Make your app free, and Apple will distribute it via AppStore and iTunes for free (and eat the costs, see below). Charge for it, however, and Apple will give you the same deal it gives Big Music: 70% for you and 30% for Apple.

How does it stack up across the commercial space? What do other publishers/distributors take?

Retail? Maybe 50%. Amazon Advantage? 55%. Typical book publisher? 90%. Record industry? (Is there a number higher than 100%?)

Bottom line, out of its 30% Apple is paying for hardware infrastructure, internet bandwidth, software development, maintenance and support, credit card transactions and accounting, and is now adding in update notification, not to mention the unbelievably huge storefront that is iTunes and (will be) AppStore.

Says Apple CEO Steve Jobs:

We don't intend to make money off the app store; the split with the music companies is about the same. We give all the money to the content owners and the developers here, and the 30% that pays for the store, that will be great.

Volume pricing will be the name of the game (or productivity app!)

If Craig Hockenberry of Twitterific fame is any indication, developers may have already figured this out:

Hell yeah. Automatic updates, handling transactions (including refunds, etc.), bandwidth, etc. adds up. People who complain about 30% have never dealt with the retail sales channel.

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