Apple and Microsoft Reportedly Facing Off Over SkyDrive In-App Subscription Revenues

[MacRumors]

The Next Web reports that Apple and Microsoft are currently engaged in a dispute over Microsoft's SkyDrive cloud storage app that was launched in the App Store a year ago. According to the report, the dispute is related to Microsoft's move to roll out the ability for users to purchase paid storage upgrades on their iOS devices without going through Apple's in-app subscription mechanism that provides Apple with a 30% share of revenues. As a result, Apple has refused to approve any updates to the SkyDrive app.

Microsoft, TNW has learned, has a new version of the application ready to go, including a key bug fix that would rectify a crashing bug, but cannot get it through.

Microsoft does not appear keen to pay Apple the 30% cut, as it lasts in perpetuity, regardless of whether a user continues to use an iOS device or not, as the billing is through their Apple account.

The report claims that Microsoft has offered to remove the subscription options from the SkyDrive app, but Apple has still declined to allow updates to the app. It is unclear why Apple would have refused such an offer, as many similar apps such as Dropbox operate under this model.

The Next Web goes on to note that the dispute between Apple and Microsoft is also affecting third-party developers who have integrated SkyDrive into their applications, as the login pages for SkyDrive displayed by these apps contain a "sign up" link that runs afoul of Apple's guidelines.

In short, applications that wish to integrate with SkyDrive cannot, until Microsoft bows to Apple's demands, and retools SkyDrive to allow for it to be integrated with the technology firm's payment system by which the firm would garner a fee for the length of the account. A user could go into their Apple account, cancel their subscription, and then re-purchase it outside of the Apple ecosystem, but as that would save them no money, few, if any, will.

It is unclear just how and when the dispute between the two companies may be settled, but for the time being both SkyDrive app users and both developers and users of third-party apps relying on SkyDrive are finding themselves increasingly affected by the standoff.

Update 11:04 AM: Engadget reports that Microsoft has issued a statement acknowledging a "delay in approval" for its SkyDrive app.

Similar to the experiences of some other companies, we are experiencing a delay in approval of our updated SkyDrive for iOS. We are in contact with Apple regarding the matter and hope to come to a resolution. We will provide additional information as it becomes available.

Article Link: Apple and Microsoft Reportedly Facing Off Over SkyDrive In-App Subscription Revenues

[skate71290]

Microsoft acts the bigger man and Apple acts like a child

[bbeagle]

Originally Posted by skate71290

Microsoft acts the bigger man and Apple acts like a child

MacRumors is increasingly turning into FOX news. What a misleading article with no facts, just assumptions, and relentless Apple bashing.

For those who will respond with 'What's misleading?' Everything. Has Microsoft actually submitted an app update? We don't know. Is Apple not allowing an app update to be approved? We don't know. Is Microsoft upset with Apple? We don't know. Is Apple upset with Microsoft? We don't know. Just assumption after assumption is all this 'article' is.

[FSMBP]

Originally Posted by bbeagle

MacRumors is increasingly turning into FOX news. What a misleading article with no facts, just assumptions, and relentless Apple bashing.

I'd rather be on a site that would report all rumors, even that bash Apple when Apple is in the wrong, than a site that only posts positive articles on Apple (i.e. DaringFireball).

[inkswamp]

Originally Posted by FSMBP

I'd rather be on a site that would report all rumors, even that bash Apple when Apple is in the wrong, than a site that only posts positive articles on Apple (i.e. DaringFireball).

You should try reading John Gruber's Daring Fireball. It routinely posts things that are critical of Apple. I'm not sure what "DaringFireball" is but clearly it's not the same site I look at every day.

(Edit: Oh maybe we are talking about the same site. Look how Gruber only posts positive things about Apple. He should be ashamed.)

[FSMBP]

Originally Posted by inkswamp

You should try reading John Gruber's Daring Fireball. It routinely posts things that are critical of Apple. I'm not sure what "DaringFireball" is but clearly it's not the same site I look at every day.

The only time I've seen him be critical on Apple is on issues that Apple already publicly acknowledges, never beforehand (unless it is a software bug).

Regardless of what you say, there is a bias on Gruber's site and The Loop.

And "I'm not sure what 'DaringFireball'? Very mature.

[mdelvecchio]

Originally Posted by FSMBP

I'd rather be on a site that would report all rumors, even that bash Apple when Apple is in the wrong, than a site that only posts positive articles on Apple (i.e. DaringFireball).

uhh, but that isnt true -- DF has no problems criticizing apple when theres merit. if you were an active reader of DF youd know this. try again.

[BaldiMac]

When I ran a retail store, we charged a commission when we sold third-party services. Nobody thought this was strange or childish.

[Brian Y]

Not too sure what the fuss is about.

The app store terms and conditions state that if you wish to sell additional services through an app, you have the be able to buy the same services through in-app purchasing.

It's a) in the T&C MS have agreed to and b) it's Apple's network, they can do what they want. Nobody's forcing MS to use the app store.

[VenusianSky]

Bold text should be the sub-title of the article

"The report claims that Microsoft has offered to remove the subscription options from the SkyDrive app, but Apple has still declined to allow updates to the app.It is unclear why Apple would have refused such an offer, as many similar apps such as Dropbox operate under this model."

...but then nobody here would want to read it.

[Stella]

Originally Posted by BaldiMac

When I ran a retail store, we charged a commission when we sold third-party services. Nobody thought this was strange or childish.

A retail store differs from a digital store, given your example.

Apple wanting a 30% cut for services that never touch their (Apple's ) servers is taking the p!ss. Its basically free money for Apple. The product seller gave apple its $99 charge that is required for AppStore commission.

For example, Best Buy don't take commission for all future MMO game subscriptions when that product was purchased at its store.

[ctdonath]

Originally Posted by Stella

A retail store differs from a digital store.

Apple wanting a 30% cut for services that never touch their (Apple's ) servers

He was referring to 3rd party services. Same idea: the retail store, and the App Store, put the customer in contact with the provider and handles initial payments. Nothing hosted by the middleman, but the transaction occurs because of the middleman, who takes a fair (and generous) cut of the price. So long as the middleman handles the payments, he takes a percentage.

[BaldiMac]

Originally Posted by Stella

A retail store differs from a digital store.

Ummm... the App Store is a retail store even though it is digital.

Apple wanting a 30% cut for services that never touch their (Apple's ) servers is taking the p!ss.

Again, we did the exact same thing. We sold third party services. We did nothing but the transaction. We received a commission. Often more than 30%.

Commissions for referrals are a completely normal business transaction. Pretending its not in order to generate faux outrage is either myopic or disingenuous.

[Windlasher]

Originally Posted by Stella

A retail store differs from a digital store, given your example.

Apple wanting a 30% cut for services that never touch their (Apple's ) servers is taking the p!ss. Its basically free money for Apple. The product seller gave apple its $99 charge that is required for AppStore commission.

For example, Best Buy don't take commission for all future MMO game subscriptions when that product was purchased at its store.

NO, they just add 50% on top of the price they paid for it BEFORE selling it to you.

[picciano]

Originally Posted by Stella

For example, Best Buy don't take commission for all future MMO game subscriptions when that product was purchased at its store.

Thanks for giving them THAT idea...

[charlituna]

Originally Posted by Stella

A retail store differs from a digital store, given your example.

Apple wanting a 30% cut for services that never touch their (Apple's ) servers is taking the p!ss.

Payment is via Apple's system. And if the app brings the customer to the service then a 'finders fee' is also fair.

Some folks, like my long standing Netflix account, pay online directly and no cut of our money goes to Apple because they neither process the payment nor were the reason we bought the service

[peterdevries]

Originally Posted by Stella

Apple wanting a 30% cut for services that never touch their (Apple's ) servers is taking the p!ss.

Microsoft uses Apple's platform to sell services. Apple is entitled to a share of the proceedings

[Gasu E.]

Originally Posted by Stella

A retail store differs from a digital store, given your example.

Apple wanting a 30% cut for services that never touch their (Apple's ) servers is taking the p!ss. Its basically free money for Apple. The product seller gave apple its $99 charge that is required for AppStore commission.

For example, Best Buy don't take commission for all future MMO game subscriptions when that product was purchased at its store.

Apple has to administer the store. It seems reasonable to me to charge a commission in return for that. I don't know if 30% is reasonable or not, but some x% is.

If we agree some x% is reasonable, then suppose Apple were to allow a vendor to divide their services into two classes, called "initial" and "aftermarket" purchases, with different commission rates for each. What would stop a vendor from gaming the system by dividing their services so that they always ended up paying the lower commission rate?

[ctdonath]

Originally Posted by BaldiMac

When I ran a retail store, we charged a commission when we sold third-party services. Nobody thought this was strange or childish.

This.

And remember that a basic axiom is simplicity.
Selling something thru App Store? 30%. Simple.
Of course this simplicity means application of the axiom seems odd or unfair at times, but better that than the raging confusion that would follow from a policy of exemptions or per-app negotiation.

Don't like it? Android is thataway. Oh, don't want to go there? 30% then. Simple.

[Mattie Num Nums]

Originally Posted by BaldiMac

When I ran a retail store, we charged a commission when we sold third-party services. Nobody thought this was strange or childish.

I don't think you've read the article.

[BaldiMac]

Originally Posted by Mattie Num Nums

I don't think you've read the article.

I know that your thoughts are incorrect in this case.

[everything-i]

Originally Posted by BaldiMac

When I ran a retail store, we charged a commission when we sold third-party services. Nobody thought this was strange or childish.

Got to agree, this is their business model and it is enforced for all developers submitting apps that require in app payments. If they treat M$ any differently to other companies then that would be a scandal.

[Yvan256]

The more you rely on others for your services, the more you get screwed.

In a fight between two companies, you might not be the target but you still suffer collateral damage.

Host your own website. In the process you get your own email addresses and your own FTP accounts.

I just wish people would add regular FTP as an additional option to all the iCloud and DropBox craziness.

[Nightarchaon]

And so the role reversal of these two is complete, Apple is the corporate Juggernaut, throwing its weight around and making unreasonable demands and being an ass and Microsoft is the amicable, easy going, reasonable company.

Seriously, i use skydrive a LOT , mostly due to the fact it works through the corporate firewall where dropbox doesn't, to not have skydrive on an iOS device going forward would mean i will be stuck with a crappy android phone for ANOTHER two years (I HATE android OS, but i love some of the android only apps).

I am hoping Apple will pull its rod out of its ass and relax a little on this, preferable before i need to look at a new phone next year, i am hoping to go from my Samsung Galaxy S2 to an iPhone 5S, but its looking like an S3 or Note 2 might be on the cards

[CodeBreaker]

Don't care whose playing good guy bad guy here, but if Microsoft wins, I too want the same terms to apply for my app. My IAP has nothing to do with App Store, and my app is also a cloud based service.