple's part. The reality is that trying to handle refunds has a number of logistical nightmares associated with it, namely:

1. Refund standards and laws within contiguous regions that the store serves are inconsistent. For instance, just because you have Apple Store USA, doesn't mean that there can be one consistent refund policy. Now multiply this problem by the number of countries that the store is present in.

2. A great number of customers would use refunds as a way to "try before you buy". The numbers would be significantly high enough to cause a problem.

Now, there's that old saying that you should never attribute to malice that which can be attributed to ignorance. I strongly suspect Apple's approach to this specific case is a simple case of bureaucratic ignorance. I bet that you have a middle-management type implementing a policy that was designed for him/her based upon very specific legal advice. The situation has probably been flagged for attention by the legal department and upper management, but until a policy is designed, they have to address the current situation using known protocols.

If you were at the Tech Talk that I was, Apple apologized for a lot of the iTunes Store stupidity that developers were complaining about online. They also explained why things were the way they were and it wasn't due to Apple being malicious.

locopati• 17 years ago

I don't think developers have a problem with paying a full refund for user-returned apps so much as a problem with paying a full refund for Apple-returned apps (the capriciousness is just the icing on the cake).

pyre7• 17 years ago

You're missing the two main points:

1. The developer is on the hook for refunding 100% of the sale price... but Apple takes a 30% cut of the sale price. So the developer is actually _losing_ money to make a refund to the customer.

2. Apple is the cause of the refunds.

Apple is in a win-win situation here (for them) because they are making their own decisions and shrugging off any responsibility or consequences for their actions on to the developers. Wouldn't it be nice to have someone else take the fall and/or answer for the consequences of any actions that you take?

anigbrowl2• 17 years ago

You raise reasonable points, but consider in turn that Apple's whole brand is built around providing a friendly experience. They're certainly aware of app store trends at the upper management level, as evidenced by discussions with stock analysts on conference calls about whether the trend towards $0.99 apps means a race to the bottom that could lower the perceived value of the platform.

I agree that it's not as simple as Steve Jobs rolling around in a swimming pool of money cackling at the misfortune of penniless developers, but I find it hard to believe nobody has mentioned to him that the peasants are revolting.

luigi• 17 years ago

Wow, when it rains it certainly pours. Here's a poll asking whether or not our development plans have actually changed due to recent events:

http://news.ycombinator.com/item?id=737511

martythemaniak• 17 years ago

At the risk of sounding like an asshole, it's nice to see one's views validated. Some of us have been getting downmodded for bad-mouthing Apple's App Store and warning against this kind of stuff since its launch.

It's important to note that none of Apple's written or implicit policies have changed - it is only people's perceptions that are now changing.

The good part is of this debacle is that, either they will change their horrible attitude and policies, or people will abandon them for greener pastures.

chaosprophet2• 17 years ago

What I would like to see is a widespread developer boycott of the iPhone platform. This would bring Apple back to the days where they used to cajole developers into writing software for the Mac.

TomOfTTB4• 17 years ago

As long as there is money to be made there will always be developers so a boycott is pointless. If every developer currently in the app store decided to abandon it tomorrow it would only serve to create an irresistible target for developers who had been turned off by the heavy competition.

Until we live in a world where every developer has all the money they could ever want there will always be developers for a platform with over 30 million potential customers.

Gormo• 17 years ago

The analogy with the Mac doesn't really work, because the Mac has never been anything but a computing platform. But the iPhone is a phone first and a platform second. Remember that the iPhone was a huge success when it was introduced in 2007, despite a higher price point and no third-party apps at all.

As long as the iPhone is subsidized by phone carriers, Apple's cash cow will be hardware sales. It won't be until the smartphone market reaches a certain level of saturation that Apple will have an incentive to focus on the App Store as a revenue generator. And when that happens, I bet they will be a lot less mercurial with their developers.

axod4• 17 years ago

>> "people will abandon them for greener pastures."

Developers, maybe some. Customers? not until there is a comparable phone on the market. Which there isn't.

misuba• 17 years ago

And there won't be, until... developers start developing for something else.

If just ten independent developers with interesting apps ported to another platform (doesn't have to be to Android, but of course I'd prefer that) in a coordinated fashion, they'd get immense press and have some real impact.

9oliYQjP4• 17 years ago

The thing about the App Store is that it allows small developers to reach huge audiences without a lot of logistical headaches. Little things to brick and mortar stores, like charging the right amount of tax to a customer, are huge problems on the web when you're trying to reach customers across the world. On the other hand, there are definite risks associated with using the App Store and this is one of them. You're absolutely right that people will abandon the App Store for greener pastures. Let's just wait to see where those greener pastures are.

Also, as you said, nothing has changed. Developers trying to make money are businesses first and foremost. They should leave their fanboy-ism at home when they set up shop. The people that are complaining the most about getting screwed by the App Store, as jws points out in another comment in this thread, are the ones that probably didn't even bother reading the contract between Apple and them, let alone getting a lawyer to give them specific legal advice about it for them.

I know that the barrier of entry for starting a business is quite low these days, but that doesn't mean that standards for professionalism should drop correspondingly. Part of being a professional is understanding what your obligations are. These obligations are outlined in contracts. Contracts are the emergency manuals that get pulled out in case something goes wrong. They dictate what you agreed to do in those situations. You wouldn't haphazardly sign an emergency evacuation plan. You'd probably read it over and try to understand if it all made sense. Treat your contracts the same way. They're all about corner cases, so they're a big deal.

TomOfTTB4• 17 years ago

The problem here is that you're confusing "legally wrong" with "morally wrong". I don't think anyone here is questioning the fact that Apple has completely covered their ass with the developer agreement. In fact they’ve essentially made it so they can do just about anything with impunity.

But that doesn’t make it right or fair. I’m not one of those “everything should be open” types but Apple should at least be required to publicly spell out its terms. In the example given in the article a developer had their app approved and it was actually in the store for months. Apple then pulled it months later and refused to even give the reason why (which in turn prevented the developer from remedying the situation). Then turned around and said the developer was responsible for dealing with the disgruntled customers even if it meant refunding their money (which they'd have to do since they had no way to remedy the situation).

Further I'd suggest these discussions have a precedent in our society. Society recognizes the fact that some things are simply too morally wrong to be allowed. Even by contract. If I sign a contract saying I allow you to do anything you want to me you still can't beat me to death with a baseball bat. Though this is obviously not in the same realm of heinousness as that the precedent is the same. You can't legally indemnify yourself against that which society won't tolerate.

dejb• 17 years ago

It certainly has been a strange phenomena, seeing otherwise intelligent geeks arguing the virtues of such a closed and locked down system. I frankly started to wonder whether Apple had a team of paid voters. Hopefully all this results in a freeing up of US mobile networks.

pyre7• 17 years ago

Benevolent dictator syndrome. Apple/Jobs have produced a lot of cool and good products out of the 'my way is always the best way, and I need 100% micromanagement control to make things my way' attitude. Apple has always had this philosophy -- at least under Jobs -- but people tend dismiss it because up to now it's served Apple and Apple fans well.

Though I'm sure if you popped over to someplace like the AppleInsider.net forums there would still be a ton of people trying to defend Apple here. My feelings are the entire 'App Store Approval Process' issue boils down to this:

If Apple feels that they are so right _and_ justified to pull such stunts with the App Store, then why are they in many cases hiding behind some 'iron curtain' of corporate bureaucracy? Why not just come out and say, "These Google Voice apps duplicate 'x' functionality. Sorry, but we won't allow it." If their approval process is anything but blindly throwing darts at the wall, then why not _publish_ their standards so that iphone application developers _know_ what the do's and dont's are so they can navigate the minefield successfully? If those standards miss something, just amend them and apologize to the developer community for overlooking that aspect. But Apple is not doing _any_ of these things.

The developers for the AppStore are Apple's business partners on some level. They are obviously making Apps as part of their own business plans, but they are providing utility and functionality to Apple's product. Apple's product is _more valuable_ as a result of all of the various AppStore applications out there. Yet Apple seems to want to treat their business partners with disdain.

Personally, I would have a hard time trying to justify why I would want to do business with Apple after seeing the way it treats other companies that are doing business with it.

jws3• 17 years ago

Of course they have to pay the customer refunds.

The developers accepted a contract agreeing to refund money in certain circumstances, the circumstance have occurred, it is time for them to uphold their end of the contract.

The sales have been rolled back, the customers' money is in the developers account (as sympathetic as "pocket" sounds, if they can carry the money in their pocket then this is about very little money at all), the customers get their money back.

I think perhaps everyone that learns this lesson does it the hard way. Understand the contracts you enter into.

(I learned mine at the hands of Digital Equipment Corporation. For "good will" reasons I agreed to supply a specific key person for a specific nearly completed project until it was finished for a specific sum. All good, until it became in Digital's best interests to not complete the project on time and get more money from the customer for another year's work. I'm sure the Digital managers had many a good laugh that year.)

invisible• 17 years ago

I agree, contracts are legally binding. However, there are judgments against contracts in civil court cases merely because the contract is ludicrous. E.g. Apple approved the application, then breached the values of the contract (despite it not being written in the contract) by rejecting the application although the application did not drastically change during it's life-cycle. (The argument may fall better under lacking competency to manage the App Store.) With this FCC ruling, I think an application developer would be insane not to sue for breach of contract by Apple.

fatdog7892• 17 years ago

Or to put it more succinctly: Apple cannot retain the 30% if it was the cause of removal for an otherwise rules-abiding application. It's known as the doctrine of unclean hands (or possibly may even just be a plain ol' breach of contract).

mhughes• 17 years ago

It's not just about the refunds. The real issue is that they deny developers apps and give them no more than an up or down vote. And when you try and talk to somebody, they don't even give you the courtesy of a real conversation. Apple is nothing without its legions of fans. Those fans start with a kernel of developers and tech enthusiasts. You think my mom would have bought an iPhone if her geeky son didn't harass her for months that it's the only phone worth having? You think my sister-in-law wouldn't have bought a Mac if I hadn't convinced her that it isn't this scary OS that's so different from Windows?

I understand Apple has business contracts. I understand they are out to make money. All we're asking is that they stop being such profound douchebags in the process. All we're asking is that they stop shitting on the very people who helped build their success. All we're asking is they stop FREAKING people out with their man-behind-the-curtain/NDA-siging/cyborg-talking dev program.

jrwoodruff2• 17 years ago

I agree 100% with this. Apple's geek core is at least part of the reason they're growing. It's not easy to convince a barely computer-literate person to leave behind the environment they 'know', but I've converted my wife, my mom, my brother.

This s#@t is leaving a bad taste in my mouth though, and I'm not even a developer.

DougBTX2• 17 years ago

> The customers' money is in the developers account

It gets worse: some 30% of that money is in Apple's pocket, but 100% of the refund comes from the developer.

Apple gets to keep their cut even after the refund, as per the developer contract, even though the reason for the refunds is because of Apple blocking further deployments from the developer.

Harsh circumstances.

jws3• 17 years ago

I think you are misinformed. Some people read the developer agreement this way and trumpeted loudly, and it is a fair interpretation, but as I understand it Apple only retrieves the 70% they paid the developers from the developers.

See http://news.cnet.com/8301-13579_3-10205293-37.html and skip down to the "Updated 4:00 p.m." at the bottom of the article where the journalist adds the response from Apple's representative.

Are there sources where developers document being charged 100%?

sammcd• 17 years ago

Why is this only newsworthy when Google has to pay the price. Developers have had to pay this price since the inception of the app store. This is one part of the agreement that I think is very unfair, and I am glad it is getting press.

Sure we signed a legal agreement, but still it is a bad deal for us, and we have no alternative.

pyre7• 17 years ago

It should have been newsworthy a long time ago. It's only really hitting the fan now because:

1. They rejected Google who seemed to be on good standing with Apple. (i.e. If they'll reject Google over something obtuse, they'll reject anyone)

2. The FCC has even decided to get involved. If this had not happened, there would have been a large uproar in the 'geek community,' but it might have actually died down. A government body conducting an investigation into this gives the story more legs.

3. It was a number of Apps rejected all at once and all related to the same technology (Google Voice). This gives it more attention due to scale (vs. single apps here and there).

4. The number of stories of stupid AppStore approval decisions has been steadily growing. There is a sort of cumulative affect.

anigbrowl2• 17 years ago

Because Google has the financial and social capital to publicly humiliate Apple if they feel like it. In other words, they are big enough to take revenge without putting their bottom line or brand at serious risk.

You know, flip off your neighbor and only a few people care. Flip off the president and you'll have people demanding you be brought up on treason charges.

quizbiz• 17 years ago

I have no intention of asking for a refund. I have no intention of deleting my GV Mobile app.

credo2• 17 years ago

I realize that this is a contrarian view, but (in its aim at being sensational), the headline is incorrect.

Apple has not said that it expects developers to pay any refunds out of pocket. On the contrary, the app-store/itunes agreement tells consumers/users that they are not entitled to any refunds for the apps they purchase.

Again, I realize that this is a contrarian view and every comment on this item (more than 50 comments?) seems to assume that the headline is correct. However, can any of you point to any evidence that Apple wants developers to refund users for any GV related app.

credo2• 17 years ago

so this has been downvoted for pointing out that the headline is incorrect and that people should look at the facts ?

anyway, I'll say it again. Apple has not said that it expects devs to pay refunds out of pocket. The headline is incorrect. If you disagree, please make the case for your argument instead of anonymous downvoting.

cubicle672• 17 years ago

Yes, the headline is sensationalist and incorrect. What's worse is that I've had to trawl through several hundred comments (I had the misfortune to venture into Reddit territory) before I found someone who noticed.

The actual story is that if any customer who has already purchased one of these apps decided to claim a refund, and that claim is accepted by Apple, then the developer loses the money they made from that sale (70% of the purchase price). That's it.

The only difference between this and any other app, is that these developers are unable to update their apps to fix any existing bugs.

stalf• 17 years ago

And they dig deeper on their stupidity hole...

Apple Expects Google Voice App Developers To Pay Refunds Out Of Pocket

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