Tech Brew Ride Home - Wed. 06/17 – HEY! The Whole Brouhaha Between Apple And Basecamp

Episode Date: June 17, 2020

We dive deep into the whole HEY brouhaha and wonder if this is the best time for Apple to draw attention to App Store policies. Uber is getting into the software business. TikTok’s business is a pretty good one, it seems like. And the most reliable web business remains the first web business. Sponsors: DoubleUp.agency CognitoHQ.com/techmeme Links: A new email startup says Apple’s shaking it down for a cut of its subscriptions (Protocol) BASECAMP’S NEW APP, HEY, FLAGGED IN APP STORE LIMBO FOR NOT USING IN-APP PURCHASE (Daring Fireball) Hey.com exec says Apple is acting like ‘gangsters,’ rejecting App Store updates and demanding cut of sales (The Verge) Apple’s App Store policies are bad, but its interpretation and enforcement are worse (The Verge) Mark Zuckerberg: Historic Facebook campaign will boost voter registration, turnout and voices (USA Today) Uber to Sell Software, Starting With Four-Van Transit Service (Bloomberg) TikTok owner ByteDance first-quarter revenue soared to around $5.6 billion (Reuters) Unbounce raises $38.4M to build better landing pages with automation (TechCrunch) Learn more about your ad choices. Visit megaphone.fm/adchoices

On April 4th, 2023, around 2 in the morning, a man was found stabbed multiple times on a sidewalk in downtown San Francisco. Hey, who did this to you? What happened next turned the story into a political firestorm. Reports have identified the victim as Bob Lee, the founder of Cash App. From Bloomberg Podcasts, this is Foundering, the Killing of Bob Lee, beginning April 16. Welcome to the Tech Meme Ride Home for Wednesday, June 17th, 2020. I'm Brian McCullough. Today we dive deep into the whole, hey, brouhaha,

and wonder if this is the best time for Apple to draw attention to App Store policies. Uber is getting into the software business. TikTok's business is a pretty good one, it seems, and the most reliable web business remains the first web business. Here's what you miss today in the world of tech. Hey, you might have heard about this. See what I did there. Yeah, so shortly after Basecamp debuted that new email service, hey, that I told you about yesterday,

Basecamp says that it was, you know, submitting its next app update as you do, only to have that update rejected because Apple wasn't getting its cut of subscription revenue. At least, that's Basecamp's point of view on this. So let's start with the whole TikTok of events. This is David Pearson Protocol. all. Right around the time the team at Basecamp was launching their hey email service to the public on Monday, Zach Waugh, Basecamp's lead iOS developer, got a distressing email. The second version of their iOS app, 1.0.1, with a few bug fixes from the original, had been rejected by the App Store reviewers. It cited Rule 3.1.1 of Apple's guidelines for app developers, which says, in essence,

that if you want people to be able to buy stuff in your app, you need to do it using Apple's payment system. Wa and Basecamp didn't think the rule applied. Hay does cost $99 a year, but users can't sign up or pay within the iOS app. It's an app for using an existing outside service, just like Basecamp's eponymous platform, and Netflix and Slack and countless other apps. So we were like, okay, maybe we just got the Monday morning reviewer, Basecamp, co-founder and CTO David Henemeyer Hansen said, lots of developers over the years have found

that their app review luck sometimes depended on who happened to be looking and whether they'd had coffee yet. So Basecamp fixed more bugs, submitted a new version 1.0.2, and hoped for the best. The app sat in the queue for review and then in the under review status for far longer than usual. Then Wa got a phone call. The Apple reviewer said he was calling because the new app hadn't resolved the issue with Rule 3.1.1. The issue had been escalated internally, and Apple had determined that it was a valid rejection. The only way to move forward would be to implement Apple's payment system. And not only that, Waugh was told that Apple would like a commitment and a timeline for implementing the payment system or Apple might be forced to remove

hay from the app store entirely. When Waugh and Basecamp pointed out that there were many other apps, even email apps like Spark or Edison, that allowed users. That allowed to log into their existing accounts without signing up through Apple, the reviewer told them they wouldn't discuss other apps. And that was that. On Tuesday afternoon, Apple sent Basecamp a slightly softer written notice, quote, we notice that your app allows customers to access content, subscriptions, or features they have purchased elsewhere, but those items were not available as in-app purchases within the app, it said. Because, Hey, didn't qualify as a Reader app. Apple said that existing subscribers could log in as normal, but Hey, needed to make all subscriptions

available to new users as in app purchases, end quote. Apple apparently later told Pierce that the mistake that it made here was actually approving the Hay app in the first place, since it never conformed to its guidelines. Which, yeah, there's some dispute around that. Here's John Gruber. I really don't get it. even if we can see that the App Store rules around in-app payments, lowercase, being required to use Apple's in-app payments uppercase APIs, which give Apple their 15 to 30 percent cut, are okay, which is a big concession. I don't see how Base Camp's Hay app is violating them. You cannot sign up for Hay within the iOS app. And if you have a Hay account in free trial mode, the iOS app doesn't have links or buttons prompting you to become a paying customer. They don't tell you to upgrade to a paid account outside the iOS app. And if you have a Hay account, the app. When you don't already have an account, these are the only three screens that you can see in the app, a sign-in screen, a help screen, and a password reset screen, end quote. To paraphrase LBJ, if you're Apple and you've lost John Gruber, but to be fair to Gruber, he's often an Apple

defender, we know, but his first allegiance has always been to independent developers. And things seem to have just doubled down from there. This is quoting the verge. David Hennemeyer Henson, the CTO of Basecamp said that Apple is acting like, quote, Gangsters, rejecting a bug fix update and asking the company in a phone call to commit to adding an in-app subscription to prevent it from being removed. Quote, I was taken aback by how brazen that threat was, Hannah Meyer Hansen told the Verge. I thought you were supposed to wrap the threats in euphemisms or something, but it was pretty clear, end quote.

And this is quoting a DHH tweet. Wow, I'm literally stunned. Apple just doubled down on their rejection of Hayes' ability to provide bug fixes and new features unless we submit to their outrageous demand of 15 to 30% of our revenue. Even worse, we're told that unless we comply, they'll remove the app, end quote. And I don't have to tell you this since we talked about it yesterday as well, but it's a heck of a time for this sort of brouhaha to erupt, right when the EU is opening up an antitrust investigation that seemingly would be looking at this exact sort of behavior on Apple's part. Let's wrap things up with this interesting analysis from Dieter Bone at the verge. The real issue is Apple's power of which this whole Kafka-esque series of changing rules is a symptom. We all know the score here. Apple needs to protect the 30% cut it takes, and if it allows too many

apps to circumvent that cut, then some sort of dam may break. From Apple's perspective, it's not so much the money for its services bottom line, but that if everybody used a different payment system, the whole experience on the iPhone would genuinely be degraded if not fragmented. The money doesn't hurt, though. For Apple, the line has to be drawn somewhere. We just happen to be right on that line, discovering that it's a lot wigglier, grayer, and more porous than we realized. And given how convoluted the interpretation and enforcement has been in this case, the reasoning for those wiggles is much easier to explain by looking at Apple's business imperatives than it is by looking at Apple's policies. There's a cognitive dissonance to calling Apple a monopolist, because after all, people

are free to buy an Android phone, and well over 80% of smartphone buyers on the planet do just that. Apple's market share in the U.S. is significantly higher than it is in the rest of the world, but it's not that high. The monopoly Apple has is a monopoly over the iPhone itself, not over smartphones. And that is a very strange way to think about a monopoly. Shouldn't Apple be free to make whatever rules it wants on the devices it sells? Is it unfair for Apple to demand a cut for all digital commerce on its platforms? Here's how Ben Thompson answered that question, and I'm not sure I can say it any better, quoting Ben Thompson.

What should be restricted, though, is leveraging a win in one area into dominance in another. That means Apple winning in smartphones would not mean it gets to own digital payments, and inventing the App Store does not mean it gets 30% of all digital goods, or be allowed to diminish the user experience of its competitors, end quote. Believe it or not, there were some other things that happened in the tech world over the last 24 hours that we could talk about today. For example, Facebook has launched a Voting Information Center for Accurate Election Information and Chalk Full of Tools for Voter Registration, aiming to help register 4 million people via its apps.

This is quoting Mark Zuckerberg in an op-ed. He wrote, For USA Today, quote, Overall, we expect more than 160 million people in the United States will see authoritative information on Facebook about how to vote in the general election from July through November. This is, in addition to reminders to register, information about voting by mail, and election day reminders that we've run through the primaries and will run for the general election as well. Ultimately, I believe the best way to hold politicians accountable is through voting, and I believe we should trust voters to make judgments for themselves. That's why I think we should maintain as open a platform as possible, accompanied by ambitious efforts to boost voter participation. By giving people a voice, registering and turning out voters, and preventing interference, I believe Facebook is supporting and strengthening our democracy in 2020 and beyond. And for those of you who've already made up your minds and just want the election to be over, we hear you. So we're also introducing the ability to turn off seeing political ads.

We'll still remind you to vote, end quote. bit of burying the news in that last bit there. Facebook will still allow politicians, apparently, to say whatever they want in political ads on Facebook, but you can now turn the ads off. Quoting CNBC, users will be able to turn off political, electoral, and social issue ads from political candidates, Superpex, and other organizations that have the paid-for-by political disclaimer on them, the company told CNBC. The company will start rolling out this feature to some users on Wednesday, and it will become available to all U.S. users over the next few weeks, Facebook said. The company aims to expand the feature to more countries where it has enforcement on political

ads this fall. When users come across one of these ads, there will be an option within the ad to turn off all future political ads. Users can also head to the settings feature of Facebook and Instagram to turn them off. In addition, users who have decided to turn these ads off can report any ads. They come across that they believe should not have been shown to them, end quote. so super i guess that doesn't change the fact that as i understand it facebook has gone to all of this trouble to set up a whole toolbox to help people find accurate information on how and where to vote but they will still allow candidates to buy inaccurate ads targeting those same voters with straight-up lies so kind of two steps forward one step back i guess today i learned that uber has dreamed up

a new business model. Uber is selling the software that it uses to power its ride-hailing business, starting with public transit agencies as clients. California's Marin County is the first to line up to buy this software, quoting Bloomberg. This is not a one-off. This is a new product and a new business, said David Reich, head of Uber Transit, adding that the company intends to partner with other transit agencies in the future. Together, we want to make car ownership, a thing of the past, end quote. But the effort is starting small. The program called Marin Connect will power logistics for just four wheelchair accessible vans when it begins on July 1st. Teaming up with Marin Transit and the Transportation Authority of Marin. It will also make public transit schedules

and discounts available within the Uber app in the county and will offer vouchers for riders traveling the last mile to their destinations from transit stops. The two-year deal will cost $80,000, said Nancy Wheelan, the general manager of Marin Transit. We pilot a lot of things, Wheelan said. We try to stay nimble. Morin Transit has also worked with transportation tech companies, Lyft and VIA in the past, end quote. And how about a check-in with how big TikTok is actually getting, not just as a platform, but again, as an actual business. Sources are reporting that TikTok's owner, ByteDance, had revenue in the $5.6 billion. dollar neighborhood just for the January to March period of this year.

That would represent a year-over-year increase of 130 percent, quoting Reuters. The growth shows the extent to which eight-year-old Bight Dance is capturing digital advertising spend. The bulk of the company's revenue is mainly from advertising on its apps in China, including news aggregator Jynri Tachau, as well as Doyen, its domestic version of TikTok, the people said, rather than from TikTok itself. Before ByteDance emerged, China's ad market had been mainly dominated by e-commerce leader Alibaba, search engine operator Baidu, and Tencent. The market grew 1.9% in that same January to March period from the same year earlier, worth about 121.2 billion yuan

showed data from eye research, bite dance's apps enjoyed a huge boost in usage at the height of the COVID-19 pandemic as containment measures saw people practicing social distancing and staying at home. In January, six of the ten most popular apps on China's iOS App Store were owned by ByteDance, according to app performance tracker App Annie. BiteDance has recently been valued at $95 to $140 billion in the market for private secondary trading, two people told Reuters, end quote. And finally, today, let's end with a quick, interesting raise. Unbounce builds optimized landing pages for small and medium businesses by using various tricks of automation. Unbounce just raised a $38 million

round, quoting TechCrunch. Unbounce was founded back in 2009 with what co-founder and CEO Rick Peralt described as a goal of helping small and medium businesses easily create different landing pages where they can direct potential customers after they've engaged with their ad and marketing campaigns. Apparently, some UnBounce customers are successful with just a handful of landing pages, while others create hundreds and hundreds. Peralt said the ultimate goal is to allow a business to set it and forget it through machine learning so that they no longer have to create landing pages at all because the Unbounce platform is doing all the optimization and personalization for them.

As a first step in that direction, Unbounce has created a smart traffic product that will automatically use visitor data to send visitors to the best landing page, resulting in an average conversion lift of 20% end quote. I wanted to mention this one because it sort of warms my heart a bit to know that 30 years into the web, still one of the best businesses out there, is the same one that was basically the first web business, helping people build better web pages. That's all for today. football's back everybody hopefully by the time you're hearing this i'm watching arsenal beat manchester city talk to you tomorrow