Financial Times Won't Give Apple A Cut, Drops iOS for Web App

[KnightWRX]

And FT isn't being greedy?!

The 30% also covers marketing and handles any upgrading and file storage.

Wait what ? Apple does no marketing aside from listing you on the app store and Apple handles no upgrading or file storage for in-app subscriptions and purchases, you need to provide your own storage and upgrade process.

Apple takes 30% to process credit cards. That's it. Even Visa isn't that greedy.

 

[AppleFan1984]

App is faster (if done right), can take offline. And there are more potential customers through the app store / itunes.

Would you want 100% fee of 1000 customers or 70% fee of 10000 customers?

The web is universal, completely unlimited by any specific device or vendor, available to all of them.

So the better comparison might be:

Wold you want "70% fee of 10000 customers", or 100% from 1,000,000,000 customers?

 

[wbc]

EXTREMELY dis-satisfied with the FT.

The FT app (which is amazing) is the #2 reason I got my iPad. I got it to replace annoying newspapers.

The mobile app is lame and reminds me of using iOS device back before you could have apps.

 

[AaronEdwards]

EXTREMELY dis-satisfied with the FT.

The FT app (which is amazing) is the #2 reason I got my iPad. I got it to replace annoying newspapers.

The mobile app is lame and reminds me of using iOS device back before you could have apps.

Maybe you should be EXTREMELY dissatisfied with the AppleTax instead. That's the reason why you no longer have the FT app.

 

[Ava's Meeshee]

Maybe you should be EXTREMELY dissatisfied with the AppleTax instead. That's the reason why you no longer have the FT app.

They could just pay it and be in the store

 

[thatrandomguy]

They could just pay it and be in the store

Under the new terms, you must offer the lowest price you offer to any other subscriber within the app store for in app purchases (30% cut for Apple).

Therefore, FT cannot abide by Apple's agreement if they just pass on the "Apple tax" on Apple users. They must allow Apple users to buy it at a lower price and relatively high transaction charge (to the point where they will lose money), or raise the price on all forms of subscription external to the App Store subs so they can price the App store sub at a lowest price that is profitable. This punishes everyone who isn't an Apple user.

Wait what ? Apple does no marketing aside from listing you on the app store and Apple handles no upgrading or file storage for in-app subscriptions and purchases, you need to provide your own storage and upgrade process.

Apple takes 30% to process credit cards. That's it. Even Visa isn't that greedy.

Technically it's also a storefront, but it's absurdly greedy to force a lower margin industry to not only use your payment processing solution that takes too high of a margin for your industry to be profitable, but then prohibit app devs from appropriately adjusting the in-app subscription price to compensate for this (making it so you have to jack up the price on everyone or take a loss). It's ridiculous.

 

[macman312]

LOL but c'mon FT just give them 30% and since your current app is popular you probably will make quite a bit of $$

 

[Cha]

LOL but c'mon FT just give them 30% and since your current app is popular you probably will make quite a bit of $$

The 30% would not have applied to current subscriptions (users of the app). It only applies to any new users who "chooses" to use the in-app subscription option.

 

[Bernard SG]

The 30% would not have applied to current subscriptions (users of the app). It only applies to any new users who "chooses" to use the in-app subscription option.

That's precisely why it seems like a dumb decision, business-wise, by the FT. Except implementing the In-App purchase feature (a trivial thing for their developers) FT wouldn't have any additional upfront cost to get all those potential new subscribers. The 70% is not just revenue, it's directly net-margin.

Personally, not having In-App purchases or subscriptions is a deal-breaker for me. I'm not opening an account and providing Credit Card info to any publishing company. I'm persuaded that a lot of iPad users think likewise.

Moreover, a web-app, not matter how anyone would like to spin it, is going to be an inferior experience for the end-user. Native magazines/newspapers apps offer a great comfort of use and the ability to keep as many issues as you want, stored on your device, as long as you want.

FT and the other publications that snub the Apple App Store are making exactly the same mistake as the music industry years ago.

Remember, folks: There's one iPad sold every second. The 30% so-called "Apple-tax" is a no-brainer compared to that tremendous commercial opportunity.

 

[OllyW]

That's precisely why it seems like a dumb decision, business-wise, by the FT. Except implementing the In-App purchase feature (a trivial thing for their developers) FT wouldn't have any additional upfront cost to get all those potential new subscribers. The 70% is not just revenue, it's directly net-margin.

Do you really think a publication such as the Financial Times wouldn't have done their sums first before deciding to withdraw from the app store?

I reckon they have quite a lot of in-house business talent they could tap up for advice or do you think MacRumors punters know better?

 

[Bernard SG]

Do you really think a publication such as the Financial Times wouldn't have done their sums first before deciding to withdraw from the app store?

Yes, I definitely think so. I believe it's more of an emotional knee-jerk reaction from FT's top management than some carefully thought-out business case.
It wouldn't be the first time that the big egos of corporate poobah's trump rational decision-making, especially when the antagonism involves Apple.

You seem to infer my commercial analysis is bogus, I'm curious to hear your counter-arguments.

 

[KnightWRX]

Yes, I definitely think so. I believe it's more of an emotional knee-jerk reaction from FT's top management than some carefully thought-out business case.
It wouldn't be the first time that the big egos of corporate poobah's trump rational decision-making, especially when the antagonism involves Apple.

You seem to infer my commercial analysis is bogus, I'm curious to hear your counter-arguments.

Think of it another way. Maybe they had this HTML5 app ready for other platforms, such as WebOS, BB, Android and it was trivial to make it work on iOS. So it costs them nothing to move iOS over, they get to cut out iOS development and keep 100% of their subscription fees for those users.

So they save money all around.

 

[Bernard SG]

Think of it another way. Maybe they had this HTML5 app ready for other platforms, such as WebOS, BB, Android and it was trivial to make it work on iOS.

So it costs them nothing to move iOS over, they get to cut out iOS development and keep 100% of their subscription fees for those users.

So they save money all around.

Doesn't seem so, they are launching the Web App just now, ahead of being potentially kicked out of the App Store in end June. In other words, they have actually incurred additional development costs to set up the Web App.

On top of that, correct me if I'm wrong, but it would seem that a Web App costs more server resource than a download-once model. Moreover they still seem to maintain an Android native App, directed specifically for Galaxy tab.

But beyond the costs aspects, for publications, iPad is first of all an additional channel that potentially captures new readership. If embracing In-App subscriptions landed the FT only 1000 new subscribers, that would equate an yearly $250 k additional revenue "net of Apple-tax". No one is going to make me believe that it wouldn't cover the internal specific cost of offering the iPad version.

 

[KnightWRX]

Doesn't seem so, they are launching the Web App just now, ahead of being potentially kicked out of the App Store in end June. In other words, they have actually incurred additional development costs to set up the Web App.

Launching the Web App just now does not mean they made it just for iOS. Again, this might have been something they were moving to do, since let's face it, most "native" apps should just be web apps anyway and they have been working on it for a while in order to unify their development accross platforms.

This could very well be something that's been cooking for quite a while.

Web apps make sense. They are cross-platform and very much platform agnostic. They are the ultimate form of control over your application updates, as everyone is always running up to date client code. As long as you adhere to standards, Q&A is dead simple and the configurations to tests are quite restricted. The MVC seperate is easy and integrated fully in the frameworks involved and finally the technology has been around for more than a decade and is proven.

In anything, people rushing their get their "Website in a Cocoa-Touch wrapper" apps into the App store are an anomaly who don't quite understand development costs vs clientele reached. Safari on iOS supports HTML/CSS/DOM standards pretty well, there's no reason to not just make a cross-platform app like a Webapp and just have a shortcut displayed on the springboard, completely bypassing the App store.

On top of that, correct me if I'm wrong, but it would seem that a Web App costs more server resource than a download-once model.

You're wrong. Most apps on the app stores are nothing but glorified Web browsers. The client code is a trivial part of webserving. It's the actual content that's heavy on server ressources, not the view portion. Whatever scraps of HTML were saved from the native client can probably be serviced by the idle cycles/RAM in the existing web infrastructure.

But beyond the costs aspects, for publications, iPad is first of all an additional channel that potentially captures new readership. If embracing In-App subscriptions landed the FT only 1000 new subscribers, that would equate an yearly $250 k additional revenue "net of Apple-tax". No one is going to make me believe that it wouldn't cover the internal specific cost of offering the iPad version.

I think people covered this. The FT has their own readership and class of people that actively look for the publication. They can stand on their own, they don't need to be part of Apple's ecosystem to build readership. Someone that gets an iPad and wants to read the FT on it will, no matter if the app is native or a Web app.

 

[Bernard SG]

You're wrong. Most apps on the app stores are nothing but glorified Web browsers. The client code is a trivial part of webserving. It's the actual content that's heavy on server ressources, not the view portion. Whatever scraps of HTML were saved from the native client can probably be serviced by the idle cycles/RAM in the existing web infrastructure.

Well, we're not talking of the same thing. I actually purchase some publications on my iPad and they are downloaded right there. Nothing to do with the "glorified Web-browsers", you're referring to. That's another category of Apps.

Anyway the discussion is moot, as Apple has just relaxed the In-App purchase policy.

 

[KnightWRX]

Well, we're not talking of the same thing. I actually purchase some publications on my iPad and they are downloaded right there. Nothing to do with the "glorified Web-browsers", you're referring to. That's another category of Apps.

So it's a glorified PDF reader instead ?

A lot of apps are also just a glorified PDF reader. Why not have 1 app that covers reading PDFs/ePubs and just serve your content there and have springboard shortcuts to open directly to a PDF ?

Again, the proliferation of native apps is only promoting the duplication of code and effort. It's a clunky system.

Anyway the discussion is moot, as Apple has just relaxed the In-App purchase policy.

Agreed to some extent, but this won't change a thing. They haven't lowered their service charge (30% for what amounts to payment processing) so I doubt FT is going to go back on their decision.

 

[maclaptop]

I love Apple, but hope that more companies will do the same.

I'm with you on this one. Apple needs a slap of reality.

 

[Bernard SG]

So it's a glorified PDF reader instead ?

A lot of apps are also just a glorified PDF reader. Why not have 1 app that covers reading PDFs/ePubs and just serve your content there and have springboard shortcuts to open directly to a PDF ?

Again, the proliferation of native apps is only promoting the duplication of code and effort. It's a clunky system.

They're not pdf's either. Your term "Web Browser" perhaps made me misunderstand your statement. It seems to imply 'online'. I do realize that some of the publications may be in HTML code, downloaded onto the device. The file format is not what I'm focused on. It's rather the nuance between being accessed online in real time or being downloaded for later consultation. The format is not my concern as a user.

Agreed to some extent, but this won't change a thing. They haven't lowered their service charge (30% for what amounts to payment processing) so I doubt FT is going to go back on their decision.

It's their call, I persist in believing that In-App purchases or subsricptions largely facilitate the act of buying for the user. That's really the crux of the issue: the final customer's behavior.

For you, the 30% is payment processing, but more so, it's access to a 25 million user base, and growing. By end 2012 those will be 60 to 80 million.

 

[KnightWRX]

They're not pdf's either. Your term "Web Browser" perhaps made me misunderstand your statement. It seems to imply 'online'. I do realize that some of the publications may be in HTML code, downloaded onto the device. The file format is not what I'm focused on. It's rather the nuance between being accessed online in real time or being downloaded for later consultation. The format is not my concern as a user.

That's the thing. Why should the user have tons of different apps that read the same format ? Do we really need "Ned's book emporium" and "Rogers Books Galore" if they all are ePub/PDF readers ? No, we need 1 "Books" app and many people should be able to sell compatible content.

Like the iPod app. Imagine if you had to have a different music player for every "store" that sells you music.

Content and applications to consume it have been segregated forever because it makes sense. Some people sell you content, others sell you the container. With the "native apps" craze, you're getting a bunch of content providers creating containers that duplicate other containers. The problem is that you can't seperate content from containers, and you're thus forced to have all of them to access the content.

Again, a lot of fluff could be removed from the app store through Web Apps and other content reading apps like the iPod app (that does music, video, etc..) by unmarrying apps from content and opening up standard ones to many different sources.

It's their call, I persist in believing that In-App purchases or subsricptions largely facilitate the act of buying for the user. That's really the crux of the issue: the final customer's behavior.

For you, the 30% is payment processing, but more so, it's access to a 25 million user base, and growing. By end 2012 those will be 60 to 80 million.

The thing is, since all Apple is doing in In-App purchases/subscription is providing a payment processing, there is no value to the user itself. The value is to the dev as a choice of payment processor. However, if there was actual competition and Paypal, Visa, Mastercard could all process payments for In-App purchases/Subscription, the rates would be much better than 30%.

There is no access to a user base. Apple doesn't provide that in the 30%, not for In-App Purchases/Subscription. They only process the payment, you still have to market your content somehow (make a catalog available from your own infrastructure), you still have to manage the accounts (so the users have access to their purchases/subscriptions) and deliver this content.

 

[Bernard SG]

That's the thing. Why should the user have tons of different apps that read the same format ? Do we really need "Ned's book emporium" and "Rogers Books Galore" if they all are ePub/PDF readers ? No, we need 1 "Books" app and many people should be able to sell compatible content.

Like the iPod app. Imagine if you had to have a different music player for every "store" that sells you music.

Content and applications to consume it have been segregated forever because it makes sense. Some people sell you content, others sell you the container. With the "native apps" craze, you're getting a bunch of content providers creating containers that duplicate other containers. The problem is that you can't seperate content from containers, and you're thus forced to have all of them to access the content.

Again, a lot of fluff could be removed from the app store through Web Apps and other content reading apps like the iPod app (that does music, video, etc..) by unmarrying apps from content and opening up standard ones to many different sources.

I agree with that, but it has little to do with Apple's ecosystem. Hoping that the multiple publishing companies will end up agreeing on a standard document format for their publications seems like wishful thinking.

However, doesn't Apple's future newsstand that will come with iOS5 looks like a step towards that direction? I don't know exactly. It's not impossible that it will be the equivalent of the iPod App for publications, being able to read the main file formats out there.

The thing is, since all Apple is doing in In-App purchases/subscription is providing a payment processing, there is no value to the user itself. The value is to the dev as a choice of payment processor. However, if there was actual competition and Paypal, Visa, Mastercard could all process payments for In-App purchases/Subscription, the rates would be much better than 30%.

There is no access to a user base. Apple doesn't provide that in the 30%, not for In-App Purchases/Subscription. They only process the payment, you still have to market your content somehow (make a catalog available from your own infrastructure), you still have to manage the accounts (so the users have access to their purchases/subscriptions) and deliver this content.

Well, the fact that I don't need to create a personal account with each content provider is extremely valuable in my view, for privacy, security and convenience reasons.

I purchased an iPad. I learned The New Yorker launched on iPad, so I purchased a monthly subscription to the New Yorker. Hadn't I have an iPad, The New Yorker would never have got a single cent from me. How's that "no access to a user-base"?

But the real story is actually that I won't renew that subscription because I found nothing compelling in the content that would motivate me to pay further. That's where the publishing industry's problems lie: the content and the experience they offer just doesn't justify the money they charge, as compared to all the content available for free on the Web. The value added is not consequent enough.

 

[KnightWRX]

I agree with that, but it has little to do with Apple's ecosystem. Hoping that the multiple publishing companies will end up agreeing on a standard document format for their publications seems like wishful thinking.

Yeah, just like hoping many website publishers agree on a standard format I guess... if only someone could make a single standard Markup Language, based on something like HyperText...



Industry standard formats are all around. MPEG, PDF, HTML, the list might be long, but so are the types of content.

However, doesn't Apple's future newsstand that will come with iOS5 looks like a step towards that direction? I don't know exactly. It's not impossible that it will be the equivalent of the iPod App for publications, being able to read the main file formats out there.

The problem is Apple will put up ludicrous barriers to entry to that app in all probability. This new Apple doesn't believe you should be able to get content elsewhere. I'm still surprised the iPod still reads MP3s sometimes.

Well, the fact that I don't need to create a personal account with each content provider is extremely valuable in my view, for privacy, security and convenience reasons.

I trust my privacy, security and convenience with Apple much less than I do with financial institutions like Visa, Paypal, Mastercard. And again, what makes you think if Apple actually opened up the field a bit that these other payment processors wouldn't have the same convenience ? Paypal already does.

Again, IAP/IAS, Apple is a simple payment processor who is quite overpriced compared to the competition and is relying on its developer terms to prevent competition, terms they have just had to relax in the face of backlash from developers (so it seems they don't all share your vision of Apple doing them a "favor").

I purchased an iPad. I learned The New Yorker launched on iPad, so I purchased a monthly subscription to the New Yorker. Hadn't I have an iPad, The New Yorker would never have got a single cent from me. How's that "no access to a user-base"?

But the real story is actually that I won't renew that subscription because I found nothing compelling in the content that would motivate me to pay further.

And you're surprised ? I don't buy a magazine because my local newsstand starts carrying it. I buy a magazine based on the content. You made a classic "Let's buy stuff just because Apple is involved" mistake that a lot of Apple users do. The vast majority of people don't get The New Yorker because it's on iPad. They get The New Yorker because they want to read it. If they need a tablet, they look at what publications are available on each and buy the tablet that gives them the content they want.

If anything, The New Yorker is bringing folks to Apple, not the other way around. All the apps are like that. This notion that Apple is doing a big favor to App developers by providing users needs to die. It's the complete opposite. Without the App developers giving Apple "300,000" apps and "4 billion downloads", there wouldn't be an iOS today.

 

[Cha]

If anything, The New Yorker is bringing folks to Apple, not the other way around. All the apps are like that. This notion that Apple is doing a big favor to App developers by providing users needs to die. It's the complete opposite. Without the App developers giving Apple "300,000" apps and "4 billion downloads", there wouldn't be an iOS today.

I think that is downplaying the impact of the App Store and the aspect of "Window" shopping. There is impact of both sides in these cases, where the New Yorker subscribers may be attracted to the iPad for the mag, but there is also a new market of people that may be introduced to the mag the other way around. Even through Bernard SG may not have like the content of the New Yorker and will not renew, at least the iPad app enticed Bernard SG to try.

I agree not all media/apps benefit equally from the Apple app eco-system, so the broad, blanket rules for all was not the proper approach.

 

[Tumbleweed666]

Think of it another way. Maybe they had this HTML5 app ready for other platforms, such as WebOS, BB, Android and it was trivial to make it work on iOS. So it costs them nothing to move iOS over, they get to cut out iOS development and keep 100% of their subscription fees for those users.

So they save money all around.

They publicly stated a single platform to minimise ongoing development costs is a large part of their rationale. Cant find the article I read unfortunately, though this refers to the same thing, "The paper says its single, cross-platform app will allow it to issue updates with more frequency, while reaching an audience that extends far beyond the iOS realm"

 

[Brett Abelson]

big disappointment