Sony App Rejection Raises App Store Concerns

| News

Sony’s Reader ebook app for the iPhone, iPad and iPod touch was apparently rejected by Apple’s App Store reviewers, and the reasoning behind the move has left confusion and concern in its wake. On its Reader Web site, Sony claimed its iOS app was rejected because of a sudden change in the way Apple handles approval policies.

“Unfortunately, with little notice, Apple changed the way it enforces its rules and this will prevent the current version of the Reader for iPhone from being available in the app store,” Sony stated on its Reader Web site. “We opened a dialog with Apple to see if we can come up with an equitable resolution but reached an impasse at this time.”

Questions surround Sony’s Reader app rejection

The Web site didn’t elaborate on what those changes were, but Sony digital reading division president Steve Haber told the New York Times that from now on in-app purchases must be handled through Apple. Assuming running in-app purchases through Apple is the issue, however, that doesn’t exactly qualify as a sudden change since that’s been the policy ever since the App Store was launched.

Apple’s current policy lets the company take a 30 percent cut of in-app purchases, which can range from unlocking new app features to purchasing single magazine issues or books.

Companies that don’t want to share that revenue with Apple jump users out of the app and into Mobile Safari to make purchases through a Web site — which is exactly what Amazon does with its Kindle ebook reader app. Tapping the in-app Kindle Store button on an iOS device launches Safari and opens the Web-based Kindle book store.

While Apple’s policy seems fairly straightforward, the New York Times muddies the waters by stating “The company has told some applications developers, including Sony, that they can no longer sell content, like e-books, within their apps, or let customers have access to purchases they have made outside the App Store.”

Assuming the information the NYT obtained is correct, the policy would effectively kill the iPad as a digital magazine and book reader platform since publishers wouldn’t have any means of providing content to customers — and that’s a move Apple isn’t likely to make since customers would have absolutely no way of viewing their books and magazines in applications.

If that’s what Apple plans, then many ebook customers will likely pass up the iPad in favor of dedicated ebook reader devices or switch to other tablet and smartphone platforms for their digital books and magazines.

Without either side offering up more information, what seems more likely is that Sony wanted to offer in-app ebook purchases, but didn’t want to share revenue with Apple.

So far, Sony’s Reader App Store rejection is leaving more questions than answers, and Apple isn’t commenting on its decision. We’re waiting to see if Sony is willing to share more details, and will report back with any information they provide.

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36 Comments Leave Your Own

Lee Dronick

“more likely is that Sony wanted to offer in-app ebook purchases, but didn?t want to share revenue with Apple”

That sounds plausible.

ctopher

Apple already has my information. They already know what I buy. Why should Sony know it was me that purchased War and Peace. I can see why they want to, but I can also see why Apple won’t let them.

Finally, I don’t really care. Sony knowing who I am and that I purchased War and Peace doesn’t improve my reading experience.

MOSiX Man

Sony wanted special treatment for their app, they didn’t get it, and so they’re now acting as though Apple is bullying them over it?

Gee, it seems like lately, any time Apple refuses to let someone pee in their pool, the other party claims how unfair and/or ‘closed’ Apple’s policies are. Recently, it was Netgear (who cares?), and now Sony. Who’s next; Dell complaining, again, about how Apple won’t license Mac OS X to them?

geoduck

The important word is IF
IF what Sony says is true Than it’s bad. IF Apple is looking at trying to lock in all purchases from iOS through its own store that would be a very bad move. It would look bad, generate lots of bad press and in the long run I don’t think it would work.
But this wouldn’t be the first time Apple has rejected an App for reason X and the developer said it was for reason Y.
I’m waiting for the other shoe to drop.

Bosco (Brad Hutchings)

Humor me again. Why is Apple entitled to a 30% cut, or for that matter, any cut of in-app purchases?

For Apple, this example is dangerously close to being framable so that regular people who don’t care too much about inside baseball will see this as a tax on content. And with that, Apple loses 1/2 of its potential market on ideological lines. The other half will explain that the taxes are needed to maintain infrastructure, like roads and bridges, and foot the bill for foreign entanglements. #WinTheFuture!

Like everything with Apple these days, it wouldn’t be an issue if devs and publishers were free to choose alternative mechanisms. Business books in 2021 will look back on this as the Apple Paradox. You can lock people in and reap enormous short term profits. But open systems will quickly displace you because competitors are willing to take lower profits (and share them) and ultimately, customers want choice.

Intruder

Because in-app purchases run through their infrastructure?

Nemo

I suspect that the problem is that Apple is insisting on getting a cut of whatever is sold through the App Store, which, I think, is only fair.  iTunes and its App Store component is very expensive to operate.  Apple has to establish vast server farms, buy bandwidth, establish and maintain its DRM, and pay the developer and engineers that keep that vast enterprise up and running.  Apple pays for all of that by charging 30% for whatever is sold on the App Store.  What it appears to me that Apple is doing is preventing Sony and others from trying to exploit a loophole, where they would sell in-app goods and services without Apple getting anything to pay for the costs of hosting and selling those in-app goods on its servers.

If you are going to use Apple’s iTunes stores to make sales, then you must reasonably expect to pay Apple for providing that content, even in-app content, in its iTunes stores.  I don’t see how any other online store will be able to afford to do anything differently.  Perhaps Google can, but only if it is willing use part of its ad revenue to defray the costs of hosting and selling in-app content, but Google ad revenues are already burden with the costs of providing Android for free.

Tiger

Because all distributors get a cut? Same as in the retail chain, only 30% is actually LOWER than what most charge for the various stages of shipping, delivery, setup, and marketing of said publications in stores.

There ain’t no such thing as a free lunch, and SONY above everybody should know that. They’ve been charging a 300% markup on their products for more than 40 years. Now that they can’t compete and they’re losing their markets, they’re actively trying to hold on to some, aka any revenue source they can. Hmm. Apple’s trying NOT to give up a revenue source in the first place. It’s all business as usual, it’s just that it gets played out in the blogosphere daily and we actually get to read about it and express our own inane opinions.

grin

MOSiX Man

Geoduck: As the article points out, there has been no change in Apple’s handling of in-app purchases. Unless Mr. Gamet is incorrect on that point, and my own memory fails me, Apple has taken their cut of that action, ever since in-app purchases became available. Apple puts in the infrastructure and sets the rules. App developers can 1) Play within those boundaries, 2) Create a website to do the same thing, or 3) Make a web-app that simulates what their native app would do.

“...And with that, Apple loses 1/2 of its potential market on ideological lines.”

Really? Are you honestly saying that 50% of Apple’s potential in-app media purchase customers will care that Apple is taking a cut of what the producers are making? Since this is not being charged to the consumers, why would they think of it as a tax?

cb50dc

This from the NYT sums up my central response:

“The move is also surprising, as Apple has indicated recently that it would be more collaborative, not less, with magazine publishers and other content producers that want more control over how to distribute content on the iPad.”

http://www.nytimes.com/2011/02/01/technology/01apple.html?nl=todaysheadlines&emc=tha26

I agree that Apple has the right to charge for the use of its infrastructure, for reasons that others have detailed above. Somewhere in this particular event, though, it feels to me as if they’re getting a little cocky, shifting beyond the slightly aloof self-confidence (which I like) they’ve grown into over this decade. Very subjective call.

cb50dc

it?s just that it gets played out in the blogosphere daily and we actually get to read about it and express our own inane opinions.

Stop making sense! :D

jfbiii

And with that, Apple loses 1/2 of its potential market on ideological lines.

That’s completely made-up.

You can lock people in and reap enormous short term profits. But open systems will quickly displace you because competitors are willing to take lower profits (and share them) and ultimately, customers want choice.

As is this. You continue to misunderstand that Apple doesn’t care how many of product x it sells so long as it sells it for more than 30% profit. Apple doesn’t care if everyone else wants to own 90% of the market and make 5? on the dollar. They’ll sell to the 10% that wants a quality product. Apple understands that it can’t prevent people from losing money just to get a customer.

Ultimately customers want a lot of different things. Some value choice (ultimately a pretty poor purchasing guideline; “I bought this one because there were fourteen to choose from.” “Is it the best tablet?” “Dude, there were 14 to choose from”) and some value a great product and some value the thing with the cheapest purchase price that barely gets the job done, even if the total cost of ownership is higher.

Not only do you not understand Apple, you don’t even understand basic marketing concepts.

JonGl

agree that Apple has the right to charge for the use of its infrastructure. Somewhere in this event, though, it feels to me as if they?re getting a little cocky, attitudinally beyond the slightly aloof self-confidence they?ve grown into over this decade.

Are you not basing your “feeling” on a news article written almost entirely from Sony’s perspective? Are you not maybe rushing a bit to conclusions? Since Apple seldom speaks up to defend itself on any of the issues that are creating these feelings of yours, is it not possible that you are rushing to judgment, and allowing feelings to outrace your head? I would be very suspicious of such feelings…

Companies these days, have been trained to utilize politics, and the fickle emotions of people to play big games. Apple, to my relief, has rejected such politics, preferring to let their products speak for themselves for the most part. They seldom “boast” unless they think their words will hold up to scrutiny. This is something that Sony has obviously shown themselves unwilling to do in this case.

I suggest a realignment of your emotions on this issue.

Oh, and for the record, that part you quoted is called editorializing—in a news article. This is truly bad journalism. I have been getting the NYT daily emails since the first months it was available well over a decade ago, and have read the NYT for years before that. The quality of their writing has sunk tragically in the last decade. I keep wondering why I keep reading them!

-Jon

Bosco (Brad Hutchings)

I agree that Apple has the right to charge for the use of its infrastructure. Somewhere in this event, though, it feels to me as if they?re getting a little cocky, attitudinally beyond the slightly aloof self-confidence they?ve grown into over this decade.

And I think we’d both agree that Apple even has a right to block competing infrastructure on the iOS platform, so as to lock devs into using its infrastructure. Apple has an inalienable right to bugger pigs too, if they are Apple’s property. But rights do not necessarily guarantee that an idea is a good one.

The 30% has to come from somewhere, and especially in the case of ebooks, the ultimate price point has to be competitive. I’d imagine that we’re not too far away from it making more sense for Sony to give away an e-reader to a moderate reader customer than pay Apple’s 30% on all books—ignoring issues of device marketshare and consumers’ willingness to use multiple devices, etc. It most certainly costs Sony less than 30% of the purchase price to process a transaction.

Ultimately, though, the real question is whose customer is it? Apple’s or Sony’s? Who is the user of the Sony ebook app buying the books from? This is where simple issues of fairness will inevitably creep in and compete against issues of rights. Nobody has a “right” to a customer. If customers believe that a system is unfair, and there are alternative systems that they perceive as more fair, the customers have options. This is where Apple will ultimately lose market share and mind share, and this niche itself. Big brands either won’t play, will kick Apple in the shins up and down the field, or will just add the Apple tax onto their prices for content on Apple devices. Apple can prevent that perception so long as it is dominant, but when it falls behind, it just looks overpriced and shiny.

Tiger

Well, the news is playing well with investors at least. Apple’s stock has shot up $4.75 as opposed to $.33 for Sony.

With content being fractured along every line possible, as long as any of them, be it Apple, Sony, Amazon, or whoever, has what is perceived to be a viable supply of content, people will buy it. Just look at cable TV. So much “content” is available, it’s now overload. Apple’s move will work if they have content to fill the void. If not, yeah, it could fail. But something tells me they’ve got a LOT coming in the pipeline. You can do that when you have $50 billion in cash…..

Intruder

Bosco, you make it sound like every decision Apple makes is 1) intended to screw the customer; and 2) irreversible.

First and foremost, as a publicly traded company, their number one responsibility is to their shareholders. They are in business to make a profit. If consumers feel that isn’t “fair” (and nothing is life is fair), then they will vote with their wallet. If Apple feels like they are losing too much market share and they actually care about that, they can always change their approach. They have reversed their position before (hence why the app store even exists for IOS devices). Nothing is set in stone.

cb50dc

Are you not maybe rushing a bit to conclusions… rushing to judgment, and allowing feelings to outrace your head? I would be very suspicious of such feelings?

Ford Prefect said it well: Don’t panic. And Chill Pills are available on Aisle 5.

I posted my observation with virtually NONE of the intensity you seem to have imputed to it. Did you notice that I like Apple’s “slightly aloof self-confidence”? That should provide enough context.

I didn’t present the quote as news. I presented it as a perspective, with which I concur. For more context, I also concur with geoduck’s emphasis on “IF” posted at 10:33 EST, and bosco’s third paragraph from 11:29 EST.

Aisle 5.

skipaq

There is a simple principle involved with any store: You want to sell your product in my store - You will have to pay me for the space. Try walking into Wal-Mart and setting up a table to sell your stuff. I sort of think that every sale of a Sony product in Wal-Mart ends with a percentage going to Wal-Mart. This is not so much a matter of rights. It is a matter of good business. Do you think that Amazon gets a cut of Sony’s action in their online store?

cb50dc

If customers believe that a system is unfair, and there are alternative systems that they perceive as more fair, the customers have options. This is where Apple will ultimately lose market share and mind share, and this niche itself. Big brands either won?t play, will kick Apple in the shins up and down the field, or will just add the Apple tax onto their prices for content on Apple devices. Apple can prevent that perception so long as it is dominant, but when it falls behind, it just looks overpriced and shiny.

Yeah, that’s what I meant to say.wink

If this particular issue does go sour, Apple’s still fine. Given the field, “go sour” may mean they rack up profits of only half of what they might have made otherwise (as I attended the Univ. of Alabama in the late 70’s, with Bear Bryant as coach, 10-0-1 would be considered a “losing season.”)

I’m nowhere near panicking. It may go perfectly fine. At worst, I think, it may mimic Antennagate?a perfuffle for a few weeks, assimilated and forgotten a couple of months later.

Bosco (Brad Hutchings)

@Intruder. I hear that Hosni Mubarak is looking for a new press secretary. Look, the world is not “if-then”. It is ebb and flow. What has always interested me most around the Apple universe is the undercurrents. Over a year ago, when Android was in the 2% market share range for smart phones, I sensed these undercurrents and began chronicling them in these comments. Turns out, I was actually wrong in not anticipating Android’s ascension happening as quickly as it did.

There is a lot to like about Apple and its products. You guys all focus on that. I understand it. There is also a lot that is quite dislikable about how Apple deals with competition and customers, especially since the launch of the iPhone, and even more especially in the last two years with the surprising success of the App Store. Discontent combined with Apple’s high margins present opportunity for competitors. Deliver something less expensive (because it lacks the high Apple profit margin) that meets the need with less drama and more flexibility. That is the formula by which Android went from 0 in November, 2009 to besting not only Apple, but RIM and now Nokia in the world smartphone market. Rinse and repeat with tablets.

It’s funny. With Google, the complaint, if there actually is one, is that Google is not controlling enough. Fragmentation, UI layers, plentitude of devices, carrier feature blocking, etc. In the absence of control, pretty much anyone is free to come in and try to control things. And nobody has really succeeded in controlling more than their little space in the Android universe. With Apple, the opposite dynamic does not apply. Apple controls too much. In that environment, nobody is free to come in and introduce a little anarchy, even in their own little space. This is that basic undercurrent that y’all ought to pay attention to. Or if you like calling me a troll, that’s fine too. It won’t change how things unfold.

MOSiX Man

@Bosco: A definite sign that a person has lost a debate is when they have to resort to personal attacks. Besides, I think that your ability to maintain an arbitrary, single-minded point of view, despite any evidence to the contrary, makes you the best suited for that job, out of anybody that posts at TMO.

MOSiX Man

@Darren K: Wait… You’re telling me that if people stopped buying Apple’s wares, Apple would have to change how they do business and/or what they sell?! Well, if people ever do vote that way, I’m sure that Apple will, indeed, change course to improve their situation. However, it seems like there are a whole lot of people that disagree with you and who are very happy with what Apple offers them, so I doubt that Apple will be going with any contingency plans any time soon.

Tiger

So, Apple has responded and it maybe Sony that’s got egg on its face?

“Apple’s made no change to its App Store Guidlines, it’s simply enforcing a rule that’s been in them all along: apps that offer purchases elsewhere must support in-app purchases as well. ?We have not changed our developer terms or guidelines,” company spokesperson Trudy Miller told me. “We are now requiring that if an app offers customers the ability to purchase books outside of the app, that the same option is also available to customers from within the app with in-app purchase.”

Instead of using the word “requiring” Ms. Miller should have probably said “enforcing” but since the guidelines required it all along it isn’t really a change.

My semantics professor from graduate school is somewhere smiling profusely. He’s having a field day with this one!!!!

Bosco (Brad Hutchings)

@MOSiX: What personal attack? Do you mean where I was giving Intruder a back-handed compliment for his ability to spin? Really? Wow, if that is your standard, then I pretty much “win” any thread that RonMacGuy posts in, never mind the twits I have on ignore. And rattyuk, MOSiX just called you the biggest loser on TMO. Congrats, pal.

You think I come here to “win debates”. Hilarious. You guys are the one of the most important measurements of the undercurrent, like seals frolicking and sunbathing at the surface, unaware and unconcerned of predators lurking below.

mhikl

This is what is killing newspapers, magazines and book providers in the material world.

Those silly “paper boys” expect to be get their coin for each paper delivered. Paper and ink companies are demanding that they get money in exchange for their paper and ink. Billboard providers expect a cheque for displaying media providers adverts. Television companies are demanding compensation for carrying advertising. Post Offices expect to be paid for delivering products based on weight and size. Writers, print setters, copyists?lord, even the gas and electrical companies?expect to get Caesar’s ration from these these media sellers.

And now, of all the gall, along comes Apple who is as greedy as all the other middlemen that get the product from producer to purchaser. Where is the government in all this ruckus. Ooooh ya. It expect its comeuppance as well.

They should all be hung out to dry for expecting newspaper, magazine and book makers to pay them for their sweat, time and delivery.

Bosco (Brad Hutchings)

?We are now requiring that if an app offers customers the ability to purchase books outside of the app, that the same option is also available to customers from within the app with in-app purchase.?

OMFD, and yes, I said “F” in the middle of “Oh My Dog”. Apple just shot itself in the nuts.

Nemo

Dear Bosco: I am sorry to tell you this, but it is my opinion of law that it is illegal for you to bugger your pigs or for anyone to bugger any pigs whether or not they own the pig in question in any state or territory of the United States.  As for the instant discussion, anyone who doesn’t like Apple’s terms for the App Store has and has always had an alternative.  That alternative is the World Wide Web.  As Mosix Man said, supra, if you don’t think the benefits of Apple’s App Store aren’t worth costs of Apple’s 30% comission and its regulations, you can, by using an in-app link to the Web or by building your own web app, use the web browser on every iPhone and iPad to sell whatever content you’d like sell to customers.  But don’t seriously ask Apple to bear the costs of hosting for free the content that a company sells.

The Web is there for anyone who wants to forgo the costs and benefits of the App Store and use his own infrastructure to sell his content.  If Sony wants to forgo the App Store, that is fine and is its right, and it has an alternative in Web and/or in other online app stores to sell to customers However, neither Sony or anyone else has any right or reason in asking Apple or anyone else to bear the cost of hosting and providing a means for selling a person’s content, including his in-app content, for free.

Bosco (Brad Hutchings)

Nemo… Pig buggerers and libertarians might argue whether they have the right to dispose of their property as they wish, and that such a law is unjust, as pigs are property. Dog owners are confronted with this curiosity of the law when law enforcement personnel shoot their dogs during botched rug raids. Google Cheye Calvo dogs. But that’s a side point in this discussion…

you can, by using an in-app link to the Web or by building your own web app, use the web browser on every iPhone and iPad to sell whatever content you?d like sell to customers.

OK, now you need to square that with what Tiger just posted, which came from an official Apple spokeshole. Cuz one of you (Nemo or Trudy the Spokeshole) is plainly incorrect grin.

mhikl

Not only do you not understand Apple, you don?t even understand basic marketing concepts.

jfbiii, I admire your persistence. However, there’s too much sense in them words. It goes over the head of one.

You must use lateral thinking; but it is impossible to explain molecules to air heads this way. Crayons and thick pencils work best for him and even then, it’s a toss-up.

mhikl

Companies these days, have been trained to utilize politics, and the fickle emotions of people to play big games. Apple, to my relief, has rejected such politics, preferring to let their products speak for themselves for the most part. They seldom ?boast? unless they think their words will hold up to scrutiny.

Laudable and germane, JonGI. This is what the rattle is all about.

May I also add, succinct.

Nemo

Bosco:  I am not sure that there is a contradiction.  Reading Ms. Miller’s statement carefully, it seems to permit widget that takes a customers to a different website, because that is, I think, a web app and not a native app in the App Store, but Apple needs to clarify this ambiguity. 

Then there is the circumstance of actually offering content for sale in an app but not allowing the customer to actually purchase in-app but only permitting the customer to purchase somewhere else on the Web.  Here a person is using the App Store to market his content but conducting the actual sale outside of the App Store to avoid paying Apple’s commission.  That is like Harrods putting up a big sign in Macy’s saying that these great shirts are available at Harrods.  I think that Macy’s would object and so to Apple objects to you marketing on the App Store and using the popularity of the App Store to market your products but doing the actual selling elsewhere to avoid paying Apple its 30% commission.  I think on a common sense basis Apple is reasonable prohibiting a person from marketing on the App Store but conducting the actual sales elsewhere, and, on cursory analysis, I think that restriction is legal.

Sony—and, if Apple let Sony do this, others would soon follow—is trying to market its goods for free by using the infrastructure, goodwill, and popularity of Apple’s App Store, while avoiding paying Apple anything for those benefits by conducting the sale elsewhere.  That too is an absurd position, just as absurd as Harrods doing its marketing in Macy’s for free.

Bosco (Brad Hutchings)

Nemo… you are parsing it wrong. It says that if you have an app (not a web app, but a native app) and you offer ways to buy content for that app outside of the app experience but linked to inside the app experience, then you need to allow in-app purchases. Apple has only one in-app purchase mechanism. It gives 30% to Apple.

As to the store analogy. I am happy for you that when you purchased your iPhone and your iPad, you also purchased a store where the front door is the power switch. This gives me some new product ideas for Apple (for after the iPhone and iPad have but a small niche following):

* A toothbrush that only works with Apple toothpaste.
* A coffee cup that only holds Apple brand coffee made with an Apple brand coffee maker.
* A humidifier that only works with Apple brand water and Apple supplied indoor air.
* The obvious Apple car that only uses Apple gas.

I mentioned above that I don’t come here to judge you guys for supporting this. Today is really testing my resolve. This has to be making some of you cringe, a little maybe?

geoduck

Geoduck: As the article poi

Careful with the attributions there bub. That wasn’t me who said any of that.

ctopher

You can use any toothpaste you want, but if you purchase it through my toothbrush, I get a cut.

You can use any brand of coffee you want, but if you purchase it through my coffee maker, I get a cut.

You can use any brand of water you want and any brand of air you desire, but if you purchase air and water through my humidifier, I get a cut.

You can use any brand of gas you want but if you purchase it through my car, I get a cut.

Tiger

What’s with all the buggering pigs talk? Nobody said anything about makin’ bacon.

Isn’t it funny that such an inane thing as in-app, out-of-app purchases can cause so much hostility?

Again I’ll state, investors don’t seem to be negatively influenced by this story. The stock jumped another 1.68% today ($5.45 in plain English).

cb50dc

if you purchase it through my toothbrush, I get a cut.

Man, you’ll need some iBandages for all those cuts. wink

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