Apple Lets Amazon Prime Video App Offer In-App Purchases on iPhone, iPad and Apple TV

[Rogifan]

Huh? They did that 3 years ago.

Apple TV channels didn’t exist three years ago.

Not exactly what Zalando is, but it looks like a clothing reseller? Which is fine, Apple does not compete with them.

The prohibition has always been about companies that compete with Apple on services/non-tangible product, such as Music/Video/Online Services. That is why companies like Netflix, Spotify, and (until now) Amazon did not sell subscriptions, they did not want to pay Apple 30% (or 15% after 1 year).

So basically anything you would consume on an iOS device Apple would get a cut of that subscription. What I never understood is, if Apple has the right to receive a commission then why do they allow reader apps on the App Store? Why is a Kindle app that doesn’t offer IAP allowed to exist? Or Netflix or Spotify?

I hope this change means all digital content apps will now be able to offer their own payment options in-app. Let Apple compete with them on a level playing field. Besides Apple will still make a crap ton of money from all the game IAP.

 

[davidjytang]

Finally someone gets it right.

This article is incorrect. Apple only requires IAP for unlocking "features or functionality within [the] app." Guideline 3.1.1.

Apple has never required apps to use IAP for selling goods and services that can be consumed outside of the app, which Amazon has been doing for years in the Amazon Store app.

• 3.1.5(a) Goods and Services Outside of the App: If your app enables people to purchase goods or services that will be consumed outside of the app, you must use purchase methods other than in-app purchase to collect those payments, such as Apple Pay or traditional credit card entry.

Spotify offers subscriptions for unlocking features (no ads, etc) not individual songs, which is why it must use IAP.

Audible doesn't offer buying directly in app due to Apple requiring their IAP.

 

[TriBruin]

Apple TV channels didn’t exist three years ago.


So basically anything you would consume on an iOS device Apple would get a cut of that subscription. What I never understood is, if Apple has the right to receive a commission then why do they allow reader apps on the App Store? Why is a Kindle app that doesn’t offer IAP allowed to exist? Or Netflix or Spotify?

I hope this change means all digital content apps will now be able to offer their own payment options in-app. Let Apple compete with them on a level playing field. Besides Apple will still make a crap ton of money from all the game IAP.

Do you want the real answer or the technical answer?

We all know the real answer, but there is also a technical reason that some Apps can not offer IAP. IAP does not scale for anything more than a handful of purchase options. It would be impossible to have an App, like Amazon Kindle, sell books by IAP. Now, subscription Apps, like Netflix & Spotify can (and have) utilize IAP, but choose not.

 

[Ballis]

Huh? They did that 3 years ago.

No

 

[Cosmosent]

Clearly this is real news to just about ALL App Devs !

 

[Rogifan]

Do you want the real answer or the technical answer?

We all know the real answer, but there is also a technical reason that some Apps can not offer IAP. IAP does not scale for anything more than a handful of purchase options. It would be impossible to have an App, like Amazon Kindle, sell books by IAP. Now, subscription Apps, like Netflix & Spotify can (and have) utilize IAP, but choose not.

Apple’s books app allows you to buy books in-app. The reason Amazon and Barnes & Noble never offered IAP in their book apps is because they refused to give Apple a cut of books sales. I guess Apple thinks allowing book purchases in-app is akin to a store with in a store but I don’t see what the difference is between video and books.

 

[Razeus]

Anti trust concerns must be breathing down Apples neck.

 

[Mascots]

Do you want the real answer or the technical answer?

We all know the real answer, but there is also a technical reason that some Apps can not offer IAP. IAP does not scale for anything more than a handful of purchase options. It would be impossible to have an App, like Amazon Kindle, sell books by IAP. Now, subscription Apps, like Netflix & Spotify can (and have) utilize IAP, but choose not.

They don't really need to IAP for something like Amazon's Kindle content, instead they can just use Apple's payment network just like any other payment gateway (which is something Apple offers to large companies as a ~private~ program) and manage the content-sale themselves. The kicker of course being that Apple takes a 30% cut from transactions through it and iOS clause stipulates that they (Amazon, in this case) can't charge more on the iOS side, making that a 30% loss on the retailers end.

The super surprising part about this situation is that rather than changing the rules to allow price variance (thus adding a 30% premium on iOS goods), they're allowing Amazon to price things evenly, go through their own gateways, and are (seemingly) giving that cut up now.

 

[btrach144]

I still would prefer that Apple handles payment. I trust that Amazon is good as well but if they open this to other developers, I can I ensure that they are PCI compliant, using TLS 1.2, etc. to protect my payment?

 

[Art Mark]

The wall is cracking... maybe we'll finally see the ability to distribute free apps (whether via the open internet or the app store) without paying Apple an annual fee or going through other hoops...

Hope not. Not apps. The one thing Apple's App store got right was security concerns. Take a ride over on the Android side for the hell that is for friends who have it. Buying media through an app is not the same as installing apps from anywhere.

 

[Rogifan]

I still would prefer that Apple handles payment. I trust that Amazon is good as well but if they open this to other developers, I can I ensure that they are PCI compliant, using TLS 1.2, etc. to protect my payment?

I trust large developers. Smaller ones would probably use Apple’s IAP anyway.

 

[aaronhead14]

It's about dang time. Now they just need to let me buy Kindle books, Audible books, movies on Vudu, and EVERY other digital purchase I want.

Apple shouldn't hold their own customers hostage waiting for their competitors to pay up. It's a bad user experience for everyone. Let me buy what I want when using my own phone.

 

[dwaite]

This is a partnership program associated with Apple TV integration that Apple just widened to include Amazon. I _suspect_ they had an individual deal with Amazon around Apple TV support, and they just consolidated that with another partnership program.

Someone like Netflix would likely not qualify because:

1. They refuse to offer deep integration into Apple TV, such as search and Up Next.
2. This only applies to expansion of _existing_ accounts and _existing_ billing - in fact I suspect there are restrictions about asking for credit card #s and the like.

Apple's policies continue to be based around the idea of marketing and introduction - leveraging Apple's ecosystem, infrastructure and store leading you to get new customers means Apple gets a cut. This is basically Apple saying, for partners we will consider that your existing relationship with the customer (including setting up billing systems with them) overrides our introduction.

Think of it this way, if a game company rep went and installed kiosks with free trial install offers/disks in a big box retailer like Best Buy, they'd likely not just kick them out but call the police for trespassing. There is no way a store would let someone in and take up floor space to try to take customers. But they will have plenty of offers that cashiers will stuff into your bag at checkout, I see ISPs and cable company representatives in there talking to people as reps, etc. These companies have made an arrangement that provides value to both parties.

Apple will likely be challenged around this, and need to define the program as being open based on specific terms - like video apps, required API support, support across all of apple's platform (except watch and HomePod obviously), only for existing accounts, only using existing billing. I'd love to see them open this up further (simply: you cannot ask for billing information in-app) but they are going to want a bit more value for Apple's ecosystem.

 

[itsmilo]

Netflix is also selling a subscription, not individual movies / tv shows. In that sense BUYING a movie is no different than using a shopping app to buy shoes.

i am guessing you can still not subscribe to prime via the app?

 

[The Phazer]

Netflix is also selling a subscription, not individual movies / tv shows. In that sense BUYING a movie is no different than using a shopping app to buy shoes.

i am guessing you can still not subscribe to prime via the app?

No, you can't. Apple has said this new exemption doesn't apply to subscriptions in it's statement to The Verge.

Odd that Apple came out and stated there had been a change here when certain posters in this thread were so insistent there hadn't been.

 

[Rogifan]

It's about dang time. Now they just need to let me buy Kindle books, Audible books, movies on Vudu, and EVERY other digital purchase I want.

Apple shouldn't hold their own customers hostage waiting for their competitors to pay up. It's a bad user experience for everyone. Let me buy what I want when using my own phone.

Apple allows what it ”reader”. apps. Kindle, Netflix, Spotify etc. are ”reader” apps. Apple doesn’t force these companies to offer IAP (using Apple’s payment system) as a condition of the app being allowed on the App Store. The only conclusion then is Apple thinks the slight inconvenience of having to use the web to sign up for these services or buy media/books will get people to use/buy Apple’s option instead.

 

[2010mini]

Not being sent through Apple's payment system is new.
Up until now, Apple didn't allow 3rd party payment options. They wanted the 30% cut from in-app purchases, which is why Amazon wouldn't let you rent or buy movies directly from the app.

that’s incorrect. Check Apple’s IAP guidelines and you will see this is a misconception.

 

[Blue Hawk]

Does someone know why I cannot pay with my amazon credit there? It only shows me my cash card.

 

[ArtOfWarfare]

Hope not. Not apps. The one thing Apple's App store got right was security concerns. Take a ride over on the Android side for the hell that is for friends who have it. Buying media through an app is not the same as installing apps from anywhere.

See the Mac. People don't have to pay Apple to distribute apps on the Mac, but security concerns are minimal.

 

[aaronhead14]

The only conclusion then is Apple thinks the slight inconvenience of having to use the web to sign up for these services or buy media/books will get people to use/buy Apple’s option instead.

It's not a slight inconvenience. It's a major inconvenience. If I want to buy a book on the Kindle store, I shouldn't have to move to my computer to do so. I shouldn't be forced to use crippled phone that can't perform basic functions. And I shouldn't be swayed to buy it from Apple's iBooks instead.

Apple's anti-competitive behavior doesn't sway me to buy/subscribe to their digital services. If anything, it bothers me so much that I'd rather go out of the way to not buy from their own bookstore.

This alone has almost caused me to switch to Android. Almost. It just boggles my mind that Apple would intentionally cripple everyone's iOS devices from doing basic things, just because they want a slice of a pie that isn't theirs. Digital goods should be just as available as any other product. Apple preventing people from buying them on iOS devices is utterly asinine.

 

[fmillion]

I'd still love for someone to give me a reasonable, valid justification for Apple claiming 30% of in-app purchased items such as content (books, etc) other than "because they can".

The App store 30% tax I can ALMOST understand. You could argue you're paying for review time, hosting costs, etc. For larger apps though this doesn't scale up too well - does Apple really spend 100x the cost on hosting an app that's downloaded 100x more times than another? You could also make the argument that this is one of those situations where everyone pays a portion based on profit and everything events out.

But charging 30% for things purchased in an app has never made any sense to me. Apple is simply a payment processor at this point. In most cases, they're not even hosting the content. This is especially true for subscriptions, e-books and the like. If Amazon were to concede and let Apple take 30% of Kindle profits, the experience of consuming the content would not change for me versus visiting the website in Safari to purchase the book. Literally the only thing that would differ is the actual purchase experience. I fail to see where that 30% is going other than directly into shareholder's pockets. (Ok, maybe 1% or so of that is going to Apple's own card processing operation, but beyond that...?)

Combine that with the idea that Apple is very privacy-strict. Don't get me wrong, I wholeheartedly agree with this, but telling third parties that they have to give up focused ad revenue AND they have to pay 30% of digital goods to Apple? I think this is why so many companies have simply chosen to not utilize in-app purchasing at all.

I'd even argue it's fair for Apple to charge a higher price than typical payment processors. Say 5% at most. But 30% has always seemed outrageous, and even the 15% for "long-term" subscriptions seems excessive. Some companies have explained that 30% is literally far more than their current profit margin, so the only way to address that requirement would be to raise the price of the goods across the board (and IIRC Apple won't let you charge more for IAP versus non-IAP, so everyone suffers). Instead, these companies simply eschew IAP for a poorer UX - but from a business perspective, that slightly poorer UX is well worth not raising all your prices and losing customers over something as simple as payment processing.

 

[Cosmosent]

In the App Store, Apple gets 85% of their Revenue from Games, 10% from Streaming Media "sub" app, & 5% from everything else.

Does this mean, that once this Bennie becomes widely known & other companies like Netflix & Disney adopt it, does Apple then almost immediately lose-out on that 10% portion ???

My recommendation to Apple, drop your cut for ALL apps that are FREE & have ONLY ONE In-App Purchase (OR that are Paid with NO IAPs), & most-importantly, that have less than 1K Ratings in the iOS App Store "here in the States".

You'll make it up on the back as more UN-Discovered apps become Discovered !

Many good UN-Discovered apps just need a Bump Start to start rolling (well) !

 

[btrach144]

I trust large developers. Smaller ones would probably use Apple’s IAP anyway.

Until you have some CTO who wants to save 30% and they outsource some crap payment system implementation.