Devs have to pay an additional 42% when customers get a refund. Is this true?

According to the article below, of you buy an app for $10, Apple takes $3, and the dev gets $7. But when you ask for a refund, the dev has to refund the entire $10; Apple keeps its $3. So when you apply for a refund it actually costs the developer an additional 3/7 = 42% of his share of the app price.

Here’s the article, which is very out of date:

https://www.cnet.com/news/apple-refund-clause-bad-for-developers/

They quote the Apple terms of service agreement with developers, which I did not read when I signed it:

6.3 In the event that Apple receives any notice or claim from any end-user that: (i) the end-user wishes to cancel its license to any of the Licensed Applications within ninety (90) days of the date of download of that Licensed Application by that end-user; or (ii) a Licensed Application fails to conform to Your specifications or Your product warranty or the requirements of any applicable law, Apple may refund to the end-user the full amount of the price paid by the end-user for that Licensed Application. In the event that Apple refunds any such price to an end-user, You shall reimburse, or grant Apple a credit for, an amount equal to the price for that Licensed Application. Apple will have the right to retain its commission on the sale of that Licensed Application, notwithstanding the refund of the price to the end-user.

So the 30% that goes to Apple is a “service fee” that the developer pays to Apple in exchange for use of the App Store. And when a customer asks for a refund, Apple keeps the 30% service fee but the developer still has to refund 100% of the app price.

Ouch!

If this is true then every time you use the refund system to “try out” and app, you are taking 30% of the app price from the developer and giving it to Apple. That’s a pretty sweet deal for Apple.

However, This article from 2009, says it’s not actually happening that way:

https://www.google.com.vn/amp/s/www.imore.com/apple-charging-developers-100-app-refunds%

No references though.

I have difficulty figuring out if this is correct or not because Apple doesn’t show individual app sales and refunds on their financial statements. It’s all lumped together.

Can anyone confirm if it’s true or not?

I’m curious because on another thread a customer was advocating buying apps to try them out and then getting a refund when you are done testing. I thought that was a good idea because it gives a free trial period, which is nice for both developer and customer. But it’s not nice to make the app dev pay 42% of his app revenue every time a customer does a “free trial”. I think customers who do this “trial” thing would stop if they knew it was costing the developers money, so it would be nice to know for sure if it’s really being charged like that or not.

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Comments

  • I've just written a post on another thread on this, but without knowledge of the claim made above. As I've said in the other thread, in the absence of a trial system I see no other option for users. However, if the above is true, it does muddy the waters a bit more. That said, the problem is with Apple, not the user.

  • @audio_DT said:
    I've just written a post on another thread on this, but without knowledge of the claim made above. As I've said in the other thread, in the absence of a trial system I see no other option for users. However, if the above is true, it does muddy the waters a bit more. That said, the problem is with Apple, not the user.

    Agreed 100%.

    The question is, is it really true?

    If not then as a dev I am happy to see people use the refund system to try before they buy.

    But making the devs pay extra to give refunds to customers who never really intended to buy in the first place?

    Perhaps they could print a notice on the screen that just tells the customer what is going to happen when he or she requests a refund. If a dev marketed an app deceptively and it wasn’t as advertised, perhaps that scheme is justified. But if the customer is just trying it out... I believe 99.9% of customers on this forum, including @audio_DT wouldn’t choose to get the refund for an honestly advertised app if they knew for sure it was costing the devs additional money above and beyond their share of the app revenue.

  • @Blue_Mangoo said:

    @audio_DT said:
    I've just written a post on another thread on this, but without knowledge of the claim made above. As I've said in the other thread, in the absence of a trial system I see no other option for users. However, if the above is true, it does muddy the waters a bit more. That said, the problem is with Apple, not the user.

    Agreed 100%.

    The question is, is it really true?

    If not then as a dev I am happy to see people use the refund system to try before they buy.

    But making the devs pay extra to give refunds to customers who never really intended to buy in the first place?

    Perhaps they could print a notice on the screen that just tells the customer what is going to happen when he or she requests a refund. If a dev marketed an app deceptively and it wasn’t as advertised, perhaps that scheme is justified. But if the customer is just trying it out... I believe 99.9% of customers on this forum, including @audio_DT wouldn’t choose to get the refund for an honestly advertised app if they knew for sure it was costing the devs additional money above and beyond their share of the app revenue.

    I've no idea if it's true - it seems like a scandal if it is, though, because Apple would effectively be extracting money from developers in a way that seems to me, at least, to be of questionable legality. No doubt it is legal, I suppose, because Apple are big enough to do their homework on the matter, but, if it's true, it's a policy that absolutely stinks. It really would amount to thievery, in my view, and we should all campaign against it. You're right, @Blue_Mangoo that I wouldn't return an app for a refund if I knew it was costing the developers money (unless, of course, the developer sold the app deceptively, etc.). It would be good to get all this clarified because it looks very bad if the claim is true.

  • From what I read it seems Apple insist on having the right to do this and it’s in the dev contracts, but that Apple would only exercise that right under circumstances where a dev intentionally or very carelessly caused an abnormal amount of refunds. Which seems fair if accurate...sounds like it’s just a legal safeguard so people can’t try to rip off a million people without knowing there could be consequences.

    But that’s just the impression I got from quick google search. Could be wrong...

  • That’s messed up if true and unfair for all the hard working devs.

    I think maybe that’s why SugarBytes let’s you try the apps for free and charge only as an IAP. I think this might be the future for all apps so that Apple won’t rip off the devs.

  • @Tones4Christ said:
    That’s messed up if true and unfair for all the hard working devs.

    I think maybe that’s why SugarBytes let’s you try the apps for free and charge only as an IAP. I think this might be the future for all apps so that Apple won’t rip off the devs.

    That's an excellent point. I don't like IAP because its extra work to implement. But perhaps I should get used to it, in light of this consideration. I do want customers to try before they buy. But I'd rather not pay for it when they do.

  • Oh dear. I do a sad face when I see a return. Now it will be a sad face + tears

  • edited July 10

    Don’t devs get a sales figure number (amount of individual sales) for each month?
    Surely they do and can just minus 30% from that, then if the numbers don’t add up then they’d see some money had vanished...

    pretty sure devs would have noticed something like that and we’d have heard a lot more about it?

  • @Tones4Christ said:
    That’s messed up if true and unfair for all the hard working devs.

    I think maybe that’s why SugarBytes let’s you try the apps for free and charge only as an IAP. I think this might be the future for all apps so that Apple won’t rip off the devs.

    The only problem with the IAP method is that IAP's don't cover family sharing. But, yes, it's definitely an option.

  • @audio_DT said:

    @Tones4Christ said:
    That’s messed up if true and unfair for all the hard working devs.

    I think maybe that’s why SugarBytes let’s you try the apps for free and charge only as an IAP. I think this might be the future for all apps so that Apple won’t rip off the devs.

    The only problem with the IAP method is that IAP's don't cover family sharing. But, yes, it's definitely an option.

    I wasn’t aware of this. So IAP wont go across all my devices?

  • @EyeOhEss said:

    @audio_DT said:

    @Tones4Christ said:
    That’s messed up if true and unfair for all the hard working devs.

    I think maybe that’s why SugarBytes let’s you try the apps for free and charge only as an IAP. I think this might be the future for all apps so that Apple won’t rip off the devs.

    The only problem with the IAP method is that IAP's don't cover family sharing. But, yes, it's definitely an option.

    I wasn’t aware of this. So IAP wont go across all my devices?

    They go across all devices connected to your Apple ID but you can't share the app with anyone on your 'family sharing' list. With any other app I've ever used, I can buy, say, Tube AU and share it with anyone on my 'family sharing' list.

  • @audio_DT said:
    I've just written a post on another thread on this, but without knowledge of the claim made above. As I've said in the other thread, in the absence of a trial system I see no other option for users. However, if the above is true, it does muddy the waters a bit more. That said, the problem is with Apple, not the user.

    No, the problem is with you.

    You know the rules, you know the devs will be out of pocket, if you’re not sure about an app ask on the forum for feedback.

  • @audio_DT said:

    @EyeOhEss said:

    @audio_DT said:

    @Tones4Christ said:
    That’s messed up if true and unfair for all the hard working devs.

    I think maybe that’s why SugarBytes let’s you try the apps for free and charge only as an IAP. I think this might be the future for all apps so that Apple won’t rip off the devs.

    The only problem with the IAP method is that IAP's don't cover family sharing. But, yes, it's definitely an option.

    I wasn’t aware of this. So IAP wont go across all my devices?

    They go across all devices connected to your Apple ID but you can't share the app with anyone on your 'family sharing' list. With any other app I've ever used, I can buy, say, Tube AU and share it with anyone on my 'family sharing' list.

    Ah ok cool. That’s not so bad, at least for my own fam/devices situation.

  • edited July 10

    I personally think it’s shameful that anyone would consider getting a refund for an audio app - regardless of whether the extra punishment (posted by OP, above) is true or false. I’ve spent about $1,000 in 3 years on audio apps, and I’ve never once requested a refund. I wouldn’t even do it as a political statement, as some have done with Ob-Xd, for example.

    But i realise this may not be a popular opinion in these waters.

    Happy to debate this point if someone wants to give me a compelling reason why our right to refund a super low-price working audio plugin should be upheld at any cost.

  • edited July 10

    Well that link is a really old article and also it says it "could" do it in extreme circumstances, but I doubt it does it very much. I'd be very surprised if they were allowed to do that without good reason. Is there any evidence of it actually happening?

    I prefer not to have iAP because if anything happens to the developer's account then there's less chance of the app being authorised even if you save the ipa, so overall this devalues the app for me in the long term.
    I'd prefer it if there was a better way to trial an app. :)

  • @MonzoPro said:

    @audio_DT said:
    I've just written a post on another thread on this, but without knowledge of the claim made above. As I've said in the other thread, in the absence of a trial system I see no other option for users. However, if the above is true, it does muddy the waters a bit more. That said, the problem is with Apple, not the user.

    No, the problem is with you.

    You know the rules, you know the devs will be out of pocket, if you’re not sure about an app ask on the forum for feedback.

    I'm beginning to think that if slavery still existed you'd tell the slave not to run away: 'you know the rules'. The point is that the rules are wrong. Therefore, the problem is not with me it is with Apple. Even the developer involved in this conversation thinks this, and yet you persist on defending a demonstrably poor system with benefits neither users nor developers, but does benefit Apples coffers a great deal.

  • @EyeOhEss said:

    @audio_DT said:

    @EyeOhEss said:

    @audio_DT said:

    @Tones4Christ said:
    That’s messed up if true and unfair for all the hard working devs.

    I think maybe that’s why SugarBytes let’s you try the apps for free and charge only as an IAP. I think this might be the future for all apps so that Apple won’t rip off the devs.

    The only problem with the IAP method is that IAP's don't cover family sharing. But, yes, it's definitely an option.

    I wasn’t aware of this. So IAP wont go across all my devices?

    They go across all devices connected to your Apple ID but you can't share the app with anyone on your 'family sharing' list. With any other app I've ever used, I can buy, say, Tube AU and share it with anyone on my 'family sharing' list.

    Ah ok cool. That’s not so bad, at least for my own fam/devices situation.

    Yes, it would only be a small thing, and it woudn't really affect me directly. But it would certainly be a bit of a setback for some, I expect.

  • edited July 10

    The best way to find out would be for a developer to straight up ask Apple?

  • @tk32 said:
    I personally think it’s shameful that anyone would consider getting a refund for an audio app - regardless of whether the extra punishment (posted by OP, above) is true or false. I’ve spent about $1,000 in 3 years on audio apps, and I’ve never once requested a refund. I wouldn’t even do it as a political statement, as some have done with Ob-Xd, for example.

    But i realise this may not be a popular opinion in these waters.

    Happy to debate this point if someone wants to give me a compelling reason why our right to refund a super low-price working audio plugin should be upheld at any cost.

    Nobody referred to 'any cost'. The compelling reason is that every other product you are likely to buy either gives you a right or return or a trial option. Apple don't allow this, and therefore the problem is with Apple. Nobody is saying the developer should lose out, and certainly not me.

  • @tk32 said:
    I personally think it’s shameful that anyone would consider getting a refund for an audio app - regardless of whether the extra punishment (posted by OP, above) is true or false. I’ve spent about $1,000 in 3 years on audio apps, and I’ve never once requested a refund. I wouldn’t even do it as a political statement, as some have done with Ob-Xd, for example.

    But i realise this may not be a popular opinion in these waters.

    Happy to debate this point if someone wants to give me a compelling reason why our right to refund a super low-price working audio plugin should be upheld at any cost.

    If the app doesn't work I expect a refund and also if it has been falsely advertised. Also I believe the price is irrelevant and price is driven by the market. If you charge too high you will actually damage the chance of you product's success.

  • @tk32 refund prevents devs from releasing broken apps. It’s the same with warranty on physical goodies....Super low prices are irrelevant. 10+ low priced buggy apps are a considerable amount .

    Just my opinion :)

  • edited July 10

    Obviously, if it doesn’t work - refund should be an option. But it drives me crazy that people think they can just use it as a non-committal “try before you buy” system.

    For example..

    • “I bought that synth... didn’t like the sound so I refunded.”
    • “I bought that DAW... found a bug so I refunded.”

    Maybe consumer culture changes a little from country to country, but here in the UK I try to exercise the ‘buyer beware’ mantra, and only return goods that are broken - not remorseful.

  • @tk32 said:
    I personally think it’s shameful that anyone would consider getting a refund for an audio app - regardless of whether the extra punishment (posted by OP, above) is true or false. I’ve spent about $1,000 in 3 years on audio apps, and I’ve never once requested a refund. I wouldn’t even do it as a political statement, as some have done with Ob-Xd, for example.

    But i realise this may not be a popular opinion in these waters.

    Happy to debate this point if someone wants to give me a compelling reason why our right to refund a super low-price working audio plugin should be upheld at any cost.

    Price is irrelevant really. But Keeping within average kinda iOS price range for an example.... you don’t buy 4 different sizes of a £10 T-shirt online and then keep them all ;) You keep the one you like. Or you send them all back if you didn’t like them in the flesh.
    So if someone’s shopping for ONE reverb and there are 4 different ones they have their eye on that add up to like £50....that’d suck if they were totally forced to buy all of them in order to make a decision of which to keep (if any..).

  • I think Apple could do a trial period of if they wanted to. That functionality is already sort of being done in TestFlight, ie. devs release a beta that's good for a set amount of time. When it's expired, it no longer launches until the dev creates a new beta build.

    I think Apple could employ some version of this in the AppStore. You could download a app for free. Use it for a week maybe, then it expires. If you want the app, you could then download the paid/non-trial version.

  • OK - I understand why consumer rights are important, and may have been a little naiive in my first post, but I really don’t like the casual non-committal consumer culture that has emerged in the last decade.

    But hey, maybe that’s more my problem than everyone else’s ;)

  • Would be cool if this stayed on topic please. I really want to know how Apple handles the refunds.

    The other question is important too. Here’s a new thread: is it cool to get app refunds? https://forum.audiob.us/discussion/33731/is-it-cool-to-get-app-refunds/

  • @audio_DT said:

    @MonzoPro said:

    @audio_DT said:
    I've just written a post on another thread on this, but without knowledge of the claim made above. As I've said in the other thread, in the absence of a trial system I see no other option for users. However, if the above is true, it does muddy the waters a bit more. That said, the problem is with Apple, not the user.

    No, the problem is with you.

    You know the rules, you know the devs will be out of pocket, if you’re not sure about an app ask on the forum for feedback.

    I'm beginning to think that if slavery still existed you'd tell the slave not to run away: 'you know the rules'. The point is that the rules are wrong. Therefore, the problem is not with me it is with Apple. Even the developer involved in this conversation thinks this, and yet you persist on defending a demonstrably poor system with benefits neither users nor developers, but does benefit Apples coffers a great deal.

    Ok I’m flagging that for the OTT slavery comment, you’re out of order.

    As for it being Apples problem - they’re running a business. They have costs running and maintaining the Store, server costs, staff costs dealing with your refunds, and taking a charge for the transaction is standard practice amongst most Marketplace e-commerce websites.

    Obtaining refunds for apps that work as advertised is abusing the system, and by doing it you’re only harming the developer. You do that, you’re the problem.

  • @skiphunt said:
    I think Apple could do a trial period of if they wanted to. That functionality is already sort of being done in TestFlight, ie. devs release a beta that's good for a set amount of time. When it's expired, it no longer launches until the dev creates a new beta build.

    I think Apple could employ some version of this in the AppStore. You could download a app for free. Use it for a week maybe, then it expires. If you want the app, you could then download the paid/non-trial version.

    +1. This is the obvious solution, but Apple are not doing it, and both consumers and devs lose out. You might have heard the old joke: ‘A banker, a worker, and an immigrant are sitting at a table with 20 cookies. ‘The banker takes 19 cookies and warns the worker: “Watch out, the immigrant is going to take your cookie away.”’ It's similar in this scenario: Apple benefit from the present system, yet some are blaming users. I don't get it.

  • edited July 10

    @skiphunt said:
    I think Apple could do a trial period of if they wanted to. That functionality is already sort of being done in TestFlight, ie. devs release a beta that's good for a set amount of time. When it's expired, it no longer launches until the dev creates a new beta build.

    I think Apple could employ some version of this in the AppStore. You could download a app for free. Use it for a week maybe, then it expires. If you want the app, you could then download the paid/non-trial version.

    This already exists.. I call it TheSoundtestRoom.

    Joking aside, after watching Doug use a plugin for 10 mins I already know whether I will be happy with my purchase or not.

  • @Hmtx said:
    Would be cool if this stayed on topic please. I really want to know how Apple handles the refunds.

    The other question is important too. Here’s a new thread: is it cool to get app refunds? https://forum.audiob.us/discussion/33731/is-it-cool-to-get-app-refunds/

    Sorry @Hmtx - Sincere apologies for derailing this thread (it’s my fault!)

This discussion has been closed.