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Learning Mobile App Development: A Hands-on Guide to Building Apps with iOS and Android by Michael Eierman, Jakob Iversen

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Understanding the Economics of App Stores

Often developers are surprised that they have to pay Google and Apple 30% of any sales made in the app stores (whether from paid apps or in-app purchases). We have often heard from clients that paying 30% to Google and Apple makes it impossible to do business, because they don’t have 30% margins in the rest of their business to give away. To the extent that a mobile app sale replaces a regular sale of the same product, this argument makes sense. However, if the sales of the mobile apps are often incremental to the rest of the business, the additional revenue could be lower.

You have to remember that you pay Apple and Google to set up an entirely new sales channel. They run and operate the stores, so you ...

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