Slashdot Mirror
iPhone App Refund Policies Could Cost Devs
CBRcrash writes "Apparently, if iPhone users decide that they want a refund for an app (users can get a refund within 90 days, according to Apple policy), Apple requires that developers give back the money they received from the sale. But, here's the kicker: Apple will refund the full amount to the user and says that it has the right to keep its commission. So, the developer not only has to return the money for the sale, but also has to reimburse Apple for its commission."
But either way, Apple is still providing a service here that both the developers and the consumers are using. Just because the consumer requires a refund doesn't make the cost of providing that service magically disappear.
...my opinion of them drops more and more. I think my opinion of them can't get worse, but they always manage to come up with some way. :\
I only hope that the devs are all quickly made aware of this and decide to do something to fix it, be that changing platforms, harassing Apple for a change, or whatever else works for them. There's no cause at all for devs to risk a loss of 30% of their initial charge per sale.
But either way, Apple is still providing a service here that both the developers and the consumers are using. Just because the consumer requires a refund doesn't make the cost of providing that service magically disappear.
So how does the developer of a pay application prevent someone from doing a DoS on the developer's bank account by asking readers of his blog to buy the app and get a refund?
I just got my sales reports for february (my first month) and I have one return. My app sells for $2.99 and I get $2.10 per sale. I was debited $2.10 not $2.99 on this statement so maybe this is not in effect.
cnet already looked into this and debunked it two days ago: http://news.cnet.com/8301-13579_3-10205293-37.html?tag=mncol;title
not in defense of apple, only that they are all equally evil.
I run an online game and "chargebacks" are really annoying. How it works is that if someone calls their credit card company and says "I don't recognize this charge", Visa immediately removes the charge and debits our account the $13.95 monthly fee, plus a $25 "chargeback fee". We then have the opportunity to provide documentation that they really did sign up for the game.
If Visa then determines that the charge was legitimate, we get the $13.95 back (but not the $25.) If they determine that the charge was not legitimate, then we get neither back, and are charged an additional $25.
The worst that's happened is that someone used a bunch of stolen credit cards to create dozens of accounts over several months, always being careful to use open proxy servers. So we ended up with $1800 in chargebacks, and no way to stop them!
What we ended up doing was explaining the situation to everyone in the community, and when this guy contacted any of his in-game friends ("hey it's me, just had to create this new character") they would tell us and we would shut the account down right away and reverse any charges, but what a PITA!
Eventually this guy moved on, but we never did find him. Some social engineering indicated that he was from playing from internet cafes in Romania, but that's as far as we got.
Read the bottom of the article, the wording has been in the contract since day one. In addition Apple charges back the 70% not 100% in the event
the customer is even able to return it.
Got Code?
Duh! It's the restocking fee of course...to offset the cost of putting that icon back among the others at AppStore.
1) Make every Apple staff buy an iPhone
2) Make every Apple staff buy as much 3rd-party iPhone App as possible
3) Request refund
4) ???
5) Profit!
If people are returning 7 out of 10 purchases, you still break even. If your software is getting 7 of 10 returns, it's either horribly broken or doesn't do what you say it does, so you shouldn't be getting paid, anyway.
After bricking unlocked iPhones, kicking applications off the iPhone store that might even slightly compete with iTunes in the far future, filing a wave of patents on basic well-known computer science and openly sodomising iPhone developers in the city square of Palo Alto, Apple Inc. today filed a Form 8-K with the Securities and Exchange Commission declaring that it was openly adopting Evil(tm) as a corporate policy.
"Fuck it," said Steve Jobs to an audience of soul-mortgaged thralls, "we're evil. But our stuff is sooo good. You'll keep taking our abuse. You love it, you worm. Because our stuff is great. It's shiny and it's pretty and it's cool and it works. It's not like you'll go back to a Windows Mobile phone. Ha! Ha!"
Steve Ballmer of Microsoft was incensed at the news. "Our evil is better than anyone's evil! No-one sweats the details of evil like Microsoft! Where's your antitrust trial, you polo-necked bozo? We've worked hard on our evil! Our Zune's as evil as an iPod any day! I won't let my kids use a lesser evil! We're going to do an ad about that! I'll be in it! With Jerry Seinfeld! Beat that! Asshole."
"Of course, we're still not evil," said Sergey Brin of Google. "You can trust us on this. Every bit of data about you, your life and the house you live in is strictly a secret between you and our marketing department. But, hypothetically, if we were evil, it's not like you're going to use Windows Live Search. Ha! Ha! I'm sorry, that's my 'spreading good cheer' laugh. Really."
http://rocknerd.co.uk
Since Android came out I've been cheerleading/fanboying for it. I own a G1, the 1.1 version of the OS is about to come out, and although there are many apps for it already it needs a lot more, and a lot of people who find the platform fun.
Android ought to be the platform you thought Apple used to be. No stupid rules, no Apple kowtowing, just write your code. If you don't like the way Android Market works (and it can't be as bad for developers as Apple's) then you can still publish your .apk file anywhere else you please online.
It's rare that you're presented with a knob whose only two positions are Make History and Flee Your Glorious Destiny.
from TFA:
"Let's say you sell a 99-cent app. You get 70 cents per sale. You sell 1,000 copies and make $700. Let's say your return rate is a whopping 3 percent (good God! Why are 3 percent of your customers returning the product?!). So you pay back $30; net $670.
and further...
Transaction fees for online credit card processing can run as high as 25 cents to 30 cents per transaction, plus a percentage of the amount. But consider the 99-cent application, the most predominant price used on the App Store.
A micropayment transaction (less than $10) processed by PayPal carries a 5-cent transaction fee plus 5 percent of the amount. Assume that Apple has negotiated a similar fee with its payment processors; it would therefore be charged roughly 10 cents on each 99-cent purchase, reducing its cut of that sale to 20 cents. If it were charged a similar amount for a refund, its cut would be down to 10 cents.
Obviously, Apple, with the biggest music store in the United States, processes an awful lot of small transactions and therefore probably gets some sort of attractive volume discount that's less than the example provided above. But that doesn't mean that it gets that service for free: processing transactions on the Internet costs money, whether you are Apple or Joe Developer.
Updated 4:00 p.m. - An Apple representative said the company's policy concerning refunds and developers is that when a refund is granted on a purchase made through the App Store, Apple returns the customer's money and debits the developer's account by 70 percent of the application price, or the revenue the developer had gained on the sale. The company does not charge the developer an additional 30 percent during the refund process, the representative said.
So it would appear that Apple is at least being as nice about this as all the other publishers, isn't creating any outrageous chargebacks, and has said this was their policy from day 1, two important things the submitter seems to have overlooked in their summary.
Any credit card purchase you make, if you take it back and get a refund, you get 100% of your money back. What happens to the 3-7% the credit card processor skims off the sale? The store doesn't get it back, the manufacturer doesn't cover the charge. The store loses that money, every time. Same thing here, Apple is just passing that small loss onto the developers. But I do see a difference, if you return an item to WalMart then WalMart (the store) eats the difference and Sony or whoever isn't affected. But with ITMS, Apple is providing the devs a service for that cut, whereas WalMart isn't providing Sony a service really. Apple believes that this tilts the burden of the loss to the devs. Also to be fair about it, the devs are chiefly responsible for the number of times their apps get returned. ;)
I work for the Department of Redundancy Department.
This has apparently been debunked, so the story summary on the front page is not true. The editors need to update the summary.
I shit you not, if you make "too much" money, the processing companies will hold your money for up to 6 months - just because they can justify it with their terms of service.
You need a merchant account with a real bank. This is more work to set up, but your merchant bank account doesn't have to be controlled by the card processing service. When I did this, I used Bank of America. There are monthly charges, and you may have to keep a deposit (a CD, for example) in the bank as security. But the money goes into your account the day after the card is charged.
People in the "adult" industry have much tougher banking problems, because most of the big banks won't take their business. The terms from the "adult" credit card providers are much tougher, and many of them are ripoff outfits. (I once got a heated twenty minute lecture on this subject from a San Francisco bondage model and web site operator; she'd lost hundreds of thousands of dollars through troubles with an offshore "adult" credit card processor.) In that area, you do see multi-month holdbacks.
I once got a heated twenty minute lecture on this subject from a San Francisco bondage model
In other words, she tied you up in conversation?
8 of 13 people found this answer helpful. Did you?