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U.S. and European Regulators 'Looking At' Apple's App Store Subscriptions Program

This has been discussed before, but I don't really get how this could work for subscription services like Rhapsody and Netflix where you pay a flat rate every month that is automatically processed without any intervention--at least for those who have a credit card on file. There is no regular buying of anything. :confused:
 
deadkennedy said:
You were being fooled by someone. Say Pandora gets 1% margin, and now Apple wants 30%. That for Pandora means 30x more money for the same neighbourhood overnight. What if in Manhattan your landlord would increase your rate from $1000/ room to $30.000 / room?
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Apple in your case would be a 3rd party service that sold that room for your hotel, and guess what they get a cut of that sale, oh and the room is still $1000, Apple isn't changing the customer.
 
bobr1952 said:
This has been discussed before, but I don't really get how this could work for subscription services like Rhapsody and Netflix where you pay a flat rate every month that is automatically processed without any intervention--at least for those who have a credit card on file. There is no regular buying of anything. :confused:
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This is one of the things most people don't seem to get, this would only be for someone new, who signed up through the app, and Apple is handling the monthly processing of the subscription, it isn't for people that sign up for the service somewhere else and then download the app from Apple...
 
spazzcat said:
Apple in your case would be a 3rd party service that sold that room for your hotel, and guess what they get a cut of that sale, oh and the room is still $1000, Apple isn't changing the customer.
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You got it wrong, here's a simpler example for you. Apple has to pay 30% for to Microsoft for every iTunes purchase made from Windows machine. Oh and add 30% to the manufacturer like Sony.
 
Popeye206 said:
Seems simple... all Apple has to do is drop the requirement that it "has to be at the same price or lower" part. This way, companies with thin margins just raise the price on iTunes to cover the margin.

From there, it's up to the end user to choose where they purchase. No harm, no foul.
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There is already no harm and no foul and this will come to nothing. It's not Apple's problem if Rhapsody or some other company with 'razor thin' margins has an unsustainable business model. No doubt major players like Netflix will negotiate their own terms with Apple. Just because Apple offers a general set of terms doesn't mean they won't negotiate when it's to their advantage to do so.

OP, you're post seems sincere and I am not accusing you of anything.

To some of the other posters though, the amount of astroturfing on this topic has been epic. Google, Sony, Rhapsody, Amazon, etc. must be writing a lot of checks to their forum trawlers. It's sad that such transparent tactics work.
 
deadkennedy said:
You got it wrong, here's a simpler example for you. Apple has to pay 30% for to Microsoft for every iTunes purchase made from Windows machine. Oh and add 30% to the manufacturer like Sony.
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That would be fine if it was Microsoft's market space that got me there and Microsoft was handling the transaction and the risk with the transaction... If someone signs up for netflix because they can watch it on their iPhone and they use their Apple id to pay for the service every month, why shouldn't Apple get a cut...
 
spazzcat said:
I don't think that 82.7% number include free apps...It isn't Apple's fault people don't want to buy apps on other systems.
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That was like saying it's not Microsoft's fault that the majority of computer users stuck with IE, instead of downloading a different browser.

Didn't stop them getting hammered by the EU.
 
spazzcat said:
That would be fine if it was Microsoft's market space that got me there and Microsoft was handling the transaction and the risk with the transaction... If someone signs up for netflix because they can watch it on their iPhone and they use their Apple id to pay for the service every month, why shouldn't Apple get a cut...
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30% is a hefty charge for payment processing... Other legit payment processors don't charge that amount!
 
spazzcat said:
That would be fine if it was Microsoft's market space that got me there and Microsoft was handling the transaction and the risk with the transaction... If someone signs up for netflix because they can watch it on their iPhone and they use their Apple id to pay for the service every month, why shouldn't Apple get a cut...
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So you're willing to pay 30% for payment gateway? I also have a bridge in my backyard if you're interested...
 
JRoDDz said:
So Apple is renting iTunes movies on their Apple-TV's. The Apple-TV's are in turn connected to a television in order to view said rentals. Should the TV manufacturers now start charging apple a 30% cut in rentals since their device utilizes their TV's to provide the content?

On another note, your Internet Service Provider is also providing the bandwidth to Apple to provide said iTunes rental. Should the ISP also start charging Apple 30% for each rental?
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Bad examples and not the way to look at it!

You bought the TV in a store or online. That is where you paid whatever profit margin was added to the product. Good chance it was more than 30%. Now you have the product at home. Use it as you like!

So, if Apple were a building with a huge retail shop (app store) and somebody wanted to rent space for their product in that store, they'd have to pay for that rent, advertising if there was any and the traffic that store draws in.

They also want you to agree to offer the app to other distribution channels for the same "suggested retail" price.
Anybody who wants to cut that "retail" price can do so via promos.

The ISP provides bandwidth that is a final product. What comes through that pipe or how people use it to make money is of no concern to them.

By your analogy suppliers of anything would have usage fees for their products extend into everyday life.

Makes no sense!

I am not defending Apple and if there are repercussions the consumers will righten them with their wallets. (Leaving platform, looking for alternatives etc.)

The 30% is not sheer profit and whoever doesn't agree with it doesn't HAVE to be there and needs to go sell their apps elsewhere!

Apple is the landlord in the app building and they make their lease agreements that you can either sign or look for another place!

Not really hard to understand IMO.
 
spazzcat said:
I don't disagree, but to say Apple should get nothing isn't right either.
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I write an application for Windows that serves magazine like content to the user... are microsoft entitled to the revenue from the sales? No.

I don't see this scenario any different from subscription charges that Apple or any other company demands for digital sales. The subscription content never touches Apple's servers.. its pure 100% profit for Apple*.

But I do agree - *since Apple are acting as a payment processor in subscription scenario Apple should charge a percentage for this service... but 30%?
 
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spazzcat said:
I don't disagree, but to say Apple should get nothing isn't right either.
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It's also unfair that Sony, Microsoft, WiFi Router manufacturer, ISP, and my cat don't get anything when someone buys song through iTunes on Sony Vaio. But life's unfair...
 
spazzcat said:
I don't disagree, but to say Apple should get nothing isn't right either.
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Actually, I tend to agree with this and I think it's fine for Apple to take a cut (although 30% is outrageous) if the subscription is made from within the app (Since they handle payment and "promote" the service with their platform).

The real problem is this:
"However, Apple does require that if a publisher chooses to sell a digital subscription separately outside of the app, that same subscription offer must be made available, at the same price or less, to customers who wish to subscribe from within the app."

Screwing many companies and customers in the process :rolleyes:
 
Stella said:
I write an application for Windows... are microsoft entitled to the revenue from the sales? No.

I don't see this scenario any different from subscription charges that Apple or any other company demands for digital sales. The subscription content never touches Apple's servers.. its pure 100% profit for Apple.
Click to expand...

I am sure they do if you write for a Windows phone.
 
deadkennedy said:
It's also unfair that Sony, Microsoft, WiFi Router manufacturer, ISP, and my cat don't get anything when someone buys song through iTunes on Sony Vaio. But life's unfair...
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They are also not handling the transcation now are they...You know when you take a credit card payment there is a risk with that transaction, Apple is taking all that risk on for you.
 
Where does it end?

What about fandango and other apps which allow you to buy tickets? Groupon? Lots of apps either allow you to make purchases or launch to a website to make purchases. Does Apple really expect to take 30% of a movie ticket purchase? Groupon purchases? It's a very slippery slope they've created as to keeping thing "fair" for all of their developers, etc...
 
I just want to charge for the space used by the free newspaper that keeps getting dumped on my lawn. Note to the people at "Bargain R Us", by putting your "newspaper" on my lawn, you agree to pay me $100 per day rent.
 
spazzcat said:
They are also not handling the transcation now are they...You know when you take a credit card payment there is a risk with that transaction, Apple is taking all that risk on for you.
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Oh man, please go and research how much does a payment gateway usually cost. You've probably heard of Google Checkout, Paypal, etc.. You're not that immature to try and justify the 30% margin with a payment gateway.
 
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)

*LTD* said:
People here seem to be assuming that Apple made these decisions without any reason whatsoever, totally oblivious to the consequences, with no long-term plan to make it all work together as perfectly as nearly everything they've touched so far.

I love it when the perpetually out-of-touch underestimate this company.
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I don't think Apple has ever done anything that LTD didn't immediately fall in line with.
 
rwilliams said:
I doubt Apple will back off of this new policy, but hopefully, they'll drop their cut to 10% or so. I think that would be very reasonable. With the increasing number of Android devices being sold, developers would be crazy to give Google 10% and also give Apple 30%. 30% is just too much.
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Exactly. The Google 10% gambit will hopefully force Apple to reconsider.
 
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