Legacy apps must comply with Apple's App Store subscription rules by June 30 - Page 5

This isn't true. Amazon takes 65% as standard. They introduced a 70/30 split to respond to Apple's App Store pricing but it has restrictions and only applies to books under $9.99. If a publisher takes the 70/30 split they have to meet the following conditions:

- The author or publisher-supplied list price must be between $2.99 and $9.99.
- This list price must be at least 20 percent below the lowest physical list price for the physical book.
- The title is made available for sale in all geographies for which the author or publisher has rights.
- Books must be offered at or below price parity with competition, including physical book prices.

http://www.businessinsider.com/henry...-option-2010-1

I suspect most books are still sold under the old model.

I think it comes down to whether or not you define Apple as a distributor/reseller of content. If you do then the 30% isn't that bad. Many resellers mark up merchandise even 50% from the wholesale price. I'm not sure what the markup is for books, magazines or music in particular but a typical reseller gets merchandise for a substantial discount and then marks it up.

In this case the problem arises when the distributor is a re-distributor, then the merchandise gets marked up twice. Since Amazon is the reseller of the publisher and the Apple is the reseller of Amazon, there is one too many middle men .

Exactly. Which won't happen. All that means is that, come June, you won't be able to click on a button in the Kindle app and launch to the Amazon store. Big deal.

I don't see this working at all as others have explained. They will pull out of the AppStore I am sure if something else isn't worked out. They can not increase the cost for every other platform just because of apple. They certainly will not take a 30% loss regardless what apple feels is fair.

In the end Apple and end users will be hurt by this. Bye kindle.., netflix... it was nice knowing you on iOS.

If I were amazon netflix I would simply put up a dialog that mentions because of the costs assocated with the apple store purchases with subscriptions, iTunes subscriptions are disabled. We simply can not take a 30% loss or increase prices everywhere else 30% because of the apple platform. Feel free to contact Apple and let them know how you feel about this issue.

But "in-app" means the user has already downloaded the app. Which means they are already aware of the publication and probably already decided to subscribe. They made that discovery with out the aid of in-app subscriptions (since they didn't have the app yet).

So is it realy going to create that big of a surge in subscribers?

amazon can still put their reader app up now. But it's only a single new rule before apple blocks the kindle app unless it offers in app purchasing.

ibooks is ONLY available on the iOS ecoystem. this is APPLE's choice. If they created a ibooks android app it would be available on android, but they won't do that because they're a HARDWARE company. You cannot use the question about ibooks on other platforms because it is APPLE blocking that, not other providers.

On top of that, the kindle is a SINGLE use product. It's there for the consumption of amazon content. It is a totally different product from the Kindle or a similar device.

With the new App Store for the Mac, it just might end up there also, restricting all software on your laptop to only those that you bought through the app store.
The writing seems to be on the wall.

For Netflix, EVERY subscriber is another profitable subscriber. Their costs are mostly fixed cost, such as data center, warehousing, licensing fees, and advertisements. These costs won't change much with or without Apple users as potential subscribers. Their variable costs for each subscriber is very low compared to the monthly fee. So Netflix will increase their profit no matter what kind of cut Apple takes. Apple can charge them 90% and Netflix will probably still come out ahead on new subscribers on Apple's platform.

Unless Netflix's licensing fee is calculated on a per view basis, then their profit margin will suffer a bit with Apple's cut. But still, each additional subscriber is most likely a profitable one even with Apple's cut.

Except that Apple requires them to include an in app purchase option.
" 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."

I don't know whether an ebook is considered a subscription but I don'tdoubt Amazon would be willing to allow an option that takes all their profit.

But apple isn't directly reselling the service. They're taking NONE of the costs associated with Amazon working out a deal with the publishers. They're not reselling ANYTHING of amazon's.

What they're doing is telling amazon to fork over a portion of the revenue (often the total profit) without giving them ANY additional compensation for it. in this relationship Apple isn't a distributor of the content, they're not even a reseller of the content, they're the platform the content gets consumed on once it's already purchased.

They're not selling ANY of the content. They're more like the leaseholder of a lot where a bookstore opens. Should a leaseholder have the right to charge rent? Yes. Do they have the right to take a HIGH % of every single sale that store makes? Hell no. No store would agree to those terms, no matter how high the traffic at that location is.

False. No, not just false, outright delusional.

Take a look at Netflix's income statement's for the past year. Their profit margin has nowhere NEAR the amount of leeway to give up 30% of their revenue.

To put it in perspective, if only 10% of Netflix subscribers subscribe through itunes, Apple will get 44% of their TOTAL net profit. The more popular the in app purchase model is, the less money Netflix will make.

There is no universe where that is "fair." Especially when you consider that most of those people who subscribe through netflix will also be using the service on different mediums (like their TV) just as much, or MORE than they'll be consuming content on the iOS device. This means that apple will get close to 50% of the companies net income just by providing a storefront?

Apple isn't selling the content, they're not paying the rights for the content. They should NOT be getting that big of a chunk.

I really am beginning to wonder if Steve is the only one to run this company... These changes just cry stupidity.

Why on earth would Apple make these changes so early on in the mobile OS/platform wars. Are they that arrogant that they feel Google, MS, RIM, and HP aren't competitors.

I guess the actual documents aren't showing up in my browser. You'll forgive me if I think you guys are just making up numbers to support your "rage".

So your browser can't view Yahoo Finance pages? Go to your browser of choice, type in "Netflix income statement 2010" and hit enter. I linked to the yahoo finance page, which is the official documents published by the company.

I've just confirmed that it loads in a webkit browser, so you're excuse is absolute BS. It also loads on IE9, firefox, Chrome, and I'm pretty sure Opera (though I don't use it). So what browser are you using exactly? Because it sucks.

Wow!!

Apple is really pushing the limits with it's users. Now they want to really restrict content that we can put on our devices if the t vendors don't' allow them to put their hands in their pockets and take their money.

It's quite obvious what Apple's goals are now. They are.

Sell you a device (iPad, iPhone, iPod touch) and make you think you can put any software on it, (as long as it's not porn or illegal content).

Cutting off Hulu, Netflix will pave the way for Apple's movie rental and tv show rental service.

Cutting off Kindle and Barns and Noble would pave the way to Apple's eBook store.

Regarding music, they have iTunes which already has a monopoly on online distribution of music.

To me, Apple is engaging in anti-competitive practices. In some instances, like iPod and iPad, Apple has a monopoly market-share, and since these rules affect those platforms, they can be brought up in that sense.

Not true. Here's the quote:

"Apps like the Kindle app from Amazon.com and the one that Sony submitted open up a browser window when a user wants to buy something. This allows the app makers to argue that technically the purchase is happening on the Web, not within the app.

Apple is now saying the app makers must allow those purchases to happen within the app, not in a separate browser window, with Apple getting its standard 30 percent cut of the transaction. At the moment this applies only to e-book purchases.

We have not changed our developer terms or guidelines, Trudy Muller, an Apple spokeswoman, said Tuesday. 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.

Note that they can have a READER ONLY, and there's no problem.

As regards why iBooks is not available, it's irrelevant. It's only relevant that Kindle IS available on the iPad.

It's not. You can have a pure ebook reader that doesn't sell anything. See below:

"Apps like the Kindle app from Amazon.com and the one that Sony submitted open up a browser window when a user wants to buy something. This allows the app makers to argue that technically the purchase is happening on the Web, not within the app.

Apple is now saying the app makers must allow those purchases to happen within the app, not in a separate browser window, with Apple getting its standard 30 percent cut of the transaction. At the moment this applies only to e-book purchases.

We have not changed our developer terms or guidelines, Trudy Muller, an Apple spokeswoman, said Tuesday. 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."

If I use the slingbox app to oder a pay-per-view movie from my cable company will apple want a cut of that. It's an in app purchase.

These guys are really confused. First, there's the way Apple is dealing with ebook readers that "sell" from within the app by clicking through to their website. That won't be allowed without also giving Apple the chance to sell at the same price. That won't happen (because it would cost the reseller too much), so ereaders will no longer be able to click through to the reseller's website. So what?

Second, if you're selling magazines and subscriptions, you need to sell via Apple. Again, so what? The subscriptions are quite reasonable. I just bought one for Popular Science for less than $16. Well worth it, especially for a mag that is optimized for the iPad.

A lot of these posters are just flapping their gums. Really annoying.

Rhapsody is already fighting back

http://www.engadget.com/2011/02/15/r...eng_latest_art

The stench of overwhelming fanboyism assaults the nostrils. The "So What" is if they cant click through to their website the lose 30% of the gross sales. So they wont have a business model. so they will pull their apps. Rhapsody has already threatened to do so.


What now? You once bought a subscription for something via Popular science and this anecdote tells us something about amazons's business model?

"Rhapsody has issued a statement, which says that it's not going to play ball and even levels a bit of a threat: "We will be collaborating with our market peers in determining an appropriate legal and business response to this latest development." The big trouble stems from the fact that Apple requires anybody offering a subscription service to offer that service for the same price or less through Apple. That means you can still sign up folks through your own methods and get all the cash, but if anybody signs up through your app, Apple gets a 30 percent cut. In addition, Apple is no longer allowing applications to include a link to an external site for purchasing, which means vendors will have trouble getting new users to pay them directly instead of using Apple's simple but heavily-taxed option. Rhapsody claims that it can't offer its services at existing prices with Apple grabbing that much of the revenue, and it sounds like Rhapsody will be leaving the App Store soon if an agreement isn't struck."

How stupid can you get. SO WHAT? Apple is simply saying they can't have a click-through to their website. BFD. Take the blinkin' click through off and sell your App without it.

DOH!

That's where the confusion comes in. An Apple spokesman said that if a service sells a book outside the app, it has to be made possible to buy inside the app as well. So, does that mean removing a link to the web store is enough? Or does the fact that it exists at all linking purchased content mean Kindle has to allow those books instead?

If that's the case, my apologies. I tend to only see red when I read about topics like this .

Go read up on some basic concept of fixed cost and variable cost before you talk up things you don't understand, ok?

A large portion of netflix's cost is fixed, they had to spend it with or without Apple's users. So these costs are immaterial when considering whether it's a good idea to try to attract users on Apple platform. The cost to Netflix for providing service to each additional subscriber is very low compared to the monthly fee, and until subscriber base increase by a large percentage, it doesn't require additional fixed investment. Thus, it pays to sign up as much subscriber as possible, since most of the subscription fee go to offset the fixed cost and pad the bottomline. Now Apple's cut decreases that income by 30%, meaning the variable cost of adding each customer increased by that much. However, since adding this customer still netted you 70%-original cost in income, it increases overall profit by signing this customer up.

DOH my arse. If you sell the app with the option to buy anywhere else, that is the mere existence of a website, you invalidate the rules. Thats what the Sony e-reader was doing. It was banned.

Apple can be stubborn is these types of situations. Remember the big deal with the third party code in apps. Adobe filed a suit but it never really mattered because Apple changed their policy before it could come to a legal suit. As it turns out, Apple wanted to promote gaming on the iOS and they needed the existing game engines like Unity. Since using Unity was contrary to the fight with Adobe, Apple just bailed on the whole restriction. I think a similar thing could easily happen here where some huge publisher wants to do subscriptions themselves and if Apple doesn't play ball they will lose the bragging rights of bringing on that huge publisher. Instant overnight reversal of the 30% tariff.

The other thing that is not being discussed here is the total ineptness of Apple's in app purchasing as a piece of technology.

1) It restricts to 3,000 product Ids. Clearly that is useless to Amazon.
2) Even if it were useful the fact that these product Ids have to added manually is itself a massive and fruitless undertaking.
3) Apple has it's own tiered model. in the UK it is 59p for tier 1, 79p for tier 2, etc. Thats all the options you have. To not be in opposition to Apple's new rules you need not only to price everything the same everywhere, you need to follow Apple's utterly ridiculous pricing model everywhere.
4) If Kindle wanted to add iAP to their app it would take a large amount of engineering effort as they would have to replicate the the website discovery system in the App, and then add IAP.

So nothing survives this.

Hey, bud, if you want to bring this down to the level of a flame-war with your smack talk, I'll be happy to oblige you. You won't be pleased with the results. If, on the other hand, you want to have a reasonable discussion, I'll oblige.


Buh-bye Rhapsody, then. If they want to have access to the iDevice marketplace, play by Aople's rules. If they can't survive without a click-through in their app, they're in trouble anyway.


No, it tells you that this story is being concatenated with a completely separate issue. One is about subscriptions. The other is about click-throughs to websites.

I doubt if any of that is true - the fact is the each customer is probably a loss on the iPad and people are skirming around for excuses even though companies have already lauched action ( Rhapsody, for instance).

And it certainly does not apply to e-books - there is a cost per book for e-books.

The "So What?" comes because Apple is essentially closing off their system more. This WILL cause Amazon and others to stop selling services on their platform, so if someone wants to buy a book on the go they HAVE to go through iBooks.

In layman's terms it's a bait and switch. They created an app market and then used that app market to get people to pick up their product instead of alternatives. Now that people have their product, they're making it so publishers HAVE to go through them and not amazon or another service.

The "SO WHAT" is that this means further locking for those consumers.

Apple's stated that if a company offers a subscription service for their product they MUST offer it in app on their device. this prevents "read only" apps like you are implying. So what does this mean? This means no kindle on your ipad, only ibooks. No netflix/hulu+, only iTunes.

Maybe a few people bought a netflix subscription because they can get it on their phone, but I'm positive a much larger number of people got that phone because it had netflix/kindle/etc. Why else would Apple stress apps so much?

This might not matter to you because you buy everything apple anyway, but it's a HUGE deal for people who like those other options, especially those consumers who bought the devices BECAUSE of those third party apps.

Again, SO WHAT?

Look the previous post answered the "So What" - which is the catch cry of an idiot, or a child. But let me add: So What is this - Apple have killed all content providers on the iPad except Apple.

thats a big issue. You may not care, but the percentage of people who defend Apple to the Death and agree with the Dear Leader whatever he says is a tiny percentage of those of us who are sometimes, or (as in my case) primarily Apple users.

We do care. If Kindle goes, and it has to, then the iPad is no good for me and millions like me. Google must be shitting themselves with laughter, they have made a marketing campaign, somewhat falsely, about Apple's closed platform. Up until now people did not really care - the average guy cared less about curation, and not much about Flash.

Then Apple do this. This is huge.

App Store subscriptions will go the way of iAd.

Yeah, and it was Apple that gave publishers this ability last year.

Here's what Apple says in the App Store Review Guidelines:


Looks like this would definitely effect Amazon, Hulu and Netflix.

Go look at Netflix's costs before you try talking about things you don't understand, ok?

Netflix's net income is NOT GREATER THAN 30%. Heck, their GROSS profit is only 37%. It doesn't matter what their fixed income is compared to their non-fixed costs. It's not rocket science. On top of that, every dollar paid to apple is one less dollar that goes towards getting new content, which will retain current subscribers.

TLDR: If you decrease a companies revenue stream by 30% you kill any real profit they make.

They have that right.


No, it will cause Amazon to rewrite their app so it doesn't click through to their web site. BFD


Not even wrong. People can still buy through Amazon directly, then download the book to the Kindle reader. They just won't be able to click in the reader to get to the web site.


Again, not even wrong. There's a difference between the subscription service deal and the ebook reader deal. You're concatenating them. Yes, a subscription service, as in a MAGAZINE subscription or some such, will need to be run through Apple. That's not the same as a Kindle reader, which only needs to remove the link through to Amazon's website.


This is not true. Ereaders that don't link to websites won't have a problem.

Microsoft actually modified APIs and left them deliberately undocumented so that Netscape wouldn't work properly, they did the same against WordPerfect/Lotus I believe so that Office would be the defacto standard. Not even remotely similar.

I think Apple is abusing it's position on this one. ABUSING. Not that they can't do it legally, they are just abusing. Perhaps they are inviting some investigation in their practices. I like/love the iPhone. However, in my view it is just a small computer. Amazon or any other vendor have been able to sell anything they want to any computer user without having to pay a dime to Apple or Microsoft. It is all part of the deal. Apple sell computers because they are useful to customers because companies like Amazon provide goods and services through the use of said computer. Apple wants to change that paradigm. It is like Apple or Microsoft saying Amazon or Hulu or Netflix has to pay 30% of their sale to them because you can use a browser in their computer in order to access the Amazon site to purchase something. What's next? Comcast or AT&T asking for a portion of the sale.

It is clear to me. Apple makes the money selling the hardware. Amazon makes money selling books, etc. Apple is free to compete on the same level with Amazon by having their iBooks application. Asking for 30% of sales for Amazon, but not iBooks is anti-competitive. I don't want that. I want the iPhone ecosystem to flourish. I don't want to switch to Android, but I will if Apple continues with these Shenanigans. I don't want a completely closed platform that nobody wants to develop for any longer. Once customers start to desert from the platform it will all be a death spiral. I am glad that Apple provides a service of verifying applications and takes a share of their sales in the Apple Store. I think it is indefensible that they want to take a cut of a subscription. Perhaps to setup the subscription, but not every month. Perhaps I haven't read all the information and it is only once that they take the cut, but I gues it is not. They take a cut on every in-app purchase. Any way, there has to be a balance. Nobody would expect Apple or Microsoft to take a cut of an Amazon sale done through their computers. Why should we put up with that in the iPhone?