Apple Reverses Stance on iOS In-app Subscriptions

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Apple has dropped its requirement that developers offer equal or better pricing for in-app subscription purchases compared to their Web sites, along with the requirement that publications offering subscriptions through other channels also offer an in-app purchase option.

Apple dumps in-app subscription rulesApple tosses its in-app subscription requirements

The in-app subscription rules were introduced in February and were set to officially go into effect at the end of June for apps that already offered in-app subscriptions but hadn’t yet been updated to comply with the new requirements.

At the time, Apple’s developer requirements stated:

Apps can read or play approved content (magazines, newspapers, books, audio, music, video) that is sold outside of the app, for which Apple will not receive any portion of the revenues, provided that the same content is also offered in the app using IAP at the same price or less than it is offered outside the app. This applies to both purchased content and subscriptions.

The revised rules remove the restrictions on in-app subscription and purchase pricing, and external subscription options don’t have to be offered in-app. Developers can’t, however, include an in-app subscription or purchase option that circumvents the App Store.

The change means many companies that had been holding off on offering subscription-based publications or services in iPhone, iPad and iPod touch apps — or were considering pulling their apps from the platform — don’t have to turn their backs on Apple’s potentially lucrative platform. It also means in-app purchases and subscriptions for at least some publications will likely increase in price to cover Apple’s 30 percent cut of sales.

While prices for some purchases may go up, the change means companies like Amazon and Netflix can carry on with business as usual.

[Thanks to Cult of Mac for the heads up.]

 

Comments

mlvezie

Maybe I’m reading too much into this, but, here’s how I see this.

Steve’s on a medical leave. Someone else there says, “Well, IAP revenue is a good thing, so we’ll put in the TOS that for subscriptions, they’re required to use App store IAP (or at least we’ll make it economically impossible for them to use anything else)”. A June 30th deadline is set, and it’s forgotten.

Steve comes back in time for WWDC & the presentation to Cupertino on the spaceship (and presumably a few other things here and there), and hears that the Financial Times has abandoned their app in favor of a web app for this very reason. He says, “Wait! What?? That isn’t right!” and the TOS gets changed.

This is a reason why I get nervous investing in Apple. As long as Steve’s at the helm, they do good things. But when he takes a leave, his underlings do some really stupid things.

jfbiii

I’m sure Steve approved those terms to begin with. After months of feedback they reevaluated and decided not to be so restrictive.

ethan

Actually Steve was at the helm when they banned cross compilers and told devs how to setup their internal business process in regards to coding. Then 4 months later they reversed it when the EU asked questions and developers complained to them about not being able to use solid libraries like Lua. The absense of Steve is not the reason they make dumb choices.

Apple could not afford the financial times web app model to be successful (and have others follow along) or Amazon giving them the middle finger and bailing on the platform at the end of June. Those companies want a direct relationship with their users and are not interested in Apple being in the middle. Now iOS users can choose for themselves what to do:

1. use apps that hide them behind Apple’s in app system and possibly pay more to cover Apple’s cut for that service

or

2. use apps where the developer wants to keep the subscription directly with the user, take the extra step of signing up/paying on the website, and probably save the Apple fee mark up

I think this was a good correction on a bad choice by Apple.

Bosco (Brad Hutchings)

I think this was a good correction on a bad choice by Apple.

Three overlooked factors:
1. The Lodsys patent fired a torpedo into this arrangement. I would only be a little surprised if it turned out that a stakeholder in this fiasco backed Lodsys. Regardless, obscure patents as attack vectors against the excesses of Apple control are squarely on the table. If Lodsys settles nicely with everyone this summer, dig into that angle of the story grin.

2. The in-app inventory system was untenable for more than a few dozen products. They weren’t even at the point of being able to negotiate the percentage from Amazon, etc.

3. Customers were not going to tolerate this. Apple can only sell as many iPhones and iPads as it does by reaching outside the all-Apple-all-the-time crowd. Apple can show these people how nice an integrated all-Apple solution can be, but it can’t force it upon them. Too many can’t afford to replace everything they have, and most don’t want to anyway. Kindle app wold have brought this dilemma about Apple front and center.

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