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Apple Debuts App Store Subscriptions
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No they are not .. they do nothing but process the billing .. they do not provide the content nor is the content distributed via their servers ... 30% is outrageous for that super limited service and forcing everybody to use it is borderline illegal (at least here in Europe I'd be surprised if that flies).
T.
Netflix can still offer two kinds of subscriptions, one that excludes iOS use and one that includes it. Only the one which includes iOS use is sold from within the app. Apple does not prevent you from offering a different product/service at a lower price outside the app store, just not the same product/service.
Naturally, how popular it will be if Netflix on iOS costs 43% more than Netflix on Android is another question.
I am surprised so many people keep ignoring this line. It is like the only line that was read is the part where Apple takes 30% and then they ignored everything else.
If you'd actually read my post, what I said was that they'd have to raise their prices for all subscriptions that could be used on the iPhone by 30% to cover the gap, irrespective of if they are made inside our outside the App.
i.e. If you buy a Netflix subscription from the Netflix website, you'll have to tick an extra box if you want to be able to use Netflix on the iPhone, and that will cost 30% extra. It's the only way they can offer a subscription service to iOS now and match what they have to charge via in app subscriptions.
The press release says that they explicity won't -
Apple said:
Phazer
No they didn't. They said the price can be lower, but they did not say the functionality can be less. It's not the "same or better deal" if what you can buy for a lower price is a subscription that only works on iOS devices.
Well, if you have doubts .. the press release reads differently in my understanding. It pretty clearly says
T.
If they did, then Apple wouldn't receive a penny, because Visa and Mastercard charges come straight out of Apple's 30 percent. As do the cost of building all the software that is needed to make subscriptions work, the cost for downloading, the cost of advertising it on the App Store, and so on and so on.
The publisher produces the content and sits back and cashes in 70%. No printing and distributing books or magazines, no taking back unsold items back. Do you think any publisher in the world gets 70% of the price that a book sells for in a book store? Do you think any software publisher gets 70% of the sale price of their software?
well if I were a publisher I would just offer nice deals on my website (which people would still visit via their laptops) and lurk them in there. You have to get people subscribing on your website with their normal computer and then just login with your iPad, I think that's the only way you get around the (way too high) 30% Apple tax.
I think for Apps 30% is fair enough, for inapp I don't really mind but for subscriptions (external content!) it should be around 15%. They just do the billing and provide a big market...
I think for Apps 30% is fair enough, for inapp I don't really mind but for subscriptions (external content!) it should be around 15%. They just do the billing and provide a big market...
But Netflix is already offering a streaming only subscription for $7.99, and DVD for $2 extra.
So who bring the most customer to who? The iPad is kind of useless without content, and a streaming service i kind of useless without a device to watch on.
It should be entirely optional, then we'll see how worthwhile it is. In my professional opinon, it's worth less than 3%.
Phazer
Do'h I though "App Store Subscriptions" meant unlimited Applications for one low monthly fee
*dead*
So the Kindle store is driving publishers into bankruptcy? Or is it only evil if Apple does it, but really good if Amazon does it?
No content business runs with 30% gross margin. Inevitably, some customers will use the Apple box that wouldn't have ticked the box on the website. So you make _more_ sales. Does your website accept iTMS gift cards? On the Apple Store, people can pay for your content with iTMS gift cards, so you will get customers that otherwise you wouldn't have got. If a subscription costs $10, then every time someone ticks the box on the App Store, it is seven dollars straight in your pocket. iTMS = 70 percent gross margin. Magazines make a lot of money by selling advertisements, often a lot more than they make from actual sales. And ads pay per magazine sold.
And if you think that taking advantage of the App Store doesn't increase your sales, then don't offer it there.
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I can not believe how many people believe this statement.
Do you honestly think that being avaiable as a native iOS app on the built-in store on millions of iOS devices worldwide is worth nothing?
That's what Apple is selling. Exposure + a simple impulse buying method. It's their biggest asset. It's what they're charging for. It's something most MacRumors posters seemingly don't understand at all.
No wonder you all think it's a bad deal. You don't even know what Apple's selling here. That's what the 30% is for.
You could argue that what they meant was what I added just above. 'Subscription offer' is a term that can mean a lot of things, including a print subscription. Apple certainly did not mean that if you offer a print subscription outside the app that it would have to offer to make the same print subscription inside the app. That would not make much sense.
Why do people keep posting this like it is a one way street. The iPhone/iWhatever needs content as much as content needs the iPhone.
30% is for marketing, website and billing. How much would it cost to advertise your product? Also the Mac App icon on everyone's desktop that lets users checkout the latest products.
I hear ya, but the scope of this is much larger than the billing alone. Apple have sold millions upon millions of iOS devices that would allow access to said content because of the App Store ecosystem. With so many of these devices in so many people's hands, publishers would be maximizing their potential reach with that 30% cut. Not saying if I were a publisher 30% is worth it, but there is some value to that potential customer base nonetheless.
this is rather shady of apple, they know most people when presented with a $9.99 book through an in-app purchase vs. having to go to amazon.com, as an example will go through the app.
i understand with music/movies/apps that apple hosts on its servers they need to cover costs, but with something like kindle where apple does nothing and administrative costs are zero they're just grabbing 30% for nothing, that's not cool.
i understand with music/movies/apps that apple hosts on its servers they need to cover costs, but with something like kindle where apple does nothing and administrative costs are zero they're just grabbing 30% for nothing, that's not cool.
You really have never done billing or worked in any accounting capacity have you. Yes it so easy that why the accounting departments are so big people just sit around doing nothing all day.
As for the subscription I thought that the apps and subscriptions are on their servers and they have to keep on top of it?
Is being available as a native app on the Mac (take Skype) is worth nothing? Shouldn't Apple (and MS) charge Skype for being allowed as native apps on their operating systems?
This is exactly how I think content providers should handle this. Anything you want to access on iOS should be 43% more expensive. Kindle or Nook books. Wired subscriptions or Netflix. All of it 43% more if you want iOS access. Problem solved and we all switch to Honeycomb. Your move Apple.
You would think that handling the billing and customer service associated with that would garner no more than 5%.
Traditionally, referring customers to a magazine subscription usually meant an initial referral payment made to the referrer, but not an ongoing cut into the subscription price for every renewal.
I fully believe that Apple deserves a share for creating the ecosystem and bringing the customer and handling the billing and customer service. However, a 30% ongoing cut into the subscription price is a bit over the top and does not seem sustainable. Further, a 30% cut into every content purchase is also over-the-top, especially when Apple is not delivering the content from their servers. This is almost as obscene as the game console manufacturers cut into games sold for the console.
Now that they have added the requirement that the in-app purchase offer the "same or better" offer as offered outside the app they have pretty much made Kindle and Nook impossible in iOS without an across-the-board price increase for those booksellers. The question is, how much of Kindle and Nook sales are coming through iOS versus their own readers? The other question is if Apple will just grandfather those apps in and leave well enough alone so as to not risk the apps being pulled and alienating their own users. The ball is certainly in Apple's court to act first and then for BN and Amazon to react.
Personally, I think Apple will do the same thing with this policy in regards to Amazon and Barnes & Noble as they did with their pornography policy in regards to Playboy. They are going to relax the policy for specific apps, but bring the hammer down on those they don't want to play ball with (e.g.: Google Books or Sony Reader).
It does not make good business sense to chase Amazon Kindle and BN Nook readers away from iOS.
Traditionally, referring customers to a magazine subscription usually meant an initial referral payment made to the referrer, but not an ongoing cut into the subscription price for every renewal.
I fully believe that Apple deserves a share for creating the ecosystem and bringing the customer and handling the billing and customer service. However, a 30% ongoing cut into the subscription price is a bit over the top and does not seem sustainable. Further, a 30% cut into every content purchase is also over-the-top, especially when Apple is not delivering the content from their servers. This is almost as obscene as the game console manufacturers cut into games sold for the console.
Now that they have added the requirement that the in-app purchase offer the "same or better" offer as offered outside the app they have pretty much made Kindle and Nook impossible in iOS without an across-the-board price increase for those booksellers. The question is, how much of Kindle and Nook sales are coming through iOS versus their own readers? The other question is if Apple will just grandfather those apps in and leave well enough alone so as to not risk the apps being pulled and alienating their own users. The ball is certainly in Apple's court to act first and then for BN and Amazon to react.
Personally, I think Apple will do the same thing with this policy in regards to Amazon and Barnes & Noble as they did with their pornography policy in regards to Playboy. They are going to relax the policy for specific apps, but bring the hammer down on those they don't want to play ball with (e.g.: Google Books or Sony Reader).
It does not make good business sense to chase Amazon Kindle and BN Nook readers away from iOS.