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App Store Tax: Elon Musk Tweets

July 30th, 2021

App Store Tax: Elon Musk Tweets
Anh Nguyen

by Anh Nguyen

COO & Co-Founder at Gummicube, Inc

Elon Musk, CEO of Tesla, slammed Apple over “walled garden” structure, App Store fees, and Apple’s use of cobalt in battery production.

Earlier this week, Tesla released their shareholders letter and announced the company’s earnings for Q2 2021. During this earnings call, CEO Elon Musk took a few jabs at Apple. When asked if Tesla plans to open its novel Supercharging network up to third parties, Musk replied:

“I think we want to emphasize that our goal is to support the advent of sustainable energy. It is not to create a walled garden and use that to bludgeon our competitors which is used by some companies.”

In case the audience wasn’t already clued in, Musk then pulled the old “fake cough” before muttering “Apple.”

Gummicube has been providing ongoing coverage of the global scrutiny Apple has been the subject of lately, and while it isn’t surprising that another prominent figure has hopped into the ring, it is unknown what prompted Elon to call Apple out this week.

He went on to slam Apple’s use of cobalt in the manufacturing of batteries for Apple devices:

“Apple uses I think almost 100 percent cobalt in their batteries and cell phones and laptops, but Tesla uses no cobalt in the iron-phosphate packs, and almost none in the nickel based chemistries [...] On a weighted-average basis we might use 2 percent cobalt compared to say, Apple’s 100 percent cobalt. Anyway, so it’s just really not a factor.”

A valid concern, considering the environmental and social impacts of cobalt mining. Apple has communicated plans to end cobalt mining and instead focus on establishing a supply chain of fully recycled raw materials, but experts say this is a lofty idea that is not attainable in the near future.

Some speculate this particular slight was spurred by Apple’s plans to manufacture electric vehicles. Musk didn’t seem overly concerned about competition, though, stating that he sees Apple as “Tesla’s graveyard” due to the Cupertino tech giant’s “poaching” of Tesla employees.

Apple’s Antitrust Lawsuits Continued

Elon Musk didn’t stop there, bringing his criticism of Apple back to the forefront Friday morning on Twitter. Musk weighed in on the recent Epic Games v Apple Trial saying that “Epic is right.”

The tweet reads:

“Apple app store fees are a de facto global tax on the Internet. Epic is right.”

Apple hasn’t commented on this tweet, but has always maintained that Apple is not an “essential facility” as many bodies, including Epic Games, have tried to claim. Apple asserts that consumers have an alternative option through Google Play Android devices and other platforms, and that users come to Apple for the “walled garden” experience.

In regards to Musk’s tweet, it is hard to truly consider Apple’s App Store fees to be a “de facto global tax on the internet” considering Apple devices are only one of many ways an average consumer can access the internet. Even on Apple devices users can browse the internet through free web based browsers that don’t rely on the iOS App Store and its associated fees.

On Commission Fees

Perhaps one of the most interesting aspects of the continued criticism towards Apple in the media is that they are far from the only company that imposes 30 percent commission fees on software marketplace platforms. Their biggest mobile competitor, Google, also charges 30 percent commission on the Google Play Store. While Google has been the subject of a number of lawsuits, it seems that the media has bit primarily into Apple and is not letting go.

A number of other platforms that subject developers to 30 percent commission fees include Valve’s Steam Store, Nintendo’s eShop, Sony’s PlayStation Store, and Microsoft’s Xbox Store (Although only on the Xbox Console, as Microsoft recently announced a shift to 12 percent commission on the Windows based Microsoft Store platform.)

It seems that although the criticism of high commission rates is valid, and that lowering these fees will greatly benefit developers, perhaps Apple is receiving an undue share of blame here. Google has definitely received its share of blame in the “app store tax” saga, but only time will tell if Apple will remain as the face of the situation as it unfolds.

Overall

Tesla’s CEO Elon Musk has added his two cents concerning Apple’s recent legal battles, taking to Twitter to back Epic Games in the fight. Musk is just one of many public figures who have taken aim at Apple recently, joining the likes of Spotify’s Chief Legal Officer Horacio Gutierrez.

While the criticism directed toward Apple is not entirely invalid, it is surprising that other companies are not relatively receiving as much of the heat in the court of public perception. While the proceedings of the ongoing Epic v Apple trial and celebrity zingers on twitter make for a dramatic reality-tv style saga, their impact could have real ramifications for developers’ take-home revenue when all is said and done.

Want to learn more about App Store Optimization? Contact Gummicube and we’ll help get your strategy started.

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