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  1. #1
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    Exclamation Our revenue share with operator billing.

    Hi all,
    Please: we need a simple answer on a simple question. Actually on 5 questions

    1). App in OVI-> Price 1 Euro -> user purchases via Operator/SMS billing -> How much do we get? = Answer: minimum....... Euro
    2). App in OVI-> Price 2 Euro -> user purchases via Operator/SMS billing -> How much do we get? = Answer: minimum....... Euro
    3). App in OVI-> Price 3 Euro -> user purchases via Operator/SMS billing -> How much do we get? = Answer: minimum....... Euro
    4). App in OVI-> Price 4 Euro -> user purchases via Operator/SMS billing -> How much do we get? = Answer: minimum....... Euro
    5.) App in OVI-> Price 5 Euro -> user purchases via Operator/SMS billing -> How much do we get? = Answer: minimum....... Euro

    Please no answers containing ifs, buts, maybe's, because, perhaps, etc. We want hard and proven figures, like we have on Apple Store, Android market etc. If possible based on experience

    Bonus question: we sell on June 1 2010. We get paid on <year> <month> <day> ?

    Thanks !

  2. #2
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    Re: Our revenue share with operator billing.

    there are no ways on answering your question without if's, basically it depends on which operator it is, and how many %'s they are charging. So can you check the FAGs, and maybe older discussions on teh topic, for example liek this thread: http://www.forum.nokia.com/forum/sho...d.php?t=196885

  3. #3
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    Re: Our revenue share with operator billing.

    Klomptek: you cant compare OVI store to apples/androide store since they only bill via credit card and in OVI you have a chance to bill users via phone bill which has additional costs like operator billing (those damn greedy companies who take up to 60% of the gross price)

  4. #4
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    Re: Our revenue share with operator billing.

    Quote Originally Posted by Klomptek View Post
    Hi all,
    If possible based on experience
    Based on experience it's impossible. Not the answer you were hoping for but it's the reality of Ovi.

    Believe it or not, no-one can explain the breakdown in revenue. I had an email conversation with a senior relationship manager from Nokia who didn't even realise we couldn't turn off operator billing. I had to point this out to him. When I turned off operator billing my revenue share was still around the 35% mark. It should never have been this low while selling at the €3 price point, even with every transaction being processed via operator billing (which was turned off). I asked why, but no-one can provide a reason. It was suggested that it could be down to VAT (answer from support) or a delay in credit card processing (answer from the senior relationship manager). Whatever about the VAT answer, the delay in credit card processing answer makes no sense given that the transactions we were discussing are four months old.

    Revenue share is a big black hole. The guys in support don't understand it... but they are helpful, one of the guys in Ovi support is currently trying to find answers for me.

    Another big difference with Android and Apple is Ovi seem to pay VAT on our behalf (out of our revenue share) to the Finnish state (weird!), even though companies (in, say the UK) shouldn't pay VAT until they reach a certain threshold. VAT seems to paid at 22% for European transactions. In the UK at least, apps are considered an "electronically-supplied service" and in this case it is being supplied to another EU VAT-registered business (Nokia) for business purposes, the place of supply rules indicate that this supply is *outside the scope* of VAT. That's how it works for Apple and Android developers. This VAT issue needs clarification, if in fact we are paying VAT and it's not simply some-one inside Nokia trying to explain away the differences in expected and estimated revenue.

    There are many anomalies in revenue. Today, I noticed that for one app I had a minus amount of almost ten euros for two transactions in Hungry. That appears to be a bug - although Nokia will deny that there are any bugs in their revenue collection subsystems. I've emailed support about this also. Given the amount of bugs in Ovi, I personally don't believe that the revenue subsystems could be immune.

    As I said, the guys in support are seeking answers to my questions and hopefully they will be able to explain the breakdown soon.

  5. #5
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    Re: Our revenue share with operator billing.


    There are many anomalies in revenue. Today, I noticed that for one app I had a minus amount of almost ten euros for two transactions in Hungry. That appears to be a bug - although Nokia will deny that there are any bugs in their revenue collection subsystems. I've emailed support about this also. Given the amount of bugs in Ovi, I personally don't believe that the revenue subsystems could be immune.
    I see JUST THAT, too!

    Hungary seems to be a "Money hole"
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  6. #6
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    Re: Our revenue share with operator billing.

    An update back from the guys at support.
    They still can't account for the difference, but VAT does account for some of the difference.

    I can confirm that we pay the Finnish government VAT. This is completely different to the Android and Apple stores.
    I explained, to the support guys, the way VAT works in the UK for Android and Apple developers (same as in my previous post) and asked how those rules effect us, but I haven't got an answer to these questions yet.

    So, leaving out operator billing (who take up to 50%), a credit card transaction on a sale of a three euro app looks like this.

    VAT is paid at 22%
    - 3/1.22 = €2.46
    Nokia take 30% of remainder
    - 2.46 * 0.7 = €1.72

    We should receive 57.3% of the gross on credit card transactions. However, in the the figures I'm discussing with the guys in support I received 36% in the US, and in the UK I receive 42% of the gross. So there must be more hidden costs.

    Ovi is a very different animal to Android and Apple.
    We pay the Finnish state 12.66% of our revenue while Apple and Android developers don't have VAT deducted (which appears to be the correct implementation of the VAT rules). We also pay network operators between 40% and 50%. And there seems to be even more charges that we don't know about. Ohh, I nearly forgot we also wait for seven months (180 days plus one month) to get paid for operator billed transactions. Wow! It's good to know that Nokia want a profitable app eco-system.

    I don't know how operator billing effects VAT. One of the support guys said they pay it but didn't elaborate... so we probably still pay a percentage. At the moment, I'm only looking for information on credit card transactions.

    If there's anyone in Nokia with influence reading this post, you might want to consider a recent article in the San Francisco Chronicle. To quote...

    "This is not to say that Symbian can't bounce back, but one slightly worrying thing we've found is that there's an overwhelming desire on the part of developers to support around no more than three platforms," Cripps says. "And right now there's a cluster of developers who are concentrating on developing for the iPhone, BlackBerry and Android."
    So, why take 30% when other offer 70% - and by others I mean everyone else.

    That argument aside, I'll update this post when I find out more information.

  7. #7
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    Re: Our revenue share with operator billing.

    Hi
    In My artilc for Individual developers written last year my opinion was:-
    Your Support For Your Content Support for your program. This is fairly obvious. If you have problems and dont sort them out Nokia will invoke the clause to deduct a further 40% for refunds

    "fixed aggregator billing costs will be calculated at forty percent (40%) of the purchase price paid by End-Users after all applicable returns and refunds"
    Opinion 20.00 euros -40% SMS = 10.2 Euros - 30%(Nokia cost) = 8.4 Euro
    Opinion 2.00 euros -40% SMS = 1.2 Euros - 50%(Nokia cost) = 0.6 Euro
    Opinion 1000 units* 2Euro =2000 Euro
    Opinion 2000.00 euros -40% SMS = 1000.2 Euros - 30%(Nokia cost) = 800.4 Euro U.k. currency charges 1.7 euro pound = 470 pounds
    So had to sell 500 items at 4 euros, this is unlikely so 2 euros result in 300 pounds uk for 2000 items 36% overall income.
    Leave this to you the reader, but wont cover the cost of signing you app.
    My opinion "So had to sell 500 items at 4 euros, this is unlikely so 2 euros result in 300 pounds uk for 2000 items 36% overall income"
    is still the same.

    There is a document about cross country which I pointed out before showing that Hungary has 25% VAT as against 17.5%

    Refer to my previous post on Ovi and VAT.

    Is one flat rate being used throughout Europe
    http://discussion.forum.nokia.com/fo...19&postcount=6

    European Commision site on VAT and e-commerce

    Thanks Jim
    Last edited by jimgilmour1; 2010-04-27 at 16:52. Reason: fix broken link

  8. #8
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    Re: Our revenue share with operator billing.

    Quote Originally Posted by jimgilmour1 View Post
    Is one flat rate being used throughout Europe
    http://http://discussion.forum.nokia...19&postcount=6
    Hi Jim,
    The link is broken. Can you check it...
    thanks
    spol

  9. #9
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    Re: Our revenue share with operator billing.

    Blackberry App world has introduced operator billing. To allow for operator billing, developers now receive 70% of the gross instead of 80%. VAT is implemented in the same manner as the Apple and Android.

    Thought this might be an appropriate addition to this thread.

  10. #10
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    Re: Our revenue share with operator billing.

    My own experience
    I am selling app for 2 ovi euros
    As you can see in billing matrix it's not 2 euros
    In some countries it's 1 euro

    This is estimation rev. per one app
    United Kingdom 0.53 €
    Germany 0.65 €
    Thailand 1.40 €
    Greece 1.15 €
    Austria 1.15 €
    Portugal 1.15 €
    Estonia 1.15 €
    Taiwan 0.83 €
    Sweden 0.63 €
    Denmark 0.62 €
    Australia 0.53 €
    United States of America 0.49 €

  11. #11
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    Re: Our revenue share with operator billing.

    The following can be explained by the information I posted to this thread

    Greece 1.15 €
    Austria 1.15 €
    Portugal 1.15 €
    Estonia 1.15 €

    These appear to be credit card transactions, not operator billing.

    -----------------------------------------------------------------
    Sales Price - €2
    VAT to the Finnish government @ 22% (2 - 2/1.22) - €0.36
    Nokia 30% - €0.49


    €2.00 - €0.36 - €0.49 = €1.15
    -----------------------------------------------------------------

    As for the remaing countries/estimated revenue, I can't offer any explaination.

    The UK figure is interesting, here you're receiving less than 25% of the gross revenue (accounting for the exchange rates, as the €2 price point translates to £2).

    You're also receiving around 25% in US. If you were selling on the other major app store, you'd get a clean 70%. Ovi is very uncompetitive from a developers perspective.

  12. #12
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    Exclamation Re: Our revenue share with operator billing.

    Wow that is cool information
    ovi paid VAT TAX as another percentage from our app.
    As I read somewhere in docs. tax should be paid from ovi's 30%.
    I don't understand it now

    ovi staff can you answer ?

  13. #13
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    Re: Our revenue share with operator billing.

    there is no where in the docs that says that ovi pays the vat tax out of its 30%.
    as for the UK pricing i can tell you that a 2euro price point is NOT fixed price point but its rather depanded on the buying power of each country for instance a 2 euro app could be sold for 1 euro no countries that their currency have low buying power like Kenya for instance.
    another good example is that the 1 euro price point is marked in USA ovi store as 0.99 cent (which is alot less than 1 euro) this maybe also due to euro being a bit stronger in terms of buying power than US dollar and it may also be because the US market is used to the 0.99 cent price point.
    etc etc

  14. #14
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    Re: Our revenue share with operator billing.

    My estimated revenue is around 37% of gross sales. Worse, I have actually received payments for only 16% of estimated revenue or 6% of gross sales.

    Clearly, there is a chain of companies (and possibly governments) who are allowed to arbitrarily nibble on our revenue without us being able to see who takes how much and on what basis. They are also allowed to withhold payments for up to 210 days (interest free credit anyone?).

    I think this is enabled by the fact that courts didn't have their say on which laws apply in this case. The folklore is that until operator / OEM practices are challenged in courts, they will charge as much as they can without feeling that they need to justify anything. So they charge extortionate amounts while knowing that it can be easily proven in court that 40% or 50% charge and withholding funds is excessive and abusive. Unfortunately, developers don't have resources to sue and Ovi is unlikely to pressure operators in any way.

    If they wanted to, Ovi could resolve this easily by changing the pricing model - the developer must be able to set his price and additional charges should be added on top of that, including Ovi's 30%. This should encourage competition in operator charges and ultimately reduce them to reasonable levels.

  15. #15
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    Re: Our revenue share with operator billing.

    Quote Originally Posted by xlazom00 View Post
    Wow that is cool information
    ovi paid VAT TAX as another percentage from our app.
    As I read somewhere in docs. tax should be paid from ovi's 30%.
    I don't understand it now

    ovi staff can you answer ?
    Tax in any country is on the profit thats the amount you get paid from the country of origin in Hungary case 25% in the UK currently 17.5%

    The other point is that if a return is made Ovi Nokia has to pay back 100% cost, so thats what they deduct from you. The SMS 40% is never recovered from the operator. On account this means you must sell another two items to recover the loss ie 60%+60% =120% -100% leaves you with a 20% profit on three sales so every "return" costs you -40% price of item. example sell item 10 euro leaves 6 euro profit. The return takes place and your account is deducted 10 euros leaving you with a minus (-4 euro loss!). so now you need to sell two items at 6 euro profit =12 euro minus to - 4 euro loss give a total profit of 8 euros for 3 sales and one return!!!.

    Jim

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