Apple's App Store Subscription Policies Raise Antitrust Issues as Content Providers F

[wisty]

iPhone Safari supports off-line storage.

Publishers can make a Java-script app, and sell it out of the app store for better margins.

Of course, then they can't get access to the app store.

Apple has the advantage that they are a big, trusted company, who already has your credit card details to grease the wheels for one-click purchasing. But so does Amazon. If Amazon creates a freer HTML based App store (for content, not native Apps), they might take a big bite out of Apple.

 

[skellener]

Apparently Google is going to announce their version of in-app purchases and make it a 90%/10% split. The article I read said it was planned to be announced in the near future but they may push that up to as early as to day to capitalize on the negative feedback.

Google One Pass
A simple way for publishers to manage access to digital content

At Humboldt University in Berlin today, Eric Schmidt announced Google One Pass, a service that lets publishers set their own prices and terms for their digital content. With Google One Pass, publishers can maintain direct relationships with their customers and give readers access to digital content across websites and mobile apps.

 

[jonasen]

What is subscriptions?

I think the real issue is, what counts as subscriptions?
You don't subscribe to Kindle e-books, no?

How about a booking app? I don't see a ferry company or hotels having the kind of marginals to cough up 30% of their income to Apple.

 

[Joker Eh]

The real problem I have here is that iOS is a platform, not just a delivery mechanism.

What if Microsoft claimed that anyone selling software for Windows 7 was required to pay 30% of their revenue to them?

iOS and iTunes need to be looked at differently. Unfortunately, Apple has built a world where the ONLY way to get software installed on their platform is through iTunes.

IMO, iOS = operating system. If you demand 30% for everything that comes from iTunes, that's fine, but then you must also provide an alternative for people to install software by alternative legitimate means.

You can build an app for a mac and sell it and people can download it and Apple gets nothing. Same as Microsoft. So your comparison is not the same.

But if you want free publicity through Top Lists on the App store, free delivery mechanism it will cost you.

 

[tripjammer]

As we are constantly lectured about, Android is kicking Apple's butt in the marketplace, so clearly Apple is no longer dominant. Or else Android supporters are exaggerating. Can't have it both ways. Either Apple is so strong you have to resort to the courts to stop them, or Apple is being beaten in the marketplace already. Pick one and stick to it, trolls.

As to the issue, I'm not sure what to think. Apple certainly deserves to get paid for its work. Every time you order a book or magazine from Amazon, the postal service gets paid to deliver it to you. So what Apple is doing makes sense, but I'm not sure 30% is the right number. More like 10% seems fairer.

Android may have more phones...but they don't make as much money off their app store as Apple does with their app store. The apple App Store is a gold mine...and about to get even richer. It's also a gold mine for the developers too. Also there is no Itunes killer out there..and probably never will be. But I wish there would be some better competition. Come on Google step up. You have had plenty of time.

 

[ChazUK]

I read a blog that basically argued this was a sneaky way to get publishers to move their content to HTML5. The argument was basically that SI (I think?) was able to create an HTML5 web-version of their magazine that very closely replicated the feeling of an app. If providers want 100% of the pofits, they can publish to the web and control the payment. On top of that, ANY tablet (or web browser) would have access.

I'd love to see this happen. A cross compatible HTML5 powered experience would be fantastic.

Apparently Google is going to announce their version of in-app purchases and make it a 90%/10% split. The article I read said it was planned to be announced in the near future but they may push that up to as early as to day to capitalize on the negative feedback.

In app purchases was announced earier this month it's a 30% "transaction fee".
http://www.google.com/support/androidmarket/bin/answer.py?hl=en&answer=1153481
I've seen no talk on subscriptions from Google tho. EDIT: It seems skellener that has tho!

 

[Centient]

A simple way for publishers to manage access to digital content

That's a shot across the bow...

 

[bittervictorian]

Wirelessly posted (Mozilla/5.0 (iPhone; U; CPU iPhone OS 4_2_1 like Mac OS X; en-us) AppleWebKit/533.17.9 (KHTML, like Gecko) Version/5.0.2 Mobile/8C148 Safari/6533.18.5)

I think this will only affect apps that have been or want to offer the ability to purchase or subscribe within the app. To my knowledge Netflix and Pandora can simply make their app a subscriber-only app (meaning you must already be a subscriber, or you need to sign up via traditional means, i.e. On the web).

Apple is merely saying if you are going to explicitly solicit subs within the app - then in the words of Robert DeNiro from Goodfellas - "pay me my money"

Unfortunately not:

"Steve Jobs, Apple’s CEO. “All we require is that, if a publisher is making a subscription offer outside of the app, the same (or better) offer be made inside the app, so that customers can easily subscribe with one-click right in the app."

http://www.apple.com/pr/library/2011/02/15appstore.html

So if you make any subscription offer outside the app you must make an offer within the app (at the same or lesser price)

 

[JonHimself]

A simple way for publishers to manage access to digital content

Thanks!

So that "direct relationship" I assume includes your CC info, your address, etc etc etc? Personally, I don't really care about that stuff.. but it bothers me that there are likely a lot of people that say "Ou look! Cheaper!!" or "See, Google supports the devs!" .. but in reality, while they may infact support the devs, they're raking in big bucks on advertising off of the customers.

 

[gturban]

adjustable percentage on subscribtion fees

I think Apple should evaluate a system where their cut is changing along with the subscription cost. The whole point of subscription is to award regular customers. So on a one year subscription the percentage given to apple is lower than on a one time purchase, in the same way the income per unit is lower to the magazine on a subscription.

 

[theBB]

30% quite a bite in the ass! I'd be pissed too!

They don't have to deal with any order processing, pay for credit car transaction fees, or for servers and bandwidth. How much would you charge for that? Some of these periodicals are daily.

Besides, how much do they spend on trying to get new subscribers? (Think of all the junk mail you get to subscribe for newspapers and magazines.) How much do they try converting free online viewers into paying customers? How many new customers do they gain by having access to Apple ecosystem? They practically give away subscriptions to get more ad revenue through higher circulation numbers. Actually many of them sell subscriptions to wholesalers, who pay them even less than what the customers actually do. Now, they want me to believe Apple is putting them in the poor house??? If you believe that drivel, you are naive...

 

[Joker Eh]

I think the real issue is, what counts as subscriptions?
You don't subscribe to Kindle e-books, no?

How about a booking app? I don't see a ferry company or hotels having the kind of marginals to cough up 30% of their income to Apple.

I don't see Kindle e-books as subscriptions, because you buy the book, you are not getting a montly magazine.

hotel booking app???? this is not that.

Think of a monthly magazine. But I don't buy any as I can read anything I want on the web anywhere.

 

[Mad Mac Maniac]

Can content providers advertise a not-so-secret secret promo code (without giving links) to give people a 30% discount while purchasing from their website?

For example:

In the iOS app, display a notification that reads "Pay here at full price. Alternatively, go to our website to purchase the same content. Type in 'FxxxAPPLE' upon checkout and get 30% off!"

Haha that certainly is tricky. I think it may be possible, as long as it's not as direct as you are making it. First of all there would have to be no mention of any promo in the app or in the app description. Maybe they would have to make "temporary" promos where they last for like a month, then full price for a day, and then have a NEW temporary promo with a new promo code. haha. I don't know what apple could do about that.

 

[logandzwon]

I still don't see anything saying that you must offer subscription sign-up through your app. IE.. Netflix. You sign up somewhere else, then access your content in app. You pay Apple nothing.

If you do not want to pay Apple 30% to recruit customers for you then simply do not offer the ability to sign up with-in your app. Problem solved. Quite belly aching pointlessly.

Anyway, small internet merchants without established credit card history do not pay 2.5 %. They pay 20%, + plus 50% of each sale goes in escrow for 6 months. Ask me how I know... I've been with a few start-ups.

[P.S. If Apple was trying to force all subscription services to allow sign up in iOS, (such as Netflix,) then that would be totally different and I would be totally against it.]

 

[al2o3cr]

The WSJ is apparently so out of breath between writing polemics about how the American social insurance system must be destroyed in order to save it and the rest of it's corporate panty-sniffing to note that subscriber revenue isn't a relevant part of the revenue stream. They couldn't even manage to go to their OWN subscription department and ask...

 

[lkrupp]

I'm OK moving to Android if Kindle and Netflix are forced off the iPhone.

I'll decide in June when the next iPhone comes out.

Steve can't be stupid enough to force people off of the platform. Android is getting too much momentum as it is.

But if he is that stupid, I'll switch.

Your response is the very reason there is no anti-trust issue here. You as a user, and developers, are free to switch platforms any time you like.

 

[gwangung]

Fail. 30% of ones revenue is significant for anybody.

Don't bend over so deep for Apple.

Double fail. Distribution often takes 40 to 50% of revenue.

Stop bending over for the anti-Apple zealots. Go out there and learn something.

 

[*LTD*]

Apple is a User-Centric organization. Once again, they've chosen users and developers at the expense of the publishing cartel.

Publishers and dinosaurs of their ilk need to evolve, or die. Oh well.

 

[vincenz]

It's good to be king

 

[perpetuity]

Who is fuming?

What I don't get is why MacRumors chose to follow a few big story's headlines ...

What content provider is fuming? I haven't seen evidence this is yet the case.

 

[Gotta Hankerin]

I think Apple just threw their weight behind web apps.

 

[rwilliams]

I still don't see anything saying that you must offer subscription sign-up through your app. IE.. Netflix. You sign up somewhere else, then access your content in app. You pay Apple nothing.

If you do not want to pay Apple 30% to recruit customers for you then simply do not offer the ability to sign up with-in your app. Problem solved. Quite belly aching pointlessly.

Um, that's EXACTLY what this is about. If Netflix has a subscription model that you can sign up for on their website, then Apple is saying that their iOS app must provide a method of doing this, or else be removed from the App Store.

 

[alent1234]

I think the 30% cut is quite heavy. But in terms of anti-trust, I'm confused. Apple still allows them to obtain subscriptions on their own and keep 100% of revenues, they are just saying they also have to offer the option via the AppStore. But with allowing developers their own pathway it seems to that Apple isn't forcing anyone to use the AppStore so I'm not sure how this is anti-trust. I'm sure I'm missing something, though, and someone can enlighten me.

microsoft also allowed you to install other browsers. you just had to find them on the internet yourself after you started using IE.

same here, why would anyone use anything else other than in-app purchasing if the price is the same

 

[blizaine]

I'm torn. I can see how this would upset the content providers and rightly so. But I can also see why Apple did this. One, so they could make money, but two, it would be worse for the customer if they had to pay more for in app purchases. If Netflix was $11/month in app and $8/month on their website, consumers would be pissed. And Apple does deserve a cut for providing the platform and retail outlet for the app to do business. If Apple set it up so that there was no standard and people had to go outside the app store to get the best deal, that would be a disaster. Also, if Apple just let content providers do in app purchases and subscriptions for free, then the content providers could use that as a loop hole to get back the 30% apple takes for everything.

 

[spritelyjim]

I would think one option would be to have a different--and higher--price for services rendered if you also want to have the service on your IOS device. Same price on web as within IOS but still higher than if you don't want the IOS option. Then the customer can decide if the extra fee is worth it.

BUT YOU CAN'T!!! READ FIRST. EVERYONE, BEFORE YOU POST KNOW THIS:

1.Apple now REQUIRES all content to be able to be also purchased on the app store.

2.Apple DOESN'T ALLOW a higher price in their store.

3.Apple DOESN'T ALLOW a link to your not-app-store store.