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back to article Apple drives iPhone app developers to the brink

A backlog in Apple's payment processing system has left some iPhone developers still waiting for February's payments, leaving some at risk of bankruptcy and considering legal action against the lads in Cupertino. Desperate developers have been told to stop e-mailing the iTunes finance system and to wait patiently for their money …

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Jobs Horns

Six of one and half a dozen of the other

Meh, harrassment on one side, theft on the other, hard to say who's in the right and who's in the wrong here.

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22 emails in 2 days?

Who seriously thinks that 22 emails over the space of 2 days is going to get them any closer to their money than, say, 4 strongly and well-worded emails over the same period?

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Joke

Hump

"Dealing with thousands of developers (and their banks) all over the world is a significant undertaking"

Ya strange how much hard work it is giving out the cash to there suppliers, but they do not have any problems collecting it from what must be many 100's of times more customers.

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Alert

Business Model?

Not good and I've been there myself, but is it wise for a software house to ostensibly have an iPhone app as a sole source of income?

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Anonymous Coward

well..

"Please stop emailing us. Your 22 emails in the past two days is bordering harassment. We receive a thousand emails a day, and will respond as soon as we can"

No , its informing them of an issue.. Apple are basically breaching contract at the moment so threatening the people in question is probably not the best of ideas since they can legally demand extra cash for time taken to email etc.

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Apple is at fault here and politicians should do something about it

Apple must pay its employees, period. And accusing and attacking non-paid employees that need to be paid for their job it's the worst marketing tactic that Apple could have ever done.

There is nothing else to do, Apple must pay and that's it. Period.

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Jobs Horns

Interest

Apple is pocketing a nice chunk of interest on all that owed money

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Jobs Horns

Yep

I'm still waiting for my Feb payments even though they have sent me my March earnings statements.

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Jax

Bordering harassment

Gotta love that "bordering harassment".

No, they're demanding their moneys that are due. I doubt any court in the land regardless of the number of emails would consider that to be harassment.

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Can I have an iPhone

And pay you for it when I damn' well feel like it?

Thought not.

Parasites

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Single point of FAIL

This is why having a closed system such as the iPhone is a bad idea, and why basing your own company's entire business model AROUND that closed ecosystem is an even worse idea.

And that closed eco-system being run and owned by Apple, the only company more anti-competitive than Microsoft? TERRIBLE idea.

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Go

When in rome...

22 emails in 2 days is not bordering harassment but - harassment. There is no doubt about but Is it bad? Have you ever missed a credit card payment? I have and let me tell you, those jokers don't mess around. They will call you from 8am until 9pm non stop trying to get their monies. It is harassment but what can Apple do? IT IS NOT ILLEGAL!

I mean seriously what are they going to do? Not pay you? Here is what YOU can do my friend. You can start tacking on late fees. for each day that passes that they have not paid you. Was a contract signed? Send them a notice of a change of contract that stipulates this, charge them $50 for the change of contract and then charge them $25 a day for each day they breach the contract.

Then send that to your local EU government and the Apple representative in your country. Agree to "waive" the fees for a quick payment. Trust me - this is your business vs their business. It may have to go to court but Apple is the one in the wrong here. They are late on paying and you keep harassing them until they pay. Just like any business would do to you.

Also - check for the nearest local apple rep. If they sell to your country they have to have a "business" license in your country. You *can* physically do something.

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Go

Oh and one more thing...

Make sure you put in the email - "This is an attempt to collect a debt and any information obtained will be used for that purpose"

When they respond to the email with this "you are harassing us" excuse - you keep that email. Take them to court a judge will gladly help you settle with them. Most likely in your favor since they are undergoing bankruptcy.

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Jobs Halo

Business risk

Well, this is the chance you take when you rely on one customer for all of your revenue. Its not unusual to large companies to streach out payment terms in difficult times. I've had customers take as long as 180 day to pay up.

Welcome to the business world!

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Coat

Interest(ing).

I wonder how much money they're making on interest? A reasonable amount even at todays shocking rates. If I were a developer, I would charge them for late payment fee's, but I suspect that won't be allowed in the contract, along with the right to sue, change the contract on the developers terms and other such activities which Apple don't like. And I suspect their response will be "If you don't like it, don't develop for us".

Insert Obligitory "The developers are revolting" "Yes, because they code for 4 days straight on a diet of pizza, red bull and no showers" reference here.

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Stop

@Jorge Lopez

"It is harassment but what can Apple do? IT IS NOT ILLEGAL!"

I do hope you are not an employer in England or Wales. The Criminal Justice and Public Order Act 1994 makes Harassment a criminal offence punishable by a fine and prison sentence.

Also you will find that your proposed $25 a day late payment charge would be contested and deemed grossly unfair by a court. You're also advocating a fast track method of getting a business kicked out of the app store methinks. Which if you are relying on it for future earnings after this issue is resolved is not a good idea is it.

What I think is more concerning about this issue, is the claims of businesses facing bankruptcy because of it. If someone's business rely's upon the app store for it's sole income stream then frankly they don't have a business.

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Pirate

6 of one 1/2 dozen of the other

Apple needs to pay up quickly. Personally, I can't see why payment details aren't all electronically setup when the app is submitted - it all seems a bit fishy.

Having said that, if you're a small developer dealing with a brand-new system from a very large corporate you will have payment problems whether its Apple or not. Any small business *must* have contingency plans for late payments. You're small, you will not get a completely fair deal. Face up to it and deal with it or go out of business. Having only one source of income will get you every time.

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[cr]App store

Sounds like Apple is trying to make a little 'interest' cash like the banks do. My bank used to allow direct transfers between account holders at the same branch on the same day, they now take a neat 5 working days, accruing interest for the bank but not for me.

Perhaps all the Devs should boycott the [cr]App-store and tell apple where they can go stick their sticky fingers.

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This needs some serious fixing

Despite what Apple may say about the majority of apps being approved quickly (and I'm not saying they aren't) things are getting bad enough now that people are going to get an overall impression that the system is broken, and these problems need to be stamped on. Fast.

Apple are doing something they can't afford to, which is to give their competitors an opportunity.

All Microsoft, Palm, Blackberry et al have to do is point to a few of these issues, make some noise about how their system isn't like that and they'll like get some mindshare from that alone. Microsoft has already taken a pop at this by saying they will have a transparent approval process where the dev can track their app's progress.

I'm actually surprised Apple has allowed it to get this far, but when a prominent user like Trent Reznor speaks out in the way he did recently, someone high up at Apple really needs to take notice and go kick the crap out of somebody to make sure this gets sorted for good.

If it really is bank errors that are causing the delays, and not some internal Apple screw-up, then Apple should fight for the devs to get interest paid on the outstanding amounts.

Do the right thing, Apple.

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T&C's people

So you're left waiting for payment on monies owed to you? Okay. So refer to your T&C's with the person you signed the contract with. There will be payment deadlines and cut-off points in there. You're running your business off the money, using the payments to pay vital bills (mortgages etc.), so you've ensured that the money will arrive in a timely manner, yes? You've got clauses in there to compensate for losses etc., yes?

Even if it's just a "monies will be paid on the last day of every month by BACS" or similar, you should *always* have a line like that before you start screaming and shouting. It's like screaming at Google Adwords because you have $99.99 in your account which they won't give you until you hit $100.00 (or whatever the limit is now). You've either:

- Agreed to a specific payment date, which you can use to determine if Apple have breached contract because of unreasonable actions inside their control.

or

- Not agreed to a specific payment date, and thus have no recourse except to wait it out or fight through the courts to argue over some vague definition like "reasonable".

I'm guessing it's the latter in most cases. Either way, the relationship between you and Apple is the same this month as any other month.

DON'T INTEND TO PAY YOUR MORTGAGE WITH MONEY THAT YOU DON'T HAVE YET, or which isn't guaranteed (this means not only the *funds* but the *timing*).

Pillocks. Yeah it's annoying, but would you let your employer off with having terms in their contracts that says they might well not pay you one month if things go wrong? If you *wouldn't* then why would you accept *absence* of the opposite clauses (i.e. that they would pay you on the 1st of each month or similar)?

And if Apple *do* state specific timings? Then you have to apply a court's definition of reasonable (I'm guessing a court of Apple's choice, seeing as it's their contract) to getting your money in a timely manner. You'll probably find that a month or two isn't unreasonable in a court's view but it'll cost ya to find out. Yep. Court action. That nasty messy stuff. You know, the thing that usually results when people agree to contracts without reading them through first and thinking about the consequences.

I've said it once but it requires re-iteration.... Pillocks.

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Jobs Horns

Typical Apple

Nothing surprise me more about what the boys at Apple, Inc at capable of.

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Handling different banks?

Over here if I want to pay different people in different countries with different banks, I only need to talk to my own bank, give them the right account number + BIC/IBAN code + amount to pay and everything will work out just fine....

May be things are different in America, but to me it sounds like a cheap excuse.

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Jobs Horns

Apple are shit

enough said.

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Jobs Horns

Nothing to do with difficulties of payment

I presume that Apple have been operating the app store for longer than just since February. And that people have been paid before that date. So all this is is a classic effort by a large company with some cash-flow issues squeezing its supply chain. Outrageous, but true nevertheless.

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Oh dear

I do feel sorry for these guys (the developers) but when you strike a deal with a control freak company like Apple you give them licence to take the piss as much as they want as who will stop them?

You've been conned, refocus your business and develop java apps for mobiles or apps for the desktop and leave their crappy iPhone high and dry.

I never have and never will own an IPhone.

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Anonymous Coward

Network download stores

I wonder how Sony Playstation or PSN , Nintendo Wii or XBox Live are in like paying up on time?

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Anonymous Coward

Calculated to annoy

I'm an iPhone developer. There seem to be a few problems that aren't Apple's fault:

- Two American banks merged (was it Washington Mutual and Chase?) and the SWIFT code for the customers of one had to change. The bank didn't tell the customers and Apple had the payments refused. Apple seem to be manually changing the codes in the payment system, but that's separate from the web interface where devs enter their bank details.

- A lot of American banks don't have SWIFT codes at all. Royalties from e.g. EU sales are sent from Apple (Luxembourg) S.A.. The chances of this money arriving at Bank Of Smalltown seem slim at best.

Having said that, Apple do seem to be screwing up too much. For example, they have without warning stopped sending out emails when apps are approved. So if you want to e.g. change your website as a new version is released, you have to poll the app store to see when your app appears. Worst of all they never say anything - no explanations, no apologies.

Other comments are right to point out that this is what you should expect when you have a monopoly. What I find strange is that both Google and Palm have produced solutions for their phones that are technically difficult for iPhone developers to support (i.e. not supporting a "C family" language). I would love to see a C-to-Java-byte-code compiler that I could use to port my Obj-C++ iPhone code to the G1, for example.

@Lee Dowling: the contract is clear, the money is due 45 days after the end of the month (for some value of "month") in which the sales were made. The problem is this: if I sue Apple it could still be months before I get the money, and they have the right to terminate thee agreement (and stop selling my apps) at any time.

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Unhappy

Oh dear.

Did you not get paid for monies on those 99c apps that peddle porn or kill babies, marketed to users that are too stupid to do their homework on better products?

Did the writers of the apps that are actually useful, not realise they're writing for the same market?

And now they're all suprised that Apple who was marketing all this crap to an idiot market can't handle all the payments because they didn't actually realise that that many people would be that stupid to buy into it in the first place?

I can't complain too loudly though, I bought an iPod, and am still kicking myself over it. Sheeze.

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Alert

giraffes

1. @a/c Cash strapped Apple are not.. $29 billion in cash reserves.

2. 22 emails in 2 days is stupid. I run a support department and the biggest problem we have is clients who do that to us when we are trying to sort a problem. All it does is delay our efforts to get the issue sorted as resources have to be allocated to dealing with answering the same question 5 times an hour to the same person.

3. Yes it is totally crap of Apple to not be able to sort this within a week maximum.

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Bah!

"Stop making a fuss". They sound like a bunch of arts students playing at running a company.

Oh, hang on, we're talking about Apple aren't we? These are the guys who came up with the "Buy from us because you're too stupid to work a PC" ad campaign.

Disgraceful.

As for SWIFT codes etc, if Apple wasn't prepared to deal with this issue then they should have barred European developers from the iPhone app developer business. Apple are great when it comes to making a piece of equipment look like it once sat in the Space Wheel in Kubrick's 2001 but seem to be a mile short of proactive once things get out of alignment with their very narrow predicted event track.

If this were eBay or Paypal we were discussing I doubt that any of the appologist AC's would be weighing in on the side of dithering and bankrupcy.

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Florida solution?

[QUOTE]DON'T INTEND TO PAY YOUR MORTGAGE WITH MONEY THAT YOU DON'T HAVE YET[/QUOTE]

Umm, if people already had the money they wouldn't have a mortgage. I seriously doubt anyone plans for a multi-billion dollar company to get months behind in payments!

The state of Florida had a solution to this -- harsh but effective.

K-Mart kept making excuses as to why they were late on paying state taxes... so, one day, these state heavies raided a K-Mart and just emptied the cash registers. Oh, in the middle of a sales day, it apparently really freaked out the customers 8-). When they got an amount that equaled the taxes owed, they left.

If Apple has any physical presence in your country, you can get a judgement and seize their assets or get a lien on them... that'll get Apple paying you right quick!

Apple needs to get this sorted. OK, so they are having problems sending cash to some banks. Understandable, I guess. But, they REALLY need to get them paid! Someone that's owed like $20 is one thing, but $1000s? If you can't get the bank transfer working, cut the crap and mail them a check!

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@John Tserkezis

Seems a bit harsh to accuse people on that basis. You might as well say that El Reg, Google, Yahoo et al should suffer random takedowns because they publish in a market rife with Pron and Warez.

JM2C.

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Apple not ready for success

let's hope that the rotten apple will be forced to pay interest and hugge penalties. it is the only to force to give the illusion of a semi-good service. but then again Apple as proven (at every single oportunitie) that they have no clue how to run a business.

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Ego Pride & Vanity alll go hand in hand with Apple.

They consider themselves so fancy that they do not hire extra people or hardware to sort out the backlog and prefer to let the backlog sit there untouched.

I suspect it will remain backlogged for atleast another 3 weeks.

If longer than that then the payment processing system needs to be replaced and taken out of Apples hands plain and simple.

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@John Tserkezis

A dickweed troll comment if ever I saw one.

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Go

Harassment - yes it is!

There are limits in the number of times you can bombard someone with calls and emails, so yes it can be harassment. One email per day ought to be enough. Harassment under UK law is almost anything the victim feels it to be, and 22 emails definitely exceeds the reason actions getout clause of the legislation

However, on the other side of the coin, you can (in the UK) unilaterally charge (a reasonable amount) of interest and/or fee on money due outside the agreed payment schedule. I forget the legislation permitting you to do this, so maybe someone can remind me.

The only flaw to this is that your contract and legal rights may fall under Californian legislation, but you may have a getout if Apple has a head office over in the UK, and an even better one if it pays you from there..

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WTF?

I think Apple should respond with free laptops all round.

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@[cr]App store

I go for cock-up before conspiracy every time.

Do not underestimate the types of cock-ups that can happen with setting up and running money transfers. It would not surprise me at all if there has been a collection of different human induced cock-ups and lack of clarity in filling in forms or things in the "Real World" changing (like banks failing or merging) which cause these problems.

22 emails in 2 days would usually get them placed at the back of the queue .. not everyone jumps because someone shouts louder ... now where did I place my Bumber Book of Bureaucracy?

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Anonymous Coward

Isn't there a method for suspending trade?

I can recall from a UK debt a while back that there is a way in which you can actually stop the company from trading at all until they pay, but it needs a UK based company to owe you (the US is so deep in depth, you don't stand a chance as a foreigner - your duty is to pay more so they can continue big bailout packages and the occasional idiotic war). It is obviously not going to make you very popular (bye bye apple account) but the question is: do need a revenue source which does not pay?

On a different tack, is this something that could be grouped into a US class action suit?

I can't see any other solution than sending the sharks round, unless someone organises action..

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Anonymous Coward

Umm sorry Apple

But those excuses don't cut it. If by this stage in the game you're seriously contending that you weren't prepared for the success that the App store has become, then you need to get someone running that division who has more than two brain cells to rub together. Bank processing errors? Ok maybe I can buy that as semi plausible excuse however the problem is that some folks have been waiting for their February payments and it's now the first week of May. So that excuse is walking on the fine edge of being not acceptable either.

Now on the other side, the tool who wrote 22 e-mails in two days whinging about his money needs to be beaten with a clue bat. A sure fire way to get a large company to totally ignore any query you have is to harass them like that. So way to shoot yourself with that one.

Bottom line is Apple has a solid system with the App store and one a lot of people like and use quite often. However fiasco's like this when it comes to the developers is a sure way to start derailing that money train.

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Our survey said...

...don't care.

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Joke

Its times like these

That I miss Webster :(

I miss his unique comments on Apple articles

Yes I know this is off topic

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22 email?!?

What, 22 emails in 2 days. Will go bankrupt if doesn't get paid. This sounds like an impatient college kid who happened to make a good selling 99 cent app that need some cash before the weekend parties. Gotta keep those college girls happy, right?

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Anonymous Coward

Re: Umm sorry Apple

> the problem is that some folks have been waiting for their February

> payments and it's now the first week of May.

The feb payments were due to be paid within 45 days of the end of that month, i.e. mid-April. They are only two or three weeks late. And apparently some have been paid. That sort of delay is bad but not unusual in the "real world". The main consequence is the bad publicity for Apple and the loss of support from the developers.

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Jobs Horns

Surprise?

Can't have been that much of a surprise, they managed to roll out the self congratulatory 1,000,000,000th download adverts easy enough.

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Bronze badge

petition them into bankruptcy.

Since Apple can't pay its bills the creditors should petition for Apple to be forced into involuntary bankruptcy. I guarantee that just filing the paperwork will get someones attention and the problems will be resolved much more quickly, with much more communication.

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Jobs Halo

In the spirit of "Really -- with Seth & Amy"

Really, Reg commenters? Really? Apple, the company that announced record earnings and has billions in the bank, is going to risk bad press and lawsuits by paying a handful of devs a few weeks late in order to sit on the money and make a few extra dollars in interest? Really? What's 2 weeks of interest on $10,000? It's $9.58. You think Apple is doing this to make $9.58 in interest. Really?

Time to put your tinfoil hats back on, I think the alien brain rays are getting in.

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Flame

Stay there, stay there forever!

Apple can do as it pleases. It's the only game in town. Monopolies are so much fun!

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come on

hold on, apple is delayed more than 2 months with invoice payments (if I can use that analogy) and they are responding like this?

and their excuse is an issue with payment system and banks? for more than 60 days?

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Paris Hilton

if you lie down with

dogs you are going to get fleas

simple really

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