Apple’s Termination of App Store Affiliate Payments Is Unnecessary, Mean-Spirited, and Harmful


(Adam Engst) #1

Originally published at: https://tidbits.com/2018/08/02/apples-termination-of-app-store-affiliate-payments-is-unnecessary-mean-spirited-and-harmful/

As of 1 October 2018, Apple will stop paying affiliate fees on apps purchased through recommendation links. It’s a small-minded, unpleasant move that can’t benefit Apple in any significant way but will hurt many small publishers, although TidBITS won’t be affected.


(SD) #2

Google has never offered affiliate bonuses for links to apps!
So why is Apple ‘mean spirited’ to offer pay outs for 10 years, when Google hasn’t paid out a dime?


(Fritz Mills) #3

Uh, because Apple isn’t Google, and has a completely different business model? Unlike Google, Apple doesn’t sell you out.


(Doug Hogg) #4

To me, friends are those who help each other. I think that Apple should continue to support its friends, namely companies and small business that have helped and supported Apple in some cases for a decade. Apple is now on top of the heap and it needs to remember how it got there.


(Simon) #5

I agree with every word you say. But honestly, looking at Apple’s actions during the last 5 or so years, can we really be that surprised?


#6

SD1

Google has never offered affiliate bonuses for links to apps!

Though it wasn’t specifically for apps, Google shut down its affiliate program around 2013. Though they didn’t give a reason at the time, it was kind of obvious they didn’t need the headache of running it when it didn’t generate much revenue compared to what they earned from advertising. They acquired it when they bought DoubleClick back in the late 90s, and had better ways to make profits by getting ads in front of precisely targeted audiences, via their AdSense program, and to target different iOS devices:

https://www.google.com/ads/affiliate network/

Apple started selling ads in the App Store about a year or two ago. They’ve also been bragging about how much smarter their App Store search algorithms have become, and they also offer the ability for advertisers to run test versions:

https://searchads.apple.com/

Search Ads Basic is pay per install, which is great for developers:

https://searchads.apple.com/basic/?cid=G-Q318Test-IBT-SL2

After expanding to Mexico, Canada, Australia and New Zeeland, they just began rolling out in Europe and Asia last week:

https://adexchanger.com/mobile/apple-finds-success-with-app-store-search-ads-hits-new-markets-in-asia-and-europe/

So why is Apple ‘mean spirited’ to offer pay outs for 10 years, when Google hasn’t paid out a dime?

I agree they aren’t any more or less mean spirited than Google; they’re just focused on becoming the first two trillion $ company. They’re reportedly talking to Pinterest and Snap about selling ads for apps on their apps. It could be very profitable for developers too:

https://www.mobilemarketer.com/news/report-apple-mulls-app-network-with-snap-pinterest-to-grow-ad-business/524886/


(Tommy Weir) #7

It’s odd that they retained other media within the program. If it’s a headache, then surely that would be too.

Your points about search ads are very interesting Marilyn, and seem on point to me. If Apple can shift away from community led to professional service they will.

Actually the more I think about it, the more what you say makes sense. They don’t have to payout, instead they get paid. It explains why this is happening on the App Store as opposed to other media, charts and popularity being determined externally (at least on the surface) within music and film. And I wonder if Screentime data will end up informing rates for ads within significant apps.


(Adam Engst) #8

Because Apple’s behavior in this case is mean-spirited in isolation, regardless of what any other company may or may not do.


(tewha) #9

I think this is of tremendous benefit to end users. For years, an approach to monetization in apps has been to try to sell people other apps. That practice drove a wedge between what was good for users and what was good for developers, making it no longer about providing a good app but about providing an app that people would download and be teased into getting another app, which would tease into getting another app. It’s been a mess, and the practice should be a lot less common after the affiliate program is shuttered.

Far from “mean spirited,” I’m always impressed when Apple can make a simple change to align their own and others’ interests with their users.


(floatingbones) #10

No. Well-researched recommendations for products are good for both the buyers and the sellers. The Wirecutter is a tremendous source of information. While I don’t always agree with all its conclusions, I consistently learn things from the stories (and the reader feedback). Ditto with Appshopper and Toucharcade – clearinghouses that will definitely be damaged by this decision.

People are not dumb. They are suspicious. They don’t get “teased” into buying an app through low-quality reviews placed solely for an affiliate payback. They naturally gravitate towards sources that can be trusted. And affiliate sites like The Wirecutter could not exist without affiliate referrals.

Are you suggesting that all media referral systems should disappear? If not, where exactly are you drawing the line?

One other note: I’m really disappointed with the timing of this announcement. Apple timed it one day after the quarterly investor call. Could they really not stand any questions about dropping this program?


(tewha) #11

I can do this, too:

No. 1% useful is not worth 99% useless spam. Apple is eliminating the economics of app spam. More power to them.


(Adam Engst) #12

Really? Do you have any stats on how common this practice was? I’ve never heard of it being a concern, since presumably people would only consider downloading a promoted app if the first one was any good. That doesn’t seem like an abusive situation.

Plus, if Apple were concerned about that sort of app behavior, I think they’d deal with it in the App Store guidelines, not in a back-handed way that hurts many other parties.


#13

tommy
Tommy Weir

    August 3

It’s odd that they retained other media within the program. If it’s a headache, then surely that would be too.

They are probably making a lot more money on movies, music and books. From the results of the past few quarters, it’s clear that services are contributing more and more to Apple’s cash pile. The app affiliate program was probably loosing more money than it was making. Because it’s curated and heavily controlled the program is expensive to maintain, they probably are loosing money even with the reduced commission rate. And redesigning, rebuilding and maintaining the even more heavily curated search isn’t cheap or inexpensive to maintain.

Other than TidBITS, there are very few sites I trust on app recommendations. My personal experience is that there are so many sites that seem to exist just to make money off of recommendations that they end up promoting a lot of junk. And as more and more companies give away the app for free and make money from in app purchases, subscriptions, advertising, sponsorships, etc. the prognosis looks worse for business that depend on affiliate revenues anyway. Personally, I’m surprised Apple kept the commissions going as long as they have.

There are many sites out there, including TidBITS, that are doing well because they earned the trust of readers because they provide objective reviews and excellent advice. They are in business because they are not dependent on App Store commissions. There are probably millions of Android focused app review sites out there that have thrived even though they never received a cent in commission from Google in years. The sites that are commission dependent need to adjust.

Your points about search ads are very interesting Marilyn, and seem on point to me. If Apple can shift away from community led to professional service they will.

Thanks! And I think the pay per install ad program will especially help small developers, as will better search and increased discoverability.


(floatingbones) #14

[quote=“tewha, post:11, topic:5582”]
I can do this, too:[quote]

Perhaps. But if you make a claim, you have to provide the source of your data.

Where exactly does that 99% number come from?

I don’t go to “useless spam” websites that promote the buying of apps. I go to trusted sites, like Appshopper, to shop for apps. I look at editorial entries from Tidbits, iMore, MacRumors, and others. I have no idea where your 99% number comes from. Unless you provide actual data, it appears you pulled it out of your… ear.

Apple is throwing out the baby with the bath water.

Tewha: you failed to answer my question: “Are you suggesting that all media referral systems should disappear? If not, where exactly are you drawing the line?”

Please answer now. I find The Wirecutter incredibly useful, and (somehow!) I manage to avoid the “99% useless” spam of low-content Amazon affiliate links. Why are you seeing so many spurious referrals? Explain how you came up with that bizarre claim!

Just like Apple app affiliate links, the world would be a far worse place if Amazon affiliate links disappeared.


(Tommy Weir) #15

@ace’s article is current lead article at Daring Fireball.

https://daringfireball.net/


#16

I think it’s just really bad timing and strategy, plus horrible copywriting. They need a better PR department.


#17

floatingbones

    August 3

Well-researched recommendations for products are good for both the buyers and the sellers. The Wirecutter is a tremendous source of information. While I don’t always agree with all its conclusions, I consistently learn things from the stories (and the reader feedback).

There is a big difference between The Wirecutter’s review policy and virtually all other sites that earn App Store commission:

Do your affiliate commissions make you biased?

Up front: Our writers and editors are never made aware of which companies may have established affiliate relationships with our business team prior to making their picks. If readers choose to buy the products we recommend as a result of our research, analysis, interviews, and testing, our work is often (but not always) supported through an affiliate commission from the retailer when they make a purchase. If readers return their purchases because they’re dissatisfied or the recommendation is bad, we make nothing. There’s no incentive for us to pick inferior products or respond to pressure from manufacturers—in fact, it’s quite the opposite. We think that’s a pretty fair system that keeps us committed to serving our readers first.

https://thewirecutter.com/about/

And the big majority of what they review is gear, not apps.

People are not dumb. They are suspicious. They don’t get “teased” into buying an app through low-quality reviews placed solely for an affiliate payback. They naturally gravitate towards sources that can be trusted. And affiliate sites like The Wirecutter could not exist without affiliate referrals.

You might not be “dumb,” but I’ve earned a living working on many projects that convinced many very intelligent and educated people to buy things they don’t really want or need. Including, for quite a few years, cigarettes.


(floatingbones) #19

I put you in the same bucket as TWiT, MacRumors, MacStories, iMore, AppShopper, TouchArcade, and (yes!) TidBITS. You all do your due diligence on (most of) your recommendations. I trust you.

And, sometimes, even The Wirecutter blows it. Your information and discussion of Nordic Walking poles was incomplete. You should have found an instructor from California or (even better) an instructor from Europe to explain it to the audience. No biggie. I still trust you. :smile:

This is a strange question. Since I’m not registered with any company providing affiliate compensation, I don’t have any “bias” here. What led you to that bad assumption?

Listen: I don’t even mind if developers have affiliate links to their own apps. If they make a compelling case for their product, I have no problem with the dev getting a few more percentage points on any app purchases. David Smith’s excellent blog article about workouts++ comes to mind here. Mr. Smith is clearly “biased” about which app he’d like you to buy, but he makes a passionate case.

It’s a distinction without a difference. Any of your writers/editors who are curious can look up the affiliate links themselves.

This is also true for app store app purchases.

All of the websites I mentioned also have the EXACT same commitment. Rene Ritchie (iMore) is the embodiment of commitment to his audience, as is Federico Viticci of MacStories, Arnold Kim of MacRumors, and Adam Engst of TidBITS. Outstanding people all, and all have an outstanding product. Rewarding them with a commission from purchases made through their recommendation is entirely appropriate.

That was your choice.

Really, Wirecutter is great, but it is hardly a unique source of greatness. It doesn’t take a huge amount of smarts to trust the app-recommending websites I listed above. Anyone who knows the “site:” keyword can find out pretty well anything they need in that list of top-shelf sources.

And Adam is dead right: these publishers play a critical and positive role in the app ecology. Hurting these indie businessmen very un-Apple thing to do.

I am mystified with @tewha’s comment that 99% of the affiliate-supported writings he sees are “useless spam”. That just doesn’t add up!


(Tommy Weir) #20

If humans stopped buying what they don’t need, where would we be? Hmmm, question for another day. In the interim The Wirecutter rocks. Took 95% of my “Tommy, which X should I buy?” enquiries away. I am happy to point family and friends there. Their version of due diligence is exemplary and open with regard to process and metrics. A very smart purchase by the NYT.

In regard to Apple, timing and spirit of it was poor. Doesn’t surprise and can’t see it being rolled back.


(Jeff Hecht) #21

Big companies with affiliate programs tend to throw the affiliates under the bus once they have served their purpose of building the business. Amazon used an affiliate program to help it get off the ground, and I became part of it to market my books. For a year or two, it was a nice little source of supplementary income that also gave readers a good deal on my books. Then Amazon started changing the rules and the income became a trickle. They haven’t killed the program, but they’ve squeezed it down to the point that it’s hard to make much money.