Apple’s App Store Subscriptions: A Bad Start

| Ted Landau's User Friendly View

Try as I might, giving Apple as much benefit of the doubt as I can, I can’t see the terms of Apple’s App Store subscriptions working out well. This is especially so for publishers. But even Apple is going to have some problems with it.

The “personal data” rule. Apple’s press release states:

Customers purchasing a subscription through the App Store will be given the option of providing the publisher with their name, email address and zip code when they subscribe…Publishers may seek additional information from App Store customers provided those customers are given a clear choice, and are informed that any additional information will be handled under the publisher’s privacy policy rather than Apple’s.

I routinely decline all such requests, figuring the less places that have my personal information the better. For me to change my mind, the publisher would have to make a good case for why giving them my data would benefit me, not how it would benefit them. I am not sure where, or how, they can effectively make this case. That’s why I assume that, like me, most people will decline the option here.

Let’s further assume that, because of the convenience of doing so, most subscribers wind up choosing to renew their subscriptions in-app. The end result is that publishers will eventually have no personal data on the vast majority of their subscribers. This is critical and valuable information. It’s hard to believe that publishers negotiated this away. At the very least, I can’t imagine they are pleased with this regulation.

The “30%” rule. Apple’s press release states:

When Apple brings a new subscriber to the app, Apple earns a 30 percent share; when the publisher brings an existing or new subscriber to the app, the publisher keeps 100 percent and Apple earns nothing.

Publishers can sell digital subscriptions on their web sites, or can choose to provide free access to existing subscribers. 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. In addition, publishers may no longer provide links in their apps (to a web site, for example) which allow the customer to purchase content or subscriptions outside of the app.

In essence, the publisher must pay a 30% service fee for in-app subscriptions. In principle, this is not much different than the situation retail stores face when dealing with credit cards: If you pay cash, the store doesn’t have to pay the credit card fee and saves some money. Of course, retailers are free to offer a discount for paying cash. Apple will not be allowing the equivalent. Using the in-app system probably saves the publisher some processing costs, but no way is that anything close to 30%.

Problems here are compounded by uncertainties as to how the rules will be interpreted and enforced.

How does Apple intend to monitor if and when a publisher offers a deal on their website that is superior to what is offered in-app — especially when there may be hundreds of even thousands of apps that are using this system some day. A publisher could offer a deal at any moment — months after an app has been approved. Is Apple going to be constantly checking for possible violations?

What happens if Apple detects a violation? What is the penalty? I assume, at a minimum, the publisher would have to immediately terminate the deal or offer it in-app. Will they also have to compensate Apple for any discounted subscriptions they obtained? If the publisher does not immediately agree to Apple’s demands, what will Apple do? Would Apple actually remove an app from the App Store? Will it stop allowing new issues to be delivered — effectively canceling the subscription of everyone who has paid for one? Who would be responsible for refunding the subscriptions in such a scenario? Apple (because it removed the app) or the publisher (because it violated the rule)?

As for not allowing links to pages on the publisher’s website that offer subscriptions — how can this possibly work smoothly? Suppose a publisher offers some extended content (such as video) on their website that is not in their magazine app. The magazine includes a link to that video content. Now suppose that the webpage with this video contains an ad for subscribing to the magazine. Has the publisher now violated Apple’s rules? I think so. Again, how will Apple effectively monitor all of this? Will they check every link in each issue of a magazine to see where it goes?

What about time-limited discounts — such as a deal that is only good for one week. Will the in-app subscription model be able to address this “on-the-fly” or will the publisher need to update the app each time a discounted deal is briefly offered? I assume it’s the former, but I don’t know.

Here’s yet another fuzzy area: If a publisher wants to offer a free subscription to subscribers of their print edition, do they have to offer this in-app as well — even though there is no revenue for Apple?

Finally, established existing apps that support paid content will now presumably need to be revised to meet all of these new rules. Does this mean apps such as Netflix and Kindle will be required to support in-app purchasing — and will be prevented from linking to their websites from the app? Apparently so.

The bottom line. Publishers have an incentive for you not to subscribe in-app — so as to avoid paying Apple 30% and to make sure they obtain your personal data. Apple has the opposite preference. This sets up a potentially antagonistic relationship between Apple and publishers right out of the starting gate. Further, as I’ve described here, the rules of the game are too often fuzzy and difficult to enforce. This will likely lead to more problems down the road. That’s why I can’t imagine this model succeeding without some significant modifications. The only question is how long will it take before the modifications come.

Comments

geoduck

You’ve made a good case for why this is going to be at least unwieldily and possibly unworkable. It will be interesting to see how this shakes out over time, especially once HP, Android, and others have similar markets with (presumably) less onerous terms.

Jamie

Hopefully soon. They seem to be hell bent on alienating the people that provide their content more so now then ever, and by extension, their customers. It’s a different game now than when they were the only venue available, and I hope they wise up before their professional community sets sail for other shores.

Their policies never bothered me with my iPhone because I saw it as a supplemental device. With my Mac and the iPad it’s infuriating. Please pay attention, Cupertino.

mhikl

1. Don?t want your particulars collected: Purchase through Apple store. Publisher violates this agreement would possibly be issued with a class action lawsuit.
2. Publisher breaks agreement with Apple as you have outlined; Apple could sue through the courts, or possibly withhold sums to be negotiated for released.
3. There has to be some honesty in business. If this is lacking, that is the purpose of contracts and the courts.
4. I know this is irritating to some, the Apple charge. It is, however, a store. I suspect that if Apple gave in on this and didn?t take a percentage from publishers of any sort?apps, papers, music, et al.?it would hurt the other want-to-be internet stores and tablet, phone manufacturers more than Apple.* The Android & et al. manufacturers need the change more than Apple. Apple is huge and diversified, they are not. The infrastructure of this store business involves planning, administrating and administration involves lawyers. Not cheap. Can the guys with soldering iron (I have so wanted to use this phrase) really afford this?
5. Kindle, Netflix are no more a social service than is Apple. They don?t produce what they peddle. The add a premium, just like cable does to internet and television services. What is the difference. Eventually, will we be dealing with TV networks to purchase such goods? Maybe, but, TV networks now produce fewer and fewer of their programmes unless it is the cheap to make news and reality programmes. CBS etc. are distributors more and more. So they will be bypassed. It is a new world with new rules about to be unleashed and every one in the chain that ends up on my computer or television will want his cut.

For example, Arcade Fire: the group composes, plays, records their own work. It owns its own recoding studio.  No big company is involved. Yet their work is on iTunes. Other distributors of their co-ordinated efforts charge AF for their efforts in distribution. They pay for distribution via a 30% cut to Apple. A lot easier than mailing lists and curb side music stands and setting up their own internet distribution service. For years Oprah produced her own programme and sold it to the highest bidder.

If it was any company other than Apple Inc. (M$, Amazon, Kindle), there would not be this ruckus. (Remember, Kindle and Amazon make their money this way already, don?t they? And I don?t remember M$ giving away free bytes in their failed attempts at this enterprise.)

* (If it were that easy and cheap to set up, administer and get to work, there would be a plethora of successful Apple copy like stores about. There ain?t.)

Simple economics says that when you are the only store in town you set the price. When others set up shop, not so much.

Question? What are the other “stores” doing. Giving everything away for free? Charging less than Apple. Would be interesting to see the facts.

jfbiii

The other half of the coin is that Apple is inventing a audience willing to pay for what they were happy to consume for free previously. 30% of nothing is $0.

Adam Christianson

Do you think Apple’s terms restrict publishers from giving non-monetary incentives for subscribing outside the App?

Like giving away SI Football Phones, but only if you subscribe on their site or better yet only offering Print+App if you subscribe online?

jackaninny

In the physical magazine world I wonder how much of the $5 an issue stand price is eaten up by the marketing, production, delivery and financial transaction processing of that issue? If it’s more than a $1.65 then Apple’s 30% seems reasonable - if it’s less then the publishers are free to continue down their current path. My logic is based on retail price - if you go by what’s typical for mailed subscriptions the breaking point is ridiculously small for the big magazine like SI and Wired where I’m getting a paper copy delivered to my house for less than a $1 so now we’re talking about Apple taking .30 and issue. What I am missing that makes this seem like a very reasonable deal for the publishers?

Tiger

Ted, could these statements be any more incongruous?

1. I routinely decline all such requests, figuring the less places that have my personal information the better. For me to change my mind, the publisher would have to make a good case for why giving them my data would benefit me, not how it would benefit them. I am not sure where, or how, they can effectively make this case. That?s why I assume that, like me, most people will decline the option here.

2. Let?s further assume that, because of the convenience of doing so, most subscribers wind up choosing to renew their subscriptions in-app. The end result is that publishers will eventually have no personal data on the vast majority of their subscribers. This is critical and valuable information.

—————
Apple is siding on behalf of the consumer by NOT passing over information to the publisher that you so deem as critical. Yet, you up front say you would personally decline the offer to release it anyway.

Me too. I don’t want them having any of my personal information. I do NOT buy from ads online. I don’t reveal anything if at all possible. I think most people will chose this. So what if marketers want it. I DON"T CARE. And apparently you don’t either.

If it’s so critical, shouldn’t we be giving it to the? The answer of course to that is NO. I don’t trust them, how many have been hacked or had personal information stolen, or worse, how many sell the information to third parties?

Developers and publishers need to see the handwriting on the wall. Consumers are fed up with losing control over their personal data and privacy. I’m only going to give you what I want you (and only you) to have.

Terrin

I am confused. This seems fair. Apple operates a store and incurs actual cost. If Apple is the cause of the sale, it gets 30%. If the publisher is the cause of the sale, Apple gets nothing. More then fair.

Ted Landau

If it?s so critical, shouldn?t we be giving it to the?

Perhaps I wasn’t clear. By “critical,” I mean critical to the publishers financial success. Sometimes, from what I have read, subscription lists are the most valuable property a magazine owns. That doesn’t make it critical to me.

As such, I don’t see the incongruity.

John Brayton

I think Amazon will simply rewrite the Kindle app as an HTML 5 app.

Ted Landau

I am confused. This seems fair. Apple operates a store and incurs actual cost. If Apple is the cause of the sale, it gets 30%. If the publisher is the cause of the sale, Apple gets nothing. More then fair.

How do we know that 30% is the magic number that is “fair.” Maybe only 10% would be fair. How do we even assess what is a fair number? I’m not sure. I guess some publishers decided it was at least “acceptable.” Still, if a publisher is already offering subscriptions at a rock bottom rate, they won’t easily be able to survive by losing another 30%. One solution here would be for the publisher to raise rates across the board. Perhaps, given the popularity of the App Store, that might even work out ? and turn out to be a benefit of working with Apple. Or not. Time will tell.

More generally, it is not the principle of Apple charging a fee that I had problems with. It’s the (lack of) workability of the specific rules of enforcing it.

Tiger

Clarified, it stands. Thanks. Critical to “them” is often diametrically opposed to what is critical to the consumer (i.e. me!).

I like your last response about the workability. Sounds kind of like enforcing a EULA these days….

Bosco (Brad Hutchings)

I think Amazon is gearing up for the war of all wars and proceeding with business as usual.  They’ll just make Apple kick them off the platform and see how that sits with Apple customers. There won’t be a special deal or joint press releases or any of that. Amazon will just keep on keeping on and force Apple’s hand. Other developers and content providers will get pissed and Apple will have to decide how important its silly rules actually are. Hilarious.

other side

Did Steve Ballmer take Steve Jobs’ place?  This is something Microsoft would do.

jackaninny

There won?t be a special deal or joint press releases or any of that. Amazon will just keep on keeping on and force Apple?s hand.

160 million total iOS devices says they won’t

I don’t know if 30% is fair or not but a typical credit card processor is going to take 3-4% off the top. You have to maintain a website (with the same availability as the iTunes store) and provide bandwidth for possibly 10’s of thousands or more subscribers to download and update their content subscriptions. There was an issue of Wired that weighed in at 500MB - if you have 50K subscribers that’s a chunk of bandwidth someone has to pay for.Then there’s the marketing aspect - iTunes reaches nearly 200 million people which is a pretty nice base of potential customers - how much would a marketing campaign to that many users cost?

Like I said, I don’t know if 30% is the right number but I wish people would quite making that figure out to be some sort of highway robbery.

Terrin

Go to Borders or Barnes and Nobles. You will see racks of magazines and newspapers. I used to work in this type of environment. Print publishers are lucky to make ten percent. To print that stuff costs real money.  Such publications operate like flower shops. A good chunk of the inventory is discarded at the end of the month. These types of stores return the magazine covers of any unsold product, and the publisher issues a credit.

Apple doesn’t hold an unfair bargaining position. It is offering struggling publishers a chance to sell their wares. In return Apple wants a cut of any sales made through its store. The publishers are saving money by not having to print their varies products and pay distribution cost. Also there are no issues with having to offer credits for unused product. Further, the publisher can experiment and offer the product directly thereby potentially keeping all the profit.

As far as enforcing the rules go, who cares how and if Apple actually does this. Look at it a different way. Apple currently sells music. All of Apple’s music publishers also either sell the same music directly or in formats that make them more money. They’d prefer people not to buy music on iTunes. Apple obliviously would prefer people to buy music on iTunes. Despite this dichotomy of competing interests, it all works out.

The publishing model is almost the same model Apple has for music. You buy the music from iTunes, Apple get 30 percent. You get it else place Apple gets nothing, but you can still download the content into iTunes and on Apple devices for free.

How do we know that 30% is the magic number that is ?fair.? Maybe only 10% would be fair. How do we even assess what is a fair number? I?m not sure. I guess some publishers decided it was at least ?acceptable.? Still, if a publisher is already offering subscriptions at a rock bottom rate, they won?t easily be able to survive by losing another 30%. One solution here would be for the publisher to raise rates across the board. Perhaps, given the popularity of the App Store, that might even work out ? and turn out to be a benefit of working with Apple. Or not. Time will tell.

More generally, it is not the principle of Apple charging a fee that I had problems with. It?s the (lack of) workability of the specific rules of enforcing it.

Bosco (Brad Hutchings)

160 million total iOS devices says they won?t

Just watch. Amazon holds a good hand and will not give it up voluntarily. Things will become increasingly awkward for Apple if it doesn’t crack down on the Kindle app. But Apple cracking down on the Kindle app would be a disaster for Apple. It draws attention to what a money grab this silly arrangement is.

Bosco (Brad Hutchings)

Like I said, I don?t know if 30% is the right number but I wish people would quite making that figure out to be some sort of highway robbery.

The 30% is not highway robbery. Google has the same rate for in-app purchases. The elaborate arrangement that ensures that Apple gets it for iOS apps is the bone of contention.

jackaninny

Just watch. Amazon holds a good hand and will not give it up voluntarily. Things will become increasingly awkward for Apple if it doesn?t crack down on the Kindle app. But Apple cracking down on the Kindle app would be a disaster for Apple. It draws attention to what a money grab this silly arrangement is.

Apple has already set the “crackdown” date - 6-30-2011

http://bit.ly/i1tQ8a

John Dingler, artist

Publishers hate that Apple is revealing the underhanded, sneaky method they use to gather customer’s personal info, while Apple is being up front about it, offering them the opt-in rather than the usual default of opt-ut.

We consumers should be on Apple’s side on this one, not on the whiny, arrogant publishers’ who feel they are automatically entitled to it just because, hey, they’re publishers.

mhikl

“I think” doesn’t make it so.

Bosco is like Queen Bess.
“Balls!? said the Queen, ?if I had them I"d be King?.
He?ll just have to live with his shortcomings; unfortunately, so shall we.

Self publishing is upon us. Just as recording artists are becoming their own publishers owning their own studios, writers are following their path. Amazon, like Apple is only the middleman selling the bytes for a cut. There will be few exclusive publishers in a few years. Their prices will fall for books just as they have for televisions and computers.

Kindle Readers Ignite Protest Over E-Book Prices
Go read this: http://www.wired.com/gadgetlab/2009/04/kindle-readers/

Everyone?s a critic, it seems.

Amazon Kindle is traversing the learning curve Apple is blazing. It is very hard to predict the future when the new supplants the old ways of business. Many resent the driver, but it is the driver who plots the course. Buckle up, hold on and enjoy the ride.

The thirty percent is the going rate. Apple is not the only one with this particular surcharge. It is always the trail blazer who takes the flak. What will eventually work out as the norm is anyone’s guess. We?ll have to hold on tight as the road curves. That?s capitalism for you. Have to live with it, can?t do without it.

mhikl

[quote author=“Bosco”]The 30% is not highway robbery.

Did I read this right, Boski or has someone subverted your unique moniker?

It takes a big man to retract his words!

I may have to revise my stand, darn.

Bosco (Brad Hutchings)

@mhikl you insufferable little piss ant. I’m gonna respond to you this one time to show this group what a silly little moronic twerp you are.

Here’s the bet. July 1, 2011 (if you don’t know the significance of the date, you’re an ignorant little piece of cow manure too), Amazon will not have caved in any way, shape, or form to Apple’s in-app garbage. If you accept the bet and lose (you will, so start stealing nickels and dimes from the other short bus kids), you send $200 by PayPal to Boxer Rescue Los Angeles, my favorite charity. Go ahead and name your charity, not that it will matter. But for completeness of the bet, do it.

If you choose not to accept this bet, you’re the loser you pretend to be here. This offer is only open to the bottom dwelling cr@p eater known as mhikl.

Terrin

I am confused, Amazon sells books, not subscriptions services. Amazon’s Kindle magazines service currently is not available on the Mac app (Amazon Description).

So, apparently this policy doesn’t effect Amazon, or the Kindle app,  at all.

Just watch. Amazon holds a good hand and will not give it up voluntarily. Things will become increasingly awkward for Apple if it doesn?t crack down on the Kindle app. But Apple cracking down on the Kindle app would be a disaster for Apple. It draws attention to what a money grab this silly arrangement is.

mhikl

I get it, Boski,
It’s your Birthday.

Best wishes in advance,
SLMT

PS I promise not to pretend to be the loser here.

rjackb

I don’t see what the brouhaha is all about. It is not excessive at all for Apple to take 30% when normal retail markup is more like 100% over wholesale. Plus there is no requirement that a publisher sell subscriptions through the Apple store so they don’t have to pay the markup if they don’t wish.

Furthermore, Apple is offering publishers a good way to increase their subscription base by exposing them to a much larger audience—which is an incredible offer when you consider that traditional print publications are seeing an ever increasing drop in traditional subscriptions.

It’s a new world, publishers. Not only get used to it but embrace it. You could do very well.

Bosco (Brad Hutchings)

It appears that @mhikl is the gutless wonder I figured him to be. If I’m so wrong, his favorite charity could have profited from it, but I guess NAMBLA will have to raise money elsewhere. And that’s the last time I acknowledge the little turd. Continue your obsession @mhikl, it’s even funnier now that everyone knows you’re being ignored.

Terrin, perhaps you might be interested in this timely article. This policy applies not just to subscriptions, but all external purchased content brought into an app. Money quote:

With razor thin margins in digital content, 30 per cent may well be too much. It’s almost certainly going to be too much for Amazon, who may discontinue their iOS Kindle app, rather than make a substantial loss on sales.

But the way Amazon is going to play this is to neither negotiate nor complain, but simply see what Apple does on July 1. Sony (previously rejected for their Reader app) might open cans of whoop ass on a few fronts in the meantime. Their music catalog is definitely in play, and having it missing from iTunes would make the iOS on—phone music purchasing experience quite lame. And then there’s the unspoken issue of Steve Jobs and his health. Why not just try to outlast his tenure as Apple CEO, especially if it might be measured in months? Everyone in this game knows that’s a factor, even if they can’t politely acknowledge it.

NotTellinYou

Unbelievable how people that don’t have a clue how this works spewing the same stuff. 

So anyone want to guess what Publisher’s Clearing House got for the subscriptions they brought in?  Anyone?

Their cut of a subscription ranged from 74 to 90 percent!

Please…nothing to see here!

Lee Dronick

an incredible offer when you consider that traditional print publications are seeing an ever increasing drop in traditional subscriptions.

It?s a new world, publishers. Not only get used to it but embrace it. You could do very well.

Some of them are desperate and I can hardly believe the offers they send me, a years worth of Time, for $12 or so. I still like the feel of a magazine and I can take it with me. However, I am also liking the interactive and multimedia you get with digital content. I do not yet have an iPad, I am waiting for the next model.

anonymous

Whether you believe Apple’s 30% is reasonable or not, Apple’s dominant share of the tablet market makes the policy anti-competitive. Specifically, content providers who want to reach the tablet market are effectively forced to offer their content through the App Store, and are prohibited from competing with the App Store (on price) even though it could be a more expensive distribution channel.

For some content providers, the App Store is clearly a good deal. Nobody is denying that, but for others 30% is not competitive. Efficient markets must allow choice that is not coerced by a dominant position in another segment.

Lachebekje

I once saw an ad for a new magazine I would like to try. I downloaded the publisher’s iPhone app, browsed their magazine catalog and wanted to order the new magazine. It then asked me to enter my details, select a payment method, etc. I immediately decided to quit the app and move on. I didn’t want yet another company to get my details and credit card number. If the publisher would have offered me the magazine through in-app purchase, I would have purchased it. Now they lost a potential new reader.

I want one way of purchasing content for my iPhone and iPad and that’s through Apple. Whether or not publishers like that, is up to them.

I fully support Apple in changing their policy. It’s not about the 30%, it’s about the ease of use.

Tonya Engst

Speaking as a small digital publisher, I think it is okay for Apple to ask for a small amount of contact info, but give the consumer the option to opt out of sharing it with the publisher. Take Control Ebooks has done this all along - the customer does need to provide some info in order to purchase, but that info stays with the cart unless they ask that it be passed along to us. (Honestly, I can’t remember if our settings are opt in or opt out at present.) IMHO, the benefit to the consumer is enormous, because we can get ahold of them to tell them about updates to their content, and we can set up a user account system for them on our Web site so that they can access their content from the Web. However, some people just want to buy an ebook and read it without any further interaction or dealing with an account, and that’s okay and understandable.

The 30% is a bit worrying, not so much because of the amount - publishers will be forced to pass that on to the customer to some extent - overall prices will rise to accommodate it for content that was already digital, and for content that wasn’t previously digital (i.e. coming from a print model), 30% is reasonable. The trouble is going to be coordinating sales, deals, other resellers, etc. with Apple’s pricing. The time lag between starting sales or bundles in various systems may not be synchronous, so it may not always be realistic to offer the same thing in-app. I think following the spirit of the rule will be important and there can always be different content (but similar) content offered in-app and out-of-app.

What consumers don’t want, I think, is an entirely different purchasing system for each digital magazine that they read, and if Apple can streamline it for hte consumer, that’s going to be a help to the consumer and the publisher. Running an online shopping cart requires a great deal of expertise with things like credit card fraud, PayPal integration, sales tax, VAT, returns, etc. and publishers may well appreciate Apple handling those issues.

Anyway, that’s my two cents, only it’s more like ten.

-Tonya Engst (www.takecontrolbooks.com)

RonMacGuy

Amazon holds a good hand and will not give it up voluntarily.

Yep, Amazon holds a good hand in the online music market too, right?  what, 13% vs. iTunes 66%.

FlipFriddle

As a small publisher, if I had the ability to sell stuff in the iBooks store, I would do it in a heartbeat; 30% for that number of eyeballs seeing my stuff? A bargain! I’m still noodling with eBooks formats because my books are so art and layout dependent (I make RPGs). It’s just another channel for income. Relax.

Bosco (Brad Hutchings)

Yep, Amazon holds a good hand in the online music market too, right?? what, 13% vs. iTunes 66%.

Ron. you’re not that stupid. Was I talking about music? No. I was talking about the Kindle app.

Ted Landau

Thanks for all the comments to this article. I would request that people remain polite in replying to each other.

Some final replies of my own to reader comments:

I concur that Apple’s setup will be a boon for consumers. The ability to manage all your subscriptions in one place, with one consistent interface is great. Much better than having to go to a separate website for each subscription.

I also agree that it is reasonable to expect Apple to get paid for doing this. And maybe 30% is reasonable. I don’t yet know enough to know.

I remain troubled by the requirement that publishers cannot offer any deal out-of-app that is better than what is in-app. And that the app cannot include a link to the publisher’s web site subscription page, even if the prices are the same. Also, as I understand it, publishers can’t opt out of Apple’s subscription scheme and entirely manage app subscriptions via their own technology. If you are going to have subscriptions in your app, it has to be through Apple.

I understand the intent here. Apple doesn’t want to make it too easy for publishers to have the advantages of Apple’s ecosystem without Apple getting its 30% cut. But, as I argued in my column, I expect this to be unwieldy to actually enforce.

In thinking about it, I have been unable to come up with any comparable system that has these same sorts of requirements. For example, one reader mentioned Publishers Clearinghouse and that fact that they supposedly got a 74-90% cut. But this is different. These were meant to be introductory subscriptions. Renewals would be at a higher price and would go directly through the publisher. This was like a “loss leader” for the magazines. Plus, I believe the publishers were free to simultaneously offer subscriptions on their own in any way they wanted ? at higher or lower prices than the Clearinghouse offer.

Overall, Google One Pass seems to be a lot closer to the type of system I had hoped Apple would use. It’s still too early to tell. But it seems promising.

Bosco (Brad Hutchings)

I concur that Apple?s setup will be a boon for consumers. The ability to manage all your subscriptions in one place, with one consistent interface is great. Much better than having to go to a separate website for each subscription.

Right. But maybe customers should pay for the convenience. What Apple has done with the surrounding terms on this is to try to ensure that Apple’s customers don’t have to pay extra for the convenience. With the best price terms, Apple is pretty much forcing non-Apple customers to pay extra for the convenience of Apple customers.

One Gizmodo article called this “a dick move”. There is really no better description I can think of. Nobody likes that guy whose dog craps on everyone else’s lawn and he doesn’t even bother to pick it up.

Terrin

The Registrar is not exactly a pillar of journalistic excellence. I’d say it falls into the category of most media organizations that do no work themselves, but instead rehash information from another source.

So, perhaps you are correct, but Apple’s own statements only apply to subscriptions. Is there something out there from Apple that says otherwise or that reasonably can be interpreted otherwise?

Let us at least use Apple as the source since that is the policy that is being discussed.

Apple likely doesn’t want to loss Amazon. Further, Apple probably has left itself leeway to grandfather Amazon in.

Terrin, perhaps you might be interested in this timely article. This policy applies not just to subscriptions, but all external purchased content brought into an app. Money quote:

With razor thin margins in digital content, 30 per cent may well be too much. It?s almost certainly going to be too much for Amazon, who may discontinue their iOS Kindle app, rather than make a substantial loss on sales.

Bosco (Brad Hutchings)

Terrin, it is “The Register”, and they have in Andrew Orlowski one of the distinguished tech journalists of our time.

You keep your head in the sand, pal. grin

Terrin

Several noted law professors have commented on the topic. The consensus is Apple’s policy is not anti-competitive. The relevant market is not tablets, but all sources that sell subscriptions.  Apple doesn’t even encompass one percent.

Apple?s dominant share of the tablet market makes the policy anti-competitive

RonMacGuy

What a surprise, Gizmodo calling it that.  I like the quotes from this article:  Favorable Viewpoints

Richard Stephenson, CEO of London-based Yudu Media?which has built more than 60 apps for periodicals ranging from Reader?s Digest UK to American Handgunner ?said he would advise publishers to put aside their reservations and plant their flag in the iOS platform. Apple?s commission may be a steep price, he suggested, but the user-friendliness of the iTunes subscription method may bring a higher number of subscriptions.

?We?re a great believer in slick consumer journeys,? Stephenson said. ?When you take people off the App Store, you lose a lot of people along the way, the dropout rate is pretty high.?

There are so many iPads in circulation, Stephenson said, ?whatever Apple charges, you have to be there. Don?t fight it, run with it.?

Popular Science?s Hano said his magazine was already selling upwards of 10,000 digital issues a month, at $5 a pop. Customers? ?biggest complaint? was the lack of a subscription option, and he expects the magazine?s new $15-a-year offering to be popular.

And some money lost in commissions to Apple could be made up with information about those subscribers. Customers will have the option to share their name, e-mail address, and zip code with publishers. Even a partial gathering of subscriber data will be useful in luring advertisers, both Stephenson and Hano suggested.

?We?re interested in being able to share with advertisers more information about who is buying our brand on tablets, and on the iPad in particular,? Hano said. ?If we can help them learn more about who our readers ? we think that?s good for everybody.?

Ted Nadeau, general manager of the Elle Digital Group, said the arrangement will allow his magazine to concentrate on content while Apple handles the money matters.

?This is good for the consumer,? Nadeau said. ?We are not in the payment processing business. We?re happy to concentrate on our core strength of producing great content.?

RonMacGuy

Was I talking about music? No. I was talking about the Kindle app.

Sorry Bosco, I often forget how specific and selective your positions typically are.

I remember when record labels were in a similar uproar over Apple’s approach to digital music.  As more and more publishers get on board with Apple and realize how successful they can be, all will be good in the world again.

“There are so many iPads in circulation, Stephenson said, ?whatever Apple charges, you have to be there. Don?t fight it, run with it.?

So true.  So true.

Terrin

Spelling error noted. I tried reading it in the past, but the pieces seemed largely like regurgitated fluff. Further, this story you linked to was drafted by “Team Register” whatever that means. I took it to mean somebody who doesn’t want their name to appear by the article because no original thought or research went into the article. Unless I am mistaken, Andrew Orlowski certainly didn’t put his name next to the piece.

Nonetheless, where does the article quote Apple’s policy? It simply points to Apple’s public comments that point to subscriptions. You may be right that Apple intends to apply this policy to all in app purchases, but Apple’s comments don’t indicate that.

My question was honest. Where are people getting the information from Apple that suggests it applies to the Kindle? I’d be interested in reading that. If you don’t know and you too are just regurgitating what you read from authors who don’t think enough of their works to put their names next to it, just say so.

Terrin, it is ?The Register?, and they have in Andrew Orlowski one of the distinguished tech journalists of our time.

You keep your head in the sand, pal.

Bosco (Brad Hutchings)

Terrin, calling El Reg either a rag or unimportant in the tech landscape is just plain ignorant. Also, you could google for “Apple Kindle”, hit “News” and find hundreds of articles. Here is one from Computer World, which I’m sure according to your guidelines is some kind of animal fetish site.

And for the record, I do know and I don’t regurgitate crap.

Lee Dronick

And some money lost in commissions to Apple could be made up with information about those subscribers. Customers will have the option to share their name, e-mail address, and zip code with publishers. Even a partial gathering of subscriber data will be useful in luring advertisers, both Stephenson and Hano suggested

?We?re interested in being able to share with advertisers more information about who is buying our brand on tablets, and on the iPad in particular,? Hano said. ?If we can help them learn more about who our readers ? we think that?s good for everybody.?

I suppose that adverts in the periodical will have links to where you can make a purchase.

As to the contact information if we chose to provide it. Will Apple give them what we have registered on our iTunes account or do we plug it in for each subscription? If the later we could provide a throw-away email address; If it gets spammed up we just dump the address.

VaughnSC

It draws attention to what a money grab this silly arrangement is.

You’re [begrudgingly] right, Brad, but it is a money grab by the publishers. I feel everyone is whining on behalf of the same outfits that still want to price the same for digital vs physical media and thus, reap and keep IMHO unearned profits.

Pretty much like the Mac App Store, that 30% buys a lot of traffic/exposure and as mentioned elsewhere, a lot more one-click impulse purchases, compared to what- filling out insert cards or online forms asking ‘gender, age group, household income, where did you hear about us?, would you recommend us to a friend?’ *required fields malarkey.

Since digital doesn’t consume more resources as volumes increase (and they will), it still amounts to a reduced portion of a much bigger pie made possible by Apple, by catering to what the consumer prefers, which is as it should be in the first place.

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