Why Developers Are So Expensive: Apple’s App Store vs Microsoft’s GitHub Deal

Platform–Developer Symbiosis

Platforms provide core APIs and infrastructure that enable developers to create new user experiences. In turn, those applications attract users and generate revenue for the platform, creating a mutually dependent ecosystem.

Apple iOS App Store

Weekly traffic: 500 million visitors.

Revenue to developers (projected for the year): over $100 billion .

Apple’s commission on sales: 30 % , enforced through a controlled distribution channel.

New capability announced at WWDC: iOS UI framework UIKit will be usable to build native macOS applications, allowing developers to target both iPhone/iPad and Mac with a single code base.

Underlying advantage: Apple’s hardware ecosystem (iPhone, iPad) creates strong user demand independent of the App Store, enabling higher willingness to pay and higher per‑app revenue compared with other platforms.

Microsoft and GitHub

Acquisition price: $7.5 billion paid in Microsoft stock.

GitHub user base: > 28 million developers who host, share, and collaborate on code.

Strategic rationale: Microsoft lacks a consumer‑facing platform with a large user base that can organically attract developers. By acquiring GitHub, Microsoft “buys” developer goodwill and integrates the service with Azure, Visual Studio, and other developer tools.

Windows Platform Characteristics

All Windows APIs are publicly available, allowing any developer to build applications without gate‑keeping.

Developers can establish direct payment relationships with end users, a model that historically made Windows attractive for large software vendors.

Despite openness, Windows has limited mobile presence and lags behind competitors in cloud market share, reducing its ability to attract new developers.

Steam illustrates how an open platform on Windows can generate substantial profit (estimated $1 billion per year ) by lowering entry barriers and fostering a virtuous cycle of apps ↔ users.

Cost Comparison of Developer Acquisition

Apple extracts a high margin from a massive user base (30 % commission on $100 B+ revenue) while developers benefit from a captive, high‑spending audience. Microsoft’s approach incurs a one‑time expense of $7.5 B to acquire a developer community, reflecting the premium of buying goodwill without a built‑in user base.

Strategic Implications

Apple’s model relies on a tightly integrated hardware‑software stack and a curated store that maximizes per‑user spend. Microsoft, recognizing the diminishing returns of a purely Windows‑centric strategy, invests in tooling, cloud services, and open‑source platforms (GitHub) to remain relevant to developers, even though this path is financially more expensive per developer.